The most technologically progressive decade of the 20th century

Can you guess?  According to economic historian Alexander Field, it is (controversially) the 1930s. Opening paragraph:

Because of the Depression’s place in both the popular and academic imagination, and the repeated and justifiable emphasis on output that was not produced, income that was not earned, and expenditure that did not take place, it will seem startling to propose the following hypothesis: the years 1929–1941 were, in the aggregate, the most technologically progressive of any comparable period in U.S. economic history.  The hypothesis entails two primary claims: that during this period businesses and government contractors implemented or adopted on a more widespread basis a wide range of new technologies and practices, resulting in the highest rate of measured peacetime peak-to-peak multifactor productivity growth in the century, and secondly, that the Depression years produced advances that replenished and expanded the larder of unexploited or only partially exploited techniques, thus providing the basis for much of the labor and multifactor productivity improvement of the 1950’s and 1960’s.

More concretely, we have this:

Within manufacturing, advance took place across a variety of fronts (Michael Bernstein, 1987, especially Ch. 4). There were, to be sure, older industries such as textiles, leather goods, and apparel, where productivity growth was slow or nonexistent. But there were also a remarkable  number of dynamic sectors, generating new process and product innovations, with varying levels of commercial exploitation before the war. Petrochemicals is an obvious example. At companies such as Dupont, advances in chemical engineering generated a host of new products, including Lucite (sold as Plexiglas by a rival manufacturer), Teflon, and Nylon (Peter H. Spitz, 1988; Stephen Fenichel, 1996). Even in an older industry such as automobiles, innovation and product quality improvement during the decade proceeded at a rapid rate. Indeed, Daniel M. G. Raff and Manuel Trajtenberg (1997) view the decade as the last one in which there were truly revolutionary improvements in internal combustion engine powered vehicles. But progress was not limited to manufacturing: communications services, electric utilities, and transportation were also standouts. TFP [total factor productivity] growth in the telephone industry accelerated significantly after 1929 before falling precipitously during the war years. In electric utilities, MFP [multi factor productivity[ growth more than doubled comparing 1929–1941 with 1919–1929; in contrast to the telephone case, high rates persisted after 1941…

Labor productivity in railroads — still one fourth of the U.S, capital stock at the time — grew as well.  Using steel with concrete also became far more productive.

I found the link to this well-known article in a very interesting post on economic recovery from the Depression.


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