Saturday, March 13, 2021

Largest Historical Real GDP

BS asked after class the other day, at what point did the U.S. become the largest economy in the world. 

My off-the-top-of-my-head answer was sometime between the end of the Civil War and the start of World War I. I suspected it was even before the Spanish-American War, when informed experts thought Spain would win easily, and in which it had trouble even winning battles much less the whole war.

But that question can be answered factually from the Maddison Project data (discussed in earlier posts like this one). 

In this data, the entities are contemporary countries, so it's necessary to combine them together to estimate the GDP of empires. Also, not every country has data for every year. This is the data for 1880. The U.S. first passed the U.K. in 1879. Bear in mind that this is the UK as currently constituted. It does not inlcude their colonial empire. This was (as in the case with China in the 21st century) a result of greater population: at that time per capita real GDP in the UK was $5,879/yr. while in the U.S. it was $4,866.

Country
Real GDP In Billions of 2011 International Dollars per Year
USA
246
U.K.
204
Germany
175
France
136
Italy
 96
Japan
 50
Spain
 50

Keep in mind that in 2011 International Dollars, the current GDP of the U.S. is about $20,000B/yr.

Here are the figures for 1913, the last year of peace before World War I. The current country is given, followed by the country and its empire in parentheses (for the countries on which we have data).

Country Real GDP In Billions of 2011 International Dollars per Year
USA
791 (816)
UK
368 (712)
Russia
485
Germany
479
China
343
France
238 (244)
Italy
174
Austria-Hungary
133
Japan
113 (124)
Canada
59
Argentina
51
Australia
45
Mexico
36
Brazil
32

I've added a few countries for curiosity's sake. China was not really a united country at this time, and the large number indicates 4 times as many people as the U.S., but real GDP per capita that was less than a tenth of the U.S. The UK is so large because India was the major economic component of its empire. Towards the bottom I've added Argentina, along with other countries that have now surpassed it.

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