Historical national accounts

Session organizer/s: Svante Prado and Kerstin Enflo

New estimates of Swedish historical national accounts from the income side, 1870–1910

Session: 3

Authors: Svante Prado

Co-authors: Erik Bengtsson and Jakob Molinder

Abstract: The rampant growth rate of Swedish GDP per capita from the mid-1850s to 1913, as borne out by early versions of Swedish historical national accounts, has nurtured the notion that the Swedish rise to prosperity was propelled by the confluence of unproportionally high levels of sophistication and very low levels of GDP per capita (Krantz and Nilsson 1975; Sandberg 1978, 1979). The purport of this nexus was captured famously by Sandberg’s (1979) depiction of Sweden as the “impoverished sophisticate”. This view was later supported also by more recent versions of Swedish historical national accounts. Krantz and Schön (2007) showed that Swedish GDP per capita by mid-nineteenth century was 80 percent of the average of Western Europe (excluding the UK and the Netherlands). The image of Swedish mid-nineteenth century backwardness has however been challenged by Edvinsson (2013). The figures of his, in contrast, show a level of Swedish GDP per capita that is equal with western Europe by the mid-nineteenth century. Also, the most recent version of Krantz and Schön (2015), by offering new deflators, has raised the level of Swedish GDP per capita in the nineteenth century relative other countries.

One of the most important differences between Edvinsson’s and Krantz and Schön’s versions of Swedish historical national accounts concerns the treatment of home production. In harmony with the recommendations of the System of National Accounts, Edvinsson (2013) include home production before 1950. This is particularly important in the case of Sweden since the grain growing season was very short. As a result of the long off season, home production offered one way of supplementing household incomes in the agricultural sector. Krantz and Schön (2012), despite offering a satellite account on unpaid domestic work, made no systematic attempt to include home production, even though they added it to GDP occasionally to circumvent the shortcomings of the Industrial Statistics (Schön 1988; Bohlin 2003).

The great benefit of national accounts is that they can be calculated from output statistics, income statistics or as the sum of private expenditures, public expenditures, and net exports. All previous versions of Swedish historical national accounts have been calculated by the output method, except for parts of services output, which have been estimated from the income side. In this paper, however, we are instead calculating GDP mostly from the income side. Thanks to a parallel project aiming to trace the income distribution from 1860 onwards and using a social tables approach, we have amassed a great deal of information on labour and capital earnings. The information on earnings is based on income taxes and an assortment of complementary sources tracking those below the income threshold for paying taxes. Based on this mass of earnings information, we will construct new estimates of decadal GDP figures between 1870 and 1910. These new estimates will help us to forward our understanding of the growth trajectory and standards of living in Sweden from the mid-nineteenth century to World War I.

Reconstructing regional harvest fluctuations in Sweden 1802-1914 for historical national accounts

Session: 3

Authors: Rodney Edvinsson

Co-authors: NA

Abstract: During the pre-industrial era, variations in gross domestic product (GDP) were predominantly attributable to fluctuations in agricultural yield, owing to its significant contribution to overall value added and its heightened volatility in comparison to other sectors. This study introduces annual estimations of both the quantity and value of primary crops, including staple grains and potatoes, across 24 Swedish provinces from 1802 to 1914, providing a basis for reconstructing regional economic records for this historical period. The database is unparalleled, as no other nation possesses an equivalent level of detail for the same timeframe. This paper delves into the covariation patterns among different crop yields and geographical regions, examining the connections to Sweden’s diverse climatic zones. Notably, a pronounced disparity in agricultural conditions is observed between the northern and southern regions of the country.

The Swedish State Revenues and Finances 1350–1600

Session: 3

Authors: Olov Lund

Co-authors: Dag Retsö

Abstract: The purpose of this project is to reconstruct the annual fixed and variable revenues of the Swedish state through taxes, fines, customs duties and other fees during the period 1350–1600. How large resources did the state have access to, how was it spent, and who benefitted from them? Departing from primary sources, some of which have recently been discovered, and with new methods a tax index is constructed as well as an index of the variable revenues of the state. The capacity of the Swedish state in the 17th and 18th centuries to mobilize financial strength to organize a competitive military power in a European context is well-known. But the origins of this system must be traced to the immediately preceding periods. Central questions are whether, when and how the Swedish state differed from other European powers. Given the character of the 15th and 16th centuries as periods of social and economic crises, the aim of this project is to shed light on these processes by uncovering and exploring the redistribution of resources through taxes and other state revenues. Thereby this project is an important starting point for future studies of the Middle Ages and later periods in general, as well as the economic history of the state in a longer time perspective, both nationally and internationally.

Growth and Resilience Theory: A new way of conceptualising convergence dynamics.

Session: 4

Authors: Anthony Smythe

Co-authors: NA

Abstract: Why do some countries develop while others stagnate? Recent evidence suggests the historic fundamental change for economic progress seems to not have been high growth rates, but compound growth through the elimination of negative growth episodes, i.e., ‘shrinking’. All economies seem to be able to grow, but few countries have been able to drastically improve their shrinking patterns, which has underpinned the divergence often argued in literature. However, whilst growth theory does not consider the role of shrinking, shrinking has not yet clearly defined itself from growth processes, leaving shrinking research more generally indistinguishable from classic growth economics. To solve these research gaps, Growth and Resilience Theory proposes growth processes to be those with the ability to shift a production function up whereas building resilience is the ability to move through a production function, specifically by guarding against backsliding. Long-run convergence is an economy’s ability to balance their growth- and resilience-based institutions to maximise the space under their respective production function. Thus, a ‘Goldilocks Area’ of long-term development patterns is proposed that would categorise a successful catch-up experience whilst still leaving room for context specific factors and potentially heterogenous institutional make-ups.

Is Economic Growth Sustainable? Conflicting Signals from International Organisations

Session: 4

Authors: Cristián Ducoing

Co-authors: Eoin McLaughlin and Nick Hanley

Abstract: s GDP, a 20th century construct, is aging and misleading for societal challenges of the 21th century, an increasing number of indicators have been proposed to replace the little big number. One proposal is to focus more on a country’s balance sheet and place greater emphasis on wealth rather than income as a measure of (sustainable) development. Comprehensive wealth indicators, the fruit of labour of scattered group of scholars since the 1990s, have been published through reports by the World Bank and the United Nations in the recent past. Despite sharing similar conceptual frameworks, the application of wealth concepts by the two transnational organisations leads to conflicting signals of sustainability. In this article, we confirm the need for further explanation expand the relationship between the indicators and outline the benefit of combining studies in historical and regional perspective.

Swedish Historical National Accounts 2023 Update, Revision and Underlying Principles

Session: 4

Authors: Kerstin Enflo

Co-authors: Charlie Nilsson, Kerstin Enflo, Håkan Lobell, Olle Krantz

Abstract: Since the most recent edition of the SHNA only stretches as far as 2010, the main purpose of this paper is to update the accounts using more recent data from Statistics Sweden (SCB). Little attention has been paid in previous publications to precisely how this should be done. While it is noted that most of the accounts use data from Statistics Sweden from various points during the 1950’s and onwards (Schön & Krantz, 2007), and that data from Statistics Sweden are adjusted to match the level of the estimates of Schön & Krantz at those benchmark years (Lobell et al., 2008), little is said regarding technical matters such as data mapping and choice of method for linking the series. It is the aim of this paper that the SHNA keeps being updated according to a consistent framework, and therefore the paper provides a description of technical matters relating to the update that have been handled, as well as discussions regarding some of the choices that have been made.