The Take-Off in Germany

Abstract

In dividing the process of economic growth into different stages the question arises whether quantitative criteria such as investment ratios and the rate of growth of real income would suffice or whether qualitative criteria should be applied in addition. In our opinion only the application of both sets of criteria can be adequate. The economic upheavals in Germany during the first half of the nineteenth century can be accounted for by qualitative changes which sometimes proceeded discontinuously, as, for instance, those brought about by the ‘freedom of trade’ (Gewerbefreiheit) and the establishment of the Customs Union (Zollverein). Sometimes these changes occurred slowly and continuously as was the case with the transition from traditional to rational methods in the economy. These qualitative changes had quantitative effects in the long run. There was no sudden acceleration in the rates of growth in real income and in number of prodpction series. Hence we are led to apply qualitative as well as quantitative criteria when demarcating the take-off period in Germany and offering an analysis of it.

I am indebted to Dr. Franz Knoll for his help in preparing this paper, which is part of a broader study on the growth of the German economy.