First calculations of the total output of Latvia and Lithuania in the 1920s: a comparison

ABSTRACT

The contemporary system of national accounts (SNA) framework is used to compare the methodologies and to adjust the findings to allow for cross-country comparisons of the very first calculations of the total economic output of Lithuania in 1924 by Albinas Rimka (1886–1944) and of Latvia in 1925 by Alfrēds Ceihners (1899–1987). Ceihners’ notion of national income corresponds to the SNA concept of gross national income (GNI), while Rimka measured net national income (NNI). Rimka’s estimate has a downward bias, because he applied a fixed capital depreciation rate that was too high and did not include the value of noncommercial public sector services.

KEYWORDS:

• Economic history of Baltic states
• Lithuania 1918–1940
• Latvia 1918–1940
• national income
• history of national accounting
• Alfrēds Ceihners
• Albinas Rimka

Acknowledgments

I thank the anonymous reviewers for their useful comments and suggestions, and to Vincentas Giedraitis, Mrs Sarah from Proof-Reading-Service.com and John McCoy for their sustained efforts to improve my English.

Disclosure statement

No potential conflict of interest was reported by the author.

Notes

1. There is no misspelling in the former sentence because his publications bear the family name of their author in at least four different spellings: Ceichners, Ceichner, Zeichner (1931), and Ceihners. In the reference list, I am providing the author’s name with the spelling in the original publication. In the text, I am using Ceihners, which is the version found in the most recent publication under his authorship and in the contemporary Latvian sources.

2. This information is provided by the world’s largest library catalog, WorldCat, which itemizes the collections of more than 70,000 libraries in 170 countries that participate in the Online Computer Library Center (OCLC) global cooperative.

3. The first calculation of the total output of Estonia was published in 1932 (Janusson 1932; see also Janusson 1937; Horm 1940). Contemporary Estonian authors (see Valge 2003; Klesment 2008) have already discussed and recycled these calculations.

4. Dresdner Bank (1930) provided national income data in current prices in Reichsmark (RM) at the foreign exchange rate. The reference list of this publication includes Ceihners’ work. For Lithuania, Dresdner Bank (1930) provided the estimates only for 1913 and 1928, and described its source as its ‘own calculation.’ In producing these estimates, Dresdner Bank analysts could have consulted Rimka’s work or even have contacted him directly, because his responsibility area as the head of the analytical division of the Lithuanian Bank included the provision of information in response to inquiries from abroad. In Rimka’s personal archive, preserved in the Library of the Lithuanian Academy of Sciences, there is at least one request of this kind (Rimka 1929). Even more importantly, the Dresdner Bank (1930) estimate for 1928 did not differ much from that of Rimka for 1924.

5. To recall (United Nations 2009), gross domestic product (GDP) is the final value of goods and services produced in a country over a certain period. Gross national income (GNI), formerly called gross national product (GNP), is the income received by the residents of a country. GNI is GDP plus labor and property income received from abroad, minus analogous income and taxes transferred abroad. Net national income is GNI minus the consumption of fixed capital.

6. The oats were consumed by horses, which were maintained in large numbers in both countries, serving as the main traction force in agriculture.

7. Most of the Lithuanian population were devout Catholics, with their religious calendar including two protracted periods of fasting (before Christmas and Easter), when fish was allowed as an alternative to meat.

8. According to the Lithuanian constitutions of the interwar time period, its official capital was Vilnius, which was then under Poland’s rule.

9. Except for a few narrow gauge lines in the Klaipėda district, all railways were state-owned in Lithuania.

10. In 1924 and 1925, the Latvian central government spent 151.4 million LVL ($29.2 million) and the municipalities 40 million LVL or $7.7 million (Siew 1931, 22, 25).

Additional information

Notes on contributors

Zenonas Norkus

Zenonas Norkus is professor at the Faculty of Philosophy, Vilnius University. His book publications include ‘Max Weber und Rational Choice’ (2001), ‘On Baltic Slovenia and Adriatic Lithuania. A Qualitative Comparative Analysis of Patterns in Post-Communist Transformation’ (2012), and ‘Two Twenty-Year Periods of Independence’ (2014).