Real US GNP Growth Rates 1870–1900 in Balke and Gordon

The estimates of Balke and Gordon (1989: 84) are as follows (I have added the annual growth rates by my own calculation):

Year | GNP*| Growth Rate
1869 | 78.2 |
1870 | $84.2 | 7.67%
1871 | $88.1 | 4.63%
1872 | $91.7 | 4.08%
1873 | $96.3 | 5.01%
1874 | $95.7 | -0.62%
1875 | $100.7 | 5.22%
1876 | $101.9 | 1.19%
1877 | $105.2 | 3.23%
1878 | $109.6 | 4.18%
1879 | $123.1 | 12.31%
1880 | $137.6 | 11.77%
1881 | $142.5 | 3.56%
1882 | $151.6 | 6.38%
1883 | $155.3 | 2.44%
1884 | $158.1 | 1.80%
1885 | $159.3 | 0.75%
1886 | $164.1 | 3.01%
1887 | $171.5 | 4.50%
1888 | $170.7 | -0.46%
1889 | $181.3 | 6.20%
1890 | $183.9 | 1.43%
1891 | $189.9 | 3.26%
1892 | $198.8 | 4.68%
1893 | $198.7 | -0.05%
1894 | $192.9 | -2.91%
1895 | $215.5 | 11.7%
1896 | $210.6 | -2.27
1897 | $227.8 | 8.16%
1898 | $233.2 | 2.37%
1899 | $260.3 | 11.6%
1900 | $265.4 | 1.95%
* Billions of 1982 dollars

Average real GNP growth rate, 1870–1900: 4.08%.
(Balke and Gordon 1989: 84).

Thus we have an average real GNP growth rate for 1870–1900 of 4.08%. That is higher than the US average real GNP growth rate for 1950–1973 at 3.6%, but not that higher.

The average rates per decade are as follows (I have included an additional measure for the 1870s):

Average real GNP growth rate, 1870–1879: 4.69%.
Average real GNP growth rate, 1871–1880: 5.10%
Average real GNP growth rate, 1881–1890: 2.96%.
Average real GNP growth rate, 1891–1900: 3.85%.

According to Balke and Gordon’s figures, the average rate per decade declined in the 1880s, which was the worst. The 1890s were the second worst for real GNP growh. The US average real GNP growth rate for 1950–1973 was in fact virtually the same as the decade rates for 1890s, higher than the 1880s, and lower than the 1870s.

As I have pointed out before, if we look at the average real GDP growth rates estimates across the whole OECD for 1950–1973 we find a better rate than the US rate of 4.08% for 1870–1900:

1700–1820 – 0.2%
1820–1913 – 1.2%
1919–1940 – 1.9%
1950–1973 – 4.9%
1973–1990 – 2.5%
(Davidson 1999: 22).

BIBLIOGRAPHY

Balke, N. S., and R. J. Gordon, 1989. “The Estimation of Prewar Gross National Product: Methodology and New Evidence,” Journal of Political Economy 97.1: 38–92.

Davidson, P. 1999. “Global Employment and Open Economy Macroeconomics,” in J. Deprez and J. T. Harvey (eds), Foundations of International Economics: Post-Keynesian Perspectives, Routledge, London and New York. 9–34.