A Comparison of Real Output and Productivity for British and American Manufacturing in 1935

The manufacturing productivity gap between the U.S. and the U.K. became much larger during the interwar period than existing estimates suggest. This paper presents a new estimate based on real value added and hours worked. First, a detailed benchmark comparison for 1935 is constructed using official industrial census reports. Second, structural shift methodology is applied to analyse productivity movements for industrial branches in the period 1900-1957. U.S. manufacturing shows high comparative levels and growth rates for chemicals and engineering. These results support revisionist accounts of Robert Gordon and Alexander Field on the Depression’s strengthening of American productivity leadership.