Making Profits in Wartime: Corporate Profits, Inequality, and GDP in Germany During the First World War

23 Pages Posted: 17 Apr 2005

See all articles by Jörg Baten

Jörg Baten

University of Tuebingen - Department of Economics; CESifo (Center for Economic Studies and Ifo Institute); Centre for Economic Policy Research (CEPR)

Rainer Schulz

University of Tuebingen (Tubingen) - Department of Economics

Abstract

Making profits in wartime: corporate profits, inequality, and GDP in Germany during the First World War. This article reconsiders, and rejects, Kocka's (1973) hypothesis that a strong income redistribution from workers to capital owners occurred in Germany during the First World War. A small number of firms profited from the war, but the majority experienced a decline in real income, similar to the decline in workers' real wages. This finding also has important implications for the political history of the Weimar Republic. The authors also use their figures to improve German GDP estimates for the war period, since their sample makes it possible to estimate private service sector development. Economic indicators were worse for the war year of 1917 than previously believed.

Suggested Citation

Baten, Jorg and Schulz, Rainer, Making Profits in Wartime: Corporate Profits, Inequality, and GDP in Germany During the First World War. Economic History Review, Vol. 58, No. 1, pp. 34-56, February 2005. Available at SSRN: https://ssrn.com/abstract=704052

Jorg Baten (Contact Author)

University of Tuebingen - Department of Economics ( email )

Mohlstrasse 36
D-72074 Tuebingen, 72074
Germany
+49 7071 2972985 (Phone)
+49 7071 295119 (Fax)

CESifo (Center for Economic Studies and Ifo Institute)

Poschinger Str. 5
Munich, DE-81679
Germany

Centre for Economic Policy Research (CEPR) ( email )

London
United Kingdom

Rainer Schulz

University of Tuebingen (Tubingen) - Department of Economics ( email )

Mohlstrasse 36
D-72074 Tuebingen, 72074
Germany

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