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Supplement
to the
Survey

of
Current
business

UNITED

STATES

DEPARTMENT

OFFICE

OF BUSINESS

COMMERCE
ECONOMICS

. ' • .

-,f

••:

- >

t".'*

-A... I

A
Supplement
to the
Survey
Current
business

^ *^* *

P R E P A R E D

B Y T H E N A T I O N A L
GEORGE
CHARLES

U .

S .

D E P A R T M E N T

SCHWARTZ,

O F

SINCLAIR

O F F I C E

O F B U S I N E S S
M.

. G O V E R N M E N T

JOSEPH

P R I N T I N G

JASZI,

I N C O M E

D I V I S I O N

CHIEF

ASSISTANT

CHIEF

C O M M E R C E
WEEKS,

Secretary

E C O N O M I C S
ME EH AN,
O F F I C E

Director
W A S H I N G T O N :

1 9 5 4

Contents
PAGE

PART I.

National Income and Product, 1929-53: A Review

Basic Trends in the Economy
Growth of the Economy
Shifts in the Use of National Output
Changes in the Income Flow
Expansion of Personal Income
Fluctuations in Economic Activity
Gross National Product Patterns
Chronological Review: 1929-53
PART II.

The Conceptual Framework of National Income Statistics

Nature and Significance of the Income Data
Summary Construction of National Output Measures
Detailed Structure of the Accounts
Definitions of Concepts and Terms
PART III.

Sources and Methods of National Income Estimation

2
2
4
7
11
13
13
15
27

27
30
40
58
61

Introduction
61
Section:
1. Wages and Salaries
68
2. Contributions for Social Insurance and Other Labor Income. . 73
3. Income of Unincorporated Enterprises
76
4. Rental Income of Persons
86
5. Corporate Profits
92
6. Interest
97
7. Personal Consumption Expenditures for Commodities
103
8. Personal Consumption Expenditures for Services
117
9. New Construction
122
10. Producers' Durable Equipment
126
11. Change in Business Inventories
135
12. Net Foreign Investment
139
13. Government Receipts and Expenditures
143
14. Transfer Payments
149
15. Personal Saving
150
16. Capital Consumption Allowances
150
PART IV.

Gross National Product in Constant Dollars, 1929-53

153

Characteristics of Constant-Dollar Gross National Product
Statistical Sources and Methods

153
155

PART V .

Statistical Section

List of Annual, Quarterly, and Monthly Tables
INDEX

159

159
243
HI

Foreword
This volume carries forward the official work on United States national income initiated in 1932 in
response to Senate Resolution No. 220 of the 72d Congress. The information presented is designed to
meet in comprehensive fashion the needs of business and other users of national income data.
Since publication in 1934 of the first of a series of national income reports by the Department of
Commerce, steady progress has been achieved in extending the scope of the estimates, in improving
their quality, and in making them available promptly, as well as in sharpening the concepts. A principal contribution of the present report—which is closely similar in form to the 1951 NATIONAL INCOME
supplement so as to facilitate use by those familiar with that volume—is the presentation of estimates
incorporating data collected in the postwar industrial and population censuses.
In the preparation of these new estimates, opportunity was also taken to rework many of the income
and product series for the entire period back to 1929 in order to reflect additional data sources and
improvements in estimating techniques. A special feature is the presentation of constant-dollar gross
national product in 1947 prices instead of 1939 prices, as previously used.
The tables presented in this volume incorporate the results of the first comprehensive review of
sources and methods since the initial publication of the national income statistics in the form of an
economic accounting system in the 1947 NATIONAL INCOME supplement. While the changes that have
been introduced do not alter the overall picture of the United States economy afforded by the income
and product accounts, they improve the data in many detailed aspects.
The text material in the 1951 volume also has undergone review. This resulted principally in reworking the descriptions of statistical sources and methods to accord with the new estimates and bringing
up to date the summary of economic developments.
The statistical changes have been examined for the light they shed on the reliability of the estimating techniques. This analysis confirms the adequacy of these techniques to produce reliable preliminary measures of national output and its major components on the basis of incomplete information.
Revisions for some of the more detailed components, however, were substantial and underscore the
need which we have repeatedly stressed for further development of the primary data sources on which
the national income estimates are based.
The present report contains all the national income statistics of the Office of Business Economics
except the annual series on income by States and the distributions of family income by size classes.
With these exceptions it supersedes all previously ptublished figures, and the series contained in this
volume will be kept up to date in the monthly SURVEY OF CURRENT BUSINESS.
We take this opportunity to express our appreciation for the continued cooperation of the many
Government and private agencies that assist the Office of Business Economics in preparing these
economic guides. Acknowledgment is made in the accompanying statement which also recognizes the
work of the individual members of our staff.

Director, Office of Business Economics

Acknowledgments
The present edition of the National Income supplement was prepared under the joint direction of George Jaszi, Chief of the
National Income Division, and Charles F. Schwartz, the Assistant Chief.
In charge of major areas of the statistical work were Lawrence
Grose, Raymond Nassimbene, and Harlow D. Osborne.
Special acknowledgement is due to Edward O. Bassett
for his contribution to methodology in the complex task of
incoporating the data collected in the postwar industrial censuses
into the commodity flow estimates.
This volume builds upon the foundations laid by its predecessors—the 1951 and 1947 editions of the National Income supplement. Work on the 1951 edition was initiated by Milton
Gilbert, former Chief of the National Income Division, and carried
through under the direction of Mr. Jaszi and Mr. Schwartz.
The conceptual framework and statistical methodology underlying the estimates, which were explained in detail for the first
time in the 1951 volume, had been established initially in the
1947 report, under the direction of Mr. Gilbert. His principal
assistants in this major undertaking of fundamentally recasting
the official national income statistics were Edward F. Denison,
now Assistant Director of the Office of Business Economics, Mr.
Jaszi, and Mr. Schwartz.
Part I of this report, dealing with trends in national income
and product, was prepared initially by Carl P. Blackwell, formerly
of the National Income Division, and revised for the present
edition by George M. Cobren. The accompanying charts were
prepared under the direction of Edwin C. Warren, Chief Draftsman in the Printing Division of the Department of Commerce,
with the cooperation of Anna M. Guindon of the Office of Business
Economics.
Numerous staff members of the National Income Division participated in the initial writing of the various sections of the
technical notes in Part III and their revisions for the new edition.
Special credit is due to Harlow D. Osborne in connection with
the sections on income of unincorporated farm enterprises, rental
income of persons, corporate profits, new construction, net
foreign investment, and capital consumption allowances.
Acknowledgments to others are listed in the sequence in which
the technical notes appear in Part III. Wages and salaries—
Franklin M. Aaronson and Lawrence Grose; contributions for
social insurance and other labor income, and income of unincorporated enterprises—Lawrence Grose; interest—Elwyn T.
Bonnell; personal consumption expenditures for commodities—
Edward O. Bassett and Raymond Nassimbene; personal consumption expenditures for services—Carolyn G. Bernhard;
producers' durable equipment—Robert C. Wasson and Raymond

Nassimbene; change in business inventories—George M. Cobren;
government receipts and expenditures—Carl P. Blackwell;
transfer payments—Lawrence Grose; capital consumption allowances—Robert C. Wasson.
In addition, the Balance of Payments Division and the Business
Structure Division of the Office of Business Economics provided
materials relating to the descriptions of net foreign investment and
personal consumption expenditures for commodities, respectively.
In the initial preparation of the estimates of constant-dollar
gross national product described in Part IV, John W. Kendrick
was principal assistant to Mr. Jaszi. Major contributions were also
made by Edward O. Bassett, Carolyn G. Bernhard, Morris Cohen,
Joseph B. Epstein, and Millard L. Gallop.
The vast statistical work underlying the estimation of the
multiplicity of income and product series contained in this report
is the result of the cooperation of all the members of the National
Income Division and others in the Office of Business Economics,
and is founded on their effort and experience. However, in a
larger sense, the statistics rest upon the work of Government
statistical agencies as a whole and of private agencies as well.
These provide the basic source data and the considerable volume
of supplementary information needed to construct the national
income and product accounts. The statistical work of the Bureau
of the Census of the Department of Commerce, the Health, Education, and Welfare, Treasury, Agriculture, and Labor Departments, and the various regulatory commissions is of fundamental
importance in this regard.
Certain of the estimates themselves are prepared outside the
National Income Division: farm income by the Agricultural
Economics Division of the Department of Agriculture; direct
estimates of personal saving by the Securities and Exchange
Commission; new construction activity by the Building Materials
and Construction Division of the Department of Commerce, in
cooperation with the Bureau of Labor Statistics of the Department
of Labor; net foreign investment by the Balance of Payments
Division; and personal consumption expenditures for commodities
since 1940 by the Business Structure Division, except 1947 for
which benchmark estimates were prepared in the National
Income Division.
Progress in the national income field has been facilitated by the
Bureau of the Budget, not only by its direct support, but by its
continuing recognition and furtherance of the needs of the Office
of Business Economics' national income work in the development
of the Government's statistical program. Finally, it is recognized
that what has been achieved has been possible only by the support
and encouragement given by the Congress continuously since
these studies were initiated at the direction of the 72d Congress.

Government Purchases
$85 Billion

Investment
Personal Consumption

$50 Billion

$230 Billion

The 1953 Income-Product Coin

Indirect Business Taxes $30 Billion

Depreciation, etc,
$30 Billion

Employee

Corporate Earnings
$39 Billion

Compensation
$209Billion

Proprietors' and Rental
Income and Interest

$57 Billion

PART

National Income and
Product, 1929-53

AR eview
The national income statistics presented in this report cover a
quarter of a century of highly varied economic developments in
the United States.
In broad outline, this period embraces the following sequence of
events: The precipitous fall from the prosperity of 1929 into the
deep depression of the early nineteen-thirties; the subsequent
recovery, interrupted by the brief recession of 1938, but then
continuing through the remaining prewar years; the tremendous
performance of the economy in the prosecution of World War II;
reconversion and the postwar boom, with attendant inflationary
strains; the mild business recession of 1949; and the rapid recovery
of 1950, merging in the latter half of that year into the period of
hostilities in Korea.
The national income data provide a detailed statistical description of the way the economy has functioned under these widely
diverse conditions. They reveal important fluctuations and longterm changes in the volume, composition, and use of the Nation's
output, in the industrial structure through which it is produced,
and in the distribution of the resultant income.
The nature of national income statistics is fully described in
subsequent parts of this report. The following general summary
highlights their major features as a prelude to an analysis of the
functioning of the economy and of the path traversed in reaching
peak levels of income and production in 1953.

National product: The flow of goods and services
Total output is measured from two principal points of view:
As the summation of final products produced by the economy; and
as the summation of costs incurred in producing those products.
Both of these approaches yield comprehensive measures of economic activity, but the analytical breakdowns to which they most
readily lend themselves throw light on different aspects of the
economy.
The gross national product measures the Nation's output of
goods and services in terms of its market value. When expressed
in current prices, this series reflects the total dollar value of production; when expressed in constant dollars to eliminate the
influence of price changes, it provides an overall index of the

physical volume of goods and services produced by the economy.
In both current and constant prices, the gross national product
is broken down to show its disposition among broad groups of
users—consumers, business, government, and foreign countries.
The commodity and service composition of purchases by each of
these major groups is delineated in considerable detail for the
current dollar series and in summary fashion for the constant
dollar series.

National income: Earnings from production
Total output is also measured, in terms of the factor costs of
producing it, by the national income—the aggregate earnings of
labor and property which arise from current production. This
measure differs from the gross national product chiefly in that it
is computed after deduction of indirect business taxes and of
depreciation charges and other allowances for business consumption of durable capital goods.
The national income is broken down by distributive shares, by
industry of origin, and by legal form of organization. The first
of these breakdowns represents a classification of earnings according to the forms in which they accrue to residents of the Nation—
compensation of employees, profits of corporate and unincorporated enterprises, net interest, and rental income of persons.
The second indicates the use of economic resources and the contribution to total output by each of a number of industrial subdivisions, as measured by income originating in the respective
industries. The third shows an important special aspect of the
institutional structure of the economy—the portions of total economic activity (also measured by income originating) conducted
by various types of productive units, including corporations, sole
proprietorships and partnerships, other private business, government and government enterprises, and households and institutions.
In addition to a summary account showing the national income
and product, accounts are maintained for each of the major
sectors of the economy. These consist of current income and outlay
accounts for the business sector, for persons, for government, and
for the rest of the world in its transactions with the United States.

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS
A consolidated saving and investment account for the economy as
a whole is also provided. The system of accounts is designed to
furnish a description of the economic process in terms of the
expenditures and receipts of the various sectors, arranged to show
their interactions upon each other. The nature and classification
of the transactions recorded for each sector are governed to a
considerable extent, of course, by the central objective of measuring total output.

Personal income: Receipts of consumers
Particular interest centers upon the personal account, which
covers the activities of the consuming public. On the one hand,
it gives total personal income—the current income received by
persons from all sources, inclusive of transfers from the government and from business; and on the other, it indicates the disposition of personal income for consumption, taxes, and savings.
Personal income is a third major aggregate, generally coordinate
in significance for economic analysis with the national income and
the gross national product.
In general outline, then, this is the body of statistical information utilized in the the following review of economic developments since 1929. While this framework permits a comprehensive
study of such developments, it by no means covers all significant
elements in the operation of the economy. It does not, for example, provide direct information regarding the monetary and
credit system of the United States. In the discussion below, therefore, only incidental attention will be devoted to trends in that
field—not because they are lacking in importance, but because
they fall outside the scope of the statistics with which this review
is primarily concerned. Although a number of other relevant
factors are similarly excluded, the picture of the economy in
action which emerges from the national income accounts is a
highly significant one.

BASIC TRENDS IN THE ECONOMY
Despite the violence of the economic fluctuations which have
occurred, the outstanding feature of economic developments over
the past 25 years is the tremendous growth of the United States
economy.
The population increased by over 30 percent, from 122 million
in 1929 to 160 million in 1953, and the number of persons engaged in production rose in roughly similar proportion. This
larger work force was equipped with a greatly expanded volume
and improved quality of machinery and plant facilities, as well
as with such intangible assets as better education and advanced
scientific knowledge. Through utilization of these enlarged
human and material resources, the economy has been able to
produce a vastly increased flow of goods and services, including
a wide array of new products.

Growth of the Economy
The gross national product amounted to $365 billion in 1953,
as compared with $104 billion in 1929. This comparison reflects
the combined influence on the current market value of total
output of both greatly increased physical volume and much

Chiefly as a result of the inflation associated with World War II
and its aftermath, and the Korean conflict, the general level of
prices in 1953 was more than Iwo-thirds above that of 1929.
After allowance for this factor, the physical volume of the Nation's
output, as measured by the gross national product in constant
dollars, is found to have risen 105 percent over the period. In
terms of real output per capita, the increase amounted to 57
percent. See chart on page 5.
A simple and meaningful comparison of the long-term rate of
growth in national production is provided by the average annual
percentage increase in constant-dollar gross national product
from 1929 to 1953, which were both years of high utilization of
productive resources. According to this calculation, the rate of
expansion in the real volume of output has averaged over this
25-year period about 3 percent per year.
In part, this growth has reflected the gradual increase of the
Nation's manpower resources. The advance in production, however, has outstripped this increase by a wide margin, owing to
the achievement of sizable gains; in productivity per unit of
manpower utilized.

Large advance in productivity
Trends in productivity may best be examined in terms of gross
product, excluding that arising in general government because
the method by which the contribution of government to constantdollar national product is estimated makes no allowance for
changes in productivity.
With this exclusion, the real increase in output from 1929
to 1953 was almost 100 percent. During the same period the
number of persons producing this output—full-time equivalent
employees plus active proprietors—rose by 27 percent, or about 1
percent per year on the average. An annual rate of growth in
real product per person engaged averaging approximately 1%
percent is thus indicated.
Moreover, this rate of increase occurred during a span of years
in which average hours worked per week in the private economy
were reduced by about 10 percent. On a man-hour basis, accordingly, the rise in productivity has been considerably greater.
Real product per man-hour was well over half again as large
last year as in 1929, implying an average annual rate of increase
somewhat in excess of 2 percent.

Many factors influence productivity
It is important to recognize that productivity increases as
computed above, although expressed in terms of output per unit
of labor input, are attributable not only to labor, but jointly to
all of the factors influencing productivity. Foremost among these,
undoubtedly, have been the technological improvements and
increased amounts of capital equipment utilized by the Nation's
industries. Better organization and management of productive
operations have also contributed, as have advances in the education, training, and health of the population.
These types of influences affect directly the technical efficiency
of particular productive processes. In addition, the productivity
measures given above also register shifts within individual industries among products involving varying amounts of output per
unit of labor input and. furthermore shifr« nf wnrV»™ l™*,..,..™

National Output, Income, and Consumer Purchasing Power in 1953
Gross national product was 20% larger
than national income. It includes in addition
depreciation and indirect business taxes

Seven-eighths of the national income was
distributed as personal income

Personal income exceeded national income
distributed, as individuals also received
$19 billion in transfer payments

After taxes, $250 billion of personal income
was available for spending or saving

$30 Billion '

--INDIRECT BUSINESS
-'TAXES

$30KBion

UNDISTRIBUTED ' v
EARNINGS
$38 fitl lion

TRANSFER PAYMENTS*
$19 Billion

PERSONAL TAXES
$36 Billion

NATIONAL ,
INCOME

DISTRIBUTED

PERSONAL.INCOME

EARNINGS

AFTER TAXES

$305 Billion

$267 Billion

$250 Billion

GROSS NATIONAL
PRODUCT
$365 Billion

NATIONAL
INCOME

$305 Billion

•INCLUDING $ 5 BILLION OF NET INTEREST PAIO BY GOVERNMENT

PERSONAL
INCOME
$286 Billion

DISPOSABLE
PERSONAL INCOME
$250 Billion

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS
An appreciable part of the productivity rise since 1929 can be
traced to a shift of the latter type. The proportion of the labor
force engaged in farming—where real product per man-hour is
substantially less than in the private nonfarm sector—has declined
markedly and almost continually. This shift of workers to nonfarm industries has in itself contributed about one-fifth of a percentage point to the average annual rate of growth in real product
per man-hour, quite apart from the improvement of productivity
in each of the sectors separately. Relative shifts of labor among
industries within the nonfarm sector have probably affected total
productivity in a similar fashion. While information is not available for precise calculation of the effects of these industrial shifts,
indirect evidence suggests that in the aggregate they may compare in importance with the farm-nonfarm movement.

Shifts in the Use of National Output
Along with the huge expansion of the gross national product
since 1929, there have been significant changes in its disposition
among major groups of users and in the composition of purchases
by each of these groups.
All major domestic purchaser groups have shared—though to
somewhat different degrees—in the increased volume of production. See chart on page 6. Net foreign investment, which
measures net purchases of United States output by the rest of the
world, is the only principal component of national product to
show a decline from 1929 to 1953.
The most notable change since 1929 in the use of the Nation's
output is a shift from private to government use. In terms of the
current dollar estimates of gross national product, government
purchases of goods and services, which absorbed 8 percent of the
gross national product in 1929, took 23% percent in 1953. Personal
consumption expenditures, on the other hand, dropped from 75%
percent of the total in 1929 to 63 percent last year. The proportion of the value of output going into investment was reduced
moderately from 1929 to 1953.
Percentage Distribution of Gross National Product
192<J

In current dollars:
Personal consumption expenditures
Qross private domestic investment
Net foreign investment
Government purchases of goods and services
Total
...
ID 1947 dollars:
Personal consumption expenditures
Gross private domestic investmentNet foreign investment...
Government purchases of goods and services

75.6
15.5
.7
8.1
-

1953

63.1
14.1
—.5
23.4

100.0 100.0
_

Total

71.9
__ 18.0
1.1
9.1

64.2
12.8
—.1
23.1

100.0

100.
0

In terms of the constant-dollar gross national product, the shift
to government use is similar. It is seen, however, to be at the
expense of both personal consumption and of investment, rather
than mainly of personal consumption, as indicated by the currentdollar figures. These value and volume relationships are summarized in the table above.

Consumption patterns reflect price shifts
Although the proportion of total national product going to consumers was smaller last year than in 1929, owing to the larger
share used for public purposes, the absolute volume of goods and
services purchased for personal consumption was, of course,

vastly increased. In terms of cons-ant (1947) dollars, the expansion amounted to 83 percent—a gain of two-fifths in real consumption per capita.
Reflecting also a 59 percent rise in average prices, the dollar
volume of total consumer outlays last year reached $230 billion,
as compared with $79 billion in 1929. The distribution of these
outlays by major objects of expenditure shifted markedly over the
two and a half decades. Nondurable goods absorbed an appreciably larger share of the consumer expenditure dollar, rising
from 47% percent in 1929 to 51% percent in 1953, while the proportion spent on services dropped from 40% percent to 35% percent last year. Durable goods purchases accounted for about the
same proportion (12-13 percent) in both years.
To a very considerable degree, these shifts reflect differential
movements of prices for major items in the respective expenditure
classes, rather than fundamental alterations of the consumption
pattern in real terms. In particular, much of the relative decline
in the importance of service outlays has stemmed from the
marked lag of rent and household utility charges behind the general upswing of consumer prices in the last decade, while most of
the increased relative importance of nondurable commodities is
traceable to the considerably above-average rise in prices for food
and clothing. The chart on page 7 shows rental outlays in
relation to total consumption.
Changes in real spending, however, have also occurred. Such
factors as the development and marketing of innumerable new
products, increased reliance upon private automobile transportation, and the expanding use of household appliances have induced
marked shifts in the pattern of spending for commodities. At the
same time, demands for some classes of services—of which the
employment of domestic servants is a conspicuous example—have
tended to decline or to lag behind the general advance.

Equipment share of investment higher
Gross private domestic investment last year amounted to $51%
billion, or 14 percent of total gross national product, as compared with about $16 billion, or 15% percent, in 1929. In real
terms, as shown in the accompanying table, the share of domestic
investment in the total was appreciably lower last year than in
1929, the difference in movement reflecting a sharper rise in the
prices of capital goods than of goods and services in general. It
may be noted that the constant-dollar data take only incomplete
account of quality change. Inasmuch as quality improvements
in fixed equipment probably exceeded those in other goods and
services comprising the national product, the indicated decline
in the proportion of real investment would be moderated if
adequate allowance for quality change could be made.
There was a marked shift from 1929 to 1953 in the general
composition of investment expenditures. New private construction put in place accounted for abo it 54 percent of the total in the
earlier period, but for only 50 pesxent last year, while business
purchases of durable equipment rose in relative importance from
36 to 47 percent. Net accumulations of business inventories
represented 10 percent of total domestic investment in 1929,
about three times the 1953 proportion.
The relative decline in construction activity was attributable
to the decrease in the proportion of expenditures for
nonresidential construction, consisting mainly of outlays for

The National Output
In Constant (1947) Dollars

•

Growth has averaged about
3 percent per year
400

300

200

GROSS NATIONAL PRODUCT

I I I I I I I I I I I I I'M I I I I 1 I I I I I [ I I I I I I I I I I I I I I I I I I I I I

1910

•

Since 1929
•

Real Output has
more than doubled

1929

•

Real output per capita
has increased by
almost three-fifths

1929

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS

Distribution of Increased Output— in 1947 Dollars
Of the $157 billion increase in the total volume of
National Output from 1929 to 1953 . . .

Consumers received almost three-fifths, o r . . .

Government one-third, o r . . .

and investment the remainder, o r . . .

$57 Billion

$11 Billion

business plant. Nonresidential construction expenditures were
reduced from 31 percent of gross private domestic investment in
1929 to 26 percent in 1953. In contrast, there was little difference
between the two terminal years in the percentage of outlays for
new nonfarm dwelling units. Thus, an outstanding feature of the
shift in investment was that business expenditures for fixed capital
facilities in 1953 were concentrated much more heavily upon
acquisition of new equipment, and proportionately less upon
plant expansion, than they were in 1929. See chart on page 8.
Over the 25-year period, these broad changes in the relative importance of construction and producers' durable equipment
were even greater in real terms than in current dollars, since
construction costs rose twice as much as equipment prices during
the period.

Shift in foreign transactions
Net foreign investment was a relatively minor component of
national product both in 1929 and in 1953. In large measure, the
shift from a positive foreign balance of $1 billion to a negative
balance of $2 billion reflects a change in the means by which
foreign countries financed their net acquisitions of United States
goods and services. In 1953, they obtained large quantities of
American exports by grants from the United States Government.
Such amounts are recorded in the national income statistics as

$89 Billion

Government, rather than foreign, purchases. Corresponding
exports in 1929, being then financed through regular commercial
channels, entered gross national product under the net foreign
investment heading. When allowance is made for this factor, the
net flow of United States output to other countries shows a
relative increase from 1929 to 1953.
The low ratio of net foreign investment to total production
should not, of course, be interpreted as an indication of the
importance of international trade to the domestic economy.
Actually, its importance is much greater than is suggested by such
a net concept. The net balance is; a composite of much larger
gross flows of United States output into export channels and of
goods and services produced abroad into domestic consumption,
capital formation, and government procurement. These gross
flows in both directions, however, were smaller in relation to
domestic economic activity last year than in 1929.

Growth of government purchases
Combined Federal, State, and local purchases of goods and
services rose from $8^ billion in 1929 to $85 billion in 1953.
As already noted, these purchases represented an increasing
proportion of total national output. See chart on page 11.
Over the two and a half decades, the entire increase in this
proportion was attributable to expanded Federal Government

NATIONAL INCOME,

activities. In the main, the expansion stemmed from the imposition upon the economy of a national defense burden much heavier
in recent years than in the prewar period. National security
purchases, which constituted less than 1 percent of gross national
product in 1929, represented more than 14 percent in 1953.
Part of the increase in the national security outlays of the
Federal Government may be traced to the large volume of foreign
aid—both military and economic—a type of activity which was
nonexistent in 1929. Federal purchases of goods and services for
all other purposes combined accounted for only a minor portion
of the 1929-53 expansion.

Changes in the Income Flow
Accompanying the expansion of the national output and the
shifts in its composition and use since 1929, there have been
marked changes in the size of the corresponding income flow, in
its industrial origin, and in the form of its distribution to residents
of the Nation.
The national income rose from $88 billion in 1929 to $305
billion last year—an increase of 250 percent. This rise, of course,
reflected not only the expansion of the physical volume of production but also the sharply higher prices prevailing in 1953.

Shifts in industrial pattern
Perhaps the most important of the changes in the income flow
since 1929 are those relating to its industrial origin. Such
changes are indicative of the way in which the allocation of
economic resources has been altered to meet the shifting character
of demand for the Nation's output.
Income originating in each industry measures the earnings of
the economic resources—both labor and property—utilized by it.
Accordingly, the breakdown of the national income by industry
of origin provides a measure of the net contribution of each
industrial segment of the economy to the total value, at factor
cost, of the net national output.
Private nonagricultural domestic industries accounted for
about the same proportion (83-84 percent) of the national income
in 1929 and 1953. The principal changes in the income originating in the remainder of the economy were in government,
which showed a substantial rise over the period, and in agriculture, which declined in relative importance.

195 4

EDITION

meet it, has centered upon commodities, including those required
for national defense. In general, fabrication and processing of a
progressively more complex character have also been involved.

Parallel grovrth in distribution
Also immediately affected by the relative increase in demand
for commodities were the wholesale and retail trade industries,
whose share of the private nonagricultural domestic total was 21
percent in 1953, as compared with 18 percent in 1929. This
expansion was closely allied with the growth of manufacturing
output, the bulk of which is distributed to ultimate buyers through
trade channels.
With the relative growth of manufacturing and trade, the
percentages contributed by all other private industrial divisions
declined except that for contract construction, which advanced
from 5 to 6 percent of the total, and communications and public
utilities which maintained the same proportion of the total in
both years. By far the greatest decline in relative position from
1929 to 1953 was registered in the finance, insurance, and real
estate division. Its share, which had matched that of wholesale
and retail trade in the earlier period, was down to about 10
percent last year.

Factors in decline of finance group
Two major factors contributed to this drop in the finance group.
Earnings in the real estate industry—especially on residential
property—were relatively depressed during most of the period,

Rent and Consumer Expenditures
The proportion of rent in total consumer
expenditures has risen since the war, but is
still lower than in the nineteen-thirfies
20 -

Large increase in manufacturing
Industrial shifts within the private nonagricultural domestic
sector are illustrated in the chart on page 12, which shows the
percentage increases since 1929 in national income originating
in several broad groups of industries. Since 1929 and 1953 were
both prosperous, full-employment years, this comparison is little
affected by cyclical influences. Corresponding data in somewhat
greater detail, covering also the intervening years, are presented
in the table at the end of Part I.
The most striking feature of the 1929-53 comparison is the
large increase in the relative importance of the manufacturing
industries. From 30 percent in 1929, their contribution to private
nonagricultural domestic income rose to 39 percent last year.
This rise is a direct reflection of the increasing degree to which

1930
MOTE:

NONFAHU

SPACE RENTS, INCLUDING IMPUTED

RENTS

both because the industry was little affected by the growth of
commodity output and because rents did not keep up with the

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS

Business Capital Investment
Business has spent relatively more on machinery and
equipment than on structures in the postwar period

1
I
I

PRIVATE
NONRESIDENT1AL
CONSTRUCTION

0 1 I l I I I I I i I l l I i I I I I I i I i I I I 1 I I i I I i i I I

1920

housing was held down by war and postwar rent controls. It
should be noted, however, that most of the relative decline in real
estate occurred long before the imposition of such controls.
Among the broad factors contributing to it was the necessarily
slow adjustment of the supply conditions emerging from the
building boom of the 1920's to the depressed housing demand of
the prewar decade, when there was a temporary slackening in the
rate of family formation and population growth. More recently
the industry has been operating in a more favorable economic
climate, and rents have risen relative to prices in general since the
gradual elimination of rent controls.
In banking and other financial industries, income originating
was much lower relative to the total than in 1929, owing mainly
to an approximate halving of average interest rates and to the
marked shift from external financing of business investment to
financing out of retained earnings. The large expansion in
public debt obligations held by banks by no means compensated
for the fact that the volume of private interest was sharply reduced
in relation to total economic activity.
Two other major industrial divisions experiencing fairly substantial declines in relative importance from 1929 to 1953 were
transportation and services. The share of the former in total
private nonagricultural domestic income fell from 9 percent to 6%
percent, entirely as a result of the much below-average expansion

I I
55

of the railroad industry. In the case of services, the decrease—
from 14 percent to 11 % percent—was centered in the private
household segment, where the relative decline of domestic service
was the most important factor.
The proportion of income originating in the remaining industry division, mining, was 2 percent last year, about % of a
percentage point below 1929.

Increase in Federal employment
Outside of the private nonagricultural domestic sector, a
significant change over the period under review was the sizable
increase in the contribution of government. As a percentage of
total national income, it rose from 6 in 1929 to \\% in 1953.
These percentages, it should be emphasized, represent only the
return to resources (in this case, labor) directly employed by
government and government enterprises—not the production of
other industries whose output is purchased by government.
The increase was almost entirely in the Federal Government
component, which expanded over the two and a half decades
from less than 2 percent to about 7 percent of the national income.
The compensation of military personnel accounted for more than
half of this growth, and much of the remainder was in civilian
payrolls associated with the expansion of the defense establishment.

NATIONAL INCOME, 195 4 EDITION

Income from agriculture
The share of the national income originating in agriculture,
forestry, and fisheries, which consists almost wholly of income
from farming, amounted to 5K percent last year. This was much
below the 9% percent contribution of the agricultural sector in
1929. Because of the erratic annual movements which characterize farm income, however, it is difficult to draw significant
long-run conclusions from a 2-year comparison of this type.
The decline in agriculture's percentage of the national income
from 1929 to 1953 was by no means commensurate with the
decrease over the same period in the proportion of the population
engaged in agricultural production. Accordingly, the net value
of output per person engaged in production rose by about 220
percent in agriculture, as against about 140 percent in the private
nonfarm sector.

Changes in distributive shares
Along with the shifts in the industrial origin of the national
income, there have been noteworthy alterations of its composition
in terms of distributive shares. Some of these alterations have
represented fundamental changes in the relative importance of
various forms of income as such, while others have merely reflected
the influence of industrial shifts in combination with the existing
differences among the respective industries as to prevalent forms
of organization and characteristic types of income arising therefrom. Both sorts of changes in the distributive-share pattern, of
course, are of considerable interest.
This breakdown of the national income is simply a classification
of total earnings, before deduction of direct taxes, according to
the forms in which they accrue—compensation of employees,
corporate and unincorporated business profits, rental income of
persons, and net interest. Such a classification, it should be
realized, does not reflect the relative distribution of total income
among various groups in the population, since many of these
have multiple sources of income. Nor do the distributive shares
indicate the relative remuneration of the various factors of
production in a theoretical sense; most of them include more
than one element of factor cost, and each of them represents only a
partial measure of the factor cost suggested by its caption.
Over these two and a half decades, there have been marked
increases in the relative importance of employee compensation
and of corporate profits and parallel declines in the other income shares. The percentage of the total going to proprietors
of nonfarm unincorporated enterprises, however, was only
moderately lower than in 1929.
Employee share of national income
Compensation of employees rose from $51 billion in 1929 to
$209 billion in 1953, or from 58 to 68}£ percent of total national
income. Much of this increase reflected developments which
occurred outside the ordinary business system. Income arising
outside business firms consists of a series of income flows which
originate in wholly unrelated activities. In most of these there
is only one type of income, and changes in the relative importance
of various income types for the nonbusiness segment combined
merely reflect changes in the relative importance of various types

The relative size of these flows has changed greatly since 1929.
The more important, and their movements relative to the national income from 1929 to 1953, are: (1) the compensation of
government employees, including military personnel, increased
sharply. (2) The compensation of domestic servants and employees
of nonprofit institutions declined relative to the national income.
(3) Income arising from individually-owned property was greatly
reduced relative to the national income. This income consists
almost entirely of rental income and interest, with compensation
of employees minor. Both rental income and interest originating
in this sector dropped sharply relative to the national income
total. (4) Interest originating in private households showed a
relative decline mainly because of the drop in interest paid on
loans from brokers. (5) Corporate profits originating abroad
(branch profits and dividends combined) increased, while interest
received from abroad dropped sharply.
The net result of these shifts was a very sharp rise in the proportion of all income originating outside ordinary business firms
which consisted of the compensation of employees. The offset
appeared almost entirely in interest and rental income.
Within the ordinary business sector, as well, important changes
have taken place in industrial structure and, largely for this
reason, in legal form of organization. Since the usual division
of income by type varies widely among industries and as between
corporate and noncorporate firms, these changes also alter the
share distribution of the total national income.
In the important corporate sector of the economy, accounting
for more than half of the national income, the ratio of employee
compensation to total income originating was substantially stable
at about three-fourths of the total in prosperous peacetime years
throughout the period from 1929 through 1951. In 1951 (the
last year for which final data are available) it amounted to 74
percent as compared with 74% percent in 1929. It then increased
to 76 percent in 1952 and 77% percent in 1953. Corporate profits
in 1952 were adversely affected by the steel strike and in 1953
by the business adjustment that started in the second half of
that year.
Some increase in the employee share is indicated by the data
to have occurred in unincorporated nonfarm enterprises from
1929 to 1953. Developments in the construction and service
industries were largely responsible for this rise. The change in
the labor percentage in these two industry divisions reflected
mainly a larger increase in the number of wage and salary workers
than in the number of self-employed, rather than divergent movements in average employee compensation and average net income
per entrepreneur. In agriculture the share of labor income has
shown no apparent trend since 1929. Although the 1953 percentage was above that in 1929, it had been lower as recently
as 1951.
An additional element stands out in the change in the employee
share of national income. This was the internal shift to a somewhat lower proportion of wages and salaries and a higher proportion in the form of supplements to wages and salaries. The
latter were an inconsequential element in 1929, consisting chiefly
of compensation for injuries. Their growth to significant proportions—3}i percent of national income in 1953—stems from
the creation and expansion of the various social insurance pro-

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS

pension, health, and welfare funds. Employers' contributions to
these funds, both public and private, are viewed as supplementary
compensation of employees.
Shifts in proprietors' and rental income
The advance of entrepreneurial earnings from $14% billion in
1929 to $38% billion last year was less percentagewise than the
rise in national income, due piimarily to the relatively small rise
in the farm component. As a share of the national income, farm
proprietors' income declined from 7 percent in 1929 to 4 percent
in 1953. The erratic behavior of farm income makes it difficult,
however, to assess long-term trend from this type of comparison.
The farm income percentage was markedly above the 1929
figure as recently as 1948, and averaged close to 6 percent in the
ensuing three years. In view of the sizable decline in the number of farm proprietors since 1929, the lower percentage share of
1953 represented an improvement in the relative position of the
average farmer.
Nonfarm business and professional proprietors' income was 8%
percent of the total last year, about 1 % percentage points below
1929. A rise in the relative importance of the retail and wholesale trade component was more than offset largely by the fact
that entrepreneurial earnings in the service industries did not
maintain their relative standing.
One of the two distributive shares exhibiting a sharp proportionate decline over the past 25 years was rental income. The
$5% billion going to persons in this form in 1929 constituted 6
percent of national income, while last year's $10% billion
represented little more than half that much, percentagewise.
The principal reasons for the diminished importance of rental
income in relation to the total are those outlined above in connection with the real estate industry as a whole. It should be
remembered, however, that the rental income share—including
imputed net rent on owner-occupied nonfarm dwellings—consists only of net rents and royalties accruing to persons not primarily engaged in the real estate business. Other rents are merged
unidentifiably with noncorporate business earnings and with
corporate profits.

Influence of inventory profits and losses
The foregoing remarks are based upon measures of corporate
profits after inventory valuation adjustment. Profits before tax
as reported under prevalent inventory accounting practices,
which generally charge goods to cost of sales in terms of priorperiod inventory costs rather than current replacement costs,
showed a somewhat greater increase from 1929 to 1953. These
figures included moderate inventory losses in 1929, when—with
prices falling—book costs of goods sold exceeded replacement
costs, and included inventory profits last year, when—with prices;
rising moderately—the reverse was true.
Such inventory profits and losses—which become major elements in book profits in years of sharp price change—are eliminated, in order to secure an economically more meaningful
measure of income originating in current production, by application of the inventory valuation adjustment. In effect, this adjustment substitutes the current replacement cost of goods sold for
their book cost in the computation of profits.
Because of the very large increase in Federal corporate income
tax rates, the percentage of national income taken by such taxes,
in combination with similar State levies, more than trebled from
1929 to 1953. The share of profits after tax (including inventory
profits) has fallen from 9% percent in 1929 to 6 percent in 1953.
Most of this decline has occurred since 1950 as a result of the
increase in taxes during the Korean war period.
One of the salient trends in corporate financing during this
period—toward greater reliance upon internal funds—is reflected
in the divergence between the terminal years with respect to the
disposition of profits after tax. In 1929, 70 percent was paid out
as dividends and 30 percent retained, whereas in 1953 only 51
percent was distributed to stockholders and 49 percent was
retained. This disparity between the 2 years is reduced if inventory
profits and losses are excluded from the comparison. On this basis,
undistributed profits rose from 33 percent of profits after tax in
1929 to 46 percent last year. It may be noted that in all but one
of the postwar years (1952) the contrast with 1929 in the proportion of corporate earnings withheld and paid out was even greater
than in 1953.

Net interest
Combined profits and interest share
The corporate profits share of the national income—corporate
profits and inventory valuation adjustment—increased from $10
billion in 1929 to $38% billion last year—from 11% to 12% percent. This rise was a reflection of the greatly reduced burden of
corporate debt, and does not signify a commensurate expansion
of the property share of current income. In combination, profits
and interest originating in corporate business was fractionally
lower in 1953 than in 1929 in relation to total national income.
It was down also in relation to total income originating in corporations—the counterpart of the increase in the labor share
already discussed. In the main, however, the combined property
share of total income originating in corporate business has been
fairly uniform in prosperous peacetime years of the period under
review. This uniformity is brought out in the chart on page 14,
and contrasts with the extreme variability of the property income
share during the business cycle.

The remaining distributive share, net interest, fell from 7%
percent of national income in 1929, to only 3 percent last year.
The major factors underlying this decline are those cited above to
explain the diminished proportion of income originating in the
financial industries—namely, the virtual halving of average interest rates and the relatively small expansion of private debt
since 1929.
In addition, part of the decline i:> attributable to a statistical
peculiarity of the series. To offset the inclusion in business incomes
of government interest, which is viewed as a transfer in the
national income accounts, government interest received by
business is deducted from the interest component of national
income. Had the statistically more difficult procedure of deducting
it from business incomes been followed, the relative decline in net
interest from 1929 to 1953 would have been less, while the other
affected shares would have shown correspondingly smaller
increases.

NATIONAL INCOME, 1 9 5 4

EDITION

GOVERNMENT PURCHASES
amounted to 23% of the Gross
National Product in 1953 as
contrasted with 8% in 1929...
BILLIONS OF DOLLARS

400
GOVERNMENT

with the bulk of the increase
in the government proportior
going for defense purposes

300
PRIVATE

PERCENT OF G N P

200

100

1929

OTHER FEDERAL
and STATE & LOCAL

1953

1929
Expansion of Personal Income
Personal income differs from national income by the exclusion
of those portions of income earned in current production which
are not paid out to persons, and by the inclusion of certain items
not arising in current production—chiefly transfer payments
and government interest.
In 1929, personal income totalled $86 billion; by 1953, it had
mounted $286 billion. On a per capita basis, the increase was
from about $700 to $1,800, or more than 150 percent.
Along with this advance in the total, there were significant
shifts in its composition. Most of these—the increased relative
importance of payrolls and the reduced proportions of interest,
291602"—54

1953

rental income, dividends, and farm proprietors' earnings—have
already been noted in the discussion of distributive shares.

Transfer payments increase in importance
In addition, there have been important changes, stemming
from the expanded role of government in the economy, in other
elements of personal income. Foremost among these developments
is the growth of transfer payments. From $1}£ billion, or less than
2 percent of personal income, in 1929, they rose to $14 billion,
or nearly 5 percent, in 1953.
Most of the rise was in the Federal Government component,
which in 1929 consisted chiefly of military pensions and related
items. By 1953, as a result of World War II and the Korean war,

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS

Growth in Private Nonagricultural
National Income Since 1929
Manufacturing, construction, and trade
have shown above-average growth
350 -

300 CO

Manufacturing

Construction
Trade

250

ALL INDUSTRIES

o
200 ©

£
u
c

150 -

100

Services
_ Transportation 8
Public Utilities
_
Mining

-'-"•-IT

Finance 8
Real Estate

50 -

1929
these payments were greatly enlarged, both absolutely and in
relation to personal income, and new classes of veterans' benefits
under the servicemen's readjustment acts were flowing in large
volume. Moreover, payments from Federal social insurance funds,
which in 1929 had been confined to civilian retirement and veterans' life insurance benefits, last year included not only increased
amounts under these headings, but also $4% billion of old-age
and survivors', railroad retirement, and unemployment insurance
benefits.
State and local government transfer payments, although overshadowed by those of the Federal Government, have also risen
markedly since 1929. State veterans' bonuses have contributed in
recent years, but most of the increase has been in special types of
public assistance for such groups as the blind, the aged, the
disabled, and dependent children. It may be noted that while

1953
these payments are made by State- and local governments, they
are financed in part by Federal grants-in-aid.

Growth of social insurance contributions
For the personal sector of the economy as a whole, the growth
of transfer payments has been partly offset by the concomitant
expansion of social insurance contributions. Confined in 1929
to a few public employee retirement systems and veterans' life
insurance funds, but since extended by the establishment and
development of the various Social Security programs, these now
take an appreciable portion of current personal earnings. To date,
contributions for social insurance have consistently exceeded
benefit payments from the funds—in most years by a sizable
margin. On balance, however, rhe combined effect of social

NATIONAL INCOME, 195 4 EDITION

insurance transactions and transfer payments from general
government funds has been a material net addition to currently
earned personal income.

to trace in a general way the course of economic development
during the period under review.

Gross National Product Patterns
Government interest increases with debt
Also of consequence in the expansion of personal income since
1929 has been the sharp increase of government interest payments
associated with the tremendous growth, mainly during World
War II, of the public debt. Owing to the inclusion of government
interest, which is treated in the national income accounts as a
transfer item, personal interest income declined much less in
relative importance from 1929 to 1953 than did the net interest
component of the national income.

Real income up substantially
Each of the elements of personal income is measured without
reference to the impact of direct personal taxes. Much of the increase in the total over the past two and a half decades, however,
has been absorbed by such taxes. Personal tax and nontax payments amounted to about $2% billion, or 3 percent of personal
income, in 1929. In 1953 they were 14 times as large, totalling
$36 billion and absorbing about 12)^ percent of personal income.
See chart on page 16. The relative increase was entirely in the
Federal Government component, and resulted almost wholly
from the broadened base and sharply higher rates of the individual
income tax. State and local personal taxes, although doubling
from 1929 to 1953, declined slightly as a percentage of personal
income.
After deduction of these taxes, there remained disposable personal income of $250 billion last year, as compared with $83 billion in 1929. Corresponding figures on a per capita basis were
approximately $1,570 and $680, respectively. With consumer
prices averaging 59 percent higher in 1953 than in 1929, the increase in real disposable income per capita was thus about 45
percent. See chart on page 19.
The proportion of disposable personal income spent for current
consumption last year was lower than in 1929—with 8 percent
going into personal saving as compared with 5 percent in the
earlier year. However, the true extent of the change may differ
somewhat from that indicated by the figures, because the saving
estimates are computed as residuals, and hence are sensitive even
to minor statistical imperfections in the measurement of disposable income and consumption expenditures.

FLUCTUATIONS IN ECONOMIC ACTIVITY
The substantial growth of the economy, as revealed by the foregoing summary comparison of national income and product data
for 1929 and 1953, was extremely irregular. Likewise, the associated changes in the economic structure did not occur in smooth
progression, but emerged from a series of fluctuations of unprecedented magnitude, including the great depression and the vast
expansion of World War II. In order to illuminate the processes
by which the economic scene has been transformed, it is desirable

Before this summary is given, some of the major factors in the
fluctuations of economic activity since 1929 will be highlighted
with the aid of two interrelated percentage distributions of the
gross national product—one by type of expenditure and one by
type of receipt—which are presented in tabular form at the end
of this summary.
The distribution by type of expenditure indicates the proportions of total output bought by each major sector of the economy:
by persons, by business (for fixed investment and inventory accumulation), by the rest of the world (net), and by Federal,
State, and local governments.
The percentage breakdown of gross national product by type
of receipt reflects broadly the corresponding distribution of currently-generated purchasing power, exclusive of borrowing transactions. It shows the proportions of the gross income flow received
by consumers as disposable personal income; by the business sector in the form of gross retained earnings, including capital consumption allowances; and by all levels of government in the form
of tax and nontax receipts net of amounts transferred (such as
interest and transfer payments) to other sectors.
Each of these breakdowns of gross national product is of interest
in itself, but they provide particularly valuable insight into the
functioning of the economy when studied in combination, with
the respective expenditure and receipt shares of each major sector
paired. Such an arrangement of the data is shown in the chart
on page 21.
In each panel of the chart are plotted the percentage receipt
and expenditure shares of one of the major sectors, the rest of
the world sector being included with the business sector for this
purpose. The shaded areas between the lines measure, respectively, the government surplus or deficit; personal saving or dissaving; and the excess or shortfall of gross investment in relation
to gross business saving—each expressed as a percentage of gross
national product. It will be noted that the three expenditure
percentages, represented by the solid lines, add to 100 in every
year, as do the three receipt percentages (dashed lines), except
for the statistical discrepancy between the estimates of national
income and national product.

Strategic role of investment
The middle panel strikingly displays the strategic role of investment expenditures in the business cycle. Clearly depicted are
their disproportionate collapse in the great depression and their
gradual rise in relative importance, briefly reversed in the 1938
recession, during recovery. Also illustrated is the severe cut in
private capital formation required during World War II and its
resurgence afterwards. In connection with the wartime figures,
however, it should be remembered that sizable installations of
plant and equipment undertaken directly by the Government are
reflected in the bottom panel rather than as business investment.
The uniformity of the proportions of output going into investment in prosperous peacetime years is noteworthy, as is the
contrast between these proportions, all in the neighborhood of 16

CORPORATE PROFITS SINCE 1929
Profits fluctuate more than other income originating in corporate business
175

150
CORPORATE PROFITS BEFORE TAX-

125
OTHER INCOME ORIGINATING IN CORPORATE BUSINESS
(COMPENSATION OF EMPLOYEES AND NET INTEREST)

100

o
z

AFTER INVENTORY VALUATION ADJUSTMENT

1950

1955

The proportional share of profits and interest is
relatively uniform in prosperous peacetime years

1945
CORPORATE LOSS

1930

1935

PROFITS AND NET INTEREST
AS PERCENT OF
••
INCOME ORIGINATING

AFTER INVENTORY

VALUATION ADJUSTMENT

100

120

140

INCOME ORIGINATING IN CORPORATE BUSINESS
(BILIION DOLLARS)

_L
160

180

NATIONAL INCOME,

percent, and the limitation of investment to 2 or 3 percent of the
gross national product at the bottom of the depression.
Gross business saving, while also showing a disproportionate
swing in the major business cycle, has been a great deal steadier
than investment, reflecting the relative stability of depreciation
allowances. In the expanding United States economy, gross
business saving has usually fallen short of gross investment.
Apart from the World War II period, this has been true in all
years except those of the great depression and 1938. The financing
of the excess of investment has required funds made available by
the other sectors, including those left on deposit with banks, as
well as those provided through purchase of stocks or bonds.

Cyclical stability of consumer spending
The percentage of output bought by consumers—charted in
the top panel—has exhibited a contracyclical tendency, as
attested by its rise from 1929 to 1932, in 1938, and in 1949. It
should be remembered, of course, that these were rising proporportions of a diminishing total output. Except in the mild recession of 1949, they represented declining physical volumes and
dollar values of consumption expenditures in absolute terms.
Conversely, falling percentages are observable in most years of
peacetime expansion in economic activity. These, however, have
been associated with increases in the absolute volume and value
of consumer spending.
Another outstanding feature of the top panel is the broad
picture it gives of the characteristics of consumer finances during
World War II. Disposable income was reduced by heavy taxation, but consumption expenditures were cut far more by the
diversion of productive resources to war use, in combination
with price controls and exhortations to save. The resultant
extraordinary volume of personal savings is clearly illustrated.
This phenomenon was not repeated during the Korean war
period, as the proportion of total output diverted to national
security use was much more moderate, and was financed largely
by taxation.

War generates large Government deficit
The counterpart to these wartime personal savings, as well as
to the concurrent excess of gross business saving over investment,
appears in the bottom panel of the chart, where the huge World
War II Government deficit stands out. Although government
purchases reached a peak of about 46 percent of total output,
government at no time claimed a commensurate proportion of
currently-generated purchasing power. Net government receipts
averaged 22 percent of gross national product at their relative
maximum in 1943 and 1944.
The difference between the share of output bought by the
Government and its share of receipts was financed by borrowing
on an unprecedented scale. The inflationary impact of this
deficit financing was restrained to a considerable extent during
the war period itself, despite scarcities of civilian goods and
services, by such factors as price control, rationing, and the
willingness of the public not only to buy Government bonds, but
also to accumulate other liquid assets. After the cessation of

195 4

EDITION

hostilities, however, the postponed effects of wartime deficit
financing contributed to the postwar inflation.
In the Korean war period, net government receipts again
mounted to almost 22 percent of the gross national product, but
government purchases of goods and services fell considerably
short of the World War II peak. Accordingly no comparable
deficits were generated in the later period.
It should be noted, especially in connection with the postwar
figures, that the relative rise in total tax and nontax receipts of
Federal, State, and local governments has been greater than that
of the net receipts item plotted in the chart. There has been a
material increase in the divergence between these two measures
because of the disportionate expansion of the volume of gross
receipts required to finance veterans' benefits, interest on the
public debt, and other transfers deducted in deriving the net
figures.

Basic expansion in role of government
A final feature of the three panels in combination is the shift
from private to public consumption, which has already been noted
in the foregoing discussion of long-run changes in the use of
current-dollar gross national product. The shift is evidenced by
comparison of the top and bottom panels, which show a distinct,
although irregular, uptrend in the government share, whether in
terms of purchases or of net receipts, together with a generally
offsetting long-term decline in the personal share. The latter
movement is reflected in disposable income, as well as in consumption expenditures. Primarily, of course, the rising percentage
share of government reflects the increasing responsibilities
assumed by the Federal Government with respect to national
defense.
Neither in gross investment nor in gross business saving has
there been any noticeable long-term change in relative importance, despite extreme cyclical and wartime variations.

Chronological Review: 1929-53
The year 1929 marked the end of an era of relatively full employment, business confidence, and general prosperity. Economic
activity had been advancing strongly, with only minor interruptions, for eight years.

Business decline: 1929-33
The 1929 downturn, the ultimate causes of which are still a
matter of controversy, was most clearly reflected in the collapse
of investment demand. Gross private domestic investment
dropped about one-third from 1929 to 1930, as new construction
and producers' purchases of durable equipment were cut sharply
and the accumulation of nonfarm business inventories ceased.
Foreign purchases also declined in 1930, although the drop was
not reflected in net foreign investment because of a matching
reduction in import demand.
With employment and incomes adversely affected by the sharp
reduction of investment, consumer purchases also decreased,
contributing to the general contraction and inducing still further
cuts in outlays for investment.

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS

Consumer purchases, however, held up much better in 1930
than investment demand. The aggregate income flow to individuals shrank less than production and the incomes generated by it,
as undistributed corporate profits absorbed a disproportionate
share of the over-all decrease in earned income. Also, consumers
tended to spend a higher proportion of current income or to
dissave in the attempt to preserve previous living standards.
Essentially the same pattern of cumulative decline persisted,
and in fact accelerated, during 1931 and 1932. By the latter year,
gross private domestic investment had fallen to the very low level
of less than $1 billion, as contrasted with $16 billion in 1929.
The further moderate decline of the gross national product in
1933 was in consumer purchases, where it reflected primarily
lower average prices rather than a further decrease in volume.

dollar volume, were considerably increased in relative importance
by the collapse of private demand.
More than half of the 1929-33 decline in the market value of the
national product stemmed from lower prices. As measured by the
gross national product in constant (1947) dollars, real output fell
by three-tenths.
Foremost among the factors underlying the shrinkage of real
output was the reduction of employment. At the depth of the
depression, the number of persons engaged in production was
almost one-fifth lower than in 1929, and unemployment was
almost 13 million—close to one-fourth of the Nation's labor force.
Moreover, average hours worked per week by those who remained
employed were considerably reduced.

Recovery: 1933-37
National product halved in value
Over the entire period of contraction from 1929 to 1933, the
gross national product dropped by nearly one-half, from $104
billion to $56 billion. At the bottom of the depression less than 3
percent of the Nation's output went into business investment, as
compared with 15% percent in 1929. Conversely, consumer purchases rose from three-fourths of the total in 1929 to five-sixths in
1933. Government purchases, although little changed in absolute

Some of the most serious deflationary forces underlying the
post-1929 collapse were by 1932 beginning to spend themselves.
Installations of new plant and equipment had virtually ceased in
most segments of the economy, and such gross fixed business
investment as did persist represented primarily the fulfillment of
minimum replacement needs. As replacements had been cut to
the bone for several years, the feasibility of further postponing
them was rapidly diminishing by the end of 1932. Business pur-

INCOME AND

TAXES

Personal and corporate taxes have taken an increased share of incomes
PERSONAL
INCOME
and TAXES

CORPORATE
INCOME
iind TAXES

CORPORATE INCOME
AFTER TAXES
$8.3 Billion

1929
$9.6 Billion

1953
$39.4 Billion

1953
$286.1 Billion

NATIONAL INCOME, 195 4 EDITION

chases of durable equipment, accordingly, fell no lower in 1933.
Private construction activity did continue downward, but the
drop was smaller than in any of the three preceding years.
Sizable inventory liquidation continued in 1933, but as it had
already carried working stocks close to a minimum even in relation to the low current volume of sales, the rate of liquidation
was considerably reduced. It had previously been possible for
businesses to meet the sagging volume of sales partly out of
relatively excessive existing inventories, with the consequence
that production—and hence total income—was reduced even
more than consolidated business sales. Now, however, this possibility was vanishing, and it became necessary to keep output at
least on a par with current demand. Here too, then, a weighty
deflationary force was exhausting itself.
With the marked retardation of income declines stemming
directly from reduced investment expenditures, the fall in consumer demand was measurably slowed in 1933. The stage was
thus finally set for recovery. It was evidenced in a few industries
as early as the fall of 1932, but appears to have dated generally
from the spring of 1933. Monthly personal income data show the
low point in March, after which there was a slow and uneven
rise during the remainder of the year.
With its decline arrested in 1933, fixed business investment
turned up moderately in 1934, when both construction and
equipment outlays began to expand again. Nonfarm inventory
liquidation ceased, and a general trend toward rebuilding of
stocks depleted during the depression set in. It was stimulated
not only by the emerging recovery of sales, but by the rise in
prices already under way during 1933.

Government supplements private recovery
In the meantime, the Federal Government had assumed an
active role in the economy, and was making strenuous efforts to
promote recovery. Along with the adoption of other measures, it
entered the market directly on an expanding scale, especially in
its work relief activities, and also provided substantial aid to
State and local governments.
With the increase of incomes generated by the pick-up of
business investment and the growth of government purchases,
personal consumption expenditures also rose in 1934. Their
expansion, in turn, fed the income stream and provided stimulus
for a further upsurge of investment. This was at first mainly confined to long-deferred replacement of capital facilities which had
deteriorated during the depression; but as profits reappeared and
business confidence in future prospects was gradually restored,
an increasing proportion went into wholly new plant and equipment, and inventories were expanded to meet the rising volume
of sales. Residential building, spurred in part by Federal aid to
homeowners, moved ahead once more, and total gross private
domestic investment advanced steadily from $\% billion in 1933
to $11K billion in 1937.
Consumer purchases also continued to rise. At $67 billion in
1937, they were 45 percent above the low mark of 1933. Although
their rate of increase was proportionately smaller than that of
domestic capital formation, they represented quantitatively the
largest element in the upward spiral of employment, production,
and incomes.
Apart from the newly expanded role of government, the whole

mechanism of the recovery was thus very similar to that of the
downswing, except that it operated in reverse and also more
slowly. Of the $35 billion increase in gross national product from
1933 to 1937, about 30 percent was in private domestic investment, raising it from 2% to 13 percent of the total. Consumer
outlays accounted for about 60 percent of the change—substantially less than their share of total output—and government
purchases, dropping slightly in relative importance, absorbed the
remaining 10 percent of the increment.

The recession of 1938
Incomplete as was the recovery of the economy by 1937, it
was interrupted by a downturn beginning in the latter part of
that year and extending through mid-1938. Although of brief
duration, this downturn was relatively severe. Within a few
months, unemployment rose sharply. Industrial production fell
by over one-fourth from August, 1937 to January, 1938, and
personal income dropped at a pace comparable to that prevailing
in 1931-32. The decline tapered off thereafter, however, and
production began to pick up again in the second half of 1938.
For the year as a whole, the decrease in gross national product
was about 6 percent.
The 1937-38 recession was much steeper in its initial descent
than the previous downswing, but it was of a less basic character.
Of the $5% billion decline in gross national product from 1937
to 1938, almost three-fifths was attributable to a shift from
accumulation to liquidation of business inventories. Inventory
shifts accounted for only 16 percent of the drop in output from
1929 to 1930.
Business plant and equipment expenditures contracted about
as sharply in 1938 as in 1930, but residential construction activity,
contrastingly, continued to rise, and consumption expenditures,
despite the drop in employment and personal income, declined
by only 4 percent, as compared with 10 percent in 1930. The
consuming public as a whole sustained its spending close to the
1937 rate by a $3 billion cut in personal saving. Moreover, the
moderate decline in consumer outlays which did occur was very
largely counterbalanced by increased government: buying and
net foreign investment.
Altogether, purchases of goods and services by final users of
the Nation's output declined by less than 3 percent in 1938, as
compared with 11 percent in 1930, and the major portion of the
swing in production was absorbed by the change in inventories.
Curtailment of production ceased as soon as the strength of final
demand became apparent. The drop in fixed business investment
proved to have been instigated by short-run considerations, rather
than by any fundamental lack of investment opportunities. The
basic underlying situation, in fact, was that large capital requirements accumulated during the depression still remained to be
fulfilled, and that many new investment opportunities stemming
from technological advances remained to be exploited.

Renewed recovery: 1938-41
Following the jar of the 1938 recession, the recovery was
renewed and continued steadily into 1941, when it was merged
with the first stages of military preparation for World War II.
All forms of business investment were expanding steadily

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS

during this period. Purchases of producers' durable equipment
nearly doubled in dollar volume from 1938 to 1941, and private
construction activity also rose strongly. Inventory liquidation
ceased in 1939, when production was brought back in line with
current sales, and inventories were accumulated on a mounting
scale in the next two years.
By 1941, total gross private domestic investment was not far
from three times as large as in 1938. For the first time, it surpassed
the 1929 total, both in value and in physical volume. Net foreign
investment was also sizable in the three years following 1938,
being especially stimulated in 1940 and 1941 by foreign demand
for munitions and other supplies required for the Allied war effort.
Responding to the increased incomes generated by expanding
employment—and contributing, in turn, to the advance of profits,
business investment, employment, and incomes—personal consumption expenditures rose from $64% billion in 1938 to $82
billion in 1941. The relative rise was particularly marked—about
two-thirds—in outlays for durable goods. Higher prices figured in
the advancing rate of consumer spending, but the major portion
represented enlarged quantities of goods and services. The real
volume of personal consumption per capita increased 16 percent
from 1938 to 1941, and exceeded the 1929 figure from 1939 on.
Military requirements become dominant
Government purchases were approximately stable until the
latter part of 1940. After the fall of France, the national defense
program got under way on a rapidly expanding scale with
progressively greater influence upon economic conditions.
Throughout 1941 and thereafter it was the dominant factor in the
economy.
In this second stage of recovery from the depression, from 1938
to 1941, the dollar value of the Nation's output advanced by
almost 50 percent, to $126 billion. With a general price rise in the
neighborhood of 9 percent, the increase in the physical volume of
production was close to two-fifths.
The year 1941 was one of marked expansion, and on the average
did not represent full peacetime capacity. During much of the
year, there were idle manpower resources, as is attested by the
fact that the proportion of the labor force unemployed was
slightly higher than in 1930, the first year of the depression.
Nevertheless, the degree of recovery evidenced by 1941 was
impressive. In constant dollars, the gross national product stood
one-third higher than in 1929. This expansion of real output
was achieved with an increase of only 15 percent in the total
number of persons engaged in production. Moreover, average
hours worked per week were reduced considerably over the 12
years. In the private sector, where the increase in output was
about 30 percent, total man-hours utilized differed but little from
those in 1929.
That so large an increase in the volume of output was nonetheless accomplished was attributable to the rise in real product per
man-hour worked in the private economy. Although lagging in
the depression, productivity had advanced rapidly after 1934,
and by 1941 was near the level indicated by its long-term trend.
The larger output of 1941 was being distributed to major
economic groups in a somewhat different fashion from that of
1929. The most noteworthy change was in the share bought by
government. With substantial military preparations getting under

way, this share—including a slightly smaller portion for State
and local governments—amounted to roughly one-fifth of the
gross national product as compared with less than one-tenth in
1929. The proportion purchased by consumers, on the other
hand, was reduced from 76 to 65 percent, while the percentages
going into gross private domestic and net foreign investment
were little changed.

The war economy: 1942-45
Preparations for war began at & time when the economy was
operating at less than full capacity, with unemployed labor,
plant, and equipment, and an abundance of raw materials. At
first, because of the availability of these unused economic resources, war production could be superimposed upon the civilian
economy. It acted as a stimulant, and civilian production increased concurrently. Gross private domestic investment proceeded at a high rate, and consumer purchases—especially of
durable goods—were buoyant.
During most of 1941, the needs of the war program were thus
compatible with expanding civilian production. Moreover,
much of the capital equipment acquired during this period later
proved to be readily convertible to war production. Also, the
additions to the stock of capital, along with additions to the stock
of durable consumer goods, subsequently permitted the diversion
of more productive resources from civilian use than would otherwise have been possible except with sharper cuts in living standards.

Emergence of war-time problems
As the dimensions of the war effort expanded, however, serious
problems emerged. Although the rising volume of war production
generated a rapid expansion of incomes, it provided no goods and
services to satisfy the resultant growth of civilian demand. Instead, it impinged upon their availability as soon as the slack in
the economy had been taken up. Shortages of specific labor skills,
capital facilities, and raw materials began to be more and more
frequently encountered. After Pearl Harbor, it became obvious
that the war program would take proportions of output so huge
that they could not be provided by enlarged production alone,
and that civilian demand would have to be restricted.
During the period of transition to a full war economy, accordingly, a succession of measures was adopted with a view to ensuring maximum war production together with the optimum functioning of the civilian economy. Rates of taxation were steeply
increased, not only to help finance Government war expenditures, but also to restrict the amount of civilian purchasing power
available to bid for the limited volume of goods and services
remaining after military requirements had been met. Fiscal
measures were supplemented by the imposition of direct controls,
including priorities, inventory limitation orders, allocations, manpower regulations, price and wage controls, and rationing. In
addition, individuals were urged to restrict consumption voluntarily and to invest their surplus purchasing power in Government
bonds.
On the whole, the flexibility of the economy in the transition to
full-scale war production proved great and total production continued to rise rapidly despite conversion.

NATIONAL INCOME, 195 4 EDITION

War peak reached in 1944
In 1944, the peak year of war production, the dollar value of
the Nation's output was $211 billion—$85% billion higher than
in 1941. Because of the extreme changes in the nature and composition of output, it is difficult to measure how much of this
dollar increase reflected physical volume. According to the constant-dollar gross national product series, the expansion of real
output from 1941 to 1944 was more than one-third. Whatever
the precise figure, it is clear that there was a large rise in physical
production during World War II. The major underlying factors
were an extraordinary expansion of the labor force and employment, an increased stock of capital equipment, large-scale operations and technological progress in war production, and a better
utilization of labor and productive capacity in many civilian
industries.
The increase in physical output was by far the most important
source of war output. Next in importance were reductions in
gross fixed investment, consumer durables, and government nonwar purchases. According to available evidence, real consumption
of nondurable goods and of services was more than maintained in
total. While the wartime level of personal consumption is somewhat exaggerated in the constant dollar figures because of the
impossibility of measuring fully the actual price rise which

occurred during the war, it is evident that, in the aggregate, real
consumption was not curtailed.
Although personal consumption held up during the war, it was
much lower in relation to income than it would have been in
ordinary peacetime years of high economic activity. An unprecedented proportion of wartime incomes was absorbed by
taxes, and the saving rate was abnormally high. The latter
reflected a combination of restricted civilian supplies regulated by
price control and rationing and the response to patriotic appeals
for investment in war bonds.

War changes distribution of output
As a result of these wartime changes, the composition of gross
national product in 1944 differed drastically from that in 1941.
Government purchases amounted to 46 percent of the total in
1944. The comparable figure for 1941 was only 20 percent, including twice as large a proportion for civilian programs of
Federal, State, and local governments.
All other major uses of output were reduced far below their
usual relative importance, with the sharpest cuts being those in
domestic and net foreign investment and in consumer durables.
Private fixed capital formation fell to about 4 percent of the
national product as compared with 11 percent in 1941; and requirements were also met in part through a net drain upon both

Real Personal Income Per Capita in 1953

was 60 percent above 1929 before taxes

and 44 percent above 1929 after taxes
$1,532
$1,339

$956

1929

$927

1929

1953
IN 1947 DOLLARS

1953

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS

business inventories and foreign sources of supply. The proportion
representing consumer outlays for durable goods was more than
halved as compared with that of 1941, and the relative share of
personal consumption expenditures for nondurables and services
also decreased—though by a much smaller margin.

Reconversion and postwar boom: 1945-48
At the end of World War II, the Nation faced a set of economic
problems which in some ways were the counterpart to those of the
original mobilization. It was widely recognized that the transition
from a situation in which roughly two-fifths of economic resources
were being employed in war production to one in which most of
the resources would again be devoted to civilian output could
only be accomplished in an orderly fashion by widespread
cooperation among all major groups in the economy. As in the
mobilization itself, the striking flexibility of the economy was
demonstrated.
A broad Government program designed to speed reconversion,
and to ease its impact upon the returning soldier and upon business, was enacted. With the quick resurgence of business, personal,
and foreign demands, as well as the vast Government programs
undertaken to aid in the rehabilitation of war devastated areas,
the immediate postwar economic decline was held to moderate
proportions.
Although war purchases of the Federal Government were cut
back with great speed—from an annual rate of $90 billion in the
second quarter of 1945 to $28 billion in the first quarter of 1946—
much of the slack was quickly taken up by the rapid expansion of
private spending. Total gross national product dropped 12 percent over these three quarters, or by $27 billion at annual rates;
thus more than half of the drop in war expenditures was offset.
Discharged servicemen and war plant workers were speedily
absorbed in civilian pursuits, and at no time did unemployment
rise appreciably above 2% million.
After the first quarter of 1946, the buoyancy of private demand
more than offset the moderate further declines in government
purchases. Strong inflationary pressures characterized the 194546 reconversion, even before controls were eliminated, and continued to dominate the economic scene for the next two years.
Influence of liquid saving and backlog demands
Several key factors underlay the strength of private demand.
During the war, both consumers and businesses had accumulated
an enormous volume of savings—much of it in liquid form. At
the same time, they had built up a backlog of urgent demands for
all types of civilian goods, and especially for durables.
As regards the purchasing power of consumers, it may be
further noted that in the brief contraction from mid-1945 to early
1946 the flow of disposable personal income was maintained.
Undistributed corporate earnings absorbed a large share of the
swing in total income arising from production, and the Government disbursed mustering-out payments and other veterans'
benefits in large volume and lowered the wartime tax rates. Not
only did the pent-up demand for durable consumer goods materialize as expected, but an insistent consumer demand for
nondurables and services also became an active and powerful force
in the economy.

Business speeds investment
At the same time, business plant and equipment investment
programs were pushed ahead fast in the immediate reconversion
period and continued to expand strongly thereafter. Inventories,
very low at the close of the war, had to be accumulated rapidly
to bring working stocks into line with the heavy volume of
business. The pace of residential building activity also accelerated
steadily.
Moreover, net foreign investment assumed a relative importance
far beyond its usual role. With financial support provided both
by wartime accumulations of gold and dollar balances and by a
large volume of United States Government loans, and under the
stimulus of world-wide shortages stemming from the impairment
of productive facilities abroad, net foreign purchases of American
output reached unprecedented proportions.
In combination, these heavy demands placed a severe strain
upon the productive capacity of the economy, which was reduced
considerably below the wartime peak. Despite low unemployment, the number of persons engaged in production was 7 million,
or 11 percent, lower in 1946 than in 1944. This was due to the
withdrawal from the labor force of sizable classes of individuals—
such as adolescents, housewives, and persons past the normal
retirement age—who are not ordinarily employed, but who had
been induced by special wartime circumstances to accept employment. In addition, average hours worked per week fell off as
overtime schedules were abandoned, and there appears to have
been some loss during the reconversion period in real output per
man-hour worked in private industries.
Rapid price rise until 1948
With the physical volume of production thus pressing against
capacity, much, if not most, of the pressure exerted by intensive
consumer, business, and foreign buying was reflected in price
movements. Prices were already advancing, though often in
covert fashion, in the early reconversion period. After the termination of wartime controls in the latter half of 1946, they spurted
up very sharply, and, except for a brief interlude of hesitation in
the spring of 1947, serious inflationary tendencies accompanied
the postwar boom until 1948.
In that year a better balance between supply and demand
emerged, and the price rise tapered off. This was brought about
partly through an appreciable expansion of real output and
partly through a diminution in the intensity of some of the demands, including those from abroad, from which the greatest
pressures had emanated.
There was a break in agricultural prices early in 1948. Although these recovered briefly, their downward slide, influenced
by the prospect of excellent domestic harvests and an improved
crop situation abroad, was resumed after midyear. Agricultural
prices are a substantial element in the total price picture, and
their decline was an important factor shaping the course of
economic developments during 1948.
More notable, however, was the increasing stability in consumer markets. The upsurge in personal consumption expenditures, stimulated by backlog demands and reinforced by large
holdings of liquid assets and a low volume of consumer debt
outstanding, had constituted one of the main foundations of the

Two Distributions of the Gross National Product

1. BY PURCHASES - SOLID LINES
2. BY RECEIPTS - DASHED LINES

L^ The sums of the receipts and expenditures are equal
0 But each part of the economy does not spend what it receives.
It saves a portion or draws on the savings of others
l) Shifting positions indicate the relative swings in
purchasing power and market demands
100
I
N
D
I

PERSONAL
OISSAVING

DISPOSABLE PERSONAL
INCOME

V
I
0

u
A
L
S

PERSONAL /

SAVING

Siii

^ * "•"•'•<•

PERSONAL CONSUMPTION
EXPENDITURES
-

§
o

1
O
*o

8
-

B
U
S

I
N
S
S

GROSS
INVESTMENT
GROSS BUSINESS

§|k

\ _

SAVING

EXCESS OF
INVESTMENT

\
V

S"~\

/ ^^^>-4
Y * ^ ^

i i i^ri

EXCESS OF , -

| | | 1 1AVI'N6I I V*f\

1 1 1 1 1 1 1 1 11

50
40

G
0
V
R
N
M
E
N

"o
c
o

a.
GOVERNMENT PURCHASES
OF GOODS AND SERVICES

O
"o

10
NET GOVERNMENT
RECEIPTS

1 1 1 1 1 11

1 I I I I. I I I

I I I I I I I I

1929 31 33 35 37 39 41 43 45 47 49

51 53 55

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS

Percentage Distributions of National Income by Distributive Shares, 1929-38
1929

Tetal national Income.

1930

1931

1932

1933

1934

1935

1936

1937

100.0

Compensation of employees
Wages and salaries
Supplements to wages and salaries.

58.2
57.4
.8

61.9
61.0

66.6
65.5
1.0

73.0
71.6
1.4

73.6
72.2
1.3

70.0
68.8
1.2

65.4
64.3
1.1

66.1
64.6
1.5

65.1
62.6
2.5

Income of unincorporated businesses.
Business and professional'._
Farm

16.8
10.0
0.8

15.2
9.8
5.5

14.6
9.3
5.3

12.5
8.0
4.5

13.9
7.9
6.1

14.3
9.3
5.0

18.2
9.4
8.8

16.1
10.1
6.1

17.2
9.6
7.6

Rental income of persons

6.2

Net interest

6.3

6.4

4.9

3.5

2.9

2.7

8.7
4.4
1.1
3.3
7.2
-4.0
4.3

2.7
-1.3

-4.6
-7.1
.9
-8.0
6.0
-14.0
2.5

-5.0
.4
1.3
-.9
5.1
-6.0
-5.3

2.2
3.5
1.5
2.0
5.3
-3.3
-1.3

5.1
5.5
1.7
3.8
5.0
-1.2
-.4

7.7
8.8
2.2
6.7
7.0
-.3
-1.1

8.4
8.5
2.0
6.4
6.4
.1

7.3

6.3

11.6
11.0
1.6
9.4
6.6
2.8
.5

Corporate profits and inventory valuation adjustmentCorporate profits before tax
Corporate profits tax liability
Corporate profits after tax
Dividends
_.
Undistributed profits.Inventory valuation adjustment

7.9

12.8

12.6

9.9

8.3

7.3

6.4

-2.1
6.8
-9.0
4.0

1. Includes noncorporate inventory valuation adjustment.

Percentage Distribution of National Income by Sector of Origin, 1929-38
1929

National income

100.0

Government and government enterprises
Agriculture, forestry and fisheries
Rest of the world
Private nonagricultural industries

5.8
9.4

83.9

1930

1931

100.0
7.0
8.2
1.0
83.8

1932

1933

1934

1935

1936

1937

100.0

9.1
8.2
.9
81.8

12.1
7.8

13.3
9.2
.8

12.8
7.6

11.8
11.2

10.6

79.0

76.3

12.5
8.3
.6
78.7

9.8
.4
79.3

79.1

76.7

Percentage Distribution of Private Nonagricultural Income by Industrial Division, 1929-38
Private nonagricultural industries
Mining
Contract construction
Manufacturing
Wholesale and retail trade
Finance, Insurance and real estate
Transportation
Communications and public utilities
Services

100.0

2.8
6.2

2.6
5.0

2.0
4.5

2.0
3.1

2.1
2.5

3.0
2.8

2.8
3.0

3.0
3.9

3.3
3.6

29.7
18.1
17.2

28.7
19.3
16.7

25.4
19.9
17.7

21.4
18.9
20.1

24.6
17.8
18.7

28.2
20.8
14.6

30.5
21.1
13.6

31.7
20.7
12.9

33.1
20.9
12.4

28.4
22.6
14.5

100.0

3.8

9.0
3.9

8.8
4.4

8.9
5.4

95
.
6.8

9.9
6.6

8.8
6.7

8.5
6.2

8.4
4.9

7.9
4.7

7.7
5.1

14.0

14.5

16.1

18.2

18.1

16.1

15.3

14.6

14.1

15.0

Percentage Distributions of Gross National Product, 1929-38
1929

1930

1931

1932

1933

1934

1935

1936

1937

1938

By type of expenditure
Total

State and local

100.0

75.6
15.5
.7
8.1

77.9
11.3

80.4

84.3

16
.
.3

75.7
10.2

74.1
12.9

75.8

7.2
.3

-.1

7.8
13
.

10.1

12.1

13.8

14.3

12.9

15.0

13
.
6.9

15
.
8.5

2.0

2.5

10.1

11.3

79.9
4.4
.7
15.0
4.6
10.4

77.6

82.9
2.5
.3
14.4
3.6
10.7

4.0
9.7

5.8
8.5

5.0
7.9

6.2
8.8

100.0

Personal consumption expenditures
Gross private domestic investment
Net foreign investment
Government purchases of goods and services
Federal

100.0

79.6
11.0

81.6

83.7

83.2

80.0

78.2

77.1

96
.
-1.1

6.8
11
.
8.4
-.8
91
.

4.6
13
.

80.0
7.5
1.1
11.4
.2
11.2

80.4

.3
91
.
2.4

81.7
4.6
1.7
11.9
1.3

8.7
-.2

7.9
1.4

11.1

100.0

By type of receipt
Total
Disposable personal income
Gross business saving'
Statistical discrepancy
Net government receipts
Federal'
State and local 3

67
.

1. Consists of undistributed corporate profits and corporate inventory valuation adjustment, capital consumption allowances, and excess of wage accruals over disbursements.
2. Consists of personal tax and nontax receipts, corporate profits tax accruals, Indirect

9.8
1.9
7.9

10.9
10.9

10.7

8.7
-.1

10.5

8.6

9.2

10.7

—. 3
13.5

13.2

1.6
9.1

4.8
8.7

3.9
9.3

business tax and nontax accruals, contributions for social insurance, and current surplus of

f jvernment enterprises, less subsidies, transfer piyments, net interest paid, and grants to
tate and local governments

NATIONAL INCOME, 1 9 5 4 EDITION
Percentage Distributions of National Income by Distributive Shares,
1939

1940

1941

1942

1944

1943

1945

1946

1947

1948

1939-53

1949

1950

1951

1952

Line

1953

100.0

66.1
63.1
3.0

63.9
61.0
2.8

61.9
50.3
2.6

61.9
69.6
2.3

64.3
62.1
2.2

66.4
64.0
2.4

68.0
64.9
3.1

65.5
62.3
3.3

65.3
62.3
3.0

63.6
61.0
2.6

65.2
62.1
3.0

64.3
61.1
3.3

65.1
61.7
3.4

67.2
63.6
3.6

68.5
64.9
3.6

2
3
4

16.0
10.0
5.9

15.9
10.3
5.6

16.6
10.4
6.2

17.4
10.1

16.6
9.9
6.7

16.2
9.9
6.3

17.0
10.5
6.5

19.6
11.9
7.8

17.5
10.1
7.3

17.3
9.8

15.1
9.5
5.5

14.7
8.9
5.8

13.7
8.8
4.9

8.6

5
6

7.6

15.8
9.9
5.9

12.6

7.3

4.0

™

3.8

3.5

3.3

3.0

3.1

3.5

3.3

3.2

3.6

3.5

3.3

3.4

3.5

7.8
8.8
2.0
(S.8
5.2
1.6
-1.0

11.2
11.4
3.5
7.9
6.0
3.0
-.2

13.9
16.2
7.3
9.0
4.3
4.7
-2.4

14.3
15.2
8.3
6.9
3.1
3.8
-.9

14.0
14.4
8.3
6.2
2.6
3.5
-.5

12.6
12.8
7.1
5.7
2.6
3.1
-.2

10.2
10.5
5.9
4.6
2.6
2.0
-.3

9.6
12.6
5.1
7.5
3.2
4.3
-2.9

12.0
16.0
6.7
9.3
3.3
6.9
-3.0

13.8
14.8
5.6
9.1
3.3
6.9
-1.0

13.0
12.1
4.8
7.3
3.4
3.9
.9

14.6
16.7
7.4
9.2
3.8
6.4
-2.0

14.4
14.9
8.1
0.7
3.3
3.5
-.5

13.1
12.8
6.9
5.9
3.1
2.8

12.6
12.9
6.9
6.0
3.1
2.9
-.3

9
10
11
12
13
14
15

6.3

5.5

4.3

3.1

2.1

1.8

1.7

1.9

2.0

2.4

2.5

2.4

2.6

2.8

Percentage Distribution of National Income by Sector of Origin,
1939

1940

1941

1942

1943

1944

1945

1946

1947

1948

1939-53

1949

1950

1952

1051

Line

1953

100.0

11.7
8.2
.4
79.7

10.7
7.7
.4
81.2

10.0
8.1
.3
81.5

11.9
9.0
.3
78.9

15.9
8.3
.2
75.6

18.5
7.9
.2
73.4

20.3
8.2
.2
71.3

12.6
9.7
.3
77.4

9.4
9.3
.4
80.9

8.9
9.4
.5
81.3

10.1
7.7
.5
81.7

9.8
7.2
.5
82.5

10.9
7.3
.6
81.2

11.8
6.4
.5
81.3

11.4
5.5
.5
82.6

2
S

Percentage Distribution of Private ^onagricultural Income by Industrial Division,

J
0

1939-53

100.0

lflO.O

100.0

2.7
4.0
30.9
21.6
13.7
8.1
4.9
14.3

2.8
3.9
33.7
21.6
12.4
7.6
4.6
13.4

2.7
4.9
38.7
20.2
10.7
7.4
3.9
11. i

2.4
6.0

2.1
4.2

2.2
3.1

2.1
3.3

2.1
4.7

2.6
5.3

2.9
5.7

2.5
5.9

2.5
5.8

2.5
6.0

2.2
6.1

2.2
6.0

41.8
18.7

45.2
18.5

44.9
19.2

40.2
21.7

34.9
24.7
10.4

36.8
23.4

37.0
23.1

7.4
3.4

9.6
7.2
3.2

35.5
22.9
10.7

37.5
21.9
10.4

39.0
21.3
10.0

38.0
21.5
10.3

38.6
20.8
10.5

10.2

11.3

12.4

11.9

11.4

12.0

11.5

11.0

11.3

11.5

Percentage Distributions of Gross National Product,

1939-53

1939

1940

1941

9.8
7.9
3.4

9.0
8.4
3.1
9.5

10.1

1942

1943

9.1
8.4
3.0

1944

9.9
8.2
3.3

1945

1946

1947

9.6
7.0
3.3

1948

6.8
3.7

1949

6.7
3.6

1950

6.6
3.7

1951

6.6
3.9

1952

6.4
4.0

8
9
10
11
12
13
14

Line

1953

100.0

71.4
13.1
1.5
14.0
6.1
7.9

65.1
14.4
g
19.7
13.4
6.2

56.4
6.2
—.1
37.5
32.7
4.8

52.2
2.9
—1.2
46.0
42.2
3.8

52.0
3.4
-1 0
45.7
42.1
3.6

57.0
4.9
.... «
38'8
35.0
3.8

70.1
13.0
2 2
14.8
10.0
4.8

71.0
12.8
3.8
12.3
6.8
6.6

69.0
16.0
8
14.2
8.2
6.0

70.2
12.6
.2
17.0
9.9
7.1

68.1
18.0
— 8
14.7
7.8
7.0

63.5
17.3
1
19.1
12.5
6.6

63.1
14.6

22.3
15.6
6.7

63.1
14.1
—.5
23.4
16.5
6.9

5
6
7

100.0

77.3
9.1
1.3
12.3
3.2
9.1

76.6
10.3
.8
13.3
4.7
8.6

73.9
9.1
.3
16.7

73.8
8.9
-.8
17.8
11.8
6.0

69.4
8.6
-.9
23.1
17.9
5.1

69.4
8.1
1.3
21.1
16.3
4.8

70.4
7.3
2 1
20!2
15.2
5.0

76.1
6.7
.4
16.8
11.0
6.7

72.8
8.6
.6
18.0
12.1
6.0

72.9
10.6
-.8
17.3
11.3
6.0

73.1
11.1
.0
15.7
9.0
6.8

72.3
10.0
.1
17.6
11.0
0.6

68.9
9.7
.4
21.0
14.6
6.J

68.4
9.9
.2
21.5
14.8

68.6
9.6

6.7

6.9

9
10
11
12
13
14

100.0
74.2
10.2
1 0
14.6
5.7
9.0

9.4
7.3

3. Consists of personal tax and nontax receipts, corporate profits tax accruals, indirect
business tax and nontax accruals, contributions (or social insurance, current surplus of

21.5
14.6

government enterprises, and Federal grants-ln-aid, less transfer payments and net interest
paid.

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS
Selected Per Capita Income and Product Series in Current and Constant (1947) Dollars, 1929-38

Line

1929

1930

1931

1932

1933

1934

1935

1937

1938

Current dollars
Gross national product
National income
Personal income.
Disposable personal income
Personal consumption expenditures-

445
320
37fi
364

514
367
424
411
410

569
448
473
458
442

646
506
534
517
488

704
571
573
551
522

656
520
527
505
497

703
711

679
689

8S7
725
723

1,003
792
764

1,112
888

1,190
913

1,123
858
845

124,949

125,690

126,4S5

127,362

128,181

128,961

129,969

857
720
704
682
648

740
615
624
604
576

614
481
529
514
494

468
341
401
389
395

1,225
927

1,098
859
819

1,020
822
789

121,881

123,188

124,149

Constant (1947) dollars
Gross national product
Disposable personal income'
Personal consumption expendituresAddendum: Population (thousands) >

1. This series was obtained by dividing current-dollar disposable personal income by the implicit deflator for personal consumption expenditures shown in table 41, Part V.

boom. As the more urgent backlog demands were satisfied, and
as the abnormally high spending rate of 1947 made inroads into
the net liquid asset positions of many consumers, the rising trend
of consumption flattened out in the latter part of 1948.
Closely allied with this tapering-off was the appearance of
substantial inventory accumulations, prevented in 1947 largely
by the intensity of consumer demand. These related developments, more than any others, slowed the price rise and brought
the inflationary spiral to an end during 1948. Late that year,
there came a general downturn in prices, and the postwar
economy entered a new phase.

Business readjustment and recovery: 1949—50
Businessmen adopted more cautious buying policies toward the
end of 1948, and the large inventory accumulations of that year
were sharply reduced in the first quarter of 1949. Substantial
inventory liquidation emerged in the next quarter, and the drain
upon stocks persisted during the remainder of the year. The
shift in the inventory position was reflected in a curtailment of
production mainly in the manufacturing industries, where the
bulk of all inventories held in the economy is produced.
By contrast, total final purchases—that is, elements of the
gross national product other than the change in inventoriesheld up extremely well during 1949. Consumer spending in the
first quarter dropped but slightly below its dollar volume at the
crest of the postwar boom, then climbed slowly upward again
during the remainder of the year. Residential building activity
decreased from a peak in the second quarter of 1948 but picked
up again in the spring and advanced strongly thereafter. And
government purchases, chiefly because of the expanding Federal
foreign aid and farm price support programs, more than offset
the moderate declines which occurred in business outlays for
plant and equipment. For the year as a whole, total final purchases actually exceeded those of 1948.
That the curtailment of employment and payrolls in the manufacturing sector had no greater impact upon consumption expenditures in 1949 was attributable in part to the payment of
sizable unemployment compensation benefits, and also in some
degree to the cushioning effects upon disposable personal income
of lower Federal income taxes as a result of the previous year's
Revenue Act. It may also be noted that dividends were sustained,
notwithstanding the sharp fall in profits. Perhaps more important

2. Continental United States including Armed Forces abroad, as of July 1.

than any of these factors, however, was the apparent willingness
of the consuming public as a whole to spend increasing proportions of current income to maintain living standards during the
recession.
It became apparent in the second half of 1949 that the curtailment of output had been excessive in relation to the existing
stable volume of business sales. Accordingly, production was
stepped back up, and the accumulation of inventories was resumed. Meanwhile, the recovery of residential construction had
grown into a sustained building boom, and consumer demand,
already strong, was being bolstered by large Government payments to veterans. These factors, moreover, were being reinforced by a renewed upturn in fixed business investment.
This widening resurgence of production generated increases in
employment and incomes, adding further impetus to consumer
purchasing. Before mid-1950, a business upswing of substantial
dimensions was under way and was carrying the economy close
to full-capacity operation.

Korean war period
It was upon this expansionary situation that the urgent demands resulting directly and indirectly from the outbreak of
hostilities in Korea were superimposed, as the Nation decided
upon a defense program encompassing a sharp step-up in direct
military potential as well as the establishment of a broad base of
productive facilities to permit quick economic mobilization in
case of full-scale war.
The ensuing rise in national output continued without interruption for three years, until the second quarter of 1953, when
gross national product reached a peak of $370 billion at seasonally
adjusted annual rates, one third above the rate of $276 billion in
the second quarter of 1950. About half of this rise represented
expansion in physical volume while the remainder reflected the
sharp advance in prices which occurred in large part during the
first nine months of the period.
In terms of current dollars, Federal Government purchases,
mainly for national security purposes, accounted for more than
two-fifths of the increase in national output. These purchases
tripled over the three-year period, and their share of total output rose from 8 to 17 percent. All other types of national expenditure combined rose by about one-fifth, with consumption, invest-

NATIONAL INCOME, 195 4 EDITION
Selected Per Capita Income and Product Series in Current and Constant (1947) Dollars,
1939

1940

1941

1942

1943

1944

1945

1946

1948

1947

1949

1939-53

1950

1951

1952

1953

Line

696
686
666
538
516

762
618
596
576
544

943
785
722
697
614

1,180
1,021
916
871
C65

1,408
1,246
1,107
977
735

1,527
1,320
1,197
1,060
794

1,526
1,295
1,224
1,075
870

1,480
1,270
1,259
1,126
1,037

1,611
1,368
1,322
1,173
1,145

1,755
1,512
1,424
1,279
1,211

1,725
1,449
1,386
1,261
1,211

1,879
1,582
1,497
1,359
1,279

2,126
1,795
1,654
1,465
1,350

2,204
1,853
1,727
1,509
1,391

2,286
1,911
1,792
1,567
1,441

1
2
3
4

1,202
926
888

1,299
981
927

1,486
1,113
981

1,658
1,245
960

1,820
1,277
961

1,938
1,312
982

1,880
1,282
1,038

1,654
1,247
1,149

1,611
1,173
1,145

1,663
1,211
1,146

1,619
1,203
1,165

1,745
1,280
1,205

1,833
1,290
1,189

1,874
1,306
1,205

1,921
1,339
1,282

6
7
8

131,028

132,122

133, 402

134,860

136, 739

138,397

139,928

141,389

144,126

146,631

149,188

151,683

154,360

157,022

159,629

ment, and State and local government outlays each registering
substantial gains.
In real terms the shifts in the use of output were more pronounced, with the Federal Government absorbing about twothirds of the increase in constant-dollar gross national product.
But on this basis also a margin was left which permitted an expansion in other purchases in spite of the increased demands of
national security. Total real consumption was about 9 percent
higher in mid-1953 than three years earlier, reflecting mainly a
larger volume of nondurable goods and services. On a per capita
basis the increase amounted to more than 3 percent. Real purchases of State and local governments showed a similar movement.
The rate of aggregate investment decreased somewhat in real
terms, although fixed investment was higher, due to a larger
volume of producers' durable equipment.

Inflationary upsurge
While the defense buildup was the dominant factor in the
economic situation throughout the three years following mid-1950,
its character and impact varied considerably during this period.
In the initial stage the increase in national security expenditures
was heavily concentrated in military payrolls, food, clothing, and
other related outlays which were capable of rapid expansion in a
comparatively short time. The strength of the Armed Forces increased by \% million persons in the first year of the defense
effort-—about four-fifths of the ultimate total increase—and
national security outlays mounted from 6 percent to 11 percent
of the gross national product.
At the same time there was a strong advance in investment by
businesses that were participating in the growing volume of
defense orders. This included investment in inventories and in
plant and equipment, the latter receiving a special stimulus from
the rapid amortization provisions that had been granted for
emergency facilities.
Although the demands stemming directly from the defense program contributed to expansionary developments, it was the waves
of anticipatory buying, set in motion by the expectation of commodity shortages and price increases, that determined the tone of
the business situation in this period. Consumer buying spurted in
the third quarter of 1950 and again in the first quarter of 1951,
following the further extension of the Korean conflict. Responding

to sharply rising sales, as well as to the same expectations that
motivated consumers, businessmen added greatly to their inventories, and fixed investment not related to the defense program
was also stimulated.
Although production continued to rise briskly, demand outstripped the supply of goods, and prices bounded upward.

Shift to defense production
By mid-1951 the situation had changed significantly. Output
was expanding at a rapid rate, and it became apparent that the
productive capacity of the economy had been underestimated.
Taxes had been raised, and the establishment of price and wage
controls gave some assurance to the public that inflation would be
kept in check. Other measures, including controls on credit and
on the flow of strategic materials, had been introduced to ensure
that the necessary resources would be channeled in an orderly
fashion into the defense program.
As a consequence of these developments, and the well-stocked
position of consumers after several months of extraordinarily
heavy buying, spending propensities eased markedly during 1951.
The rate of consumer spending out of disposable income, which
had risen to 96 percent during the buying surge in the first
quarter fell to about 91 percent in the succeeding quarters of the
year. Since the trend of income was strongly upward, the absolute dollar value of consumption in the final quarter of the year
exceeded the first-quarter rate in spite of this decline in the spending rate.
The easing in the urgency of consumer demand was paralleled
by a curtailment of business buying, which had been geared to
the same sort of anticipations and to the resultant abnormal
volume of sales. The shift entailed a very substantial inventory
readjustment—with a notable scaling down in the accumulation
of civilian goods.
In the setting of rapidly increasing physical production, of
Government measures designed to minimize the disruptive effects
of economic mobilization upon the economy, and of less urgent
private demand, it was possible to achieve a substantial expansion
in national defense expenditures and allied fixed capital outlays
concurrently with a high rate of civilian consumption and a
diminution of inflationary pressures.
The absolute increase in national security expenditures in the

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS

second year of the defense buildup was nearly as large as in the
previous year although the percentage increase was smaller. It
was concentrated in hard goods, such as planes, tanks, and
electronic equipment. Deliveries of these items were reaching a
high volume, after design difficulties had been overcome and the
long lead-time involved in their production had elapsed. Defensecennected fixed investment also expanded rapidly in this period.
In contrast, the advance in total fixed investment was limited by
offsetting declines in investment not related to the defense effort.

General expansion
In the third year of the defense effort—from mid-1952 to mid1953—the Nation's capacity to produce continued to expand
substantially while the rate of growth of national security outlays
tapered off. This shift in the relation of supply and demand permitted the relaxation and subsequent removal of economic
controls.
Civilian demand proved strong, particularly in the durable
goods lines previously restricted by controls and material shortages.
Residential, institutional, and State and local construction,
business investment in plant and equipment other than in defenseconnected industries, and consumer and inventory demand for
automobiles and other durable goods became major factors supporting further economic growth. Together with the still rising
military demand they provided the basis for a balanced economic
expansion which, unlike that of the previous year, was shared by
most industries.
Agriculture was the principal sector of the economy that ran
counter to the generally favorable trend. As a consequence of
lower farm prices, income originating in agriculture was reduced
substantially during 1952 and 1953. The steady downward
pressure on prices reflected the unusually heavy output of farm
products—which reached successive highs in the 2 years—and
the appreciable decline in foreign sales. Domestic consumption
remained firm, however, and the full force of the other develop-

ments was not reflected in farm income, as large quantities of
the chief crops and dairy products were placed under loan to the
Commodity Credit Corporation, both in 1952 and 1953.
The restoration of civilian durable goods production was retarded by the steel strike which occurred in the second quarter of
1952 and affected end products mainly in the third. As a consequence final purchases and inventory accumulation of durables
were particularly heavy in the fourth quarter of 1952 and were
probably raised also in the opening half of 1953.

National output reduced
Total production reached a peak in the second quarter of 1953
and receded moderately in the latter half of the year. The major
change occurred in the net flow of goods into the inventories of
durable goods industries. These inventories had been replenished
and the immediate need for further accumulation had thus been
removed. In addition, sizable liquidations were made when it
became apparent that, relative to actual and prospective demand,
some of the earlier build-up had been excessive.
National security expenditures, entering a new phase, registered
moderate declines, mainly in the procurement of hard goods,
and consumer purchases of commodities, particularly durables,
also drifted downward. The effect of these reductions on total
final purchases was offset, however, by advances in other components of national expenditures, notably consumer expenditures
for services, State and local government purchases, and the agricultural price support outlays of the Federal Government. Hence
final purchases were maintained in the aggregate in the latter
half of 1953.
While the percentage decline in total national output was small,
it was heavily concentrated in durable goods and thus had a
disproportionate impact upon the durable goods manufacturing
industries where it led to substantial reductions in production,
employment, wages, and profits. The year 1954 opened with these
developments still in progress.

PART

The Conceptual Framework
of National Income Statistics
In the past two decades national income statistics have undergone a basic transformation. This is manifest in the considerably
broadened scope of the field.
The traditional purpose of national income research is to provide information on the outcome of economic activity through
comprehensive measures of the size, composition, and use of
national output. In the more recent period, the measurement of
national output has continued to be the basic aim. But, with the
growing realization that they can furnish a statistical picture of
the economic structure and process, national income statistics
have been used also to an increasing extent to facilitate an understanding of the factors which determine the outcome of economic
activity. Much more fully and systematically than in the past,
national income statistics have been designed with the dual objective of measuring the national output and placing it against
the background of the transactions which underlie its production
and distribution.
The national income statistics for the United States contained
in this report are constructed according to this broader plan.
They are therefore a comprehensive single source of integrated
information on the Nation's economic life.

NATURE AND SIGNIFICANCE OF THE
INCOME DATA
Because they reduce the voluminous detail of economic activity
to intelligible proportions, national income statistics have become
widely used as the factual background for economic analysis and
the preparation of economic programs. They provide the basic
statistical framework required for the study of long-term economic trends and of business fluctuations, and for the formulation
of business and government economic policies. Needless to say,
the statistics do not throw light on all aspects of the economy,
and often must be supplemented by other bodies of economic
information.
291692°—54

Two broad, practical uses of national income data may be
cited. These data are needed, in the first place, when the automatic working of the market mechanism cannot be fully relied
tipon. The mitigation of business cycles and economic mobilization for national defense are important instances in which an
understanding of the economic mechanism, such as is facilitated
by the use of national income statistics, is a prerequisite to intelligent action.
Secondly, even when active influencing of the broad course of
economic events is not the aim, it is desirable to have some knowledge of these events so that the best possible adjustments to them
can be made. For example, the businessman wants to gauge the
probable market for his output so as to obtain a more rational
basis for determining his policies; and the tax administrator must
estimate what governmental revenues are likely to be so that intelligent decisions can be made about matters relating to the expenditure and revenue policies of the various levels of government.
Whether for the purpose of exerting active influence on economic events or for passive adaptation to them, national income
data are the most important single statistical tool for orientation
in the economic world. They do not, of course, furnish direct
answers to the economic problems involving their use, but they
do provide the relevant, and often indispensable, statistical background for arriving at intelligent solutions. This statistical background consists of a quantitative description of the structure of the
economy over a period of years. The framework of this description is a national economic accounting system which summarizes
the transactions linking the economic units whose interplay determines the functioning of the economy.

Economic accounting system
The production and distribution of the Nation's output necessitate countless transactions of buying and selling, hiring labor,
investing capita], renting property, paying taxes, and other operations inherent in the functioning of the economic system. The
27

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS

records of these transactions kept by the business, consumer, and
governmental- units participating in them obviously are highly
relevant for obtaining a statistical view of the economy because
they reflect the most concrete manifestations of the Nation's economic life. However, these innumerable records must be summarized into a limited number of significant categories if a comprehensible and useful description of the economic process is to
emerge. This is the basic task of the national economic accounting
system.
The plan of the accounting system underlying the United States
estimates is based upon a division of the economy into four major
sectors—business, consumers, government, and foreign. The economic behavior and motivation of these four sectors is quite different; to distinguish among them appears necessary for an understanding of the economy in terms of the interactions of its constituent parts.
In the construction of the economic accounting system, a national income and product account is first established. This account provides measures of total national output, which is the
sum of the outputs produced by the four sectors of the economy.
Next, accounts are set up for the sectors. In addition to showing
the portions of national output originating in each of them, they
are designed to depict the economic structure in terms of the interrelated transactions of the four major economic groups.
Specifically, four current accounts are shown, one each for
business, consumers, government, and the rest of the world. These
trace the transactions determining the current income of each of
the sectors, and what part of that income is used up and what
part is devoted to saving. The sector account for business is in
essence a consolidated profit and loss account for the business
system as a whole. For the other sectors, the accounts represent
current receipt and expenditure accounts, in conformance with
the nonprofit-making character of thdr transactions.
Most of the current transactions that appear in the account of
one sector are matched by corresponding entries in another.
However, this is not so with respect to the items of saving or investment. With these, the corresponding entry is found in the
capital or gross saving and investment account, which shows on a
consolidated basis the saving and investment for the economy as
a whole. This is the sixth account in the national economic accounting system.

Main advantage of accounting approach
The principal advantage of formulating and presenting national income statistics as a system of accounts has been intimated
in the preceding discussion. Such a system yields a set of interrelated tables which are a tremendous aid in revealing the structure of the economy and thereby contribute toward a better understanding of its functioning. Two aspects of the analytical value
of the accounting system may be considered.
It throws into clear relief the nature of accounting relations that
must always hold true among the component transactions summarized. The sense in which saving and investment are necessarily
equal is a prime example of such a relationship. The establishment
of an economic accounting system displaying this and other accounting relationships has been an aid to simplicity and clarity in
economic discussions.
Also, light has been thrown on the relative magnitudes of the

component flows of the economic process, and the study of the
functional relationships among them has been facilitated. In contrast to the accounting relationships, which are a matter of definition and must always hold, these functional relationships are
regularities that hold by and large as a matter of economic experience, but which can and do change in response to technological, institutional, and psychological changes. Measurement and
study of these relationships—such as those between consumption
and disposable income and between wages and profits—are
essential for an understanding of the working of the economy.
However, because they cannot be counted upon to hold without
fail, these relationships must be the object of continuing investigation.

Technical uses of economic accounting system
The establishment of a system of national economic accounts
has benefited also the producers of national income data. It has
aided their work in both its theoretical and statistical phases.
With respect to the former, it must first be recognized that national economic accounting has been of some aid in improving the
definition of national output. It is true that no genuinely new
criteria for solving definitional problems have been provided, and
also that many definitions of national output are compatible with
the principles on which the system is based. Yet, it has helped the
discussion in several ways.
A great deal of the discussion of definitions was obscured by the
failure to distinguish clearly between the income and product
measurements of output and by the lack of a clear grasp of the
relation between them. The development of national income statistics in an economic accounting framework has made for clarity.
Some of the larger issues involved in the definition of output were
brought into better focus, and a powerful tool was provided for
the consistent treatment of financial intermediaries, nonprofit
institutions, imputed income and product, and similar problem
areas in the formulation of national income concepts.
Economic accounting has contributed to problems of definition
also by depriving them of some of their importance. In substantial
part, these problems revolve around the question of whether or
not certain items—such as government interest, business taxes,
transfer payments, and subsidies—should be included in the aggregate measures of national output. Prior to the establishment
of the system of accounts, the decision to omit such moot items
from total output meant that their record, insofar as national income statistics were concerned, was lost. Since the items are germane to economic investigations in which national income data
are used, there often was reluctance to exclude them, even though
this may have been indicated from the standpoint of measuring
output. With the presentation of national income statistics in the
form of a complete statistical picture, the record of transactions
excluded from the principal aggregates is no longer lost. The problem of defining output can be faced squarely on its own merit.
Moreover, to the extent that fully satisfactory solutions to
definitional problems cannot be found, the economic accounting
system has made it easier to live with them. Many of the controversial items (irrespective of whether defined as part of the output
aggregates) are shown separately in the account tables, and alternative measures of output can be constructed depending on
particular needs and preferences.

NATIONAL INCOME, 1 9 5 4 EDITION

In two general ways, the accounting approach is an aid to the
statistical aspect of national income work. To begin with, it is of
considerable help in defining the task of statistical data collection.
Once the particular accounting framework providing the most
useful summary of the economic structure has been decided upon,
a comprehensive list of requirements for economic statistics
emerges rather automatically. A list obtained in this way provides
a useful guide for planning the collection of primary statistical
data so as to yield the information most relevant to economic
analysis.
The use of the accounting approach also facilitates the estimation of the various national income aggregates and their components from the available statistical material. It does this by making
clear that many items of information can be obtained from the
records of either the buyer or the seller, and hence affords flexibility in adapting estimating methods to available information.
In addition, this approach enables one to check every account
for internal consistency by comparing the debit and credit totals
as well as the relations among the various debit and credit entries.
It also enables one to derive as residuals components of the national economic accounts which cannot be estimated directly
from available data.

Improvements of the accounting system
In the derivation of the definitions and classifications used in
the national economic accounting system, an attempt is made to
set forth the distinctions that are most meaningful from the standpoint of economic analysis, taking account of the limitations imposed by the nature of the accounting data available for the four
major economic groups. Fortunately, there is a great deal of
parallelism between the requirements of economic analysis and
those of the accounting systems used by business and other economic units. Over wide areas no conflict arises from the fact that
economic questions have to be answered by reference to measures
constructed from such accounting data. On the contrary, a major
advantage of the system of national economic accounts is that it
summarizes the actual transactions of economic units as reflected
in their own accounting records.
However, some of the most difficult problems of national income estimation arise when the definitions underlying these
records do not yield the type of information demanded by economic analysis. National income work is continually concerned
with the modification of the basic accounting data in order to
improve their economic significance. Often these data can be
adjusted to meet the requirements of economic analysis, but when
the transition cannot be accomplished supplementary information must be introduced to complete the picture.
Comprehensive national economic accounting is a recent development the potentialities of which have not yet been fully
realized. The set of accounts presented in this report should not
be regarded as the definitive system. Apart from possible improvements in the formal design of the accounts, several elaborations
of the present system would be desirable.
For instance, only four major economic groups are distinguished, whereas, in view of their heterogeneity, further breakdowns would be useful for many types of analysis. Also, saving
and investment accounts for each of the four major sectors would
constitute an important supplement to the consolidated account

for the economy as a whole. The construction of balance sheet
accounts, showing the structure of the assets and liabilities of the
various sectors, likewise would expand the scope and usefulness
of the national economic accounting system.
It is to be emphasized, however, that further expansion of the
national accounts must be made with due regard to the flow of
statistical information (which would constitute a generally limiting factor) and to the danger of an overelaboration that might
add unduly to their complexity and not proportionately to their
value.
Coordinate in importance to further work on the conceptual
framework, articulation, and coverage of the economic accounting system is the improvement of its statistical reliability. For the
entries in the national economic accounts represent estimates
which are subject to error. The problem of statistical reliability
is discussed in Part III of this report.

The detailed statistics
In the preceding discussion the main emphasis was on the summary aspects of the economic accounting system underlying
United States national income statistics. However, sight should
not be lost of the wealth of statistical information that now exists
to elaborate and supplement various aspects of this accounting
system. For in many uses of the data it is specifically this information which is of primary interest and value.
Attention may be drawn first to the many statistical tables in
Part V of this report, of which the six national account tables
briefly described above are but highly condensed summaries.
These detailed tables present further information on the breakdowns of the income flow by type of income and legal form of
organization and of the product flow by type of product. Also
given are breakdowns of national income and its constituent
distributive shares by industry of origin.
Secondly, the conversion of gross national product and its components into constant dollars, which is presented in Part IV,
represents an important addition to the current dollar series in
terms of which the complete accounting system is stated.
Thirdly, the annual estimates of personal income by States, not
included in this report, may be regarded as the elaboration in a
regional dimension of the depiction of the economic structure.
Of a similar nature, as also involving further articulation of the
consumer sector, are the estimates of the size distribution of income prepared in the National Income Division.

Plan of the following discussion
In the following pages of this Part of the report, the conceptual
framework of the United States national income statistics is explained in greater detail. Since the measurement of output totals
is the prime objective of national income statistics and, moreover, is largely independent of the full-fledged economic accounting system depicting the economic structure, the derivation of
these totals is first explained, in a summary manner. Next, the
structure of the complete accounting system is developed. In the
course of this discussion, the more detailed aspects of the definitions of the output totals are also covered. A final section provides, for convenient summarization, a series of definitions to
which the national income and product aggregates and their
components conform.

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS

SUMMARY CONSTRUCTION OF NATIONAL
OUTPUT MEASURES
In this section the basic notions underlying national income
and product are stated; the derivation of these measures in terms
of their conceptual content is explained; and the adequacy of
definition of the resulting aggregates is examined.

Basic Notions Underlying National Output
Measurement
Economic production
In the definition of a measure of national output, the first task
is to delimit economic production from the pursuit of other activities that resemble it in that they involve the use of human effort
and other resources and are useful. For instance, the production
of radio sets has its counterpart in the hobbies of the radio amateur, commercial shaves are akin to self-administered ones, and
the educational services of teachers often are supplemented by
those of parents. In spite of resemblances, a distinction must be
drawn between economic production and noneconomic pursuits.
For a measure of national output must, broadly speaking, be confined to the former; it cannot, in any systematic way, take account
of activities outside the economic sphere.
In the present report, the basic criterion used for distinguishing
an activity as economic production is whether it is reflected in the
sales and purchase transactions of the market economy. The exclusion of illegal transactions is a tradition-based convention
which is an exception to this general rule.

Product and income flows
A fundamental distinction relevant to the measurement of economic production so delimited is suggested by observation of the
operations of a typical business firm. On the one hand, such a
firm produces and sells a flow of product values. On the other
hand, it pays out (or retains) incomes that accrue in the course
of its operations. This double aspect of the activities of the single
business firm suggests that the measurement of national output
can be approached in a two-fold manner, either by summing
product values or by summing income flows. It will be seen that
the measure of national output in terms of product flows which is
obtained by pursuing this approach is the gross national product
and that the corresponding measure in terms of income flows is
the national income.

Final and intermediate products
In the measurement of national output via product flows, a
further distinction, between "final" and "intermediate" products,
must be made. A nonduplicative total is desired, one that is confined to the value of the final, or end, products of the economy and
excludes all others, labelled intermediate. To use a simple example, if the production process during a year involves the production of wheat, its milling into flour, and the baking of bread

which is sold to consumers, then the value of national output
should equal the full value of the bread and should not count
also the separate values of the wheat and flour which have been
used up in the course of producing it. This result is obtained by
counting only the value of the bread, as the end product, and
ignoring the other product values.
A distinction between final and intermediate products cannot
be drawn on the basis of the technical characteristics of the output involved. In the above example, for instance, flour is an intermediate product. If, however, the flour is sold not to bakeries,
but directly to housewives for home baking, it becomes the final
product of the economy, even though in a technical sense it is not
fully fabricated.
However, an effective criterion for distinguishing between final
and intermediate products can be established by reference to
business practices followed in the production of goods and services. There emerges a working definition of final product as a
purchase that is not resold, and of intermediate product as one
that is resold. A more technical, but sometimes more convenient,
phrasing of the same idea is that a final product is a purchase
that is not charged to current cost whereas an intermediate
product is one that is so charged. The phrase "during the accounting period" is sometimes appended to these formulations so as to
make them more exact.1

Imputations
In the measures of national output shown in this report, the
foregoing criteria are the basic tools for distinguishing economic
production from noneconomic pursuits and the part of economic
production which is final from that which is intermediate. However, modifications in the definitions are made in certain instances
to enhance the significance of the measurements.
The most important of these modifications concern the inclusion
in national output of the so-called "imputations," or items of production and income "in kind." For instance, food furnished to
employees would not become part of the national output if the
initial definition were rigidly followed. It would be an intermediate product, since it is an element of the current cost charges
of the employer furnishing the food. However, it seems desirable
to count it as part of national production, if only to secure uniformity of treatment with respect to employees who buy food out
of the correspondingly higher money wages given them. Other
imputations that are made in measuring national output are for
the value of food produced and consumed on farms, the rental
value of owner-occupied houses, and for nonmonetary income
and product flows arising in connection with financial intermediaries.

Charges against final product
In this report, the product measure of national output is derived by adding the values of final products and omitting intermediate products, as in the bread and flour example. It is termed
1. In order to simplify the discussion, changes in business inventories are not taken into
explicit account in this section. But it should be noted that, according to the above definitions, an increase in inventories is a positive component offinalproduct and a decrease in
inventories a negative component. (A detailed explanation of the treatment of inventories
in the national accounts is given later in this Part.)

NATIONAL INCOME, 195 4 EDITION

the gross national product. However, the same total could be obtained also by adding in the first instance the total product (final
and intermediate) of each producing unit and then deducting
for each the intermediate product it bought from other units.
For the economy as a whole, purchases and sales of intermediate
products would cancel, and what would remain would be the
value of final products.
The total value of final products can thus be broken down into
elements consisting of the total product of each producing unit
less its purchases of intermediate products. However, for each
producing unit the difference between the value of its product
and its intermediate purchases consists of the incomes that accrue
in the course of production (wages and salaries, interest, profits,
etc.) plus certain "nonincome" charges against the value of its
production, the most important of which are taxes (such as property, excise, and sales taxes) and depreciation charges for the
wear and tear and obsolescence of fixed capital.
Thus, since (1) the value of the final product of the economy
equals the sum of the total product of each producing
entity less its purchases of intermediate products, and (2)
for each producing entity, product less intermediate purchases
equals income plus nonincome charges against the value of production, it follows that (3) for the economy as a whole the total
value of final product equals the sum of incomes accruing in production plus nonincome charges against the value of production.

mation, and hence of net national product, cannot be calculated
since depreciation charges are not available on a basis of valuation comparable to that of the gross production of fixed capital.

Personal and disposable income
Another aggregate, personal income, measures the actual current
income receipts of persons from all sources. It differs from the
national income in that it excludes certain types of income which
accrue in production but are not received by persons (for instance,
the undistributed part of corporate profits) and, on the other
hand, includes certain types of income which do not arise in current productive activity but constitute personal receipts (such as
relief and unemployment benefits). Hence personal income, unlike the national product and national income aggregates, is not
a measure of national production. Since the bulk of personal
income is derived from production, however, it can in ordinary
circumstances be used as an indicator of productive activity and
has, in fact, gained prominence in this use as the only comprehensive income or product total available on a monthly basis.
Personal income net of taxes—disposable personal income—is
another useful aggregate, being the closest overall statistical approximation to consumer purchasing power derived from current
incomes.

National Income and Product Account
Factor incomes and other charges
A measure of national output in terms of total charges against
the value of gross national product, and therefore numerically
equivalent to it, can thus be obtained. However, this is not the
income flow measure generally used. The common measure,
national income, is derived by emphasizing the distinction, which
has already been emerging, between two types of charges against
the value of final product: factor costs and other costs.
Briefly, the sum of employee compensation, interest, and business incomes is considered to represent the remuneration of factors of production. In national income terminology, their aggregate measures the total factor cost incurred in producing the output of the Nation. By contrast, no factor incomes correspond to
the other charges against gross national product. Indirect business
taxes do not form the cost or income of any factor of production.
Depreciation and kindred charges reflect allowances for the consumption of fixed capital, and not its net income or return. Thus,
a further total is distinguished—the national income—which
represents the sum of factor incomes or factor costs. This is the
income measure of national output most widely used.
Two other magnitudes can be derived by recombining the
components so far discussed. Net national product may be obtained
as gross national product less depreciation and kindred allowances for the consumption of fixed capital. A corresponding
measure of total charges against net national product may also
be obtained by deducting these allowances from total charges
against gross national product. These two aggregates are in a
theoretical sense more clearly defined than the corresponding
measures of gross national output, since some duplication is involved by the inclusion in the latter of the production of fixed
capital which serves merely for replacement purposes. However,
as a practical matter, a fully satisfactory measure of net capital for

The foregoing basic notions underlying national output measurement are incorporated in the National Income and Product
Account shown in table I, which presents for 1950 the several
alternative measures of United States output.
The right side of this account shows the gross national product
as the sum of final product flows. The summary listing includes
personal consumption expenditures, gross private domestic investment (consisting of new construction, purchases of producers'
durable equipment, and the change in business inventories), net
foreign investment (reflecting, in general, net purchases by foreign nations), and government purchases of goods and services.
These components represent purchases of the four major sectors
into which the economy has been divided and conform to the
operational definition of final products as purchases not resold
during the accounting period. However, certain modifications
in this definition, especially with respect to imputed income and
product, have been made in deriving the national income and
national product measures.
On the left side of the account are listed the charges against the
value of gross national product. In principle, the sum of these
charges should numerically equal the value of gross national
product. However, because of statistical estimating errors, the
nature of which is discussed in Part III, this is not actually the
case. To secure balance, an item termed "statistical discrepancy"
is entered on the left side of the account.
Total charges are broken down into factor costs and other
charges. The former, consisting of employee compensation, net
interest, and the various types of business incomes, corporate and
noncorporate, are added to obtain the national income. The other
charges against the value of gross national product are arranged
so as to permit a further subtotal of charges against net national
product.

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS

Coverage of National Income and Product
Account
The economy covered by this account, and hence by the various income and product aggregates, is the continental United
States. Thus it does not coincide with the customs area of the
Nation since territories and possessions are excluded. Also, it is
important to note, the account measures the income and product
attributable to factors of production supplied by residents of the
country, rather than the income and product of factors physically
located in the country.
Not only individuals who contribute their labor and property
to the productive process, but nonprofit institutions and governmental bodies supplying capital resources are viewed as
residents supplying factors of production.2

Anatomy of the Output Totals
The foregoing discussion has attempted to give a general notion
of the major concepts underlying the measurement of national
output and of the nature and relation of the major alternative output measures. However, it has passed over much that is essential
to a precise understanding of the output concepts.
National income and national product are comprehensive
measures of total national output. They include not only business
production, but also production contributed by the nonbusiness
sectors of the economy—households and institutions, government,
and the rest of the world. Measurement of output in each of these
sectors is subject to special problems of its own. The principles
underlying the measurement of production in the various sectors
are next explained. The sector measurements based on these'
principles are then added to obtain the national income and
product totals shown in table I.

Measurement of business output
The bulk of national output originates in the business system,
and the framework adopted for the measurement of business output sets a pattern for the whole. In deriving national output as
the summation of the outputs originating in the several sectors
of the economy, it is therefore convenient to start with the business sector.
The Consolidated Business Income and Product Account, presented in table II, shows the portion of national output originating
in the business system. Business output is measured in terms of the
concepts underlying the major income and product aggregates
covered in table I and discussed in connection with it.
2. The meaning of the term "resident individual" is largely self-explanatory and agrees with
the definition adopted for balance-of-payments-purposes by the International Monetary
Fund. The classification of certain special categories may be noted explicitly. United
States Government employees, civilian and military, whose usual residence is in the United
States are considered United States residents even when stationed abroad. Residents of
foreign countries hired abroad by the United States Government are not considered United
States residents. This treatment applies symmetrically to employees of foreign governments
in the United States. In principle, foreign border workers working in the United States are
not regarded as United States residents. United States residents whose place of work is
across the border are so regarded. As explained in section 12 of Part III, however, the statistical information for implementing the definition of resident with respect to border workers
is lacking. Also, there are marginal oases in which it is difficult to decido whether an individual is to be classified as a resident or as a foreigner. In practice, these cases are quantitatively unimportant.

The right (or credit) side of the account shows the market value
of the consolidated production of the business system. On the left
side of the account appear the charges against this production.
The two column totals are equal in principle, for reasons which
have been stated in broad terms.
The nature of the equality can be understood in an alternative,
and perhaps more precise manner, if it is realized that the business
income and product account is similar to a profit and loss account
for the business system as a whole from which intrabusiness sales
and purchases on current account and intrabusiness flows of interest and dividends have been eliminated by a process of consolidation. The two sides of such an account must always balance
because profits are derived as the residual of sales and costs.
However, for statistical reasons equality is not achieved in practice, and in the estimates embodied in table II the "statistical
discrepancy" is entered on the debit side as a reconciliation item.
In addition to consolidation, certain other operations have been
performed to transform the column totals of the profit and loss
account into a measure of business output. Capital gains and
losses have been eliminated as not reflecting the value of current
production. Inventory change has been entered on the right side
of the account to convert sales into a measure of production, and
subsidies have been transferred to the left side as not being part
of the market value of the products shown on the right side.
Further, certain items have been netted, also with the aim of obtaining column totals that measure the contribution of the domestic business system to national output.
In the first place, imports, which in a consolidated statement of
domestic business would appear on the left side of the account,
have been transferred to the right side and netted against exports
(under consolidated net sales to abroad). Imports must be deducted from the credit side since they reflect foreign production
included in the value of the column totals prior to the deduction.
The fact that, in table II, they are netted against the export item
is merely a matter of convenience.
The second netting which is made in table II is in connection
with property income flows. In a consolidated account not further adjusted, receipts of interest and dividends from other sectors would appear on the credit side and would be reflected correspondingly in the total of the charges entered on the debit side.
Since receipts of interest and dividends from other sectors do not
represent output of the business system, it is necessary to remove
them from the credit side of the account and to net them against
elements of factor income in order to make the sum of factor incomes on the debit side of the account reflect the factor cost of
business output. In practice, interest received is netted against
interest paid under the heading "net interest," and dividends received are netted against dividends paid under the heading
"dividends." In these instances also, the particular matching
adopted is essentially a matter of convenience.
The components of business production listed on the credit side
of table II conform to the definition of final product specified in
connection with table I. It may also be noted that the entries are
very similar. Differences arise because table II is confined to
business output, whereas table I provides a summary of national
output which covers the nonbusiness sectors as well. Similar comments apply to the charges against the value of business product
listed on the debit side of the account. Factor income charges

NATIONAL INCOME, 1 9 5 4 EDITION

Table I.—National Income and Product Account, 1950

[Millions of dollars]
Compensation of employees:
Wages and salaries
Supplements

146, 526
7, 799

Income of unincorporated enterprises and inventory valuation adjustment
36, 140
Rental income of persons

8, 473

Personal consumption expenditures

194, 026

Gross private domestic investment

51, 219

Net foreign investment

Government purchases of goods and services

GROSS NATIONAL PRODUCT

— 2, 201
42, 023

Corporate profits and inventory valuation adjustment:
7
8
9
10
11
12

Corporate profits before tax:
Corporate profits tax liability
Corporate profits after tax:
Dividends
Undistributed profits
Inventory valuation adjustment

13 Net interest
14 National income

17, 829
9, 207
12, 934
—4, 864
5, 912
239, 956

23, 741
15 Indirect business tax and nontax liability
843
16 Business transfer payments
215
17 Statistical discrepancy
18 Less: Subsidies minus current surplus of government enterprises
204
19

Charges against net national product

264, 551

Capital consumption allowances

20, 516

CHARGES AGAINST GROSS NATIONAL PRODUCT.. 285, 067

differ from those in table I in magnitude only, because table I
includes nonbusiness items. Nonfactor cost charges are identical,
in magnitude as well as with respect to classification, because, as
will be seen, these charges are confined to the business system.

Treatment of taxes and subsidies
Some of the most important decisions that must be made in defining business output have to do with the classification of charges
against the value of business product between factor-cost and
nonfactor-cost charges, and involve in particular the treatment
of taxes and subsidies.
According to the definitions used in this report, employment
taxes under the social security and related programs are included
in the compensation of employees (the employers' share as a supplement to wages and salaries and the employees' share as a part
of them). This is done on the ground that these taxes are an element of the cost of hiring labor and accordingly should be included in a measure of total factor costs. A supplementary argument is that social insurance contributions reflect a benefit received by the employee in the wage bargain which should be
taken into account in calculating total employee compensation.
Contributions of self-employed persons under the recent extension
of the old-age and survivors insurance program are treated analogously; that is, the income of self-employed persons is measured
before deduction of these contributions.
Secondly, a distinction is made in this report between corporate
profits taxes, which are considered as part of factor cost—corporate profits are measured before deduction of these taxes—and
other (indirect) business taxes, which are considered nonfactor
charges—business incomes are calculated net of them. This distinction is based upon the following reasoning.

285, 067

Since national income is designed to measure output in terms
of the costs or incomes of the factors of production, it should
change only if either the volume of factor services or their unit
remuneration changes, and not because of a mere change in tax
rates. If it is assumed that corporation profits taxes are not shifted
and indirect business taxes are generally shifted forward, inclusion of corporate income taxes in national income and exclusion
of indirect business taxes from it are clearly indicated, since on
these assumptions mere changes in tax rates will not cause changes
in an income total so defined.
The classification of business taxes in this report is dictated by
the belief that the above assumptions about tax shifting are the
most realistic summary ones that can be made. It may be noted,
however, that the entire subject of tax shifting and incidence is a
rather controversial one and that definitive and final conclusions
are not available. Moreover, the operational definition of indirect
taxes is drawn in a rather summary fashion. All taxes that are
chargeable as business expense (other than employment taxes)
are classified as indirect business taxes. Thus certain taxes—business property taxes, for instance—are included in this group even
though a detailed study of their proper treatment from the standpoint of tax shifting and incidence might call for a different classification.
The classification of taxes in the national income represents an
instance in which an accounting distinction—whether a tax is
chargeable to expense or not—is adopted as a basis for classification and yields, broadly speaking, satisfactory results. In instances
in which it fails to do so and can be superseded by a superior
distinction—as in the case of employment taxes—modifications
are made. However, where the disadvantages of the accounting
distinction are less apparent and less easily remediable because of
conceptual or statistical difficulties, it is maintained.

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS

Subsidies, which are a type of business receipt, appear on the
debit side of the account (with a negative sign) because they are
not part of the market value of business output; the subsidized
products are included at their market values under business sales.
As a matter of long-standing convention, subsidies are regarded as
payments necessary to elicit factor services. Accordingly, they are
included in the sum of factor incomes (by considering them as a
gross receipt in the calculation of business profits) and are deducted in reconciling the factor income originating in the business
system with the market value of business output.

Other aspects of business output
The measurement of business output has, in addition to the
treatment of taxes and subsidies, many other aspects which must
be discussed—such as the precise delimitation of the business
sector; the classification of income shares and nonfactor charges;
the measurement of capital formation and consumption, including
inventory change; the imputations for wages and salaries in kind,
food produced and consumed on farms, and the rental value of
owner-occupied dwellings; the imputations made in the case of
financial institutions; and the special methods adopted in measuring the transactions of these institutions and of other organizations such as government enterprises.
Decisions that are made in these areas affect the definition of
national output and hence are relevant to the present discussion.
However, these decisions are regarded as less crucial to the
definition of national output than those concerning taxes and
subsidies that have been reviewed; also, the treatment of some of

them is rather complex. Therefore, their discussion is postponed
until later (to the detailed presentation of the business sector) so
as not to interrupt unduly the derivation of the national output
or to blur its outline by excessive detail.

Measurement of nonbusiness output
Production included in the measures of national output is not
confined to the business system, but occurs also in each of the
nonbusiness sectors of the economy: households and institutions,
government, and the rest of the world. In the household sector,
account is taken of certain services—such as domestic service—
which, although of a market character, are better thought of as
involving direct factor services rather than business production.
In the government sector, the services provided by the government to the community are accounted for. In the rest-of-the-world
sector, the production accruing to United States residents by
virtue of their net claims on foreigners is measured.
For each of these sectors, the measurement of output differs
basically from that employed for the business sector. The twofold
measurement of output in terms of product flows and factor costs
is not available for the nonbusiness sectors of the economy, and
factor cost must be used for both aspects of the value added by
them to total output. A single measure must be used in these
instances to depict both income and product originating because
there is no sales transaction involving the output produced as
distinguished from the purchase of the ingredient factors of production and supplies and materials. It may be noted parenthetically that the factor cost measurement of output in the non-

Toble II.—Consolidated Business Income and Product Account, 1950
[Millions of dollars]
Compensation of employees:
Wages and salaries:
Disbursements
Excess of accruals over disbursements
Supplements:
Employer contributions for social insurance
Other labor income
Income of unincorporated enterprises and inventory valuation adjustment
Rental income of persons
10
11
12
13
14
15
16

Consolidated net sales:

120, 565
0

27
28
29
30

3, 146
3, 440

Change in inventories

BUSINESS GROSS PRODUCT

To
To
To
To

persons
government
abroad
<
.
business on capital account

184, 340
17, 828
1, 302
. 43, 868
7, 351

36, 140
8, 473

Corporate profits and inventory valuation adjustment:
Corporate profits before tax:
Corporate profits tax liability
Corporate profits after tax:
Dividends
Undistributed profits
Inventory valuation adjustment

17 Net interest
18 Income originating

17, 829
8, 781
12, 360
— 4, 864
3, 708
209, 578

23, 741
19 Indirect business tax and nontax liability
20 Business transfer payments
843
21 Statistical discrepancy
215
22 Less: Subsidies minus current surplus of government enterprises
204
23

Charges against net product

234, 173

Capital consumption allowances

20, 516

CHARGES AGAINST BUSINESS GROSS PRODUCT. .. 254,689

254,689

NATIONAL INCOME,

195 4 EDITION

business sectors also conforms to the definition of final output
underlying national income accounting: the factor services purchased, in terms of which output is measured, are not resold.

Rest of the World
Finally, account must be taken of United States production
arising in the rest-of-the-world sector. As stated in connection
with the National Income and Product Account, the output of
Households and institutions
the United States economy is defined as that accruing to factors
Exhibit 1 presents the measurement of output originating in
of production supplied by residents of the United States, as disthe personal or consumer sector of the economy. Its measurement
tinguished from the alternative of defining national output in
is in terms of the direct factor services bought by households and
terms of the physical location of the factors of production.
Hence, to obtain a measure conforming to the definitions used
Exhibit 1.—Income and Product Originating in Households and Institutions,
in this report, there must be deducted from the components
1950
derived so far a measure of the output produced in the United
[Millions of dollars]
1. Compensation of employees:
2.
Wages and salaries paid
3.
Supplements paid:
4.
Employer contributions for social insurance
5.
Other labor income
6. Interest paid
7. Income originating and net and grvss product

Exhibit 3.—Income and Product Originating in the Rest of theWorld, 1950
6,312
__

18
53
1, 956
8,339

[Millions of dollars]
1.
2.
3.
4.

Wages and salaries (net)
Interest (net)
Dividends (net)
Branch profits (net)

5. Income originating and net and gross product

institutions, consisting of employee compensation and payments
of interest. The latter represent payments by households to nonpersonal lenders and payments by institutions. As in the case of
business production, discussion of more detailed points is postponed.
Government
The value added by government to total output is shown in
exhibit 2. As in the case of households and institutions, it is
measured by the value of factor services purchased, except that
in this instance only payments for labor are considered payments
for factor services. Interest paid by government is not counted.
Exhibit 2.—Income and Product Originating in Government, 1950
[Millions of dollars]
1. Compensation of employees:
2.
Wages and salaries
3.
Supplements:
4.
Employer contributions for social insurance
5.
Other labor income..
6. Income originating and net and gross product.

19,631
812
330
20, 773

The accounting for government production in general and
government interest in particular is, and probably will remain,
a controversial point in national output measurement. Basically,
this seems due to the fact that government activities are substantial and quite different in economic character from other
types of production. Accordingly, they are difficult to put on a
common denominator with other types of production in a summation designed to obtain a comprehensive measure of national
output.
The exclusion of government interest paid from factor incomes
stems, as a practical matter, from the fact that the bulk of government debt was created to finance wars and current expenditures.
In no commonsense use of the term can interest payments on
such debt be taken to represent currently produced goods and
services or the current use of economic resources. For example,
it seems sensible that a comparison of the prewar and postwar
volumes of production should not be distorted by the continuing
interest on the national debt that arose during the war. The
treatment of government interest is given further consideration
in the discussion of the government sector below.

18
248
426
574
1,206

States but accruing to foreign residents, and there must be added
a measure of the value of output not produced in the United
States but accruing to United States residents. The deduction
and addition are accomplished, on a net basis, by the separate
measurement of United States output originating in the rest
of the world, equal to the net international inflow of factor
incomes, as shown in exhibit 3.

National income and product, by sector of origin
In table la the contributions of each of the four major sectors
are summed to yield the totals of national output as shown in
table I, in a breakdown, however, which displays more clearly
their conceptual building blocks. The items in table la are crossreferenced to tables I and II and exhibits 1-3 so as to permit a
precise tracing of how national output is derived from the component output series of the four sectors.
Little need be said about table la since it represents only a
summary of the preceding discussion. However, certain of the
major points may be repeated for emphasis.
In table la, the measures of national output given in table I are
derived by summing the values added to total output by each of
the four major sectors of origin. For the nonbusiness sectors—
households and institutions, government, and the rest of the
world—contribution to total output is measured identically in the
product and factor income measures, since a distinction between
the two is not possible. For the business sector, however, the
product measure differs from the factor income measure. The
difference represents nonfactor charges against the value of business production, which are entered in table la and reconcile the
value of national income with that of the gross national product.

Anatomy of Product and Income Components
A tolerably precise derivation of the measures of total output
presented in table I has been obtained in table la. However, it
will be noted that the components of output as given in the second
table differ from the conventional classifications shown in table I.
Those of table I are drawn up, on the credit side of the account,
in terms of the purchases of product by the four sectors of the

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS
Table la.—National Income and Product Account, by Sector of Origin, 1950
[Millions of dollars]

Income originating in
Households and institutions (exhibit 1, item 7)
Government (exhibit 2, item 6)
Rest of the world (exhibit 3, item 5)

8, 339
20, 773
1, 266

Gross product originating in
Households and institutions (exhibit 1, item 7)
Government (exhibit 2, item 6)
Rest of the world (exhibit 3, item 5)

8, 339
20, 773
1, 266

Income originating in nonbusiness sectors

30, 378

Gross product originating

30, 378

Income originating in business (table II, item 18)

209, 578

National income (table I, item 14)

in nonbusiness sectors

Gross product originating in business (table II, item 32)

254, 689

GROSS NATIONAL PRODUCT (table I, item 26)

285, 067

239, 956

Other charges against net national product (table II, items 19, 20,
21, and 22)

24, 595

Charges against net national product (table I, item 19)

264, 551

Capital consumption allowances (table II, item 24)

20, 516

CHARGES AGAINST GROSS NATIONAL PRODUCT (table I,
item 21)
285, 067

economy; and, on the debit side, they do not separate the costs
incurred in production by each of the sectors. By contrast, the
classifications in both sides of table la refer to sector of production.
As the next step in explaining the content of national income
and national product, each of the components as given in table I
is derived from the measurements underlying table la. Product
and income items are taken up in turn.

Gross national product
Personal consumption expenditures
The personal consumption expenditures shown in table I are
derived as in exhibit 4. The bulk of them consists of purchases
Exhibit 4.—Derivation of Personal Consumption Expenditures, 1950

Government purchases of goods and services
The derivation of government purchases of goods and services
is indicated in exhibit 6. The procedure is similar to that employed for consumer expenditures. In addition to purchases from
business and purchases of direct factor services, which are entered
as the first and second items in exhibit 6, government makes purchases from abroad, which have not appeared so far in the accounting for national output. These purchases are entered as the
third item in exhibit 6 to complete the enumeration of government purchases as shown in table I.
Exhibit 6.—Derivation of Government Purchases of Goods and Services, 1950
[Millions of dollars]

[Millions of dollars]
Consolidated net business sales to persons (table II, item 27). 184,340
Gross product originating in households and institutions (exhibit 1. item 7)
-8,339
Net purchases of households and institutions from abroad-. 1,347
Personal consumption expenditures (table I, item 22)

account and the change in inventories, each as taken from the
business account (table II). The derivation is given in exhibit 5.

Consolidated net business sales to government (table II, item 28)
Gross product originating in government (exhibit 2, item 6)
Net purchases of government from abroad

17,828
20,773
3,422

Government purchases of goods and services (table I, item 25)

194,026

from the business system. Direct purchases of factor services by
households and institutions account for another part. These two
are entered as the first and second items in exhibit 4, with references to the previous tabulations in which they have been included. It will be apparent, upon reflection, that the sum of these
two items falls short of a complete enumeration of consumer expenditures by the amount of direct purchases from abroad
(mainly tourist expenditures). This item, which has not so far
appeared in the derivation of national output, is entered as the
third item in the exhibit.
Gross private domestic investment
Gross private domestic investment as shown in table I is derived
simply by combining consolidated net sales to business on capital
Exhibit 5.—Derivation of Gross Private Domestic Investment, 1950
[Millions of dollars]

42,023

Net foreign investment
With two exceptions, all of the elements underlying the construction of gross national product by sector of origin in table la
have now been used to derive components of gross national product as shown in table I. These two exceptions are "consolidated
net business sales to abroad" and "gross product originating in
the rest of the world." On the other hand, in the derivation of
personal consumption expenditures and government purchases
two items were added which have not appeared as components
of gross national product by sector of origin. These are "net purchases of households and institutions from abroad" and "net purchases of government from abroad." Hence, adding the first two
Exhibit 7.—Derivation of Net Foreign Investment, 1950
[Millions of dollars]

Consolidated net business sales to business on capital account (table II, item
30).
43,868
Change in business inventories (table II, item 31)
_
7,351

Consolidated net business sales to abroad (table II, item 29)
Gross product originating in rest of the world (exhibit 3, item 5)
Less: Net purchases of households and institutions from abroad (from exhibit 4).
Less: Net purchases of government from abroad (from exhibit 6)

Gross private domestic investment (table I, item 23).

Net foreign investment (table I, item 24)

51,219

1.302
1,266
1,347
3,422

-2,201

NATIONAL INCOME,

of these items to the components derived in exhibits 4, 5, and 6
and then subtracting the second two items will yield the correct
total of gross national product.
But the difference between these additions and subtractions is
numerically equal to "net foreign investment," the remaining
component of gross national product in table I which has not yet
been derived. This is so because the four items combined equal
the net receipts of the United States from abroad, from factor incomes as well as from the sale of goods and services. These net
receipts represent the balance of payments on current account,
and their financing implies a change in the net international
asset position of the United States, which is net foreign investment.3 The derivation of net foreign investment is shown in exhibit 7.
The derivation of gross national product as shown on the credit
side of table 1 is now complete. The next task is to derive the income flows shown in the breakdown on the debit side of that
table.

195 4 EDITION

Undistributed corporate profits
Undistributed corporate profits are obtained in exhibit 11.
Exhibit 11.—Derivation of Undistributed Corporate Profits, 1950
[Millions of dollars]
Business (table II, item 15)
Branch profits (rest of the world) (exhibit 3, item 4)

12,360
574

Undistributed profits (table I, item 11)

12,934

Corporate inventory valuation adjustment
This item is taken from table II.
Net interest
The calculation necessary to derive net interest, as shown in
table I, is given in exhibit 12.
Exhibit 12.—Derivation of Net Interest, 1950
[Millions of dollars]
Business (table II, item 1 7 ) . - .
Households and institutions (exhibit 1, item 6)
Eest of the world (exhibit 3, item 2)

National income
Wages and salaries
The derivation of wages and salaries is given in exhibit 8. It consists of a summation of payroll accruals in the four sectors of the
economy.
Exhibit 8.—Derivation of Wages and Salaries, 1950
[Millions of dollars]
Business (table II, item 2)
Household aad institutions (exhibit 1, item 2)
Government (exhibit 2, item 2).
Rest of the world (exhibit 3, item 1)

120,565
6,312
19,631
18

Wages and salaries (table I, item 2)

Net interest (table I, item 13)

3,708
1,956
318
1

5,912

Nonfactor cost charges
All the components of national income, as listed in table I, have
now been derived by allocating the entire national income as
constructed in table la. The nonfactor charges against the value
of gross national product shown in table I are all taken directly
from table II.

146,526

Supplements to wages and salaries
Supplements to wages and salaries are obtained in a similar
manner, as shown in exhibit 9.
Exhibit 9.—Derivation of Supplements, 1950
[Millions of dollars]
Business (table II, item 5)
Households and institutions (exhibit 1, item 3)
Government (exhibit 2, item 3)

6, 586
71
1,142

Supplements (table I, item 3)

7,799

Income of unincorporated enterprises and inventory
valuation adjustment, and rental income of
persons
These two items are taken directly from table II.
Corporate profits tax liability
This item is taken directly from table II.

Dividends
The calculation for dividends is shown in exhibit 10.
Exhibit 10.—Derivation of Dividends, 1950
[Millions of dollars]
Business (table II, item 14) — Rest of the world (exhibit 3, item 3)
Dividends (table I, item 10)

8,781
426
9,207

3. In the definitions adopted in this report, international cash gifts, which are also current
account items, are included with goods and services.

The Output Measures Examined
The measures of national output have now been derived with
sufficient precision to make possible their evaluation in terms of
the basic concepts that underlie them—of the national product
as an aggregate of final product values and the national income
as an aggregate of factor costs.4

The concept of final product
As noted earlier, measures of national output must be denned
essentially in terms of the market economy. They cannot encompass the broad range of nonmarket activities that may bear some
resemblance to economic production. In this report the market
economy is taken as the area over which sales and purchase
transactions occur. Once this criterion has been adopted, there
remains the necessity of distinguishing between final and intermediate production within the market economy.
The operational definition of final product underlying the
present national product measures rests on the obvious fact that
purchases not resold do not become elements in the value of other
goods and services, and that hence there is a presumption that
they should be counted in a comprehensive enumeration of the
4. For a more detailed discussion of these concepts see Milton Gilbert, George Jaszi, Edward F. Denison, Charles F. Schwartz, "Objectives of National Income Measurement,"
Renew of Economics and Statistics, August 1948.

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS

value of the final output of the Nation's economy. It also takes
cognizance of the corollary fact that purchases which are resold
are used up in further production and included in the value of
other goods and services, and hence may be presumed to be intermediate products which should not be counted separately in an
unduplicated measure of production.
The practical consequence of this general definition is to enumerate capital formation and purchases by consumers and general government, and to exclude from final production the raw
materials used up by business in the course of further production.
Capital formation is clearly a part of final product to the extent
that it consists of items that are not used up but are added to
wealth. (Only the inclusion in gross national product of capital
formation for replacement purposes must be noted as a limitation
in this connection.) The inclusion of consumer and government
purchases and the exclusion of business purchases charged to
current account also are broadly reasonable.
Since the expenditures of individual consumers and nonprofit
institutions serving individuals are incurred largely to meet the
needs of individuals, they consist in the main of goods and services
that determine what is commonly regarded as the standard of
living. Government purchases consist essentially of goods and
services provided on behalf of the community as a whole, which
it has been found better to secure collectively rather than individually. They should likewise be included in a measure of the
total goods and services provided to satisfy the needs of the members of the community. In contrast, the bulk of business purchases
of goods and services consists of items that are raw materials in
the production process, rather than items that directly satisfy
human needs. Their separate count is accordingly not necessary
in enumerating the flow of final goods and services.
It is believed that this is a realistic description of the general
nature (of consumer, government, and business purchases and
that the criteria employed in United States national income
statistics for distinguishing between final and intermediate products are accordingly useful for segregating the major types of goods
and services provided to satisfy the needs of individuals.
It is evident, however, that, because of differences in institutional arrangements, certain anomalies may result from the
restriction of the national output measure to the market economy
and from strict application of the purchase-not-for resale convention. Thus, the dividing line between the final products
enumerated and similar nonmarket benefits excluded may not be
appropriate. For instance, literal implementation of the operational definition of final product would count the net value of
services rendered by rental housing but would exclude the
counterpart for owner-occupied housing. Moreover, within the
market economy the distinction between final and intermediate
product would sometimes be unsuitable. Food purchased by employees, for example, would be classified in national income and
product whereas food furnished to them by their employers
would not.
Peculiarities of this type can be dealt with to some extent by
appropriate modification of the definitions, but the potentialities
of this approach are limited. This is obvious with respect to the
extension of output measures beyond the market economy, but it
also holds true of modifications in the basic convention for distinguishing between final and intermediate production.

In the first place, it is not feasible from a purely physical standpoint to examine every purchase by consumers, government, and
business so as to determine which were simply means of facilitating
production, and hence intermediate, and which served an end
use, and hence were final products. As a practical matter, one
must generally deal with types of buyers and categories of goods
and services.
But more important, one must place basic reliance on a broad
convention because in most cases in point there is no alternative.
No precise line can be drawn between final and intermediate
products from mere observation of the nature of the products or
the uses to which they are put. It would be easy, for example, if
all consumer purchases were for goods like Sunday clothes and
holiday dinners, which are obvious elements of the good life, and
if all business purchases were raw materials for further processing,
which are obvious intermediate goods. Between these two extremes, however, there is a wide range of purchases for which
neither the motivation nor the use is so clear-cut and which must
be placed in one category or the other by somewhat arbitrary
rules.
For this reason any measure of total production must be somewhat conventional. For instance, it must overlook the fact that
the expenditures of individuals in their business capacity are
influenced by their standards as consumers, and that expenditures of consumers are influenced by their activities as producers.
It must overlook also the fact that the conditions under which
work is performed have an important bearing on the welfare of
individuals. These conditions are affected by business expenditures on goods and services that are classified as intermediate just
because there is no satisfactory way to take account of their
benefits in a quantitative measure of final output.

Adjustment by imputation
In the present estimates, adjustments have been made to take
account of institutional peculiarities to the extent of imputing
factor returns in the form of income in kind and entering corresponding inputed items in personal consumption expenditures.
Even in this direction cognizance has been taken, in the main,
only of sizable and unequivocal types of factor income in kind
which have come to be recognized through tradition as elements
of real income. It is apparent that other additions to the national
output could be made if the relevant information were available.
For example, income and consumption expenditures could be
imputed for recreational facilities provided by business, which
are not counted because they are charged to current cost by
business.
The limitation of imputations to cases clearly associated with
factor incomes serves to confine the field, but it is not a principle
of selection which could be firmly defended on theoretical grounds.
The services of the radio broadcasting and television industries
are an outstanding example of an item which is not listed in the
national product because it is financed by business via charges
that are made to current cost. Yet radio broadcasting and television are important forms of recreation, similar to legitimate
theaters and motion pictures for which explicit entries, representing admission fees, are made in consumer expenditures.
No imputation is made for radio broadcasting and television in
measuring national product. Formal neatness can be given to this

NATIONAL INCOME, 195 4 EDITION

omission by general reference to the limitation of imputations to
items that are associated with factor incomes, on the ground that
broadcasting services do not accrue to a distinct factor of production, but to the consuming public owning receiving sets at large.
However, it would seem preferable not to stress this point unduly
and to recognize the essentially arbitrary and tradition-based
nature of the decisions that must be made in this area.

practice to any detailed, selective functional classification designed to add up those particular items which may be considered
"final." However, when any sort of concrete, workable criterion
of intermediate product is applied, it becomes evident that the
present scheme of summary classification does not lead to significant distortion.

Need for market-type measures of output
Quasi-intermediate products
The process of reclassification of intermediate products could
be extended in the opposite direction by deducting from factor
income, and hence shifting from consumption expenditures to
business costs, business-type expenses incurred by individuals. As
an example, "miners' expenditures for explosives, lamps, and
smithing" (a small item of consumer expenditure in table 30,
Part V) are certainly the sort of cost ordinarily borne by business
rather than by the wage earner, and are unlike the vast bulk of
consumption goods. It is a peculiarity of the coal mining industry
that these materials customarily are paid for by the miner rather
than purchased by the enterprise and charged to current cost.
No attempt has been made to adjust the pattern of consumer
transactions along this line because there is no tradition of adjustment that provides an adequate standard of what is appropriate.
In any event, it would appear that the magnitude of such adjustments would be very limited, unless the concept of "production
expense" were stretched far into the broad region of mixed
motivations in which no useful and commonly accepted exclusions frc m final product can be made.
Similar considerations apply to government purchases as well
as to consumer purchases. It is possible to think of cases in which
the treatment of government purchases as final product would
not necessarily be the best procedure. For example, if certain
government purchases reflected clear-cut aid to business it might
be preferable to view them as "subsidies in kind" and, in accord
with the handling of subsidies, to eliminate them from government purchases and the national product. Such a treatment, it
should be recognized, would be somewhat artificial and statistically difficult, and would obscure the national economic accounts in their capacity as records of actual transactions, thus
rendering them less meaningful for many purposes. Also, the
feasibility of its application to government services used jointly
by business and individuals, like the maintenance of highways, is
highly questionable.
If government services consisted of the running of public recreation grounds on the one hand and of the provision of free raw
materials to business on the other, a classification of the latter as
subsidies in kind might be useful and important. This is not, however, the actual character of government operations. Clear-cut
types of direct subsidies in kind that are of any quantitative importance have not come to attention. Even if account is taken of
the more consequential cases of government services involving
the use of a public service jointly by individuals and by business,
the problem remains quantitatively small. It looms large only if
the concrete notion of aid to business is stretched to cover the
broad range of government services to the public which actually
reflect a complexity of causes and purposes and cannot appropriately be classified under any such narrow head.
Neither government expenditures nor consumer expenditures,

i n 1r»o-i«~ r\r

It is apparent that even if substantial departures from the present definition of final product were logically defensible and statistically feasible, they would not result in a measure of national
product that could serve as a substitute for the present one. This
measure is tied closely to the modern market-economy and is
obtained, broadly speaking, by summing actual transactions of
its major constituent economic groups. As such it is an important
element of the economic accounting system designed to facilitate
an understanding of the functioning of the economy in terms of
the interaction of these groups.
For this purpose, the definition of the consumer and government purchases components of national product is generally appropriate, as is the exclusion of intermediate production according
to the present definition of the term. Even if basic departures from,
these definitions could be justified on other grounds, the resulting
measures of national output would probably not be useful in the
study of business cycles, in problems of economic mobilization
and fiscal policy, in market research, and in many other types of
investigations in which national income statistics are increasinglyemployed.

The concept of factor cost
Underlying the definition of national income in terms of factor
cost is the general idea that the output of the Nation is the result
of the services rendered by agents of production who cooperate
in the production of that output. These agents of production are
the labor and capital, the entrepreneurial ability and natural
resources which are used in the production process. It is the
services of these agents or factors as valued in the market by their
earnings for which a quantification is sought in the national
income, to the extent permitted by the data available as statistical
raw material.
It is hardly necessary to stress the importance in studies of
resource allocation of such a measure of the services rendered by
productive agents. To give only a few examples, one may wish to
know the incomes of the various factors of production used in each
industry in order to compare the relative importance of industries, or to marshal information about the relative amounts of
factors of production that are available for allocation to various
uses, or to compare the relative importance of labor and property
factors in the outputs of various industries.
>
It must be recognized, of course, that the concept of factors of
production is not given precisely in economic theory but must, to
some extent, be formulated with reference to the problem at hand.
Furthermore, the use of factor returns for some problems of the
type indicated is limited by such facts as the temporary or permanent non-transferability of factors to other uses, and by monopoly
and imperfect competition. In addition, property income is only
tenuously related to the type of measure of the contribution of
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A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS

involving resource allocation. This is because it includes a
residual share, profits, which fluctuates widely over the business
cycle.
In spite of these limitations and difficulties, the idea of factor
costs has always been of fundamental importance in economic
analysis, and national income defined as an aggregate of factor
earnings is the only general measure by which the idea can be
quantified.
It is true that difficulties are encountered in the course of this
quantification. The assumptions about tax incidence that are
made in the classification of taxes as between factor income and
nonfactor cost, the somewhat conventional rationale that leads to
the calculation of national income gross of subsidies, and the
common sense consideration on which the exclusion of government interest is based are all open to question.
Yet it would appear that for the items that are large and of
strategic importance in the dynamism of the United States
economy, the assumptions made are sufficiently realistic to provide useful economic measurements. For instance, in spite of the
theoretical uncertainty which surrounds the incidence of corporate profits taxes, it appears in statistical investigation that
corporate profits before taxes are more invariant to mere changes
in tax rates than are profits after tax, and that the before-tax
series must be used in studying the economic regularities reflected
in the movement of the various income shares. Nor would any
realistic study of national output be advanced by the inclusion in
national income and product of interest paid by the government.
One important aspect of the factor-cost definition of national
income should be understood. The constituent income shares of
national income so defined cannot be construed as measures of
benefits accruing to the recipient groups. For instance, the definition of the income shares gross of direct taxes levied on them is
necessary in order to reflect the factor costs of current production,
but would not be appropriate for measuring benefits received.

DETAILED STRUCTURE OF THE ACCOUNTS
As noted at the outset, an important recent development in
national income research is the expansion of national income statistics from measures of the national output into an economic
accounting system giving a statistical picture of the economy.
The national output aggregates and their major components now
having been derived in broad outline, and presented in the National Income and Product Account in table I, the groundwork
has been laid for an explanation of how a comprehensive national
economic accounting system is constructed. Incident to this explanation, further light will be shed on the definition of national
output and its various components.
The plan is to derive a set of accounts which will summarize the
economic process in terms of the interrelated transactions of the
four major economic groups into which the economy can be
divided—business, persons (households and institutions), government, and the rest of the world. This will involve the construction of a current account for each of the constituent economic
groups or sectors and of a consolidated saving and investment
account for the economy as a whole.

The Business Sector
The business sector is defined broadly to include all organizations which produce goods and services for sale at a price intended
at least to approximate costs of production. In the main, it covers
all private enterprises organized for profit, both corporate and
noncorporate, including farm operators, independent professional
practitioners, and lessors of real property. Mutual financial institutions, cooperatives, and nonprofit organizations serving business are also included, as well as government enterprises. Owneroccupied houses and buildings used by nonprofit institutions
serving individuals are considered to be business establishments
selling their current services to their owners.
The business sector thus covers a wide variety of organizations,
and for some purposes it would be desirable to distinguish further
between corporations and unincorporated enterprises, financial
institutions and nonfinancial business, and so forth. Also, it would
be instructive to treat industries or industry groups as separate
sectors in order to reveal the flow of intermediate output among
them, and to show their complete sales, cost, and profit structures.
Such breakdowns of the business sector are not presented in
this report, although important elements of them are contained
in Part V. (See the tables on national income by legal form of
organization and by industry of origin.) To regard the business
system as an entity is sufficient for many purposes, and the statistical information for establishing further sectors within it either
is unavailable or could be assembled and utilized only at the
expense of disproportionate effort. However, a further development of national income statistics does lie along these lines and
would serve to integrate them with other studies of the industrial
structure, such as the interindustry relation studies.

The business account
The receipts of the business system and their disposition have
already been exhibited in table II, in connection with the derivation of national income and product via the summation of sector
incomes and products. This Consolidated Business Income and
Product Account serves as the current account for the business
sector in the present economic accounting system. Several essential features of this account—its basic affinity to a consolidated
profit and loss statement and the netting, transposition, and
classification of items necessary to obtain significant measures of
output originating in business—have already been explained. At
this point further characteristics will be considered.

Classification of business transactions
The right side of the business account consists of the consolidated net sales of the business system, adjusted for the change in
inventories in order to measure business output. Since this account
covers all types of enterprises that are included in the business
sector, the definition of "sales" is broad. For instance, fees for
professional services and gross rental receipts are included, although they are not always thought of as sales in the daily meaning of the term.
Sales are subdivided according to the four major purchaser
groups: consumers, government, business (on capital account)
and foreign nations. To a large extent the content of the items is

NATIONAL INCOME, 195 4 EDITION

adequately conveyed by their designations. Aspects needing further explanation will be taken up later, particularly in the discussions of capital formation (which concerns sales to business
on capital account and the change in inventories) and of imputations and the treatment of financial institutions (which affect the
definition of business sales to persons).
Types of factor income
The left side of the business account lists the charges against the
value of national product. These charges are classified into factor
costs or incomes and nonfactor charges. The former are listed in
five main categories—compensation of employees, income of unincorporated enterprises and inventory valuation adjustment,
rental income of persons, corporate profits and inventory valuation adjustment, and net interest.
The compensation of employees consists mainly of wages and
salaries but includes additional forms of compensation under the
heading of supplements to wages and salaries. Wages and salaries
include payments received in kind in addition to monetary remuneration. They are subdivided into "disbursements" and
"excess of accruals over disbursements" to take account of differences (due to retroactive wage adjustments) between amounts
charged to cost and actual disbursements to individuals.
Supplements to wages and salaries consist of employers' contributions for social insurance and of "other labor income." The
former item comprises employer taxes, or contributions, under
social security and kindred publicly administered schemes. The
corresponding employee contributions are included in wages and
salaries. Other labor income includes employer contributions to
private pension and related funds, compensation for injuries,
and certain minor items which are charged against the value of
business production and can conveniently be classified as factor
charges under the heading of supplements to wages and salaries.
Income of unincorporated enterprises and inventory valuation
adjustment, rental income of persons, and corporate profits and
inventory valuation adjustment cover the business incomes of the
private enterprises that are counted as part of the business sector
of the economy. Within the noncorporate part of the business
sector a distinction is drawn between unincorporated enterprise
and rental income. The former covers the earnings of sole proprietorships and partnerships (including farm and nonfarm businesses as well as independent professional practitioners) and of
producers' cooperatives; the latter consists of the net rentals of
individual landlords who are not primarily engaged in the real
estate business. The earnings of professional real estate operators
are classified under income of unincorporated enterprises. Both
the income of unincorporated enterprises and rental income include, in addition to monetary earnings, important items of income in kind.
The definition of monetary business earnings is in general accordance with Federal income tax regulations. Significant modifications are made, however, in the treatment of capital gains and
losses, inventory profits and losses, depletion charges, and receipts
of property income.
Business incomes in the national income and product accounts
are stated exclusive of capital gains and losses, because these do
not represent a return for the current use of economic resources.
The "inventory valuation adjustment" is designed to eliminate

from corporate profits and the income of unincorporated enterprises an element which is very similar to capital gain or loss.
The adjustment is often large and uncertain statistically, and
there is a great deal of interest in the corporate profit figure prior
to the adjustment. Hence the accounts are set up to give the
unadjusted figures and the adjustment separately, with the two
adding up to the proper total for purposes of national income
measurement. By contrast, ordinary capital gains and losses are
eliminated outright.
With respect to depletion charges, no deduction is made for
them in computing business net incomes. The value of new discoveries of natural resources is not counted as part of capital
formation or of profits, and consequently deduction of a capital
consumption charge for impairment of the stock of natural resources would be inappropriate.
Finally, all corporate receipts of dividends are netted out of
corporate profits (and dividends) to avoid double counting and
to arrive at income originating in the business system; and interest
and dividends received by the owners of unincorporated enterprises are considered to be received by them in their personal
capacity, rather than treated as an element of business income,
except in a few financial industries in which the earning of property incomes is an integral part of business operations.
In table II corporate profits before tax are broken down further
to show tax liability, dividends, and undistributed profits. A
similar breakdown is not presented for unincorporated business
and rental incomes. With few exceptions, there are no taxes levied
specifically against these types of income (business incomes are
merged with other types of income in determining individuals'
income tax liability). Moreover, in the noncorporate area a realistic distinction between distributed and undistributed business
income is difficult to establish in principle and to measure statistically.
Net interest measures the excess of interest payments of the
business system over its receipts. In addition to monetary interest
flows, it covers imputed interest arising in connection with the
operations of financial intermediaries.
Nonfactor charges listed in table II consist of indirect business
tax and nontax liability, business transfer payments, the statistical
discrepancy, subsidies minus the current surplus of government
enterprises, and capital consumption allowances.
The classification of indirect business tax and nontax liability
as a nonfactor charge already has been discussed in summarizing
the derivation of national output.
Business transfer payments
Business transfer payments represent transfers from business to
persons which are charges against business product for which no
return in the form of factor services is received. Major items included are corporate gifts to nonprofit institutions and allowances
for consumer bad debts. The nature of the latter item can be
understood as follows. Sales to consumers, on the credit side of
the account, are stated at their sales price and are not (except in
the case of professional fees) adjusted by an allowance for consumer defaults. However, the incomes of sellers and lenders, on
the debit side, have been calculated net of these defaults. Hence,
an accounting discrepancy between the two sides arises which
can best be resolved by regarding the value of consumer bad

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS

debts as reflecting goods and services transferred from business
to consumers with no quid pro quo.
Subsidies are listed as a (negative) nonfactor charge against
the value of business output. They are not considered part of the
value of product, but are included as receipts in calculating
profits. The current surplus of government enterprises is an item
akin to business profits earned in the course of making the sales
listed on the credit side of the account. Hence it must be included
on the debit side to ensure balance. However, for reasons to be
noted later, it is classified as a nonfactor rather than a factor
charge.
The foregoing nonfactor charges reconcile the income originating in business with the market value of business net product.
To arrive at the total designated in table II as charges against
business gross product, capital consumption allowances must be
added.

Capital consumption allowances
Capital consumption allowances consist of depreciation proper,
capital outlays charged to current expense, and accidental damage
to fixed capital. The first of these items measures the wear and
tear and obsolescence of fixed capital and (with the exception of
agricultural depreciation, which is on a replacement cost basis)
is based on accounting practices used for tax purposes—largely
straight-line amortization of original cost to the current owner.
Capital outlays charged to current expense are an entry in lieu
of depreciation proper for items of durable capital listed on the
credit side of the account (on the basis of the durability definition
there adopted) but charged to current cost in accepted business
practice. It is apparent that the value of these items must be
entered on the debit side also in order to preserve the balance of
the accounts. In a stationary economy capital outlays charged to
current expense would, for business as a whole, approximate the
charges for depreciation which would have been made for these
items had they been capitalized instead of expensed. In a situation
in which net capital formation occurs, the entry will overstate
actual depreciation; when capital formation falls below replacement needs, it will fall short of an adequate capital consumption
allowance for the types of equipment involved.
Accidental damage to fixed business capital measures the value
of such capital destroyed by accidents. The accounting necessity
for an entry of this type stems from the fact that business profits
are net of such losses on the debit side while no corresponding
entry appears on the credit side. Its classification as a species of
capital consumption allowance is based on the practical fact that,
for the business system as a whole, the magnitude of the item is
steady and can be regarded as akin to regular depreciation. If
there were large fluctuations in these losses, a strong argument
could be made for treating these unusual deviations from the
average experience like capital gains and losses—that is, calculating profits and total income without deduction for them. This
treatment would prevent fluctuations in national income due to
the accidental destruction of fixed business property.
As has been noted, depletion charges are not deducted in calculating profits, since the value of the corresponding discoveries of
natural resources is not an element of capital formation or profits.
Similarly, these charges are not included with capital consumption allowances.

Interpretation of income share breakdown
The breakdown of the income shares given in table II reflects
to a large extent the actual institutional, legal, and financial arrangements in force at any particular time which determine the
form in which income accrues to individuals. An additional,
broader grouping sometimes found helpful consists of employee
compensation and net interest, which are contractual incomes,
and of other incomes, all of which are residual shares.
The recording of earnings in the forms in which they accrue
means, for example, that shifts in the legal form of organization
as between corporations and unincorporated enterprises, or
changes in the relative importance of internal and external business financing, will be reflected in the several income shares. In
many economic investigations which deal with the concrete arrangements of economic society, a breakdown of this type will be
appropriate. However, it will present handicaps in analyses in
which it is desired to abstract from such arrangements.
The attempt to use the income share breakdown to study the
ultimate factors which cooperate in production is a case in point.
It deserves special mention because it is directly suggested by the
definition of total income originating as the sum of factor incomes
or factor costs. In the light of this general definition, one might be
tempted to go further—to make identifications of particular income shares with the various factors of production envisaged in
economic theory.
Along these lines, it is possible to say that employee compensation consists of labor income, that unincorporated enterprise and
rental incomes are mixed returns to labor and other productive
factors, and that corporate profits and net interest are components which do not contain a labor return element, in any ordinary sense of the term. However, in view of difficulties attaching
to the factor of production notion and in view of the lack of
statistical information, one cannot go much further in the way of
identifying factors with the income shares, and it is important
to have in mind the limitations of the data for this general type
of use.
With respect to a segregation of the returns to the factor of production "labor," it should be noted that employee compensation
is heterogeneous in character. It includes the wages of the charwomen as well as the bonuses of the corporation executive. Moreover, it is not the only income share in which returns to labor are
reflected. In the income of unincorporated enterprises and the
rental income of persons the labor of the owner is an element,
although it cannot be quantified and segregated.
In connection with the classification of income shares other than
employee compensation, no identification can be made between
the rental income of persons and the rent concepts of economic
theory. Rental income is confined to the net rentals of individual
property holders (including imputed rentals on owner-occupied
nonfarm homes) whose main occupation is not the renting of
property. Rental income of professional real estate operators is
classified under the income of unincorporated enterprises; gross
rental receipts of corporations are merged with their other business receipts and (after deduction of costs) reflected in corporate
profits; both the imputed net rental value of farm homes and
agricultural net rents received by farmer landlords are included
in the income of unincorporated farm enterprises; and the return
on user-owned business real estate becomes a component either

NATIONAL INCOME, 195 4 EDITION

of the income of unincorporated enterprises or of corporate profits.
The dividing lines between profits and net interest also call for
comment. First, net interest represents the payments less the receipts of the business system. An increase in corporate interest
receipts from other sectors (most importantly from government)
is therefore reflected in a decrease of net monetary interest and an
offsetting increase in profits, and vice versa, even though no
change in the profit and interest flows that are an integral part of
business operations has occurred.
Also, the breakdown of property income between interest and
profits is affected by the manner in which interest flows are channelled through the economic system. For instance, if money is lent
by corporate or other professional lenders the interest paid on it
is counted in business receipts and reflected in profits. But if individual lenders are involved, the interest paid to them appears as
such in the business account.
Finally, of course, the breakdown between profits and interest
is influenced by the choice between external and internal financing. For all these reasons, it is more appropriate for some types of
economic analysis to combine the interest and profit shares than
to consider them in isolation.

Fixed investment
Fixed investment by business (business purchases on capital
account) includes new construction and durable equipment acquired by private business enterprises. New residential construction purchased by owner-occupants (as well as by business proper
for rental purposes) is included because home-ownership is treated
as a business in the national income accounts. Acquisitions of
fixed capital by nonprofit institutions serving individuals also are
included.
Fixed capital formation is defined, in the United States statistics, as including all newly produced durables (goods with an
average life exceeding 1 year) acquired by their ultimate business
users. Thus fixed capital formation is stated gross of capital consumption, and includes plant and equipment bought for replacement purposes.
From a theoretical standpoint, a net concept would be preferable. The definition of gross capital formation must needs be
somewhat arbitrary, because the size of the category will depend
on the particular definition of durability adopted. The shorter the
average life used in defining durability, the larger will be the
apparent volume of gross capital formation, although it should be
noted that the magnitude of this variation is very small for
alternative definitions of durability that one might consider in
practice. (See section 10, Part III.)
In addition, the considerations dictating elimination of intermediate production to achieve output measures without duplication also call for the statement of fixed capital formation on a
net basis, since, broadly viewed, capital outlays for replacement
purposes are really a species of intermediate product.
Measurement of fixed capital formation on a gross basis has
been advocated as being more appropriate for certain types of
analysis concerned mainly with the short-term availability of
resources. If fixed capital need not be replaced in the short run,
the total value of production available for alternative uses is
measured better, it is contended, by the gross than by the net
totals.
291602°—54
4

While this argument has some merit, there is no reason to
believe that gross fixed capital formation as measured in the
business account is appropriate for the purpose. It would give an
exaggerated view of production available for alternative purposes
in the short run if it included essential replacements that could
not be postponed without interfering with the operations of the
productive apparatus. On the other hand, it would fail to reveal
the true short-run production potential if there were ways of
utilizing the fixed capital more intensively than normal or of
postponing maintenance and repair, as distinguished from replacement. In short, the use envisaged calls for estimation of the
capital stock that is consumable in the short run, including the
stock of business inventories as well as consumer and government held tangible assets; it cannot be served adequately by a
fixed capital formation series defined on the gross basis used in the
national income and product accounts.
Measurement of fixed capital formation gross of replacement
may be preferable for certain purposes in business cycle and
market analysis. Replacement demand is an important factor in
aggregate demand and it is useful to have an explicit record
including it. However, in this as in the preceding case, the present
definition of gross capital formation is imperfectly adapted to the
purpose envisaged. For instance, it excludes maintenance and
repair outlays although these too have a significant bearing on
cyclical fluctuations in demand.
In any event, in designing an unduplicative measure of national
production these and related considerations must remain subsidiary. Defining fixed capital formation gross of capital consumption allowances must rather be justified largely on the
ground that it sidesteps the unsolved problems involved in the
definition of net capital formation.
The problem of what is meant by "keeping capital intact" is a
most controversial one in economic theory, basically because in
a dynamic economy the nature of capital equipment changes and
the notion of replacing worn out capital consequently loses its
simplicity. But even apart from theoretical difficulties, the statistical problem of estimating capital consumption in a manner
consistent with gross capital formation is quite formidable. The
bulk of the capital consumption allowances recorded in table II
is derived from financial accounting records and is on an original
cost basis. While from the standpoint of accounting consistency
these allowances are appropriate for inclusion on the debit side of
the business account—business profits are calculated as a residual
consistent with them—they do not measure capital consumption
on the current price basis which underlies the values shown for
fixed capital formation on the credit side, and hence cannot be
used to obtain a measure of net capital formation in current
prices.
The statistical information, on prices and on the age composition of the capital reflected in depreciation charges, that would be
necessary to convert these accounting charges into a price level
comparable to that of gross capital formation is deficient. Useful
approximations in this direction have been made (the pioneering
study in this field is Solomon Fabricant's Capital Consumption and
Adjustment, National Bureau of Economic Research, 1938). However, in the national income and product accounts no revaluation
of the accounting charges is attempted, and consequently a
measure of fixed net capital formation is not presented.

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS

It will be noted that business profits, income originating in
business, and national income all incorporate the same depreciation charges which are considered inadequate as measures of
capital consumption for the purpose of arriving at fixed net capital formation, business net product, and net national product.
Net measures of income had long been established before the
problem of valuing depreciation charges was met in particularly
acute form in connection with fixed capital formation, and their
continued use reflects in part the accident of this historical
sequence.

Inventory change and the inventory
adjustment

valuation

The measurement of inventory change in business accounting
practice is subject to the same type of deficiency from the standpoint of national income and product as fixed capital depreciation. As a broad proposition, original cost instead of current replacement cost is used to value inventories consumed in the
process of production, and hence a measure of net change based
on business accounting records would be misleading for national
income purposes.
In this instance, however, an adjustment is made in the national
accounts to convert reported "book" value data to a current replacement cost valuation. The distortions that would result from
failure to make such an adjustment would be more disturbing
here. It is not possible to sidestep the issue by dealing with a gross
concept, as in the case of fixed capital formation; also, short-term
comparisons, for which national income data are frequently used,
are particularly affected by the methods of inventory valuation.
Moreover, the conceptual and statistical difficulties that stand
in the way of an adjustment, although formidable, are less overwhelming than in the case of depreciation. Use over a long period
of years is not involved, as with fixed capital formation, and consequently the conceptual problem of defining replacement which
stems from quality change and the emergence of new products
looms less large. In addition, information on prices and age composition is more readily available for inventory goods than for
capital goods.

Nature of inventory valuation adjustment
According to the prevalent methods of business accounting, the
book valuation of the physical volume of inventories used up in
production differs from current replacement cost in times of
changing prices.5 When prices are rising, book charges fall short
of current replacement cost; when prices are falling, they exceed it.
No deviation from a current price valuation occurs with goods
added to inventory during a given accounting period. These are
valued at prices current in that period.
The change in the book value of inventories represents additions
to inventories minus inventories used up. Hence it reflects not
only (1) the change in the physical volume of inventories valued
at current prices, but also (2) the excess of the replacement cost of
inventories used up in production over their book valuation.
The former element of book value change is appropriate
for inclusion as a component of national product, because it con5. The following discussion is concerned with the treatment of nonfarm inventories. The
estimates of farm inventory change are computed directly from data on physical stocks and
current prices. No problem of adjusting book value data is involved; that is, an "inventory
valuation adjustment" is not necessary.

forms to the principle of current price valuation applied to all the
other components. To include, however, the "inventory gain" or
"inventory loss" measured by the second element of book value
change would be misleading. In extreme cases the inventory
movement as indicated by the change in book values would differ
in direction from that of the actual volume of inventories. Therefore, the "change in inventories" line in business and national
product is derived by adjusting the reported book value change
in inventories to exclude the inventory gain or loss element.
For similar reasons, business profits as initially calculated on
the basis of business accounting methods of inventory valuation
are, for purpose of inclusion in national income, adjusted to
exclude inventory gain or loss. This is done in table II by adding
the "inventory valuation adjustment" to corporate and noncorporate business profits as estimated from "book" data reported
by business. When negative, the inventory valuation adjustment
measures the inventory gain, and when positive, the inventory
loss, which arises from the fact that inventories used up in production are not valued at current replacement costs. Its affinity
to capital gains and losses, which also are eliminated in calculating
national income and product, is readily evident.
The statistical methodology for estimating the inventory components of national income and product is explained in Part III
of this report. The following numerical examples may serve to set
forth more precisely the accounting principles involved.

FIFO method
Suppose that a firm had beginning inventories of 1,000 units
valued at $5 each, that it purchased during the accounting period
400 units valued at $3 each, and that it used up, in production
and sale, 300 units of inventories. According to the first-in, firstout (FIFO) method of inventory valuation, which charges inventories to cost of sales in the order of their acquisition, inventories
used up would be valued at $5 each, resulting in a total of $1,500.
The inventory change would be registered as minus $300, the
difference between $1,200 of acquisition and the $1,500 used up.
The book value change of minus $300 is the algebraic sum of a
physical volume change, in current prices, of plus $300 (100 units
at $3 each) and an inventory loss of $600, which measures the
difference between the book cost and the current replacement
cost of inventories used up ($2 on 300 units). Since purchases of
inventory goods are valued at current prices, the departure from
current valuation in the measure of inventory change reflects
entirely the manner of valuing inventories used up.
For national output measurement it would be misleading to
register an inventory decline of $300 when the volume of inventories has actually increased. Accordingly, on the credit side of
the business account, the change in business inventories is entered
at plus $300, equal to the physical change of 100 valued at $3
each, in conformance with the current-price valuation basis used
for the other components of the product and income flow. Correspondingly, on the debit side an inventory valuation adjustment
of $600 is added to business profits as based on the FIFO method
of inventory valuation. This adjustment corrects profits for the
difference between the book cost of goods sold ($1,500) and their
current replacement cost ($900). Essential to note is that the
adjustment is equivalent to the excess of the physical inventory
change in current prices ($300) over the book value inventory
change (minus $300). Needless to say, if current prices exceed

NATIONAL INCOME, 195 4 EDITION

book cost prices an inventory gain instead of an inventory loss
occurs, and the sign of the inventory valuation adjustment is
negative.
The above example is based upon the straight cost variant of
the FIFO method of inventory accounting. But a revaluation of
the inventory change reported by business is also necessary for
other business accounting methods in which the valuation of
inventories used up departs from a current replacement cost basis.
Consideration of two of these is pertinent: the "cost or market,
whichever is lower" practice of valuing year-end inventories,
which is frequently associated with the FIFO method, and the
last-in, first-out (LIFO) method of inventory accounting.
Under the cost-or-market practice, year-end inventories are
written down by businesses if market prices are below cost prices.
This practice generally necessitates a revaluation of book value
change for national income purposes. However, it should be recognized that the cost-or-market procedure is not the prime cause
leading to revaluation of book value changes in the national income and product accounts. It represents only a special case in
which revaluation is necessary because of a departure from the
current replacement cost basis of valuing inventories used up in
production.
For instance, if the cost-or-market procedure is followed in the
example given, the ending value of inventories will be reported
as $3,300 (1,100 units at $3 each, the lower market price). The
book value change of inventories will be minus $1,700, and an
inventory valuation adjustment of $2,000 will be needed to adjust
the change in book values to national income and product
definitions. However, even without exercise of the method an
inventory valuation adjustment (of 1600) is needed, as previously
shown.

LIFO method
The LIFO method of inventory accounting yields results most
akin to national income practice. As a general proposition, it
yields identical results when the physical volume of inventories
increases, but divergent results when the physical volume decreases. In the former case no revaluation of the book value
change is necessary, but in the latter an inventory valuation adjustment must be applied to inventories charged on a LIFO basis.
As long as the physical volume of inventories is increasing, inventories used up represent, according to the LIFO convention of
assuming that units acquired last are charged out first, current
acquisitions valued at current prices. There is no difference in this
case between the LIFO and national income methods of inventory valuation. This can be seen by applying the LIFO method
to the above numerical example. Inventories used up are valued
at $900, because they are assumed to represent the 300 units most
recently acquired at their current price of $3 each. The book value
change therefore amounts to plus $300 (purchases of $1,200
minus $900 of inventories used up), which is equal to the change
as measured for national income purposes.
However, when the physical volume of inventories decreases
"last-in" prices no longer represent current prices. Inventories
used up reflect past-period acquisitions valued at past-period
prices, which in general differ from current prices. To illustrate
this case numerically, it may be assumed that in the initial
example 500 units rather than 300 units are used up, so that the

physical volume of inventories decreases by 100 units. According
to LIFO practice, the inventory change would be minus $500.
This represents acquisitions of 400 units valued at $1,200, minus
400 units used up valued at $1,200 (corresponding to the acquisitions), and minus 100 units valued at $500, reflecting the cost
price of the units included in the initial stock. According to the
method adopted in this report, however, the inventory change
would be valued at minus $300, measuring the physical volume
change at current prices, and an inventory valuation adjustment
of $200 would be necessary. This adjustment would account for
the inventory loss which arises because the 100 units of inventories used up in excess of current acquisitions are valued at $5
each, $2 more than the current market price of $3.
The foregoing summary treatment of the problem of inventory
valuation should not create the impression that the subject is a
settled one. On the contrary, there is a great deal of discussion
among accountants and national income technicians both as to
the broad principles and detail involved.
It should also be mentioned that many simplifying assumptions
have been introduced into the summary in order to bring out
more clearly the basic nature of the problem. In their absence,
some of the generalizations made would have to be qualified,
although not changed in essence. In particular, the assumption
underlying the numerical examples, as well as some of the statements in the text, that the prices of inventory goods change discontinuously between accounting periods but remain constant
within them, has permitted the neglect of some complicating
factors which, although significant, are definitely of secondary
importance. This assumption should be noted specifically, because the fact of continuous price change during the year is quite
important from the standpoint of the statistical calculations
described in the section on Change in business inventories in
Part III.

Imputations
As noted earlier, the measures of national output presented in
this report cover not only output whose production and distribution give rise to explicit monetary transactions, but also certain
types of income and product flows which do not take monetary
form. It has also been pointed out that from a theoretical standpoint these imputations represent modifications of the operational
concept of final output, and that they are made to correct for
anomalies and other disturbing omissions that would otherwise
result. The imputations made are the result of concrete considerations and of the traditions of national output measurement.
They do not and cannot represent a logically clear-cut exhaustive
list, but merely a pragmatic selection among a wide variety of
possible imputations.
The general prodecure for allowing for nonmonetary income
and product flows in the national accounts is to imagine that the
flows in question take monetary form and to reconstruct the
accounts to reflect consistently these flows. The business account
is affected by four imputations: wages and salaries paid in kind,
the rental value of owner-occupied houses, food and fuel produced and consumed on farms, and nonmonetary income and
product flows arising in connection with financial intermediaries.
These will be discussed in turn.

A SUPPLEMENT TO THE SURVEY OF CURRENT

Wages and salaries paid in kind
An imputation is made for wages and salaries paid in kind in
the form of food and lodging in industries in which this type of
arrangement is of quantitative importance and is regarded as
involving a clear supplement to monetary wages and salaries.
Imputed items are valued at cost to the employer. Needless to say,
difficult and somewhat arbitrary decisions are involved in delimiting the area of this imputation and in establishing the proper
valuation.
In effect, the imputation takes the form of assuming that the
employer, instead of furnishing his employees with free food and
lodging, pays them corresponding amounts of wages, and that
the employees in turn use them to buy the items previously purchased by the employer. Wages and salaries (in income originating in business) and sales to persons (in business product) are
thus raised by corresponding amounts. In terms of the more technical implication of the procedure, intermediate purchases by
the employer are converted into factor costs (wages and salaries)
and final purchases (consumer expenditures).

Rental value of owner-occupied homes
The imputation for the rental value of owner-occupied homes
is made to provide comparable treatment between rented and
owner-occupied housing. It assumes that home ownership is a
business producing housing services which are sold to the homeowner in his capacity as tenant. These sales are estimated in terms
of the sum for which the particular type of home could be rented,
and the expenses of the home owners are deducted to obtain
imputed net rent. The imputed gross total becomes a part of sales
to persons, or consumer expenditures, and imputed net rent
becomes a part of the rental income of persons.
It may be wondered how the balance of the accounts can be
maintained if for imputed rents a gross item is entered on the
credit side and a net item on the debit side. The inconsistency is
only apparent. Adjustments corresponding to the expense items
which constitute the difference between imputed gross and net
rent are made simultaneously in several components of the gross
income and product flow, and secure balance.
One of the expense items, depreciation on owner-occupied
homes, is added to capital consumption allowances. In the
absence of imputation, it would not enter the purview of the
national accounts. Indirect business taxes are raised by the
amount of property taxes included in the expenses of owneroccupants. Otherwise, these taxes would be classified as personal
taxes (see the discussion of the personal account below). Mortgage
interest serves to raise the "net interest" item in the business
account. Without the imputation, it would be entered as interest
paid by the personal sector. Finally, all other expenses, such as
for supplies and materials necessary for the maintenance of
owner-occupied homes, are classified as intermediate business
purchases charged to current account. Without the imputation,
they would be counted as final products, as elements of business
sales to persons.

Food and fuel produced and consumed on farms
The imputation for food and fuel produced and consumed on
1 r frJlnwc
x

rental imrnirntinn Tn this

BUSINESS

instance the accounts are reconstructed to conform to a situation
in which the farmer sells the food and fuel to himself. An imputation for the full value of the food and fuel (at prices received by
farmers for this type of product) is made in business sales to
persons, and an imputed net profit on the production of this food
and fuel is included in the income of unincorporated farm enterprises. The apparent inconsistency of a gross imputation on the
product side and a net imputation on the income side is resolved
in a manner similar to that of the rental imputation.
Use of the rental and farm imputations, it should be noted,
avoids statistical difficulties that would occur if measurement
were restricted to monetary transactions. The imputation for
farm food and fuel, for instance, obviates the necessity, in arriving
at the income and product totals, of allocating expenses between
production for the market and for home consumption. Similarly,
it is unnecessary to allocate interest, maintenance, taxes, depreciation, and other housing expenses between owner-occupied and
tenant-occupied units. The statistical basis for making such allocations is tenuous. (Some of the detailed information shown in
Part V involves allocations of this type. However, within the
framework of the imputation procedure these do not affect the
income and product aggregates.) The estimation of consumption,
saving, and investment would be greatly complicated in the absence of a rental imputation because it would be necessary to
estimate the transfer of existing housing units between owneroccupied and tenant-occupied status. The amounts involved in
some periods are believed to be large but information required for
their determination is deficient.

Commercial banks and investment trusts
Imputed income and product flows arising in connection with
financial intermediaries involve some of the most complex constructions of national income and product measurement. Several
distinct types of procedures are involved, and will be discussed in
turn.
Exhibit 13.—Income and Product Account of a Commercial Bank,
Transactions Only

Monetary-

[Thousands of dollars]
Wages paid
Net interest paid
Interest paid on deposits
Less: interest received
Profit

50
—95
5
100
30

Service charge receipts
Less: current account purchases from
other firms

Income originating

—15

Product originating.

-IS

The ordinary methods of measuring value added to total output
in terms of income and product flows break down in the case of
commercial banking. This is because an element of the income
and product in this area does not take monetary form. An imputation is introduced to make it explicit and, as a consequence, a
much more satisfactory picture of value added emerges.
The problem is illustrated in exhibit 13 by means of an income
and product account for a commercial bank, drawn up in conformity with the principles of the Consolidated Business Income
and Product Account. Only a few essential transactions are
covered, in order to simplify the presentation.
On the credit side of this account, the value added to output by
the commercial bank is calculated in terms of monetary product
flnws hv HpHnrrinc from its sales rnnsistine' nf monetarv service-

NATIONAL INCOME,

charges, its current account purchases from other firms. (It will
be remembered that, for industry in general, this netting yields
the desired value of final production since sales and purchases of
intermediate products cancel for the economy as a whole.) In
terms of monetary income flows, value added is obtained on the
debit side by summing the distributive shares, with interest netted.
Since monetary service charges made by commercial banks are
low in relation to total costs incurred, income and product originating appears low—in the present example it is actually negative.
It is evident that the conventional method fails to give a proper
accounting of output originating in the commercial banking area.
Some income and product flows not taking monetary form must
occur, omission of which results in seriously incomplete measurement.
The product flows in question are identified as the services
rendered by banks without explicit charge to their depositors,
such as checking, bookkeeping, and investment services in connection with the handling of deposits. In lieu of monetary service
charges, banks finance the cost of these services by retaining part
of the property income earned by investing deposits instead of
paying it out to the depositors. This retained income is assumed
to represent the income flows not taking monetary form.
Exhibit 14.—Income and Product Account of a Commercial Bank, Monetary
and Imputed Transactions
[Thousands of dollars]
Wages paid
50
Net interest paid-.
0
Monetary interest paid on deposits
5
Imputed interest imid on deposits.. 95
Less: monetary interest received... 100
Profit
30

Service charge receipts
Monetary
Imputed
Less: current account purchases from
other firms

Income originating.

105
10
95

Product originating.

To obtain an adequate picture, the accounts are redrawn as
they would appear if this short-circuiting of income and service
flows had not occurred and, instead, commercial banks had (1)
paid out to depositors all property income earned on the investment of their deposits and (2) charged them fully for the cost of
the services rendered to them. An item for imputed interest paid
(equaling property income received minus interest paid on deposits) is entered on the debit side of the accounts. On the credit
side, an entry is made for imputed service charges (equalling
total operating expenses of banks, including profits, less monetary
service charges). It can be seen by reference to exhibit 13 that the
two must always balance: imputed service charges=wages paid
(50)+ current account purchases (25)+profits (30)—monetary
service charges (10)=imputed interest paid=interest received
(100) —interest paid on deposits (5) = 95.
This imputation is added, in exhibit 14, to the data shown in
exhibit 13.
The nonmonetary income and product flows having been made
explicit, a more adequate accounting of the value added by
commercial banks appears. Also, these banks are revealed in their
role of financial intermediaries. Interest is seen not to originate in
banking, but to be transferred by banking from the industries in
which it originates to the depositors to whom it accrues. (A minor
complication is introduced if, in addition to receipts of interest
income, receipts of dividends by commercial banks are taken into
account. See Part III, section on Interest.)

195 4

EDITION

Next, the imputed banking flows must be traced further through
the economy to determine their ultimate effect on the size and
structure of national income and product. This is done on the
basis of the ownership of the deposits in connection with which the
imputed flows arise. To the extent that these deposits are owned
by businesses, matching debit and credit entries are made in their
accounts—the debit for imputed service charges paid and credit
for imputed interest received. The balancing of the accounts is
not disturbed; for businesses affected, purchases of intermediate
products are increased by the amount of imputed service charges
and net interest paid is decreased by the amount of imputed
interest received.
Thus, to the extent that the deposits of commercial banks are
held by business owners, the imputation process does not change
the size of national product or income. Imputed service charges
cancel as intermediate products in the consolidation of the
business system, and so do the inter-industry imputed interest
flows. All that occurs is a redistribution in the industrial origin of
output, in the process of which the share of banking is increased
and that of other industries is reduced.
To the extent, however, that the ownership of bank deposits is
vested in persons, the results are different. Imputed service
charges made to persons constitute payment for a final product
and appear as a component of sales to persons under personal
consumption expenditures for "seivices rendered without explicit
charge by financial intermediaries, other than life insurance."
Imputed interest paid by banks to persons serves to increase net
interest by an identical amount. Both product and income originating are thus raised to reflect nonmonetary income and product
received by persons from banking. (In this discussion, it will be
noted, the accounting for imputed flows between banking and
government has been neglected. For this detail, see the section
on Interest, in Part III.)
The above description of the measurement of imputed flows
in banking is only a brief summary of a complex subject which
is still the subject of lively discussion among technicians in the
field. The procedure has been criticized in general as unduly
complex and, more specifically, as based on certain assumptions
of doubtful validity. Particular exception has been taken to the
assumption that all banking services not explicitly charged for
are rendered to depositors and that the borrowers of bank loans
are not involved, as well as to the assumption that these services
are distributed in proportion to the ownership of the volume of
deposits irrespective of turnover.
While these and other objections have some merit and it is
hoped that a simpler and more cogent solution may be found to
deal with the underlying problem of measuring the value added
to output by banking, it would appear that the present procedure,
all things considered, is the most satisfactory devised so far.
Whatever its particular limitations, it attempts to measure a real
element of income and product in the business economy and
permits a sensible solution to the problem of allocating income
by industries.
An imputation essentially similar to that for banking is made
in connection with investment trust type of financial institutions.
The precise mechanism of this imputation can be traced in the
light of the above discussion of banking on the basis of the additional detail provided in the section on Interest, in Part III.

A SUPPLEMENT

TO THE SURVEY OF CURRENT

Life insurance and mutual financial intermediaries
other than life insurance
The treatment of life insurance involves the second major type
of imputation which is made in connection with financial intermediaries. Imputations are introduced because the standard
national income and product classifications break down owing
to the combined saving and insurance functions performed by life
insurance. It is not possible to classify the explicit transactions
which occur between life insurance companies and their policy
holders into the conventional classifications of current receipts
versus capital transfers and of consumption and saving. Accordingly, in the income and product accounts imputed transactions
are substituted for the explicit transactions.
Specifically, claims and premiums are disregarded. Next, the
property income of life insurance companies which is withheld
to the account of policy holders is treated as if it were actually
disbursed in the current period. This item becomes imputed
interest in the net interest component of income. Finally, the
companies are regarded as explicitly charging policy holders for
their services, as measured by operating expenses. An imputation
equal to these expenses is entered in the business account under
sales to persons. It appears in personal consumption expenditures
as "Expense of handling life insurance."
That a balance between the income and product accounts is
secured if life insurance is treated in this manner can be seen
most simply by realizing that, as far as the totals are concerned,
life insurance companies have in effect been treated as individuals
rather than businesses. Claims and premiums have been cancelled
as though they constituted transfers among individuals; property
income received by these companies has been converted via the
interest imputation into property income received by policy
holders; and operating expenses incurred by the companies have
been converted by means of the service charge imputation into
final purchases made by policy holders. The balance of the Consolidated Business Income and Product Account thus reflects, in
essence, the balancing accounts of the business system other than
life insurance.
The effect of the treatment of life insurance on personal saving
may be anticipated at this stage. Since the property income and
operating expenses of life insurance are imputed to policy holders,
and receipts and payments of premiums and death claims are dis-

BUSINESS

regarded, a measure of personal saving results (in the personal
income and expenditure account described later) which consolidates the saving of life insurance companies with that of policy
holders.
An illustrative treatment involving mutual life insurance,
shown in exhibit 15, may serve to make this summary more
concrete.
The upper panel of the exhibit records the monetary transactions which occur in a simple economy involving life insurance
companies, other businesses, and persons. The lower panel reflects
the transactions that would be recorded in the national income
and product accounts. (Since nonbusiness production does not
occur in this example, a distinction between business output and
national output need not be made.) The lower panel differs from
the upper panel by excluding death claims and premiums and by
including imputed income and service transactions.
Gross national product (2200) is obtained from the lower panel
by adding sales (imputed) to persons by life insurance companies
(600), sales to persons by other business (1100), and business
capital formation (500). National income and personal income
(also 2200) are obtained by adding wages paid by life insurance
(200), wages paid by other business (1200), and (imputed) interest paid by life insurance (800). Personal saving (500) is obtained by deducting from personal income (2200) monetary and
imputed personal consumption expenditures (1700). It can be
seen that personal saving reflects the consolidated saving of persons and life insurance, as shown by the consolidated change in
their net asset positions (400 for life insurance and 100 for persons,
as indicated by the differences between the credit and debit totals
in the upper panel).
The treatment of stock life insurance companies is essentially
similar to that of mutual life insurance except that the operating
expenses of stock life insurance companies are measured to include
the companies' profits, which are correspondingly included in
total income.
Further detail on the specific items entering the calculation of
the property income flows (in the present example only interest
was allowed for), together with information on somewhat similar
imputations in connection with mutual financial intermediaries
other than life insurance, is given in Part III in the section on
Interest. This should be read in the general framework provided
above.

Exhibit 15.—Illustration of Treatment of Mutual Life Insurance
[Thousands ot dollars
Mutual Life Insurance
Debits

Other Business
Credits

Death claims .
Wages
Cost purchases

100
200
- 400

Wages
Cost purchases
Interest

200
- _ 400
_
*S00

Premiums....
Interest

700

Debits
300
800

Interest
Wages

1100
Interest
Sales.

1400
•Imputed.

800
- . . - «600
1400

Persons
Credits

800
1200

Sales
400
Sales
1100
Sales (business
capital account) . . . . 500

2000
Interest
Wages

800
1200

2000

Debits
Premiums
Purchases

300
1100

Purchases
Purchases

1100
*600

2000
Sales
Sales
Sales (business
capital account)

400
._ 1100

Credits

1400

500
2000

Death claims
Wages
Wages

1700

100
200
120©
150O

Wages
Wages
Interest

200
1200
*800
2200

NATIONAL INCOME, 195 4 EDITION

Government enterprises
In addition to financial institutions, other types of business organizations require special treatment in the national income and
product accounts. Government enterprises deserve explicit comment, not because they are important quantitatively in the
United States economic structure, but because they complicate
the accounts in a rather obtrusive way.
The distinction between government enterprises and general
government can be understood readily even though it cannot be
drawn with theoretical precision. Government enterprises are
those agencies of government whose operating costs are at least
to a substantial extent covered by the sale of goods and services,
in contrast to the general activities of government which are
financed mainly by tax revenues and debt creation. Government
enterprises, in other words, conduct operations essentially commercial in character even though they perform them under
governmental auspices. The Post Office and public power systems
are typical examples of government enterprises. On the other
hand, State universities and public parks, where the fees and
admissions collected cover only a nominal part of operating costs,
are part of general government activities.
Since a choice must be made, it is preferable to consolidate
government enterprises with business rather than with government. However, it seems desirable in handling these entities to
introduce certain departures from the standard procedures
adopted for ordinary business enterprises. (1) The profits of government enterprises are not included as part of factor cost in
income originating in business, but instead are treated as a nonfactor charge against the value of output (see "subsidies minus
current surplus of government enterprises" in table II). (2) The
capital formation of these enterprises (including both fixed capital
formation and inventory change) is classified in government
purchases rather than gross private domestic investment. (3) The
profits ("current surplus") of government enterprises are calculated without deduction either of net interest paid by them or
of depreciation. Therefore, depreciation charges of government
enterprises are not included in capital consumption allowances;
and net interest payments by government enterprises are not
counted as net interest payments by business. Since these modifications of the standard treatment of businesss enterprises do not
involve changes in the debit or credit totals, it can be seen that
the balance of the business account is not disturbed.
The effect of the treatment of government enterprises on the
government account (see table IV) may be anticipated at this
stage by noting that net interest paid by these enterprises is
combined with that paid by general government and that their
current surplus is treated as a receipt in the government account.
These steps, in conjunction with (2) above, serve to consolidate
the surplus (or deficit) of general government with that of
government enterprises. This is so because net interest paid plus
capital formation less current surplus of government enterprises
measures the net excess of their expenditures over their revenue.
Several considerations suggested the particular accounting for
government enterprises adopted in this report. With respect to
the profits ("current surplus") of government enterprises, it was
thought desirable to exclude them from factor charges because,
in a way too difficult to disentangle, they were recorded net of

losses which in effect reflected government subsidy operations
conducted through the medium of government enterprises,
mainly in World War II. The inclusion of government enterprise
losses due to subsidy operations would have offset the corresponding subsidies in total income originating, and would have run
counter to the general procedure of treating government subsidies as part of total factor cost.
The decision not to count net interest paid by government
enterprises as net interest paid by business (and, correspondingly,
to calculate the current surplus of government enterprises before
deduction of net interest paid by them) was closely related to the
decision not to treat their profits as part of factor cost. In general,
a meaningful total of factor cost with respect to property factors
can be obtained only if profits and interest are combined, and
the inclusion of net interest paid alone might have been misleading.
Next, government enterprise capital formation was combined
with government purchases rather than with private investment
because the dividing line between capital purchases by government enterprises and those by general government is quite
arbitrary. For instance, the construction of post offices is recorded
in the general budget of the United States rather than in the
accounts of the Post Office. Pending an exhaustive classification
of all government purchases of capital goods, it was thought
preferable to merge government enterprise capital formation
with government purchases.
Finally to be noted is that the government surplus or deficit
(consolidating both government enterprises and general government) which is obtained by this general procedure is the most
useful definition of government surplus or deficit for many types
of economic analysis.
The main aspect of the handling of government enterprises is.
their treatment as business-type organizations in order to avoid
the classification of their current expenses as final purchases.
Beyond this aspect, however, the treatment of government enterprises is in essence not more than a convenient means of disposing
of a type of operation that has not reached quantitative importance in the United States total income and product picture.
Were government enterprise operations to assume greater importance in the United States economy, it is entirely possible that
some modification of their treatment in the national income accounts would be called for.

The Personal Sector
The personal sector of the economy covers essentially the consuming public. It consists chiefly of individuals in their capacity
as income receivers and consumers, but it includes also nonprofit
institutions, private trust funds, and private pension, health, and
welfare funds.

Personal account

•

Unlike business transactions, which are summarized by a profit
and loss type of statement exhibiting the profit or loss realized in
the current period, personal transactions are summarized by a
statement of current receipts and expenditures. This difference
reflects, of course, the fundamentally dissimilar nature of the two
sectors of the economy.

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS

The personal account, shown in table III, represents a consolidation of the accounts of all the persons who constitute the personal sector, just as the business account presented in table II
was derived by consolidating the accounts of all the firms included
in the business sector.
The personal account shows, in general, the transactions of
persons with the other sectors of the economy. Since nonprofit
institutions, private trust funds, and private pension and related
funds are regarded as part of the personal sector, income receipts
of these entities from other sectors are included in personal receipts and their purchases from other sectors are included in
personal expenditures.
Conversely, since the account is consolidated, most transactions
between these entities and individuals, as well as among individuals, are cancelled out in the process of consolidation. This
process of cancellation is not extended, however, to the transactions among persons that are regarded as purchases of the services
of factors of production—for instance, wages paid to domestic
servants and payments of wages and interest by nonprofit institutions. Instead, these transactions are reflected on both the receipt
and expenditure sides of the account, in order to preserve a record
of them which is needed in tracing the total flow of production in
the economy.

Classification of personal income
The classification of personal income on the right side of the
personal account in table III follows closely the classification of
the income items on the left side of the business account in table
II. In addition, however, to the incomes originating in business,
it also includes incomes received from general government and
from abroad, as well as incomes derived from production within
the personal sector.
The nature of the incomes derived by persons from the business
system has been covered in the discussion of the business account.

Separate entries for each of the items disbursed by the business
system can be found in the personal account except for interest
and dividend payments, which are included in the interest and
dividend entries but not available separately, for lack of statistical
information.
It will be noticed that only incomes currently received by persons
are included in the personal account. Thus, the wage and salary
component measures disbursements in the current period, and
differs from wages and salaries earned in the same period by the
"excess of wage accruals over disbursements" (see table II).
Similarly, only corporate profits distributed in the form of
dividends appear in the personal account. For unincorporated
enterprises, however, no useful distinction can be made between
distributed and undistributed income, and the entire amount is
transferred to the personal account. Finally to be noted is that
personal contributions for social insurance—including contributions by both employees and self-employed—are excluded from
personal income. Along with the contributions by employers on
behalf of their employees, they constitute receipts to government
rather than to individuals.
Income receipts from government consist of wages and salaries,
other labor income, interest, and transfer payments. With the
exception of interest payments, they are listed separately in
table III. Government interest payments to persons are included
in personal interest income.
The definition of each of these income receipts is similar to that
of the corresponding receipts derived from business and does not
require separate discussion. It should be kept in mind, however,
that although the formal definitions of the items are similar their
actual content may be very dissimilar owing to the different
nature of government operations. For instance, wages and
salaries received from government include military wages and
salaries, a type of payment which is not made by the business
sector. Similarly, government transfer payments include social
security benefits, relief, and various payments to former members

Table HI.—Personal Income and Expenditure Account,

1950

[Millions of dollars]
Personal consumption expenditures:

Wage and salary disbursements:

Purchases of direct services:

16
17
18
19

Business
Government
Households and institutions
Rest of the world

120, 565
19, 631
6, 312
18

20
21
22
23

Other labor income:
Business
Government
Households and institutions

3, 440
330
53

Income of unincorporated enterprises and inventory valuation adjustment

Compensation of employees:
Wages and salaries paid
Supplements paid:
Employer contributions for social insurance
Other labor income
Interest paid
Income originating in and net and gross product of households and institutions

6, 312
18
53
1, 956

36, 140

8, 339
25

9, 207

Personal interest income

10, 628

Government transfer payments

14, 304

Business transfer payments

Net purchases from abroad

Dividends

8, 473

Net purchases from business

Rental income of persons

Less: Personal contributions for social insurance

PERSONAL INCOME

184, 340
1, 347 j

Personal tax and nontax payments

20, 920

Personal saving

12, 104

PERSONAL OUTLAY AND SAVING

227, 050

843
2, 894
227, 050

NATIONAL INCOME, 195 4 EDITION

of the military establishment, all of which constitute payments
that are unique to government operations and have no genuine
counterpart in business.
Net wage and salary receipts from abroad appear explicitly as
receipts of the personal sector.6 Personal interest and dividend
receipts from abroad are included with other personal interest
and dividend receipts under personal interest income and
dividends.
Personal income derived from households and institutions
consists of income receipts of individuals for productive services
rendered within the personal sector of the economy. Incomes
included under this heading are those received for labor services
rendered directly to households, such as domestic service, and
the incomes received by employees of, and personal suppliers of
capital funds to, nonprofit institutions. (The labor income is shown
explicitly in table III, but the interest income is merged with
other personal interest receipts.) As has been noted, in order to
maintain a comprehensive record of total productive activity
these transactions are not cancelled in deriving the consolidated
personal account even though they occur within the personal
sector.

Relation of national income and personal income
The bulk of personal income is derived from production, and
personal income is therefore used widely as an indicator of
economic activity. However, it is not a measure of the value of
national output because it excludes certain incomes that accrue
in production but are not distributed to persons and includes
certain other income receipts that do not accrue in production.
The relation between national income, which is a measure of
output in terms of factor income flows, and personal income is
shown in exhibit 16.
Exhibit 16.—Relation of National Income and Personal
Income, 1950
[Millions of dollars]
National income
Less: Undistributed corporate profits
Corporate profits tax liability
Corporate inventory valuation adjustment
Contributions for social insurance..
Excess of wage accruals over disbursements
Plus: Net interest paid by government
Government transfer payments
Business transfer payments
Equals: Personal income

239,956
12,934
17,829
—4,864
6,870
0
4,716
14,304
843
227,050

In this exhibit, personal income is derived by deducting from
national income all incomes earned in current production but
not received by persons and by adding to it the incomes received
by persons but not earned in current production. The deductions
consist of all elements of the "corporate profits and inventory
valuation adjustment" component of national income except
dividends (undistributed corporate profits, corporate profits tax
liability, and corporate inventory valuation adjustment) and of
the parts of employee compensation and unincorporated enterprise income not regarded as distributed to individuals (contributions for social insurance and the excess of wage accruals over
disbursements). The additions consist of transfer payments from
government and business and of net interest paid by government.
The latter item represents the excess of the total interest payments
6. For certain statistical limitations of this item, see section 12 of Part III.

by government over its total interest receipts, and must be added
to national income because the net interest component of national
income falls short of the interest receipts of persons by that
amount. (For a detailed tracing of interest flows, reference is
again made to the Interest section of Part III).

Personal outlay and saving
The debit side of the personal account contains three general
categories: personal consumption expenditures, personal tax and
nontax payments, and personal saving.
Personal consumption expenditures consist chiefly of net purchases from business, corresponding to the credit entry for consolidated net sales to persons in the business account. Also included
are purchases made directly by persons from abroad (mainly
while traveling abroad, but including also international remittances) and purchases of direct factor services.
Purchases by persons of direct factor services measure production originating in the personal account. They are entered at
their full cost, which consists of the compensation of employees
and interest payments. As already mentioned, much of this expense is matched by a receipt entry in the personal account itself.
However, employer and employee contributions for social insurance appear as a receipt in the government account, while the
interest cost of production in the personal sector is composed of
payments to all sectors of the economy.
It will be noted that there is no entry for purchases of goods and
services from government. This is simply because all government
agencies which are conceived as selling their services for a market
price are defined as government enterprises and classified in the
business sector, so that consumer payments to them, such as for
postage stamps, appear as purchases from business.
Payments by persons to general government, consisting chiefly
iof direct personal taxes, are classified as personal tax and nontax
payments, the second general category on the left side of the
personal account. This entry does not include contributions for
social insurance, which are excluded in the computation of
personal income. It may be noted, however, that the total individual income tax, including the portion withheld at source, is
treated as though initially received by the personal sector. In
other words, personal income is measured before deduction of
this tax. The different treatment of income taxes and social
insurance contributions is somewhat arbitrary. Disposable personal income, of course, is measured net of both of them.
The amount remaining out of personal income after the purchase of goods and services and payments to government is
personal saving. It comprises the saving of individuals, including
owners of unincorporated enterprises, and the saving of the
organizations that are considered part of the personal sector,
namely private pension, health and welfare funds, private trust
funds, and nonprofit institutions serving individuals. It is the
algebraic sum of the saving and dissaving of these groups.
Seen from another aspect, personal saving measures the net
change in the asset position of persons as between the beginning
and end of the accounting period. Personal saving is made up of
the net increase in all the kinds of assets in which recipients of
personal income invest, offset by the net increase in all the kindsof liabilities which they incur.

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS
Exhibit 17.—Illustration of Treatment of Nonprofit Institutions Serving Individuals
[Thousands of dollars]
Nonprofit Institutions
Debits

Wages (t)_
Interest (2)
Interest (3)..
Purchases (4)
Cash relief (6)

Individuals
Credits

16
3
2
12
4

Gifts (6)....
Gifts (7)
Dues (8)__
Interest (9)._

Debits
11
6
..- 8
7
31

Gifts (6)
Dues (8)
Purchases (10)
Interest (11)
Wages (12)....

Credits
11
8
40
1
6
66

Included are not only the items commonly thought of in connection with personal saving, such as changes in cash and
deposits, in security holdings, and in personal indebtedness, but
also the net investment of noncorporate business in realty, equipment, and inventories. Personal saving also includes changes in
the reserves of life insurance companies and mutual financial
institutions, as explained above in the discussion of the treatment
of these entities in the national income and product accounts.
Assets are defined, of course, in the context of the conceptual
framework underlying national income measurement. Capital
gains and losses are not counted as changes in asset position, and
all consumer purchases of goods except residences are classified as
consumption rather than as investment.
A breakdown of personal saving by type of asset or liability is
provided in table 6, Part V of this report.

Imputations
As in the case of business output, the measurement of output
in the personal sector is not confined to monetary transactions,
but also takes into account imputed income and product flows.
The most important of the imputations is for the value of food
provided free to employees of households and nonprofit institutions. The imputation involves an increase in the wages and
salaries of employees, equal to the cost of the food to the employer,
on both the credit and debit sides of the personal account. The
reconstructed account depicts the situation which would prevail
if monetary wages were raised by the value of the imputation and
the corresponding food were purchased by the employees rather
than by their employers.
An imputation is also made for the value of free lodging furnished to clergymen, employees of nonprofit hospitals, and
certain quantitatively unimportant groups. None is made in the
case of domestic servants, because it is felt that, as a general
proposition, they do not regard the lodging furnished them as an
addition to income.

Nonprofit institutions
Nonprofit institutions include religious organizations, social
and athletic clubs, labor organizations, nonprofit schools and
hospitals, charitable and welfare organizations, and other nonprofit organizations furnishing services to individuals. It has
already been pointed out that they are consolidated with individuals in the personal account. While the principle of consolidation is clear, some fairly intricate manipulations of items are
involved. These may be illustrated by reference to exhibits 17 and
18, which are designed to show the treatment of the major
transactions involving nonprofit institutions. Certain simplifica

Corporations

Wages (1).
Wages (12)
Wages (13).Interest (2)
Cash relief (5).

Debits
15
6
45
3
4

Wages (13)
Gifts (7)...
Interest (9)

Credits
45
5
7

Interest (3)
Sales (4)
._
Sales (10)
Interest (11).

2
12
40
1
65

tions have been made to keep the example to manageable proportions. Investment by nonprofit institutions (counted as part
of private domestic investment) has been excluded, as have
government payments to nonprofit institutions (included in
government transfer payments).
Exhibit 17 shows a set of interrelated transactions of nonprofit
institutions, individuals, and corporate business. Exhibit 18 gives
the Personal Income and Expenditure Account corresponding to
these transactions. In essence, the latter account is obtained by
consolidating the transactions of nonprofit institutions and individuals. In this process, the tiansactions involving cash relief,
gifts, and dues cancel out. However, cancellation is not extended
to transactions between nonprofit institutions and individuals involving payments for factor services. The record of these transactions is preserved in the comprehensive accounting for national
output.
Exhibit 18.—Personal Income and Expenditure Account Based on Exhibit 17
[Thousands of dollars]
Personal consumption expenditures:
Purchases of direct services:
Compensation of employees:
Wages and salaries paid:
Wages (1)
15
Wages (12)
6
Interest paid:
Interest (2)
3
Interest (3)
. 2
Interest (11)
1
Income originating in and net and
gross product of households and
institutions
27
Net purchases from business:
Purchases (4)
12
Purchases (10)
40
Personal saving
2
PERSONAL OUTLAY AND
SAVING

Wage and salary disbursements:
Wages (1)-.
Wages (12)
Wages (13)
Personal interest income:
Interest (2)
Interest (9)
Business transfer payments:
Gifts (7)

PERSONAL INCOME

15
._ 6
45
3
7
5

Thus, employee compensation [wages (1)] and interest paid by
nonprofit institutions to individuals [interest (2)] appear on both
sides of the personal income and expenditure account and constitute components of "income originating and net and gross product
of households and institutions," which measures the value added
to national output by the personal sector. In addition, this measure includes the compensation of household employees [wages
(12)] and interest paid to the business sector by nonprofit institutions [interest (3)] and by households [interest (II)]. 7
7. The above summary covers the principal features of the national income accounting
treatment of nonprofit institutions. If allowance is made also for depreciation on plant and
equipment owned by nonprofit institutions, it can be seen that they are measured in personal
consumption expenditures by their current operating expenditures including depreciation
(but excluding domestic cash benefits paid). In the personal consumption expenditure estimates in table 30, Part V, the current operating expenditures of nonprofit institutions are in
some instances measured net of the institutions' receipts accounted for separately in consumer expenditures, such as receipts from the sale of food, housing, and recreational services.
Of further note, it is often not possible to measure current operating expenditures directly.
In such instances, indirect approximations—such as gross receipts less benefits paid—are
used, and the items in table 30 are labeled correspondingly.

NATIONAL INCOME, 195 4 EDITION

Private trust funds and private pension, health, and welfare
funds are also consolidated with individuals in the personal sector.
In these cases, however, the procedure is more straightforward
since the administrative expenses of these entities are small and,
in practice, can be neglected.

Further breakdowns of personal account
The personal account, like the business account, includes somewhat heterogeneous elements, and further breakdowns of it would
be useful. In particular, individuals might be distinguished from
the various types of quasi-individuals included in the personal
account; and, more important, individuals might be subdivided
into significant social groups, such as farmers, other businessmen,
independent professional practitioners, and wage earners, showing
separately the incomes of these groups and their disposition
among consumption, taxes, and saving. At the present stage, inadequacy of statistical materials limits the development of comprehensive measures of this sort.
The National Income Division does prepare, however, two sets
of estimates, not included in this report, that represent breakdowns
of the personal account which have wide analytical significance.
These are the series on personal income by States and by size of
income.

The Government Sector
The government sector includes Federal and State and local
general governments and the social insurance funds administered
by them. These funds comprise those set up under the Social Security and Railroad Retirement programs. State health insurance
funds, the retirement funds established for government employees, and military life insurance funds. The distinction drawn between general government and government enterprises, which
are included in the business sector, has already been described.

Government account
The transactions of government are summarized by a consolidated statement of receipts and expenditures, as presented in
table IV. In many ways this statement resembles the conventional
budgets of governmental bodies. However, there are several differences.
In the first place, the account shown in table IV is consolidated.
All levels of American government, the social insurance funds
administered by them, and the net expenditures of government
enterprises are covered. (However, separate breakdowns for the
Federal Government, State and local governments, and social
insurance funds are given in tables 8, 9, and 10 in Part V.)
Second, the account excludes receipts from the sale of, and
expenditures for the acquisition of, financial assets and secondhand fixed assets. Third, the timing of receipts and expenditures
differs from that of conventional budget statements, being synchronized with the timing of the corresponding expenditures and
receipts in the other accounts. Personal taxes are on a cash basis,
other taxes are on an accrual basis, and purchase entries reflect
time of acquisition rather than of payment. Finally, the classification of transactions differs from that of conventional budget statements, being adapted to the needs of national output measurement and general economic analysis.

Classification of receipts and expenditures
Most of the transactions contained in the government account
have already been discussed in connection with the business and
personal accounts.
The labor cost items, which appeared on a receipt basis in the
personal account, are on an accrual-cost basis in the government
account. The difference consists of employers' and employees'
contributions under retirement systems for government employees. In table IV the employer contribution is treated as a
simultaneous government expenditure and receipt. The employee
contribution appears as a deduction in the personal account
(under "personal contributions for social insurance") and as a
receipt in the government account.
Transactions with abroad, not yet discussed, appear explicitly
under "net purchases from abroad" and are included also in "net
interest paid." The former entry measures the excess of government purchases from foreigners over government sales to them
(cash gifts are treated like purchase and sale transactions in this
connection, but loans are excluded). Net interest paid is defined
as the excess of total interest payments by government to all sectors over total interest receipts from all sectors. Government
enterprises are covered in both payments and receipts.
Most of the salient features of the classification of government
receipts and expenditures have come to attention already, in
connection with the construction of measures of total national
output. However, certain points may be elaborated now that all
government transactions have been assembled.

The value of government output
Value added by government to national output, like value
added in all other nonbusiness sectors of the economy, is measured
by total factor cost incurred. In the case of the government,
factor cost is confined to the compensation of government employees. Interest payments are not counted. Two issues should be
considered as relevant to this treatment: first, the distinction between employee compensation and transfer payments; and,
second, the exclusion of monetary interest and the question of
substituting an imputed interest series for it.
Employee compensation versus transfer payments
A distinction is made between two types of government payments to individuals in their nonbusiness capacity—employee
compensation and transfer payments. The former is in return
for current productive services rendered; to the latter no such
services correspond. This distinction is a basic one, because it
segregates flows which are taken as measures of value added to
national output from flows which are not so regarded. Hence it is
important to see how it is made in practice.
Difficulties arise in the concrete interpretation of the term "productive service." For instance, in the classification of work relief
wages that were paid in the depression of the thirties, the question
arose as to whether they should be classified as labor returns or as
transfers. A more fundamental issue is raised by the national
income estimates of some foreign countries, in which military employee compensation has been excluded from factor income and

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS
Table IV.—Consolidated Government Receipts and Expenditures Account, 1950
[Millions of dollars]
16

Purchases of goods and services:
Purchases of direct services:
3
4
5
6

Personal tax and nontax receipts

20, 920

17 j Corporate profits tax accruals

Compensation of employees:
Wages and salaries
19, 631
Supplements:
Employer contributions for social insurance
812
Other labor income
330

Income originating and net and gross product

17, 829

18 j Indirect business tax and nontax accruals

23, 741

19 i Contributions for social insurance:
Personal contributions
Employer contributions:
Business
Government
20, 773
Households and institutions

Net purchases from business
Net purchases from abroad

2, 894
3,146
812
1&

17, 828

20
21
22
23
24

3, 422

Transfer payments

Net interest paid

Subsidies minus current surplus of government enterprises....

Surplus ( + ) or deficit (—) on income and product transactions
8, 113

GOVERNMENT EXPENDITURES AND SURPLUS

14, 304
4, 716
204

69, 360

treated as a transfer on the basis of some more ultimate, philosophical notion of productiveness.
In the United States estimates, the criterion for classifying an
item as employee compensation or as transfer hinges on the current performance of work. No attempt is made to probe into the
issue of whether the work is performed efficiently or whether, in
some more basic sense, it is "productive." The practical impossibility of drawing distinctions of this type has been covered inferentially in the evaluation of the basic notions underlying national
output measurement.
But even on the basis of the simple current-work-performed
criterion, a clear-cut distinction between wages and salaries and
transfer payments does not emerge in all cases. For it is not
always possible to say whether a specific payment is made for
the current work that is performed or for other reasons. Allowances for soldiers' dependents presented a classification problem
of this type. It was decided to classify them as employee compensation rather than transfer payments, although a case for the
opposite decision also could have been made. On the other hand,
retroactive terminal leave payments, bonuses, and other deferred
payments (such as under the "GI bill") to members of the Armed
Forces of World War II were considered transfers, as they were
disbursed at a date far removed from the time the military service
was performed. Counting these payments as compensation for
services would have necessitated allocating them over past years
on an accrual basis—a course which seemed artificial and would
have involved continuous revisions of the national income and
product estimates for the war period.

Government Interest
Government interest payments are not included in value added
to output by government because they are subject to fluctuations
which, it is believed, it would be artificial to regard as representing corresponding changes in the value of current production. It
may be added that business interest can be included in a measure

GOVERNMENT RECEIPTS

69, 360

of national output without such explicit consideration of its
behavior. Any fluctuations in it not reflecting productive activity
are offset by opposite changes in business profits. Hence, the
inclusion of business interest has no distortive effect on the output
measure and, in fact, is necessary to secure the correct total.
Thus, value added by government takes account only or the
services of the labor factor whereas the valuation of business output includes also returns to nonlabor factors. The question
accordingly arises as to whether an allowance should be made for
the services of government-owned property by the imputation of
a rate of return to it, somewhat analogous to the imputation of a
return to owner-occupied homes in the business sector of the
economy.
An imputation for government-owned property is not made in
the national income accounts for the United States because the
conceptual and statistical bases for making a realistic and useful
imputation are absent. The analogy to the housing imputation
does not hold. The bulk of this imputation is anchored to realistic
estimates of the gross rental value of owner-occupied houses
available from Census reports, based on comparisons of owneroccupied property with rental property of similar type. In the
case of the government no similar, market-based information to
establish the rental value of the vast bulk of government structures and equipment is, or can be, available. The rental value of
the highway system or of the Tennessee Valley Authority cannot
be estimated by reference to the rental value of property of
similar type.
In the absence of a realistic market evaluation of the rental
value of government property, its net return would have to be
derived by estimating the total value of government real capital
assets, segregating the part which is deemed to be in productive
use, and then applying to the latter a rate of return to reflect the
value added by the property. Clearly, each of these steps would be
highly speculative, and a measure of imputed return useful in
realistic analysis would not be likely to result.

NATIONAL

INCOME,

Decisions affecting valuation of business output
In the national product, output is valued at market prices—•
inclusive of indirect business taxes and exclusive of subsidies. The
manner in which these two items are denned therefore affects the
total value of national product.
Indirect business taxes versus personal taxes
Indirect business taxes are taxes (other than social insurance
contributions) that are chargeable to current cost by business
enterprises; and personal taxes are taxes paid by persons that are
not so chargeable.
This distinction leaves the treatment of retail sales and related
taxes somewhat ambiguous, since in some instances these taxes
are included in the sales price and charged to current expense,
and in others excluded and paid separately by the consumer. In
the latter case it would be possible to regard these taxes as personal
taxes and to list the corresponding purchases at values excluding
them. In this report the procedure of treating all these taxes as
indirect business taxes forming a part of market price has been
adopted, because it is thought to be the more meaningful from the
standpoint of studying market behavior.
Further emphasis on this type of study underlies a proposal to
depart from the accounting distinction between personal and
indirect business taxes used in this report. It has been suggested
that for analysis of consumer behavior all taxes that are closely
tied to consumer purchases should be treated as indirect business
taxes and included in personal consumption expenditures, regardless of whether they are chargeable to current cost by business.
For instance, automobile license and registration fees paid by
personal consumers would, according to this plan, be classified
in personal consumption expenditures and indirect business taxes,
rather than in personal taxes as at present. The logic would be
that payment of these taxes is a determinant in the choice of
consumers as between automotive and other types of expenditures.
While this suggestion has some merit, it would raise difficult
problems of classification. The influence of various types of taxes
on personal consumption is a matter of degree and does not
provide a clear-cut criterion of classification.
Subsidies versus purchases
Subsidies are monetary grants to business, and it is usually easy
to distinguish them from government purchases of goods and
services. However, in certain instances a subsidy element may be
included in the purchase price of an item in lieu of an explicit
subsidy. Cases of this type have involved payments by government enterprises (such as payments by the Post Office for air mail
contracts, which until recently have included an element of subsidy.) By virtue of the accounting for the current surplus and
deficit of government enterprises, as described earlier, indirect
subsidies of this type receive in effect the same treatment as
explicit subsidies. Payments of similar type on the part of general
government have not come to notice. To the extent that they
occur, they are regarded as purchases, and no attempt is made
to segregate the subsidy element.

Imputations
Imputations are made for wages and salaries paid in kind to
government employees. The most important of these imputations

1954

EDITION

is for food and standard clothing issued to members of the Armed
Forces. It may be noted that only standard, or personal, clothing
is included, not special clothing and equipment. Also, the rental
value of shelter provided is not allowed for. The principal line of
reasoning is that in many instances the provision of lodging to
servicemen does not reduce their cash housing expenditures and
hence is not a clear addition to their income.
In the recording of the imputations, the accounts are reconstructed to correspond to a situation in which the government paid out
to its employees additional wages equal to the cost (to the government) of the food and clothing provided and the employees themselves purchased these items from the business system. In the
government account (table IV), compensation of employees (and
income and net and gross product originating in government) is
raised by the value of the imputation. But total government purchases of goods and services are not changed because government
purchases from business are reduced by a corresponding amount.
In the business account (table II), there is a corresponding shift
from sales to government to sales to persons. Finally, in the
National Income and Product Account (table I), the imputation
raises personal consumption expenditures and gross national
product, on the one hand, and the compensation of employees,
national income and the sum of charges against the value of national product, on the other.
In view of the fact that an imputation is made for wages and
salaries received in kind, it may be wondered why transfer payments, and also subsidies, are confined to monetary transactions—
why specific goods and services given to individuals are not
included in transfer payments, and why those given to business
are not counted in subsidies. The basic reason for this apparent
inconsistency is that, whereas in the case of wages and salaries a
generally accepted procedure for imputation, partly pragmatic
and partly tradition-based, is available, this is not so with respect
to transfer payments and subsidies. The principal difficulties in
the way of establishing such a procedure have been set forth in the
discussion of the basic notions underlying national output
measurement.
By way of supplementary argument, it may be noted that the
introduction of transfer payments and subsidies in kind would
interfere with the function of the accounts as a record of actual
transactions. Of course, wage and salary and other imputations
that are made in the national accounts have a similar effect. In
these instances, however, it is felt that the resulting improvement
in the income and product components and totals outweighs the
disadvantages involved.
Two examples of the rather extreme complications of the
accounts that can arise from the introduction of imputations of
transfer payments and subsidies may be given.
Suppose, for instance, that services rendered by government
employees in the administration of relief programs were to be
regarded as transfer payments in kind. In the government
account (table IV), transfer payments would be increased and
compensation of government employees correspondingly reduced. In the personal account (table III), transfer payments
would be increased on the credit side and employee compensation (and hence purchases of goods and services and income and
net and gross product originating) on the debit side. In effect, the
government employees rendering the services classified as trans-

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS

fer payments in kind would now be classified in the personal
sector, as household employees. Finally, in the National Income
and Product Account (table I), personal consumption expenditures would be raised, and government purchases lowered, by
the amount of the imputed transfer payments. It is apparent that
these reclassifications would greatly reduce the value of the
accounts as records of the income and product flows that actually
occur among the major sectors of the economy.
Or, assume that a subsidy in kind consisted of services rendered
by government employees. In this instance the reclassification
would involve labelling as subsidies in the government account
payments actually made for wages. In the business account wages
would have to be increased, to include wage payments actually
made by the government, and offset by a corresponding increase
in the deduction made for subsidies.

Social insurance funds
The consolidation of social insurance funds with the accounts of
general government is a straightforward procedure which need
not be detailed. However, certain differences between the treatment of social insurance funds and of privately administered
pension funds may be pointed out. These stem from the fact that
the social insurance funds are consolidated with government
while private pension funds are consolidated with individuals in
the personal sector.
With respect to the measurement of employee compensation
(and national income), the difference is merely one of classification between shares—employer contributions to governmentadministered funds are listed under "employer contributions for
social insurance," whereas employer contributions to private
pension funds are included in "other labor income." However,
the effect of the difference in treatment on personal income and
saving is more substantive. Employer contributions and property
income received by privately administered funds become elements
of personal income, and the saving of these funds part of personal
saving. Employee contributions into these funds, as well as benefit
payments made by them, are canceled as constituting transfers
within the personal sector. Employer and employee contributions
and property income received by social insurance funds, on the
other hand, enter government receipts; benefit payments made

by them are explicitly recognized (as transfer payments by the
government) as a component of personal income; and the saving
of social insurance funds is a component of the government surplus
rather than of personal saving.

Rest of the World Sector
The transactions of the rest of the world with the United States
are summarized in the rest-of-the-world account presented in
table V. The rest of the world covers foreign countries, territories
and possessions of the United States, international organizations,
and the United States monetary gold stock. The gold stock is included in this sector because net acquisitions of gold by the
monetary authorities from domestic sources are considered
foreign investment.
It may seem strange at first that the "rest of the world" is a
sector of the national economy, and, indeed, there would be no
need to consider it in the case of a closed economy which had no
dealings with foreign countries. In the real world, however,
trade and investment do cross international boundaries. Consequently, to complete the set of accounts it is necessary to include
one which summarizes the transactions of foreigners with the three
domestic sectors of the economy.
The rest-of-the-world account is a receipt and expenditure
account and, like the other accounts, consolidated. It bears a
close affinity to the balance-of-payment statement. It differs from
this statement mainly in arrangement, with respect to netting
and the classification scheme applied to the transactions involved.
The debit side of this account shows the net purchases of United
States goods and services by the rest of the world. It is divided
among net purchases of direct factor services and other purchases
(net) from business, government, and persons. Net purchases of
direct factor services from the United States by the rest of the
world, as shown by the net inflow of factor incomes to the United
States, measure United States national income and product
originating in the rest of the world.
Because of the inclusion of gifts in net purchases from United
States persons and government, net purchases of goods and
services by the rest of the world cover all its current transactions
with the United States. The excess of purchases over sales must
be financed by a change in the net international asset position (an

Table V.—Rest of theWorld Account, 1950

[Millions of dollars]
Net purchases of goods and services:

Net purchases of direct services:
Wages and salaries
Interest
Dividends
Branch profits

Income originating and net and gross product

Net purchases from business

Net purchases from government

NET DISINVESTMENT IN THE
UNITED STATES

- 2 , 201

— 3, 422

Net purchases from persons

—2, 201

2
3
4
5
6

Net disinvestment in the United States

— 1, 347

10
11

NET CURRENT PAYMENTS TO THE
UNITED STATES

18
248
426
574
7, 266

1, 302

- 2 , 201

NATIONAL INCOME, 195 4 EDITION

increase of United States claims on abroad or a decrease of foreign
claims on the United States). From the standpoint of the
rest of the world, this excess constitutes net foreign disinvestment
in the United States, as shown on the credit side of the account.

International gifts
Inclusion of cash gifts received by foreigners from the United
States in sales to United States persons and to the United States
Government, together with the corresponding inclusion of gifts
made by foreigners in purchases from the United States, secures a
treatment of these transactions which is appropriate for the
measurement of national product. Net gifts made by United
States persons and Government appear in personal consumption
expenditures and government purchases but are offset in the net
foreign investment component of national product.
Needless to say the treatment of gifts as purchases is a somewhat
unsatisfactory short-cut. It was adopted in order to simplify the
structure of the accounts at a time when the important role of
gifts in international transactions was not yet apparent. It has not
been discarded because the alternative, more elaborate treatment
also has serious shortcomings.
This alternative treatment consists of the establishment of a
separate category of international transfers in the income and
product accounts to cover the gifts now included in the purchases
and sales of goods and services. These international transfers
would affect, in addition to the rest-of-the-world account, the
personal and government accounts (tables III and IV). The
detail of the national income and product account (table I) also
would be affected. Personal consumption expenditures and government purchases of goods and services would be reduced by the
amount of net gifts made, and the entry under net foreign investment would be increased by a corresponding amount (with an
appropriate change in the designation of the term to indicate that
it would no longer reflect net foreign investment, but the balance
of transactions in actual goods and services).
The complication of the accounts which would be involved in
the establishment of a separate category of international transfer
payments, while considerable, would be warranted if it would
throw into clear relief the large international aid transactions involving the United States Government. However, this would not
be accomplished for the reason that international aid, in addition
to cash grants, involves also loans and aid in kind. The three forms
of aid often are almost indistinguishable from one another in their
economic aspects.
There is no clear-cut procedure available for distinguishing between international aid rendered in kind and government purchases for domestic purposes. For instance, in World War II it
would have been rather unrealistic to distinguish between lendlease, which presumably would have been classified as international aid in kind, and other government purchases for war purposes. Nor is there available an uncontroversial yardstick for
classifying loans into loans proper and those that in effect represent
international transfers. Since the relative magnitudes of the three
media for extending international aid of essentially similar nature
have been subject to considerable shifts, it would not have been
instructive to establish a separate category for cash gifts alone, the
only type of aid that could have been distinguished objectively.

It may be noted that conceptually similar problems arise with
respect to the domestic operations of government. Aid to individuals and business also involves monetary grants, goods and
services rendered in kind, and loans. In the case of these domestic
transactions, monetary aids (in the form of transfer payments and
subsidies) are recorded, but the two other types of aid are not
recognized as such. While from some standpoints this dividing
line is somewhat arbitrary, it is much more meaningful than a
corresponding line would be for international aid. In the domestic
sphere, shifts in the relative importance of the three media in
extending aid of essentially similar nature have not been present
in a comparable degree.

Treatment of gold
In essence, the treatment of gold production in national income
and national product is the same as that of any other commodity.
The distributive shares arising directly or indirectly in its production (together with nonfactor charges, such as indirect business
taxes and depreciation) are reflected on the debit side of the
national income and product account. The value of gold produced enters the credit side either as such or as an ingredient of
the value of some other final product, although the classification
in the product flow is less transparent than in the case of other
commodities. Domestic nonmonetary use of gold may be reflected
in any of the domestic components of national product—personal
consumption, domestic investment including inventory change,
and government purchases. To convert domestic nonmonetary
use into a measure of total domestic production, monetary use
and exports must be added and imports must be deducted.
These items—the change in the monetary gold stock and net
gold exports—which in combination measure net domestic
business sales of gold for export and monetary purposes, are
included in net purchases by the rest of the world from United
States business. In other words, the monetary gold stock is set up
as part of the rest of the world and its transactions with United
States business are treated as foreign transactions. Thus, changes
in the monetary gold stock not offset by gold exports and imports
come to be reflected in net foreign investment.
Silver is not regarded as an international monetary asset. It is
classified in the product flow exactly like any other commodity.

Gross Savins and Investment Account
The entries in the sector current accounts presented so far show
the current transactions of each of the four major economic
groups, yielding in each case a residual which represents a form
of saving. A logical extension of this system of sector current
accounts would be the establishment of corresponding sector
saving and investment accounts showing the disposition of these
savings in the form of net financial and real investment.
Sector saving and investment accounts of this type have not
been constructed on a comprehensive scale (a statement of this
type for persons is presented in table 6, Part V) and cannot yet
be made an integral part of the national economic accounting
system. A consolidated saving and investment account for the
Nation as a whole is presented instead, in table VI.

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS

In the process of consolidation the financial investments involving transactions among the domestic segments of the economy
are canceled, and all that remains are matching flows of saving
and of domestic investment (fixed capital formation and inventory change) and foreign investment. The consolidated capital
account is obtained from the four sector current accounts by
assembling all items in these accounts that so far have been
entered only once because they constitute transactions not with
other current accounts but with the capital accounts of the same
or other sectors.
The content of the gross saving and investment account is
determined by the basic concepts and classifications underlying
national income accounting. Only business assets are included in
fixed capital formation and inventory change. Consumer- and
government-held tangible assets are not included in capital formation. It should also be recalled that fixed capital formation is
presented gross and that, therefore, capital consumption allowances appear as a component of (gross) saving.

DEFINITIONS OF CONCEPTS A N D TERMS
The following definitions of the national income and product
aggregates and their components are intended to give concise,
accurate descriptions of the coverage of the various series and,
at the same time, to call attention to the principal aspects of the
series which are not readily apparent from their titles. The definitions of the national aggregates should be considered in conjunction with the definitions of their components as the details of
the latter are not repeated in the former.

/. National Income and Product Aggregates
National Income is the aggregate earnings of labor and property
which arise from the current production of goods and services by
the Nation's economy. Thus, it measures the total factor costs of
the goods and services produced by the economy. The Nation's
economy in this context refers to the labor and property supplied

by residents of the Nation. Earnings are recorded in the forms ir
which they accrue to residents of the Nation, inclusive of taxes or
those earnings. As such, they consist of the compensation of employees, the profits of corporate and unincorporated enterprises
net interest, and the rental income flowing to persons.
Gross National Product or Expenditure is the market value o:
the output of goods and services produced by the Nation's economy, before deduction of depreciation charges and other allowances for business and institutional consumption of durable capita!
goods. Other business products used up by business in the accounting period are excluded. The Nation's economy in this context
refers to the labor and property supplied by residents of the Na
tion. Gross national product comprises the purchases of goods anc
services by consumers and government, gross private domestic
investment (including the change in business inventories), anc
net foreign investment.
Net National Product or Expenditure is the market value of the
net output of goods and services produced by the Nation':
economy. All business products used up by business in the ac
counting period are excluded. The Nation's economy in thi:
context refers to the labor and property supplied by residents o
the Nation. Net national product comprises the purchases of good
and services by consumers and government, net private domestii
investment (including the change in business inventories), anc
net foreign investment.
Personal Income is the current income received by persons fron
all sources, inclusive of transfers from government and busines
but exclusive of transfers among persons. Not only individual
(including owners of unincorporated enterprises), but nonprofi
institutions, private trust funds, and private pension, health, am
welfare funds are classified as "persons." Personal income is meas
ured on a before-tax basis, as the sum of wage and salary dLs
bursements, other labor income, proprietors' and rental income
interest and dividends, and transfer payments, minus persona
contributions for social insurance.
Disposable Income is the income remaining to persons after de
duction of personal tax and nontax payments to general govern
ment.

Table VI.—Gross Saving and Investment Account, 7950

[Millions of dollars]
Business purchases on capital account
Change in business inventories
Net disinvestment in the United States by rest of world

43, 868
7, 351
—2, 201

5
6
7
8
9
10
11
12

GROSS INVESTMENT

49, 018

Excess of wage accruals over disbursements
Undistributed corporate profits (domestic)
12, 3(
Corporate inventory valuation adjustment. .
—4, 8(
Capital consumption allowances by private business
20, 5
Foreign branch profits (net)
5
Personal saving
12, I1
Government surplus (-|-) or deficit (—) on income and product transactions
8, 1
Statistical discrepancy
2

GROSS SAVING AND STATISTICAL DISCREPANCY.

49, 0

NATIONAL INCOME, 195 4 EDITION

//. Components of National
Aggregates

Income and Product

A. National Income (as in table 1, Part V).
Compensation of Employees is the income accruing to persons
in an employee status as remuneration for their work. From the
employer's standpoint, it is the direct cost of employing labor. It
is the sum of wages and salaries and supplements to wages and salaries.

Wages and Salaries consists of the monetary remuneration of
employees commonly regarded as wages and salaries, inclusive of
executives' compensation, commissions, tips, and bonuses, and of
payments in kind which represent income to the recipients.
Supplements to Wages and Salaries is the monetary compensation of employees not commonly regarded as wages and
salaries. It consists of employer contributions for social insurance;
employer contributions to private pension, health, and welfare
funds; compensation for injuries; directors' fees; pay of the military reserve; and a few other minor items of labor income.
Income of Unincorporated Enterprises measures the monetary
earnings and income in kind of sole proprietorships, partnerships,
and producers' cooperatives from their current business operations—-other than the supplementary income of individuals
derived from renting property. As with corporate profits, capital
gains and losses are excluded and no deduction is made for
depletion.
Inventory Valuation Adjustment measures the excess of the
value of the change in the volume of nonfarm business inventories,
valued at average prices during the period, over the change in the
book value of nonfarm inventories. This adjustment is required
because corporate profits and income of unincorporated enterprises are taken inclusive of inventory profit or loss, as is customary
in business accounting, whereas only the value of the real change
in inventories is counted as current output in the national product.
No valuation adjustment is required for farm inventories because
farm income is measured exclusive of inventory profits.
Rental Income of Persons consists of the monetary earnings of
persons from the rental of real property, except those of persons
primarily engaged in the real estate business; the imputed net
rental returns to owner-occupants of nonfarm dwellings; and the
royalties received by persons from patents, copyrights, and rights
to natural resources.
Corporate Profits Before Tax is the earnings of corporations
organized for profit which accrue to residents of the Nation,
measured before Federal and State profit taxes, without deduction of depletion charges and exclusive of capital gains and losses.
Profits accruing to residents are measured by eliminating intercorporate dividends from profits of domestic corporations and by
adding the net receipts of dividends and branch profits from
abroad In other major respects, the definition of profits is in
accordance with Federal income tax regulations.
291692°—54

Corporate Profits Tax Liability comprises Federal and State
taxes levied on corporate earnings. Disbursements of tax refunds
are deducted from tax liability in the year in which the tax
liability was incurred.
Net Interest measures total interest (monetary and imputed,
private and government) accruing to United States persons and
governments minus total interest paid by United States governments. Government interest (Federal and State and local) is
deducted because it is not considered income arising in current
production. It is necessary not only to exclude the portion of it
paid directly to persons and governments, but also to deduct the
portion of it paid to business, because the latter is reflected in the
incomes paid out or retained by the business system. The imputed
interest component of net interest is measured in general as the
excess of property income received by financial intermediaries
from funds entrusted to them by persons over property income
actually returned in monetary form by these intermediaries to
persons. A portion of imputed interest is numerically equal to the
value of financial services received by persons without explicit
payment; the remainder represents property income withheld by
life insurance companies and mutual financial intermediaries on
the account of persons.
8. Gross National Product (as in table 2, Part V ) .

Personal Consumption Expenditures consists of the market
value of purchases of goods and services by individuals and nonprofit institutions and the value of food, clothing, housing, and
financial services received by them as income in kind. It includes
the rental value of owner-occupied houses but does not include
purchases of dwellings, which are classified as capital goods.
Gross Private Domestic Investment consists of acquisitions of
newly produced capital goods by private business and nonprofit
institutions and of the value of the change in the volume of
inventories held by business. It covers all private new dwellings,
including those acquired by owner-occupants.
Net Foreign Investment is the net change in international assets
and liabilities, including the monetary gold stock, arising out of
the current international flows of goods and services, factor incomes, and cash gifts and contributions. Thus it measures the
excess of (1) domestic output sold abroad over purchases of
foreign output, (2) production abroad credited to United Statesowned resources over production at home credited to foreignowned resources, and (3) cash gifts and contributions received
from abroad over cash gifts and contributions to foreigners. The
net transfer of cash gifts and contributions offsets corresponding
entries in personal consumption expenditures and government purchases of
goods and services.

Government Purchases of Goods and Services measures purchases of goods and services by government bodies, exclusive of
acquisitions of land and used depreciable assets and of current
outlays of government enterprises. It consists of general government expenditures for compensation of employees, purchases from
business (net of sales by government of consumption goods and
materials), net government purchases from abroad and inter-

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS

private pension, health, welfare, and trust funds. Personal saving
national contributions, and the gross investment of government
enterprises. Therefore, government purchases of goods and servicesmay be in such forms as changes in cash and deposits, security
holdings, indebtedness, and reserves of life insurance companies
excludes transfer payments, government interest, and subsidies,
and mutual savings institutions, the net investment of unincorpoas well as loans and other financial transfers outside the scope of
rated enterprises, and the acquisition of real property net of
income and product transactions.
depreciation.
C. Personal Income and Disposition of Income (as in table 3,
Part V).
D. Reconciliation Items Between National Income and Gross
National Product (as in table 4, Part V).
Wage and Salary Disbursements is equal to wages and salaries,
except that retroactive wages are counted when paid rather than
Depreciation Charges represents the charges made by private
when earned.
business against receipts for the current consumption of durable
capital goods and comparable allowances for nonprofit instituOther Labor Income is the same as supplements to wages and tions. It includes depreciation charges against owner-occupied
salaries exclusive of employer contributions for social insurance houses. Depreciation reported by business is not adjusted for
in national income.
changes in the replacement value of capital goods, except for
farm enterprises.
Proprietors' and Rental Income is the sum of income of unincorporated enterprises and inventory valuation adjustment and rental income Accidental Damage to Fixed Capital measures the value of
of
persons as given in the components of national income.
the physical losses by fire, natural events, and other accidents to
fixed capital of private business, not covered by depreciation
Dividends measures cash dividend disbursements by corporacharges.
tions organized for profit to stockholders who are United States
persons.
Capital Outlays Charged to Current Expense represents new
construction and purchases of new durable capital goods included
Personal Interest Income measures total interest (monetary and
in gross private domestic investment that are charged as current
imputed, private and government) accruing to United States
expense by business rather than entered on capital account.
persons. The imputed interest component of personal interest income
is the same as in national income.
Indirect Business Tax and Nontax Liability consists of tax liabilities incurred by businesses, except corporate income taxes, and
Transfer Payments consists of monetary income receipts of
other general government revenues from business. It includes all
individuals from government and business (other than governsales taxes. It includes payments for such specific services as are
ment interest) for which no services are rendered currently, of
provided within the framework of general government activity.
government payments and corporate gifts to nonprofit instituIt excludes, however, purchases from government enterprises.
tions, and of individuals' bad debts to business.
Government receipts from the sale of surplus property are not
included in this item. Tax liabilities are net of refunds.
Personal Contributions for Social Insurance consists of payments by both employees and self-employed. Contributions of the
Subsidies Minus Current Surplus of Government Enterprises:
self-employed, which relate to old-age and survivors insurance,
were first made in 1952.
Subsidies are the monetary grants provided by government
to private business.
Personal Tax and Nontax Payments consists of the taxes levied
against individuals, their income, and their property that are not
Current surplus of government enterprises represents the exdeductible as expenses of business operations, and of other general
cess of sales receipts over current operating costs of government
government revenues from individuals in their personal capacity.
enterprises. In the calculation of the current surplus, no deducIt includes payments for such specific services as are provided
tion is made for charges to depreciation or other reserves and
within the framework of general government activity. It excludes,
interest is not counted in either receipts or costs.
however, purchases from government enterprises. Tax refunds
are deducted from payments as of the time of refund.
Subsidies and current surplus are shown as a single item
because of the difficulties involved in segregating subsidies paid
Personal Consumption Expenditures is the same as in gross
through Federal Government enterprises from other expendinational product.
tures of these enterprises.
Personal Saving is the excess of personal income over personal
consumption expenditures and personal tax and nontax payments. It consists of the current saving of individuals (including
owners of unincorporated businesses), nonprofit institutions, and

Statistical Discrepancy is the excess of the value of the estimated gross national product computed by the final products
method over its independently estimated value computed by
adding necessary conceptual adjustments to the national income.

PART

III

Sources and Methods of
National Income Estimation
INTRODUCTION
The statistical methodology underlying United States national income estimates is of interest to two broad groups—to users of the data and to producers
of similar and related estimates. The importance of the former group is obvious. The importance of serving the latter group is easily appreciated if it is
realized that it includes workers in the entire field of economic statistics, not
only in this country but all over the world.
Users of national income statistics are concerned with sources and methods
mainly from the standpoint of their bearing on the accuracy of the statistics.
The interest of this group in methodological detail is limited because much
of it is not germane to the question of the reliability of the estimates. Producers
of statistical data, on the other hand, want to learn about sources and methods
in order to derive assistance in their related tasks. They are likely to require
knowledge in greater detail.
In practice, however, this conflict of interests is not too serious. For, as will
become apparent, the user of the data cannot form a judgment of their reliability without a considerable acquaintance with statistical methodology. In
turn, the interest of the professional statistician in specific detail tends to be
limited, because much of it is not applicable to his situation. Hence, in writing
the statistical descriptions which follow, it seemed appropriate to plan a compromise that would be helpful to general users of the data as well as to technicians.

Salient Features of the Statistical Methodology

National product, which is a measure of total output in terms of product
flows, is obtained generally by adding component estimates of the purchases
of final products by major purchaser groups. Since measurement is restricted
to final product flows, the mutually canceling purchases and sales of intermediate products, which would be necessary to determine the industrial distribution of output, cannot be taken into account.
This lack is not felt to be a significant gap in the statistics, since the corresponding breakdown of national income serves most needs for an industrial
distribution of total output. (It may be noted that an indirect measure of
gross national product by industrial origin could be obtained by adding to
the national income originating in each industry other charges against gross
national product and deducting subsidies. However, most of these elements
of reconciliation have not been distributed on an industrial basis.)
Moreover, this lack of an industrial distribution of national product is
more than counterbalanced by the economic significance of the breakdowns
of the product flow by type of purchaser (and also by type of product) which
are yielded by the final product approach. In fact, these breakdowns provide
essential elements for extending the scope of national income and product
statistics beyond the mere measurement of output totals into a comprehensive
national economic accounting system providing a statistical picture of the
economy.
The components of national income and national product are the core of
this picture. The remaining statistical task consists of deriving supplementary
breakdowns and series necessary for a fully articulated picture of the economy,
mainly in terms of the interrelated transactions of its major constituent
groups—businesses, households and institutions, government, and foreign
nations.

Stages of statistical measurement

The reporting units

Since national income and product are measures of total national output,
it might appear that the most direct way to obtain these measures would be to
sum the values added to total output by each of the industrial sectors of the
economy. In terms of product flows, these values would, in general, be
measured as the total product of the industry minus its purchases of intermediate products from other industries. This difference equals the sum of
wages, interest, profits and other distributive shares accruing in the industry
plus certain additional charges against the value of its production. Seen from
this aspect, the summation of industrial values added would yield a measure
of output in terms of incomeflows.If national output were calculated according to this plan, its breakdowns by industry of origin would be the basic
statistical building blocks. In fact, however, the data on value added by each
industry are not available directly, and total output must be estimated by
other procedures.
National income, which is a measure of total output in terms of factor income flows, is estimated by summing estimates of the various distributive
shares. Data to estimate these shares are not always available on an industrial
basis, and only as the result of often complex supplementary calculations is
an estimate of national income by industrial origin obtained.

Only on a limited scale is reliable statistical information available from
individual consumers, because of the general inferiority of consumers' records
and other difficulties involved in the collection of data from them. Hence,
even over the broad areas in which national income and product flows reflect
transactions in which individual consumers are involved, the statistical information for making the estimates is usually derived from the other parties to
the transactions—chiefly businesses and government. These sources, in
general, are decidedly preferable. The character of the underlying records is
superior; the number of reporting units is smaller; and the reporting systems
necessary for the procurement of reliable information can be developed more
readily.

Major reporting systems
The entries into the national income and product tables are derived from a
multiplicity of statistical sources ranging over most of the essential phases of
the Nation's economic life.
A large body of statistical data is collected by the government, mainly with
the intent of providing information which is of general interest to broad user
61

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS

groups. The various censuses—such as the Census of Manufactures, the Census
of Business, and the Census of Agriculture—are prime examples in this category. Of equal importance is the statistical information which becomes available as the byproduct of the administrative functions of the government.
The wage and salary data provided in connection with the old-age and survivors and unemployment insurance programs by the Health, Education,
and Welfare, and Labor Departments are an outstanding example. Another
is the information on the incomes of corporations and of proprietorships and
partnerships furnished as a byproduct of Federal income tax administration
by the Internal Revenue Service.
Government-produced statistics are the mainstay of national income and
product estimates, but they are supplemented by a wide variety of information obtained from private sources, such as trade associations, labor organizations, research organizations, private educational groups, and religious
and welfare organizations.
By any comparative standard the available information for estimating
national income in the United States must be judged abundant. Also, long
experience in the reporting and collection of economic data, the stringent
requirements of governmental administrative agencies, and emphasis on
sound statistical techniques make for a generally high degree of reliability.
The adequacy of the data has improved. Outstanding in this connection
has been the signal increase in the current reporting of economic information.
This development, closely connected with advances in the theory and practice of sampling techniques, has put the preliminary estimates of national
income and product, which are made pending the availability of final benchmark data, on a much firmer basis. And, indeed, it has made it possible for
these estimates to be made with little time lag and in considerable detail.

Estimating procedures
In spite of the abundance and general reliability of statistical information,
the task of the national income estimator is complicated because the basic
data are not collected in the framework of a coordinated statistical program
designed to fill the needs of national income measurement. Without significant exception, the reported information is not in a form in which it can be
entered directly into the national income and product accounts. It must be
processed further to fill gaps in coverage and to adjust for differences in
definition. This processing of the data involves procedures that are often
quite complex. Although the mathematical operations used are usually
simple, involved estimation may be necessary to combine and adjust a multiplicity of diverse sources to produce series that have the coverage and
definition required by the national income estimates.

Reliability of the Estimates
It is clear from this summary discussion of the derivation of national income estimates that they are subject to error. Hence it is important to evaluate the degree of their reliability.
A comprehensive statement of the degree of accuracy of a given estimate is
usually thought to involve the specification of a frequency distribution of
similar estimates around the universe value. In the field of national income
this ideal cannot be approximated. The many source materials and procedures
utilized are not of such a nature as to permit calculations of the probable
errors in the various income and product series.
The replacement of present estimating methods by the sampling approach
would not be a solution. Serious difficulties in applying sampling techniques
would be encountered with income and product components for which knowledge about the size and characteristics of the universe was lacking, or whose
composition was heterogeneous or subject to rapid change.
Moreover, the sampling errors that could be calculated would provide only
partial approximations to the errors in the final estimates. Faulty reporting,
willful misstatement, and negligent enumeration are all sources of error in
reported data (and hence in the estimates) which are outside the scope of
sampling-error measurement. Such sources of error might be checked upon
and allowed for; but in the sampling process, as well as in the varied other
methods now used in national income estimation, they generally are unknown
and hardly ever can be quantified. In practice, they are likely to be much
more important factors in the reliability of the national income estimates
than are sampling errors.

Thus, the reliability of the national income and product estimates cannot
be assessed with mathematical precision. Rather, the main approach must
be to make a detailed analysis of the statistical sources and methods underlying them and to use this as the basis for qualitative judgment. The general
aim must be to decide whether the reliability of the estimates is sufficiently
high to warrant the specific use intended, and, if this does not appear to be
the case, whether the plan of investigation can be simplified to take account
of the limitations of the estimates.
This task is admittedly difficult. It is complicated by the fact that throughout
the period since 1929 relatively few series of estimates are derived from the
same sources and methods, and hence have the same range of error in all parts
of the period. Many series are a time-period admixture of sources and methods
of widely varying type and quality.
Given this situation, it often will not be fruitful or possible to judge the
reliability of the estimates in an overall sense. The investigator not only will
have to take account of general features of the series involved, but often will
have to distinguish between benchmark and other-period estimates and make
such determinations as whether annual levels or year-to-year changes are
principally relevant and whether components are being used in isolation or
in relation to other components. Having determined what aspects of reliability are relevant in a particular instance, he can proceed to a study of the
national income data with these aspects in mind and obtain optimum results.

Factors affecting reliability
Consideration of four major factors should prove helpful in forming a
judgment about the reliability of estimates of the various components of
the income and product flow.
In the first place, one must consider whether the economic units (such
as businesses, governmental agencies, or individuals) are reporting on an
item which is represented by straightforward transactions of simple definition, or on an item which requires complex calculations on their part or is
somewhat vague in definition. In practice, the former case is likely to be
associated with the occurrence of monetary transactions.
The second factor to be considered is the quality of the records kept by
the economic units whose trarsactions are being measured. Lack of adequate
records leads to less reliable reporting or to an absence of reported data.
In either case, the reliability of the resulting estimates is impaired.
The third factor which should be given weight is the reporting system—
its character and the quantity of data it produces. The obvious distinction
here, as to the former, is between complete census-type coverage and
sampling. However, this distinction in itself does not throw much light on
the problem of reliability. While, other things being equal, complete enumerations are more reliable than samples—and, for that matter, large
samples are more reliable than small ones—the ceteris paribus qualification
in this instance deprives the statement of much of its practical sigrificarce.
So much depends on the quality of the censuses and of the samples—
including the skill and training of enumerators—that only a detailed investigation of all the relevant characteristics can yield well-founded conclusions regarding reliability. Needless to say, such investigations are difficult
undertakings and often may not prove conclusive. In particular, recent
advances in sampling techniques have considerably narrowed the area
over which a flat claim of superiority for the results of census-type reporting
can be made.
With respect to the quantity of information yielded by a reporting system,
it is first to be observed that large and frequent quantity does not necessarily, of course, make for reliable estimates. But smallness of quantity, even
of high quality, results in data gaps impairing the adequacy of an income
or product series.
The final point to be considered is to what extent the items that enter the
income and product accounts differ from those that are actually reported.
Such differences almost always imply that estimating procedures have been
introduced. This means an impairment of reliability of the final figures
which can be evaluated only by an examination of the procedures. In
general, a long and involved estimating chain can be taken as a sign of
statistical weakness, although this rule must be qiialified in the light of the
adequacy of the supplementary data introduced and of the cogency of the
procedures adopted. Simplicity of procedure, however, cannot be taken
as an evidence of absence of statistical weakness. It may only mean that

NATIONAL INCOME, 195 4 EDITION
reliable data for making necessary adjustments are not available, and that
summary, arbitrary assumptions have been used instead.

Application of factors to broad income and product
components
It may prove of interest and value to test some of the major components
of national income and product against these four criteria of reliability.
For brevity this is done in a very general way, and with frequent resort
to personal judgments of the type which have sometimes proved erroneous
in the past.
Considering first the components of national income, there can be no
doubt that wages and salaries rank highest in reliability. This conclusion
is based on the relative simplicity of the concept, the comprehensiveness
and high quality of the record-keeping and of the reporting system (both
to a large extent byproducts of the social security system), and the fact
that the adjustments to the reported totals that are necessary to bring them
into conformance with the requirements of the income and product accounts
are small and well-founded statistically. In this instance the statement
seems warranted that since 1939 the departure of the annual estimates
from their true value is probably very small. Any marked lowering in the
quality of the 1929—38 estimates is precluded by the fact that periodic
industrial-census results and the sample wage indexes compiled by the
Bureau of Labor Statistics are available to extrapolate the social security
based series.
The estimates of rental income of persons are on the other end of the
reliability scale. In this instance, a profit-type income is involved, the
definition of which to the reporting unit must always be complex and
somewhat vague. Both record-keeping and reporting systems are fragmentary and poor, and the estimating procedures which are necessary to convert
reported data into national income entries are unusually complex and
tenuous.
Estimates of the other income shares range between these two extremes on
the scale of reliability. Supplements to wages and salaries follow wages and
salaries closely. Large parts of them are as well-founded as the wage and
salary data, for reasons that are essentially similar. Supplements rank somewhat lower because their "other labor income" component includes certain
items which are statistically less well-founded, especially with respect to the
tentative estimates for the most recent years.
On the lower end of the scale the "income of unincorporated enterprises
and inventory valuation adjustment" may be considered as superior to
rental income. The problems of calculating entrepreneurial income confronting the reporting units are similar to those involved in the calculation
of rents—both constitute a type of profit income. Records and reporting
systems are, however, somewhat more satisfactory than in the case of rental
income; and the estimating procedures that are applied to the reported
data are somewhat more direct and incorporate better information. It
should be noted, however, that the entrepreneurial income estimates are
subject to significant shortcomings when compared with the other income
shares.
Broad generalizations of this type, it is recognized, are not apt to be of
much concrete help for any particular use of the entrepreneurial income data.
For one thing, the estimations of farm and nonfarm incomes, although
handicapped by certain common limitations, are fundamentally dissimilar.
There is no parallel in the nonfarm segment to the Department of Agriculture's systematic long-period study of farm income and development of
reporting sources. And the estimation of farm income has no counterpart
to the necessarily heavy reliance that is placed upon income-tax return information in deriving the net income of nonfarm unincorporated enterprises. Moreover, the data and procedures used to estimate farm income
since 1929 are characterized by substantial uniformity over the period,
whereas those underlying the nonfarm total vary widely in different subperiods.
Corporate profits before tax are a series whose probable deviation from
true universe values must be adjudged smaller than that of any of the other
distributive shares except employee compensation. The definition of profits
is not simple, and measurement at the level of the individual business firm
involves complicated computations that can be performed with varying

accounting criteria. Yet the quality of corporate records is surely good,
and the reporting system developed over a period of many years by the
Internal Revenue Service doubtless has gone far toward standardization
of reporting. This system has produced comprehensive annual data not
requiring unduly large estimating adjustments before inclusion in the
national income tables.
In judging the corporate profit series, two limiting aspects should not be
overlooked. First, the estimates for recent years are not based on Internal
Revenue Service tabulations, in which there is a 2-year lag, and are less
firmly grounded. Secondly, the addition of the "inventory valuation adjustment" to corporate profits before tax appreciably reduces the statistical
reliability of the profit series. This adjustment—designed to put inventories
charged to cost of sales on a uniform and current pricing basis, differing
from the diverse pricing practices followed in business accounting—is introduced because it is thought to constitute a significant improvement in
the economic meaningfulness of the statistics. But the adjustment is based
on information that is slender and procedures that are complex and subject
to error.
The remaining income share, net interest, is based in part on corporate
sources of data (obtained mainly from the Internal Revenue Service), but
its reliability is weakened by the inadequacy of information on interest
flows originating in certain major noncorporate areas, and by the general
lack of reliable data for the latest years.
Government purchases of goods and services are highest on the scale of
reliability among the components of gross national product. Were it not
for certain problems involving the timing of purchases which are important
when the level of government expenditures is changing sharply, the data
for the Federal Government would parallel the quality of the wage and
salary estimates, using the criteria of definitional clarity, quality of recordkeeping and reporting, quantity of available information, and the statistical
foundation of the estimating adjustments. However, the problem of timine,
together with the fact that the series on State and local government purchases
is less well-founded than the Federal series, reduces the reliability of the
combined government purchases series below that of wages and salaries.
The estimates of chanpe in business inventories probably rank lowest on
the product scale. The measurement of inventories presents substantial
problems of cost allocation and pricing- to reporting units, and for important
segments of the noncorporate economy records are not adequate and reporting is unsatisfactory, especially for recent years. More important,
however, is the fact that the change in business inventories represents the
difference between large and volatile annual totals, and hence is subject
to significant percentage errors. Also the reported inventory data require
substantial estimating adjustment. Involved in the measurement of nonfarm
inventory change is the inventory valuation adjustment, the inadequacy of
which was noted above in the comments on corporate profits.
Estimates of producers' purchases of durable equipment and of personal
consumption expenditures for commodities—both based largely on producers' records—follow government purchases in reliability on the product
side. The definitional problems confronting the ultimate reporting units do
not loom too large; record-keeping and reporting are relatively adequate;
estimating procedures applied to the reported basic data are fairly complex
and reduce reliability, particularly in the case of consumer commodities, but
on balance, the two series must be rated rather high. These generalizations,
it is important to add, refer to the methodology adopted for years for which
benchmark data are available. For estimates for other years, the evaluation
would be less favorable. As will be noted, however, in the sections covering
these series, actual experience to date with provisional estimates prepared
before the availability of benchmark data has been very satisfactory.
The series on personal consumption expenditures for services is based
largely, but by no means exclusively, on producers' sales records. The
concept of sales is simple, and comprehensive, census-type reporting systems
yield generally reliable data for items comprising the bulk of the total.
The estimation problem is simplified by the absence of intermediary enterprises between the producer and consumer and by the comparatively small
extent to which reported sales must be adjusted for the elimination of sales
to nonconsumers. But reliability is significantly lowered by the fact that
many of the comprehensive sources on which heavy reliance is placed become
available only rather infrequently. Of lesser effect is the inadequacy of
materials for many of the numerous smaller items forming part of the
services total.

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS

The field of private construction is an extremely difficult one for statistical
estimation. The concept of "value of work performed" used in the new
private construction series is not a simple one on which to report, and
consequently little of the reported information is obtained on this basis.
Neither enumeration nor sampling is well suited for establishing universe
levels, and complex statistical methods are necessary to adjust for the
coverage gaps and timing deficiences of data secured through varied reporting systems.
The estimates of public construction are much more firmly based, mainly
because of the comprehensiveness and superiority of Federal agency records.
However, these estimates are not an independent component of gross national
product, but are used only in obtaining a breakdown of total government
purchases.
Estimates of individual series entering into the computation of net foreign
investment are based on a great deal of solid statistical information. But this
component of gross national product is derived as the difference of large
minuends and subtrahends. Consequently, substantial percentage errors are
likely, especially in years when the absolute magnitude of the component is
small.
Personal income is more reliable than national income. The major items
included in personal income but not in national income (government transfer payments and government interest) are reliable. The exclusions that are
made either do not affect reliability (such as the accurate deduction of social
insurance contributions) or else actually increase it (such as the deduction of
the corporate inventory valuation adjustment and all other components of
corporate profits except dividends).
With respect to the disposition of personal income, the major point relates
to saving. This item is the difference between large totals, and is therefore
subject to sizable percentage error. Supplementary information that should
be considered in interpreting the reliability of this component of the accounts
is discussed in the section of the methodological descriptions dealing with
personal saving.
Although a study of the methodology underlying the national income and
product estimates is the main basis for an evaluation of reliability, there are
two other types of evidence whose examination throws light on the subject.
The first is the record of the "statistical discrepancy;" the second is the record
of the revisions that are made of the estimates as originally published. These
two will be discussed in turn.

Significance of the statistical discrepancy
The "statistical discrepancy" measures the excess of the gross national
product as estimated by summing its component product flows over the gross
national product as estimated by summing components of the national income and all other charges against the total value of gross national product.
It arises because of errors in the component estimates, and hence is relevant
to the problem of reliability.
In the national income and product account the statistical discrepancy is
entered on the debit side, as an item reconciling national income with charges
against national product. This manner of entering the statistical discrepancy
is purely a matter of convenience. It permits the two most widely used aggregates—national income and gross national product—to be broken down into
component items which do not include the "statistical discrepancy." It does
not signify that the national income and the gross national product have been
correctly estimated, and that the error has been made in the estimation of one
or more of the items reconciling the two. Quite to the contrary, it is likely that
the aggregates are affected whenever a statistical discrepancy appears.
The statistical discrepancy appears also in the business income and product
account, and similar comments apply to the form in which the entry is made
there. It may be noted that in the accounts as shown the item always reflects
discrepancies between the estimates of business income and production. This
is so because business income and production are obtained statistically by
making consistent deductions for nonbusiness income and production from
the two sides of the national income and product account. Hence, the results
of all estimating inconsistencies, whatever their origin, are shifted into the
business account.
The adjustment for statistical discrepancies appears also in the gross saving and investment account. It signifies an error either in total saving and/or
total investment and in one or more of their components.
The statistical discrepancy is a measure of the difference in error between
the two estimates of the total gross national product. While its presence is

conclusive evidence that errors have been committed, a zero discrepancy
does not constitute proof to the contrary. Strictly speaking, the discrepancy
measures lack of consistency, and it does not register absolute errors which
compensate in the accounts. To the extent, however, that the sources and
methods of estimating the components of the credit and debit sides of the
national income and product account are independent—in the sense that
errors committed in estimating components on the one side do not involve
corresponding errors on the other—it is reasonable to give some weight to the
statistical discrepancy in evaluating the reliability of the totals. In these
circumstances, greater confidence can be attached to the value of the national
income and product totals if the size of the discrepancy is small than if it is
large.

Degree of independence of income and product estimates
It is important, therefore, to consider to what extent the two sides of the
income and product account are in fact independent as to statistical sources
and methods. Quantification is not possible, but certain relevant considerations can be presented. These are of a summary nature and should be supplemented by the detail contained in the following statistical notes.
It is not possible to classify the estimates of the various components of the
income and product flow into two neat groups, consisting of those that are
based on independent sources and methods, on the one hand, and of those
lacking such independence, on the other. In fact, the estimates range over a
wide scale.
Largely due to the utilization of social security data, the estimates of employee compensation are the outstanding example of a close approximation
to statistical independence on the income side of the accounts. Even this
statement has to be qualified, because certain components of these estimates
are entered identically on the product side (for instance, the sizable item for
domestic service).
A second example of a high degree of statistical independence is provided
by the estimates of government purchases, on the product side of the accounts. The degree of independence is probably somewhat smaller in this
instance, because estimates of government employee compensation, in the
national income, are based upon records and reporting systems related to
those upon which the estimates of government purchases are made. However, in spite of this qualification, the degree of independence is very large.
While, on the other end of the scale, there is considerable interdependence
of statistical methodologies, no major component of the income or product
flow can be said to lack independence completely. However, the opportunity
for consistent error is also wide. In particular, there is substantial interdependence between the business income components of the national income
and the estimates of several of the components of the product flow. This is so
because inventory and sales data are used in a related fashion.
The inventory valuation adjustment is perhaps the most clear-cut example
of such a relationship. It is made in the form of identical entries on the income
and product sides, consisting of an adjustment to the income of unincorporated enterprises and corporate profits, on the one hand, and to the change
in the book value of inventories, on the other, in the measurement of the
change in nonfarm business inventories.
Moreover, there is close interrelation between the estimates of unincorporated enterprise income and corporate profits and the change in the book
value of inventories. For benchmark-year estimates, errors in corporate inventories result in identical errors in corporate profits, since both estimates are
based on balancing corporate accounts submitted to the Internal Revenue
Service. For noncorporate business inventories, the offset is complete in the
case of farming, and it tends to hold for other unincorporated business to the
increasing extent that the estimates are based upon balanced accounting data
similar to those used for corporations.
Instances in which related sales or gross receipt series underlie the estimates
of both business profits and product flows are analytically similar, although
in statistical practice effective interdependence is usually reduced. Clear-cut
examples are afforded by the rent and professional service estimates. Errors
in gross dwelling rents and in the estimates of gross receipts of professional
practitioners from consumers affect both personal consumption expenditures
for services and the corresponding business incomes, although not necessarily
to the same extent. The same type of relationship can be found in other areas
of business income, unincorporated as well as corporate, although it may be
attenuated by the particular statistical procedures adopted, or harder to
trace because of a less explicit coordination of them.

NATIONAL INCOME, 195 4 EDITION
In the examples of interdependence hitherto given, all reference has been
to instances in which for accounting reasons errors in the estimates of the
product components must lead to offsetting errors in the income components.
It may be noted that complete interdependence is not involved. Independent
errors are still possible, for instance, when in deriving business profits current
expenses are wrongly reported or estimated.
So far no reference has been made to compensating errors which are a
matter of statistical probability rather than accounting necessity. For instance,
when wage and sales data are taken from identical sources, lack of complete
coverage of the basic reports may lead to similar errors in both items. However, this need not be the case. Both in census-type reports and in samplebased estimates, the error in the one component may differ from that of the
other. Prior to the introduction of the social security data, the United States
estimates were susceptible to this type of common error to an important
extent. Large segments of the estimates of wages and salaries and of the
product flow were derived from identical, industrial census, sources. Since
the utilization of social security data, there do not appear to be any important
areas of the income and productflowsin which this type of error is significant.
The statistical discrepancy measures the net residual of error which remains
after the best possible estimates of the various components of the income and
product flow have been made. If initial estimates of the components lead to a
sizable statistical discrepancy or to erratic movements in it, they are reexamined and an effort is made to trace the source of the discrepancy and to
eliminate it as far as possible. This reexamination of the initial estimates consists mainly of a critical comparison of the methodology of the component
estimates for error and inconsistency. This is an essential step of the estimating
procedure which cannot be taken by the individual estimators responsible
for the preparation of the component series, but must be reserved until initial
estimates of all the components have been prepared. While significant improvements can sometimes be made in this manner, a residual discrepancy
will remain.
The suggestion has been made that this residual discrepancy should be
eliminated, either by the exercise of further judgmental decisions of the type
used in reducing it from its initial size, or by the application of more formal
mathematical procedures that tend in the direction of greater objectivity.
Superficially, complete elimination of the statistical discrepancy would be
desirable, from the standpoint of convenience to the users of the data.
Basically, however, it would be harmful. A statistical discrepancy of substantial size or irregular movement reflects troublesome errors in the estimates.
If this is the situation, the users of the data should be aware of it so that they
can exercise due caution in the application of the estimates in economic
analysis.

Characteristics of the revisions
Recent-year estimates of national income and product are based on incomplete data and are revised as additional information becomes available. A few
of the components do not undergo significant revisions after the publication
of the initial estimates, but this is not the usual case. Fairly widespread revisions can be expected in the estimates for the two most recent years because
of the lag in the availability of Internal Revenue Service tabulations from
income tax returns, which serve as benchmarks for many of the component
estimates. Revisions extending further back reflect the incorporation of census
information obtained at intervals which can range up to 10 years. In certain,
much less frequent, instances, improved sources and/or methods may become
available which call for revisions over an even longer number of years.
Some inferences as to reliability can be drawn from the record of the
revisions which initial estimates of the income and product flows underwent
in subsequent years. Frequent and large revisions in the estimates are a positive evidence of lack of reliability. However, absence of sizable statistical
revisions can be taken as positive evidence of reliability only if the more
recent estimates incorporate additional information which is known to be
more reliable. In this case meaningful judgments as to the relative reliability
of recent-year estimates as compared with later benchmark estimates can be
made. But it is not possible to go further than this. Absence of revisions in
estimates of several significant components of the income and product flow
reflects only a lack of data accretion subsequent to the publication of the
initial estimates, rather than constituting a positive sign of reliability.
With reference to the national income and product aggregates, it may be
said that since their publication on a new basis in July 1947 the revisions in

the initial estimates have been very moderate—generally less than 1 percent.
Thus, for the years from 1942 through 1952—starting with the period in
which estimates presented in the 1947 supplement have undergone at least one
intermediate revision—the maximum difference between the present estimate
of national income and any previous estimate published in the 1947 and 1951
supplements and in July issues of the SURVEY OF CURRENT BUSINESS is less than
1 percent in 8 of the 11 years. The exceptions are 1943 (1.2 percent), 1947
(2.7 percent), and 1948 (2.1 percent). Over the same time span, the maximum difference between the present and any previous estimate of the gross
national product provided in the same reports is less than 1 percent in 6 years
and 1.1 to 1.6 percent in three years. It amounts to 2.6 percent in 1946 and
2.0 percent in 1948.
Revisions of the annual changes initially shown by the totals have been
much larger, of course. The worst record was with respect to the decrease
from 1945 to 1946. In this instance, the initial estimate was cut from $9.4
billion to $4.3 billion for the gross national product and from $4.6 billion to
$1.7 billion for the national income. The years immediately following the
war, it may be noted, saw drastic changes, giving rise to unusual estimating
problems, in both the composition of the national product and in the
legal-form and industrial structure of the national income.
Of particular interest from the standpoint of gauging statistical reliability
are the revisions incorporated in the present edition of the National Income
supplement. As will be evident from the statistical notes which follow this
Introduction, the major feature of these revisions is the incorporation into the
estimates of the results of the postwar censuses (the 1947 Census of Manufactures, the 1948 Census of Business, the 1950 Census of Population and
Housing, and the 1950 Census of Agriculture). Opportunity was taken at the
same time to introduce numerous other new data sources and improvements
in estimating techniques, some of them affecting series back to 1929.
As a consequence of the incorporation of the postwar census data, the new
estimates replace for more than one-half of the gross national product total
(but for a very much smaller proportion of the national income) preliminary
series which represented extrapolations ranging up to 11 years of benchmark
estimates based on prewar censuses. Evidence as to the reliability of the estimating procedures used by the National Income Division pending the
availability of census information is accordingly provided.
That this evidence is distinctly favorable can be seen from the fact that in
none of the years 1947 to 1950 did the estimates of gross national product
incorporating the census data differ by more than }{a of 1 percent from
the preliminary estimates which they replaced. It may be noted that a
favorable outcome of this general type had been expected with confidence.
This was because the estimates of the national income, which are dependent
on census data only in minor degree, had confirmed the gross national product
estimates in the interim period. The statistical advantages of estimating
income and productflowsin an interrelated accounting framework are clearly
apparent in this connection.
Needless to say, these favorable results should not be taken to indicate that
census information is inessential to the estimates incorporated in this report.
Census data provide indispensable benchmarks for these estimates, and the
above evidence relates only to the feasibility of extrapolating such censusbased benchmarks. Moreover, there is no assurance that the results of extensive extrapolation would be similarly accurate in future periods. Finally,
extrapolating errors in the components of the income and product flow were
larger than in the estimates of the aggregates, as will be noted in the subsequent sections dealing separately with these components. Frequent, comprehensive, and accurate census data are indispensable to the reliability of much
of the detailed income and product breakdown.
It is generally true that percentage revisions in the national income and
product totals are much smaller than those in some of their components.
To a substantial extent, this is due to the effect of offsetting errors. According
to past experience, such offsets may be counted upon to increase the reliability
of the estimates as their finest components are added to obtain broader
subtotals.
The national income and product series are published in somewhat
greater detail than is warranted by the statistical reliability of some of the
ultimate components. While it would be hazardous to attach precise significance to the level and movement of these components, offsetting errors
make it feasible to recombine them into reliable subtotals differing from the
published ones and better adapted to specific types of economic analysis.
It is in order to facilitate judicious recombinations of this type that some of

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS

the detail (in particular recent-year detail on the industrial origin of some
of the income shares and on the product breakdown of some of the consumer
commodity and service flows) is published, and one should be aware that
the use that can be made of these series in isolation is limited.

Allowing for statistical error
While the foregoing survey may provide a sufficiently definitive basis
for the general conclusion that the estimated annual totals of gross national

product, national income, and personal income are subject to only a small
percentage of error, it clearly indicates that there is no easy way of providing
the users of national income data with measures of statistical reliability.
Relevant quantitative measures are not available; and, owing to the basic
nature of the data, the prospect of their ever being constructed on a comprehensive scale appears quite limited. A study of the statistical methodology
underlying the national income estimates, supplemented by analysis of the
statistical discrepancy and of the revisions, will remain the major avenue for

Exhibit 1.—Industrial Classification for the National Income

A. MANUFACTURING INDUSTRIES

Industrial content in terms
of the Standard Industrial
Classification 1942 edition
(basis for 1929-47 national
income data)

Industrial division or industry'

Manufacturing
Food and kindred products
Tobacco manufactures
Textile-mill products
Apparel and otherfinishedfabric products
Lumber and timber basic products
Furniture andfinishedlumber products
Paper and allied products
Printing, publishing, and allied industries
Chemicals and allied products
Products of petroleum and coal
Rubber products
Leather and leather products
Stone, clay, and glass products
Iron and steel and their products, Including ordnance
Nonferrous metals and their products
Machinery, except electrical
Electrical machinery
Transportation equipment, except automobiles
Automobiles and automobile equipment
Miscellaneous manufacturing

19 to 39.
20.
21.
22.
23.
24.
25.
._ 26.
27.
28.
29.
30.
31.
32.
19 and 33.
34.
35.
36.
37.
38.
39.

Industrial division or industry

Industrial content in terms
of the Standard Industrial
Classification 1945 edition
(basis for 1948-53 national
income data)

Manufacturing
Food and kindred products
Tobacco manufactures
Textile-mill products
Apparel and otherfinishedfabric products
Lumber and wood products, except furnitureFurniture and fixtures
Paper and allied products
Printing, publishing, and allied products
Chemicals and allied products
Products of petroleum and coal
Rubber products
Leather and leather products
Stone, clay, and glass products
Primary metal industries
Fabricated metal products, including ordnance.
Machinery, except electrical
Electrical machinery
Transportation equipment, except automobiles.
Automobiles and automobile equipment
Instruments
Miscellaneous manufacturing

19 to 39.
20.
21.
22.
23.
24.
25.
26.
27.
28.
29.
30.
31.
32.
33.
19 and 34.
35.
36.
37 (exc. 371).
371.

38.
39.

B. NONMANUFACTURIXG INDUSTRIES

Industrial content in terms
of the Standard Industrial
Classification 1942 edition
(basis for 1929-53 national
income data)

Industrial division or industry2

Agriculture, forestry, and fisheries
Agricultural services, forestry, and fisheries

01 to 09.>
01 to 06.
07 to 09.3

Metal mining
Anthracite mining
.. _ ...
_
Bituminous and other soft-coal mining
Crude petroleum and natural gas
Nonmetallic mining and quarrying

10 to 14.
10.
11.
12.
13.
14.

Contract construction .
Wholesale and retail trade
Wholesale trade
Retail trade and automobile services
_.
Finance, insurance, and real estate
Security and commodity brokers, dealers and exchanges.._
Finance, n. e. c
insurance carriers
Insurance agents and combination offices
Real estate
..
...
Transportation.
_
_
Local and highway passenger transportation
Local railways and bus lines
_
Highway passenger transportation, n. e. c
Highway freight transporation and warehousing
Water transportation
._

16 and 17.
40 to 61 and 88.
40 to 47.
48 to 61 and 88.
62 to 70 (exc. 707).
62.
66.
63, 64, 65, and 67.
68.
69.*
70 (exc. 707).
72 to 80.
72.
73, 741, 742, 743, and 749.
73 and 741.
742, 743. and 749.
75 and 79.
76 (exc. 766).

1. Numbers refer to the code numbers in the Standard Industrial Classification Manual.
(Government Printing Office, 1942 and 1945 editions.)
2. All establishments operated by government agencies or corporations are classified in
the Government and government enterprises industrial division, regardless of their classification in the Standard Industrial Classification Code.
3. The National Income Division classification includes irrigation system operation in
"Local utilities and public services, n. e. c."
i. In National Income Division classification, includes insurance agents, brokers, and services, and establishments regularly engaged in any combination of real estate, insurance, loans,
or lega] activities when none of these activities alone constitutes the principal business of the
establishment.
6. Includes all Federal Government agencies and operations except those included in the
industry, "Federal—government enterprises."
6. The following list enumerates all Federal enterprises: Agricultural Marketing Act
Revolving Fund, Alaska Railroad, Army Post Exchanges, Banks for Cooperatives, Bonneville Power Administration, Boulder Canyon Project, Commodity Credit Corporation,
Defense Homes Corporation, Defense Plants Corporation, Defense Supplies Corpoi*ation.
Disaster Loan Corporation, Electric Home and Farm Authority, Emergency Crop and Feed
Loan Program, Export-Import Bank, Federal Crop Insurance Corporation, Federal Deposit

Industrial content in terms
of the Standard Industrial
Classification 1942 edition
(basis tor 1929-53 national
income data)

Industrial division or industry2

Transportation—Continued
Air transportation (common carriers)
Pipeline transportation
. . _.
Services allied to transportation
Communications and public utilities
..
Telephone, telegraph, and related servicesRadio broadcasting and television...
Utilities: electric and gas
.
. ..
.
Local utilities and public services, n. e. c
Services .
..
Hotels and other lodging places
_.
Personal services
_
Private households
...
Commercial and trade schools and employment agencies..
Business services, n. e. c
Miscellaneous repair services and hand trades
Motion pictures
.
.
Amusement and recreation, except motion pictures
Medical and other health services
Legal services
..
Engineering and other professional services, n. e. c
.Educational services, n. e. c
_
Nonprofit membership organizations, n. e. c.._
_
Government and government enterprises1
Federal—general government • 6
Federal—government enterprises T
State and local—general government 8
State and local—government enterprises
Rest of the world"

771.
78.
744, 766, 772, 773, and 80.
81 to 83.
81 (exc. 813).
813.
821, 822.
823, 83.3
84 to 96 (exc. 88), 707.
84.
85.
86.
874, 953, and 954.
87 (exc. 874), 942, and 707.
89.
90.
91.
92.
93.
941 and 949.
951 (exo. 953 and 954).
96.
97.

_.
..

Federal Housing Administration, Federal Intermediate Credit Banks, Federal Land Banks
(until July 1,1947), Federal National Mortgage Association, Federal Prison Industries, Inc.,
Federal Savings and Loan Insurance Corporation, Home Owners Loan Corporation, Inland
Waterways Corporation, Maritime Administration (operating activities), Metals Reserve
Company, Navy Ship Stores and Ship's Service Stores, Panama Canal Company, Panama
Canal Zone, Panama Railroad Company, Petroleum Reserves Corporation, Post Office,
Production Credit Corporations, Public Housing Administration, Reconstruction Finance
Corporation, Regional Agricultural Credit Corporations, RFC Mortgage Company, Rubber
Development Corporation, Rubber Reserve Company, Rural Electrification Administration,
Smaller War Plants Corporation, Tennessee Valley Authority, U. S. Commercial Company,
War Damage Corporation, War Shipping Administration (commercial operating and war
risk insurance activities).
7. Includes all State and local government agencies and operations except those included
in the industry, "State and local—government enterprises."
8. Includes State workmen's compensation funds, and business-type activities involving
significant amounts and accounted for as enterprises, mainly alcoholic beverage monopolies;
water, electric, gas, and transit systems; housing authorities; highway toll facilities; ports
and terminals; and airports.
9. Includes foreign countries, United States territories and possessions and international

NATIONAL INCOME, 195 4 EDITION

obtaining an evaluation of their reliability. If best use is to be made of national income statistics, their reliability will have to be evaluated concretely
on the basis of this evidence, from the standpoint of the specific economic
problem at hand.
While the task of evaluating statistical reliability confronting the user
of national income data is difficult, it should also prove rewarding. Analysis
of methodology and of relevant supplementary evidence will forestall many
misuses of the data. It will lead to more effective utilization of the data by
channeling them into uses warranted by their nature and degree of accuracy.
It will serve to make the informed user wary of many seemingly significant
conclusions that are drawn from small changes in the data which are
obviously well within their margin of error. Also, for any analysis an awareness of hitherto unknown limitations of particular national income series
may demonstrate the advisability of marshaling all other relevant information, within and outside the scope of national income. Clearly, if the evidence
is supportive and consistent, greater confidence can be attached to the
indicated conclusions than if the evidence is contradictory.
Finally to be noted is that the suggested approach to evaluation of reliability is methodic, even though presently permitting quantitative definiteness in only few instances. Large strides may be anticipated from the
integration into it of the results of further work and experience. For it must
be recalled that official national income work in the United States spans
merely two decades, and that the new and expanded series were established
only in 1947. The scope for analysis of methodology will be substantially
expanded over time with the continued improvement of source materials,
the opportunity for testing past sources and the procedures applied to them,
and a broadened basis for analyzing the record of revisions. The statistical
notes and related material presented, in this report represent only a start in
the indicated direction.

Aim and Plan of Statistical Descriptions
The following sections in this Part deal with the sources and methods used
in estimating the income and product flows. Insofar as feasible, the sections
are written according to a uniform plan.
An introductory part first discusses the general nature and reliability of
the series. Next follows a discussion of methodology, covering both base-year,
or "benchmark" year, estimates and their extrapolations, whenever such
a distinction is relevant. This discussion is intended largely as an evaluative
review but also contains considerable descriptive material, with the dual
objective of giving information about the principal methods used and affording an independent basis for judgment about reliability. Concluding remarks
are made on the characteristics of revisions in instances in which a separate
discussion of this subject appeared pertinent.
Only the annual estimates are covered by the sections on sources and
methods. No reference is made to the monthly or quarterly series, or to the
summary annual data derived from them which are published each February
in the Annual Review Number of the Survey of Current Business.
In general, more emphasis is placed on recent-period estimates than on
those for the period, say, 1929—39; and the discussion is aimed principally
at covering the totals of the various components, rather than their industry
or commodity breakdowns per se. Nevertheless, a considerable amount of
information on these breakdowns is introduced, as it often is relevant to an
evaluation of the broader categories and also is of substantial interest to
users of the estimates.
The various income and product components selected for discussion
cover all of those listed in the first four tables in the statistical section (Part
V) of this report. These are the summary tables on national income by distributive shares, gross national product or expenditure, personal income and
its disposition, and the relation of gross national product, national income,
and personal income. At the end of this introduction is provided a summary
of the stubs of these four tables, cross-referenced against the numbers of
the various sections on sources and methods.
In the following descriptions of sources and methods numerous "exhibits",
or supporting tables of data, are presented. Most of these exhibits refer to
1950. This year was chosen because the 1953 estimates (and the revised
figures for 1951 and 1952) were not completed until after the text had been
written and sent to press.
Although geared directly to the first four tables, the following sections on
methodology furnish partial or complete coverage of nearly all of the other

35 tables of annual estimates. Many of these tables relate to income flows by
industry. As already indicated, the discussions of the various distributive
shares give considerable attention to their industry breakdowns; but natiora
income by industrial origin, which is obtained statistically by aggregating
these individual-share breakdowns, is not separately discussed. It is convenient at this point, therefore, to give consideration to an important summary aspect of the industry data—the basis of industrial classification
underlying them.

Industrial classification of national income
The industrial distribution of national income is based primarily upon a
classification of establishments rather than of companies, or firms. Use of the
word "primarily" connotes a statistical exception (noted below), not one
of definition.
The establishment is the preferred unit since it yields an industrial classification much closer to an activity basis than does the use of the company. It
also largely prevents discontinuities due to mergers or other changes in the
structure of ownership.
Industrial classification by establishments, for example, places in bituminous coal mining a soft coal mine owned by a corporation engaged primarily in the production of iron and steel products, whereas classification by
companies places it in the iron and steel industry. The establishment classification, nevertheless, is quite different from an activity or product classification
since many establishments produce secondary products which fall within
industries other than those in which their major products are classified.
Force-account construction is an important special type of secondary product.
The establishment basis is used for the industrial classification of wages and
salaries, supplements to wages and salaries, income of unincorporated enterprises and inventory valuation adjustment, and interest paid by noncorporate
enterprises. But, because of statistical necessity, the company basis of industrial classification is used for corporate profits, the corporate inventory valuation adjustment, and interest paid and received by corporations.
The data for these items are all calculated from tabulations of corporation
income tax returns filed with the Internal Revenue Service. During the years
from 1934 to 1941 such returns were filed by every corporation, with certain
exceptions, and separately classified by industry. From 1929 through 1933,
and again in 1942 and subsequent years, affiliated corporations were permitted to file consolidated returns. More precisely, then, from 1934 to 1941 the
unit of classification for corporate profits and corporate interest is the individual corporation; from 1929 to 1933 and from 1942 on it is a corporate
unit consisting of either a single corporation or of affiliated corporations.
Because the bulk of total income originating is comprised of distributive
shares which are classified by establishments, and because of the probable
tendency for subsidiary activities of corporations operating in more than one
industry to be offsetting, it is unlikely that the industrial distribution of the
total national income is seriously distorted by the use of a company, rather
than an establishment, classification for corporate profits and corporate interest. This is a serious limitation, however, on the comparability of the
distributive share estimates for some industrial groups, and one which should
be considered carefully by those who use the data for particular industries.
The estimates of the national income and of the various distributive shares
by industry are based upon the Standard Industrial Classification Code,
which is published by the Office of Statistical Standards of the Bureau of the
Budget and recommended for use by all agencies classifying data industrially. Departures from that Code were dictated, for the most part, by statistical necessity.
For the years 1948 to date, the national income estimates are based upon
the 1945 edition of the Code for manufacturing and on the 1942 edition for
nonmanufacturing industries.1 The industry estimates for 1947 and prior
years, however, are based wholly upon the 1942 edition of the Code. This
difference introduces an element of noncomparability into the estimates for a
number of industries in the manufacturing division, since the 1945 edition
of the Code (now generally adopted by Federal statistical agencies) incorporated extensive changes for that division as compared with the 1942
1. Changes in classification for the nonmanufacturing industries were made in the 1949
edition of the Standard Industrial Classification Code. They are in general insignificant at the
level of detail shown in the national income classification and are not incorporated into the
present report. It may be noted that the State unemployment insurance wage data—the
principal statistical source for the national Income estimates—are not reported on the new
basis.

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS

GUIDE TO SECTIONS ON METHODOLOGY
Income and product components

Section
Number

Income and product components

NATIONAL INCOME BY DISTRIBUTIVE SHARES

PERSONAL INCOME AND DISPOSITION OF INCOME—
Continued

Compensation of employees:
Wages and salaries
Supplements to wages and salaries

Transfer payments
Less:

Income of unincorporated enterprises and inventory valuation adjustment:
Income of unincorporated enterprises
Inventory valuation adjustment

3
11

5
11

Personal contributions for social insurance

Less:

Rental income of persons
Corporate profits and inventory valuation adjustment:
Corporate profits before tax
Inventory valuation adjustment

Section
Number

Personal tax and nontax payments

14
2
13

Equals: Disposable personal income
Less:
Personal consumption expenditures:
Durable and nondurable commodities
Services
Equals: Personal saving

7
8
15

Net interest

GROSS NATIONAL PRODUCT OR EXPENDITURE

RELATION OF GROSS NATIONAL PRODUCT, NATIONAL INCOME, AND PERSONAL INCOME

Personal consumption expenditures:
Durable and nondurable commodities .
Services

Gross national product
Less:

Gross private domestic investment:
New construction
Producers' durable equipment. .
Change in business inventories:
Nonfarm
Farm

9
10

Net foreign investment

Government purchases of goods and services

Equals: Net national product
Plus:

11
3

Capital consumption allowances

Subsidies minus current surplus of government
enterprises

Less:
Indirect business tax and nontax liability.
Business transfer payments
Statistical discrepancy

PERSONAL INCOME AND DISPOSITION OF INCOME

Less:
Undistributed corporate profits
Corporate profits tax liability
Corporate inventory valuation adjustment. . .
Contributions for social insurance
Excess of wage accruals over disbursements. . .

13
14

Equals: National income.

Wage and salary disbursements.
Other labor income

Proprietors' and rental income:
Income of unincorporated enterprises and inventory
valuation adjustment:
Income of unincorporated enterprises
Inventory valuation adjustment
Rental income of persons
Dividends
Personal interest income.

3
11
4
5
6

edition previously in force. Accordingly, in the industry tables in Part V,
estimates for the manufacturing industries which were basically affected by
changes in the Code cannot be shown for the entire period since 1929. For
other industries, estimates are shown for all years of the period in spite of
some noncomparability, but its approximate magnitude (for the year 1948)
is indicated by footnotes in all instances in which it is significant.
The exhibit on page 66 provides a comparison of the National Income
Classification with the Standard Industrial Classification Code.

1. WAGES AND SALARIES1

Plus:
Net interest paid by government.
Transfer payments

5
5
11
2
1

6
14

Equals: Personal income.

lag between preliminary and final estimates is short, and the largest revision
that has been required in recent years by the accession of later data has been
less then 1 percent of the total.
From the standpoint of sources and methods, the estimates may be divided
into those covered by the social security systems and those not covered. The
former include virtually the whole of industrial and commercial employment.
They account for almost 80 percent of total wages and salaries and almost
95 percent of private-industry wages and salaries.
The area of the economy not completely covered by the Social Security and
Railroad Retirement Acts, and therefore estimated independently, consisti
of government, agriculture, private households, and a few quantitatively
minor industries. The following tabulation shows a breakdown of wages and
salaries into the segments estimated from different sources.

Industries Covered by Social Security Programs

The annual estimates of total wages and salaries for the period since 1939
are extremely reliable. Over 90 percent of the total consists of reported payroll
information taken from accounting records of business and government. The

Total payrolls

1. This section covers also, at the end, "wage and salary disbursements," which is a
component of personal income.

The reporting system that has been developed under the Social Security
and Railroad Retirement Acts approaches the ideal as a source for income

NATIONAL INCOME, 195 4 EDITION

estimates. It has the advantages of comprehensive coverage, regularity of
reporting, and of being largely "self-policing," in that the wages reported by
employers—upon which the size of benefits partly depends—can be verified
by the employee. Because the reports from every firm list the employees and
their wages individually, unlike other enumerative surveys, the possibility of
omissions and accounting errors is minimal. Reported figures account for
practically the entire total of wages and salaries in covered industries; only
about 1 percent of the total must be filled in by estimation.
In industries covered by the old-age and survivors insurance program
(OASI), each employer with one or more employees files a quarterly list of
his employees and the taxable earnings paid to each employee—through
1950, the first $3,000 earned during the calendar year; thereafter, the first
$3,600. Taxable payrolls are compiled from these lists for each calendar
quarter and an estimate added for delinquent employers. The four-quarter
Exhibit 1.—Wages and Salaries, 1950
Item
Industries covered by social security programs
Industries not covered:
Federal Government
State and local governments
Farms.
__.
_
Private households
...
Nonprofit hospitals
Educational services, n. e. c. (part)
Nonprofit membership organizations, n. e. c. (part)
Insurance carriers (part)
_
._.
Agricultural services, forestry and fisheries (part) —
Federal Reserve banks...
_
Rest of the world
Tips (in all industries)
Total wages and salaries

Millions
of dollars

Percent

114,770

78.3

11,843
10,368
2,724
2,668
1,202
9S8
827
279
98
54
18
717

8.1
7.1
1.9
1.8
.8

146,526

100.0

which processes and tabulates these data. The Board has an accurate basis
for raising taxable wages to the total, by multiplying them by the ratio of
total wages reported by employers to the Interstate Commerce Commission
to the taxable wages of the same employers, which account for about 97 percent of taxable compensation.
Information necessary for computation of the "covered" wage and salary
total has become available 6 months after the period in which the wages were
earned. Thus in June of each year data have been available for the previous
calendar year.' Thefiguresaresubject to revisions of two types: (1) Correction
of errors in reported data and (2) substitution of actual data from delinquent
reports for the earlier estimates of delinquent wages. In the past, revisions of
either type have been negligible.
The relation of the reported to the estimated elements of wages and salaries
for covered industries is shown in Exhibit 2. This covers the 1950 estimates
prepared for publication in July 1954. The estimated portion was slightly
less than 1 percent of the total. In the first estimates for 1950, published in
July 1951, the estimated portion was somewhat higher—about 2 percent—
because of the necessary higher allowance for delinquent wages.
Exhibit 2.—Derivation of Wage and Salary Total for Covered Industries, 1950
[Millions of dollars]

Item

Reported
by
employers

Estimated

.6
.2
,1
.04
.01
.5

Industries under Social Security Act
Taxable wages
Nontaxable wages
Industries under Railroad Retirement Act
Taxable wages
Nontaxable wages
Total wages and salaries, covered industries.

sum of these totals represents a b o u t four-fifths of t h e total wages of these firms.
Nearly all of n o n t a x a b l e earnings in e m p l o y m e n t covered by the O A S I prog r a m is reported u n d e r the State u n e m p l o y m e n t insurance ( U I ) programs.
T h e State agencies obtain from employers covered by their p r o g r a m s regular
quarterly reports on b o t h total a n d t a x a b l e payrolls a n d s u m m a r i z e these
reports for t h e Bureau of E m p l o y m e n t Security of the D e p a r t m e n t of
L a b o r . T a x a b l e earnings u n d e r the O A S I p r o g r a m a n d n o n t a x a b l e earnings
reported to t h e State u n e m p l o y m e n t insurance agencies together h a v e represented in most years more t h a n 99 percent of total wages a n d salaries in
industries covered by the Social Security Act. 2
T h e two sources a r e not quite complete because some of the U I programs
e x e m p t firms with few employees (ranging at present from 1 to 7, according
to t h e individual State laws) a n d firms in business intermittently or for short
periods. As such firms a r e covered by the O A S I p r o g r a m , only their n o n t a x able wages m u s t be estimated. This is d o n e by a m e t h o d developed in the
Division of Research a n d Statistics of the D e p a r t m e n t of H e a l t h , Education
a n d Welfare. T h e taxable payroll of firms not covered by the State laws is
multiplied by a ratio of nontaxable to taxable earnings. T h e first of these
factors, t h e taxable payroll, is obtained by subtracting t a x a b l e wages paid
u n d e r t h e U I programs from taxable wages u n d e r the O A S I p r o g r a m . T h e
second factor, the ratio, is a p p r o x i m a t e d from U I d a t a a n d then adjusted, by
use of a 1943 O A S I study, to a p p l y to firms not u n d e r the U I p r o g r a m .
T h e overall wage a n d salary estimates for industries covered by the Social
Security Act a r e thus built u p as the s u m of (1) taxable earnings reported
u n d e r O A S I , (2) nontaxable earnings reported u n d e r U I , a n d (3) estimates,
based o n social security d a t a , of n o n t a x a b l e earnings in these industries not
reported u n d e r U I .
T o t a l wages paid u n d e r the R a i l r o a d R e t i r e m e n t Act are ascertained in
m u c h t h e same way. Wages taxable u n d e r this p r o g r a m — t h e first $3,600 for
each employee—are reported quarterly to t h e R a i l r o a d R e t i r e m e n t Board,
2. This percentage refers to the relation of the specified source materials in the 1939-50 period.
Since 1951, taxable earnings under the OASI program ($3,600) have no longer coincided with
those under the UI law ($3,000), and coverage of OASI has been expanded to include some
groups, chiefly agricultural and private household workers, not covered under the UI programs. The Bureau of Old-Age and Survivors Insurance, however, furnishes a special estimate ol what the OASI taxable wage total lot the year would have been in teims of the 1950
coverage provisions—thus permitting extension of the basic procedure being described,
which represents an integration of OASI taxable wages and UI nontaxable wages. This
special estimate is derived from sample data which serve, in efEect, to adjust reported taxable
wages for the year to a 1950 coverage basis.

Total

87,204
22,239

87,184
21,514

4,704
623

4,704

114,770

114,010

120
3 725

15
760

1. Estimated delinquency as of April 1954.
2. Nontaxable wages paid by employers not covered under State laws.

Industrial distribution of payrolls
The method used to derive an all-industry total of "covered" wages and
salaries cannot be followed satisfactorily for the separate industries, chiefly
because old-age and survivors insurance data have not until recently been
collected or tabulated on an establishment basis. As noted in the Introduction
to this Part, this is preferred to the company basis of classification.
The preparation of an industry breakdown of the covered payroll total
relies heavily on the Bureau of Employment Security's reports summarizing
wages and salaries under the UI programs, in which the establishment basis
of classification is used. This source and the Interstate Commerce Commission's Statistics of Railways reports together provide accurate, employer-reported data by industries for about 95 percent of total covered payrolls.
The missing part consists of the payroll of firms (1) covered by the OASI
program but not by the State laws and (2) covered by the Railroad Retirement Act but not reporting to the Interstate Commerce Commission. The
latter element, quantitatively very small and affecting only a few industries,
is estimated from data furnished by the Railroad Retirement Board. A satisfactory basis for estimating the former is furnished by special tabulations of
old-age and survivors' insurance data showing by industries the taxable payroll of the small firms not covered by the State laws. These are available for
the third quarter of 1940 and 1943 and the first quarter of each of the years
1945-49 and 1951.
For nearly all covered industries, the process of obtaining provisional estimates (before adjustment to the controlling total) involves simply the addition
of these OASI and Railroad Retirement Board data to the comprehensive
data reported under the UI programs and by the Interstate Commerce Commission. This general method was departed from only in those few instances
where more reliable data were available from other sources or where the
portion of employment in firms not covered by the unemployment insurance
data was so large as to suggest use of another procedure. The industries thus
3. At present, however, there is a time lag of one year in the availability of the special
estimate of total OASI taxable wages on the 1950 coverage basis. This is not a significant
limitation, as the taxable wage total for the most recant year can ba estimated within narrow
limits by means of the change in this aggregate shown by UI data.

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS

receiving special treatment include "agricultural services," "forestry," "fisheries," "banking" (prior to 1943), "water transportation" (prior to 1947),
"medical and other health services," and "legal services." The data utilized
in making estimates for these industries were obtained from the population
and industry censuses, the Maritime Commission, governmental bi.nking
regulatory bodies, and special surveys of the professions (described in the
section on Income of unincorporated enterprises) conducted by the National
Income Division.
The summation of direct industry estimates from these general and special
sources yields a payroll aggregate falling short of the independent controlling
total in most years by only a fraction of 1 percent.4 A large part of this discrepancy can be traced to exclusions from the industry estimates of amounts
unclassified by industry in both the unemployment insurance data and the
special tabulations of OASI small firms, as well as to the omission of nontaxable wages from the latter. Adjustment to the controlling total is accomplished
by allocating the amount of the discrepancy among the industries in proportion to the estimates of wages not covered by the State unemployment insurance programs.
For the years 1929—38, before social security data were available, wages and
salaries for the "covered" segment of the economy were derived from diverse
sources, the most important being the periodic censuses of industry and business. These provided coverage of manufacturing,5 retail trade, wholesale
trade, most of the "covered" services, mining, construction, insurance, communications and public utilities, and parts of banking, highway transportation, and services allied to transportation. Reliable, comprehensive data were
available from Federal reports also for banking, railroads, pipeline transportation, and air transportation. For the industry groups for which censuses
furnished one or more benchmarks, the general procedure for estimating the
intercensal years was through interpolation or extrapolation by sample data
on payrolls and employment collected by the Bureau of Labor Statistics.
The series prepared for individual industries for the years 1929-39 were used
to extrapolate the 1939 estimates derived from social security data.

Industries Not Covered by the Social Security Programs
Federal Government

Statistics. Prior to 1934, when monthly payroll estimates were not available,
this conversion was made by monthly distributions of personnel.
Pay in kind includes the cost value of food consumed by the Armed Forces
and standard issues of personal clothing. This is estimated by the various
services from their cost records, since no suitable accounting data for the two
items are available. The procedure involves multiplication of the number of
personnel receiving the food or clothing by the estimated cost per person.
Necessary revisions of the calendar-year estimates of military wages are
usually small but on occasion have been as large as 5 percent.
Wages and salaries in Federal work relief projects, covering the period
1933—43, are compilations of the Department of Health, Education, and
Welfare from records of the various agencies which administered the
projects.

State and local government
Estimates of public education payrolls—classified in general government—
have been based since 1946 on information reported by the Bureau of the
Census. In the preparation of these estimates, three series of payroll data
have been utilized, covering (1) the school years 1945-46, 1948-49, and
1949-50, (2) 1 month of each quarter for the period 1946-49, and (3) each
month since early 1951. These data were derived from samples covering a
very large proportion of the universe (in general, 80 percent or more) and,
as indicated in Census Bureau reports, having a small degree of sampling
variability.
The school-year figures were converted to calendar-year totals for 1946,
1949, and 1950 by use of patterns shown by the monthly data noted in (3)
above. Estimates for the calendar years 1947 and 1948 were obtained by interpolation. For this purpose an annual series was prepared for 1946—49 which
represented for each year a combination of reported data for 4 months—see (2)
above—and estimates for the other months based on the later monthly payroll
distributions. For the period beginning with 1951, annual totals are the sum
of the monthly amounts reported by the Census Bureau. Totals derived from
this monthly series, it may be noted, check closely with the annual data collected by the Census Bureau in its comprehensive 1952 survey and published
i n Summary of Government Finances in 1952.

For the period 1929—39, the annual estimates of public education payrolls
are those prepared by the State, county, and municipal survey conducted by
Civilian payrolls of the Federal Government—executive, legislative, and
the Department of Labor with Works Projects Administration funds and
judicial—are reported monthly to the Civil Service Commission and the
published by the Department in Employment and Payrolls in State and Local
Department of Labor from records of the individual agencies. The data
Governments, 1929-39. This survey collected data from all States and a comprebecome available with about a 2-month lag; subsequent revisions due to late
hensive sample of local governmental units.
reporting are negligible. Two small items are estimated by the National InEstimates of public education payrolls for the years 1940-45 represent
come Division and added to the reported payroll total for the continental
interpolations of the 1939 Labor Department estimate and the 1946 CensusUnited States: (1) the pay of employees stationed abroad who are citizens of
based estimate by means of a series constructed from detailed payroll data
the continental United States, and (2) the pay of civilian employees of Army
given in the Biennial Survey of Education of the Office of Education. The 1939
post exchanges and Navy ship stores and ships' service stores.
and 1946 values in this series, it may be noted, agreed closely with the totals
Prior to September 1933, monthly payroll data for the civil executive service
used for those years.
were not available. The Bureau of Labor Statistics derived the 1929—33
annual estimates largely on the basis of Budget of the United States Government For the years 1940-50, total nonschool payrolls (except work relief)—general government and government enterprises combined—were estimated by
figures and detailed employment data collected by the Civil Service Comthe Census Bureau for 1 month in each quarter from a mail sample of governmission.
ment units. Months not sampled were filled in by the National Income DiviFederal Government civilian payrolls have been divided between general
sion by straight-line interpolation. Estimates for years since 1951 represent
government and government enterprises on the basis of these sources, supplethe sum of sample-based monthly figures reported by the Census Bureau. As
mented on occasion by direct reports from certain of the individual agencies
in the case of the public education series, the Census Bureau's nonschool paysuch as the Post Office Department, the largest of the enterprises. Little estiroll data have been obtained from samples accounting for a very large part
mation has been necessary.
of the estimated total and subject to small sampling variability.
Military wages are estimated as the sum of cash pay and allowances and of
The Census Bureau generally has provided separate data for 1 month in the
pay in kind. Information on cash wages is secured separately on a fiscal-year
year on government enterprise payrolls. These are interpolated for interbasis from the five armed services. These accounting (budgetary) records
vening months by total nonschool payrolls. Subtracting enterprise payroll
must be adjusted in some instances to eliminate nonwage items. The adjustfrom total nonschool payroll yields the general government portion of the
ments likewise are based on detailed data furnished by the services. The data
latter.
are generally adequate for the purpose, even though not developed for it. The
The annual estimates of nonschool (except work relief) payrolls for the
fiscal-year figures are then converted to a calendar-year basis by means of
period 1929—39 are those prepared by the State, county, and municipal
monthly estimates supplied by the armed services to the Bureau of Labor
survey noted above. Separate data were provided for general government
4. In 19.50, for example, the total of the direct industry estimates was lower than the $114.7
and government enterprises.
billion aggregate by only $500 million.
State and local government payrolls include also a small amount of income
5. For a description of the methodology used for this large industry, see the article on
in kind, representing the value of food and lodging received by government
wages and salaries by Edward F. Denison in the June 1945 Survey of Current Businsss, pp.
hospital employees and of food received by State prison employees. This has
23-24.

NATIONAL INCOME, 1954 EDITION
been estimated from data contained in two Census Bureau publications:
Patients in Mental Institutions and Prisoners in State and Federal Prisons and Reformatories.

State and local work relief wages, covering the period 1929—42, were derived largely from reports of the Federal Emergency Relief Administration,
supplemented by compilations of the Departments of Labor and Health,
Education and Welfare. For lack of complete data, the estimates for 1929—32
(totaling only $50 million for the period) are subject to sizable percentage

Farms
Farm wages, including both cash payments and the cost of board, lodging,
and other perquisites furnished to hired workers, are estimated by the Agricultural Economics Division of the Department of Agriculture. The cash
part, comprising more than four-fifths of the total, is taken as reported in the
Census of Agriculture. The census figures are extended to other years by
sample data on employment obtained monthly and wage rates quarterly from
a mail questionnaire of between 15,000 and 20,000 farmers.
When the results of the 1950 Census of Agriculture became available, it
was necessary to correct the 1949 estimates of cash wages derived from the
sample by only 3 percent. Larger corrections had been required to adjust to
the censuses covering 1929, 1939, and 1944.
The basic data for estimating wages in kind were obtained from two early
census enumerations and several sample surveys. Sample data on employment, wage rates, and the prices of perquisite items are used for extrapolation.

Private households

tary hospitals, as obtained from social security records, from independent
estimates for all privately controlled hospitals. The following description
relates to the latter.
Virtually complete data on the cash payroll of privately controlled hospitals
have been collected annually by the American Hospital Association since
1944. Only slight estimation is required to secure the aggregate, of which
nonprofit hospitals account for about four-fifths. The value of maintenance
furnished employees is added by the National Income Division. The value of
maintenance per employee receiving maintenance was derived from the 1935
Census of Hospitals and has been extrapolated to 1944 and later years by an
index constructed by weighting the Consumer Price Index by one and the
food component of this index by four. The proportion of employees receiving
maintenance was estimated from the 1935 census, and, in the absence of later
information, this proportion has been held constant. Maintenance accounts
for about one-fifth of total wages and salaries.
Prior to 1944 the only comprehensive payroll data were those provided by
the 1935 Census of Hospitals. The 1935 census total (cash and maintenance)
was extended back to 1929 mainly by data collected in a special survey of
hospitals made by the National Income Division in 1935.
Estimates through 1941 were prepared by extrapolating the 1935 payroll
by estimates constructed from such information as the number of hospital
beds and the average salary per bed, per capita expenditures for hospital inpatient service, and the average daily census of patients. Unemployment insurance data (covering largely proprietary hospitals) were used to interpolate
between the 1941 and the 1944 payroll estimates.
Since the hospital estimates for the period 1936—43 are based on diverse and
partial sources, it may be noted that the original estimate for 1944 differed
by only 2 percent from the final estimate subsequently derived from the basic
data provided by the American Hospital Association, adjusted to include
maintenance.

Estimates of the total cash pay of domestic servants are obtained as the
product of employment and average annual earnings. For the period beginning with 1940, the employment totals used represent monthly averages of
data collected by the Census Bureau in its continuing sample study of the
labor force reported in Current Population Survey. Prior to 1940, it was necessary
to base the movement of employment on indirect data (employment in inNonprofit membership organizations, n. e. c. (part)
dustrial and commercial pursuits), and the resulting series was adjusted to
an estimate of the number of domestic servants derived from 1930 Census of
The bulk of wages and salaries of nonprofit membership organizations not
Population data.
covered under the social security laws is comprised of the payroll of religious
organizations. This payroll is estimated separately for payments in cash and
For the years 1939 and 1949, estimates of average cash earnings of domestic
in kind.
servants were computed from data in the 1940 and 1950 Census of Population
showing the frequency distribution of such persons by detailed size-of-earnThe basic estimate of cash payrolls was derived from the 1936 Census of
ings classes. Estimates for other years since 1939 have been obtained by interReligious Bodies, reported totals being raised to allow for churches not repolating and extrapolating the 1939 and 1949 census-based averages by
porting. This figure has been extrapolated by multiplying estimated annual
means of the domestic service component of the Consumer Price Index of the
employment by an index of average salaries computed from data supplied the
Bureau of Labor Statistics. To obtain average earnings figures for the period
National Income Division by various denominations, with the movement
1929-38, the 1939 estimate was extrapolated by an index of the average
between 1940 and 1950 adjusted on the basis of earnings information reported
earnings of domestics prepared by the National Bureau of Economic Refor clergymen in the Census of Population. The employment estimates have
search from data collected from employment agencies by the National Income
been derived from data obtained from the following sources: the 1930, 1940,
Division and the National Bureau.
and 1950 Census of Population; the Official Catholic Directory; a special survey
The value of board furnished domestic service employees is based on a
of Catholic dioceses made by the National Income Division, covering 1929—
standard budget for 1935—36 derived from the National Resources Planning
35; and correspondence with other denominations.
Board study on Family Expenditures in the United States, 1935—36, moved by
The rental value of parsonages was assumed to be 10 percent of their value,
changes in food prices and multiplied by the proportion of employees reas reported in the 1926 and 1936 Censuses of Religious Bodies. The rent comceiving board in 1936, as estimated from a survey of employment agencies
ponent of the Bureau of Labor Statistics' Consumer Price Index has been
made by the National Income Division.
used for interpolation and extrapolation. The value of board received by
It should be noted that the level of private household employment indicated
Catholic clergymen—the other item of pay in kind—was estimated for 1934
for 1950 by the Census Bureau's Current Population Survey—as incorporated infrom data collected in the special survey by the National Income Division.
the present estimates—is about one-third higher than that shown by the
The extrapolation to other years has been made by the product of number of
decennial Census of Population. The Census Bureau has found that data perclergymen and the food component of the Consumer Price Index.
taining to employment of women 25 years old and over and in industries
Estimates of payrolls for other nonprofit organizations not covered by
where part-time and occasional work is common tend to be reported more
social security are based on the 1935 Census of Nonprofit Organizations,
accurately in its current survey than in the decennial census. It is believed
Office Buildings, and Miscellaneous. To obtain estimates for other years of
that for areas where labor force classification is difficult—including domestic
service—the Current Population Survey yields more reliable results by reason of the 1929-39 period, the 1935 census data were extrapolated largely on the
basis of the domestic current expenditures of private social welfare and relief
the greater skill and experience of its permanent enumerative staff.
agencies (as included in table 30, pt. V). For the period beginning with 1940,
the National Red Cross payroll has been obtained directly; and the remainder
Nonprofit hospitals
represents an extrapolation—with adjustment to the employment level indicated by the 1950 Census of Population—chiefly on the basis of payrolls in
Direct estimates of nonprofit hospital payrolls have not been prepared
"covered" nonprofit membership organizations.
separately. Instead, these are derived by subtracting the payroll of proprie

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS

Educational services, n. e. c. (part)

enterprises as estimated from tabulations of Federal income tax returns to
the Internal Revenue Service. For years other than 1939, 1945, and 1947,
Estimates of wages and salaries for private educational services not covered
fishery payrolls were estimated, in the main, through interpolation and extraby the social security laws are prepared separately for parochial schools, other
polation by the value of the catch series.
elementary and secondary schools, higher education, and a miscellaneous
Benchmark estimates of the payroll and employment of agricultural and
category of institutions and agencies. The general procedure is one of piecing
similar service establishments were prepared for 1939 from old-age and surtogether information on average earnings and employment (the latter advivors insurance data. In that year, although not subsequently, the OASI
justed to conform with results of the 1940 and 1950 Census of Population).
program provided complete coverage of this industry. Payroll estimates for
The Office of Education has been the principal source of data, including not
the period after 1939 were obtained by extrapolating the 1939 benchmark
only the Biennial Survey of Education and other published reports, but also nu- chiefly on the basis of data reported under the UI programs, which—with admerous special tabulations. Other sources include the National Catholic Weljustment for small firms not covered by them but covered by OASI—have
fare Conference, the National Education Association, State unemployment
accounted for about two-thirds of estimated total payroll in the industry.
insurance tabulations, and a special survey of Catholic dioceses made by the
Prior to 1939, payrolls were estimated as the product of employment and
National Income Division covering the period 1929-35.
average employee earnings. Employment was derived by extrapolating the
1939 figure by the Department of Agriculture's index of farm production.
The average earnings series for that period represents an extension of the 1939
Life insurance carriers (part)
average by the National Income Division series for miscellaneous repair
Until the 1951 amendments to the Social Security Act, insurance solicitors
services and hand trades, as adjusted for 1935-39 movement on the basis
on a commission basis were excluded from coverage of that act.6 The basic
of data reported for a group of agricultural service industries in the 1935 and
estimates of the number of such persons were derived from the 1935 Census of
1939 Census of Service Establishments.
Insurance and from the Institute of Life Insurance's Fact Book for 1940 and
1945—50. The 1935 census also presented data permitting the computation of
the average earnings of solicitors for that year. Such earnings could be estiRest of the world
mated for 1951 through a comparison of the average earnings of insurance
This series is described in the section on net foreign investment.
employees covered by OASI (including solicitors on a commission basis)
with the earnings of those covered by UI (not including solicitors). The 1935
and 1951 average earnings figures were interpolated and extrapolated by
Tips
average annual earnings of "covered" employees in the insurance industry.
Multiplication of employment by average earnings yielded the payroll series
Tips are treated in the category "not covered" since it is believed that the
used.
extent of actual coverage under the social security laws is small. The social
security regulations state that tips are considered wages only if the employee
renders to the employer an accounting of the tips. To the extent that tips are
Federal Reserve Banks
covered, however, they offset any exclusions of income in kind, which is
treated as being completely reported in the social security payroll data.
Wages and salaries are obtained from the annual reports of the Board of
Tips were estimated at $0.7 billion in 1950, and are included in the payroll
Governors of the Federal Reserve System.
estimates for retail eating and drinking places, railroads, taxlcabs, hotels,
personal services, and athletic and social clubs (classified in amusements and
Agricultural services, forestry, and fisheries (part)
recreation, n.e.c).
Tips in eating and drinking places were estimated for 1939 from wage
Only parts of the agricultural service, forestry, and fishery industries are
studies in restaurant occupations made by State labor departments of Illinois,
covered by the social security laws. These are deducted from estimates of total
New York, Ohio, and Rhode Island. The 1939 estimate has been extrapolated
payrolls (described below) to obtain the noncovered portions as shown in
to other years by the Office of Business Economics series on sales of eating and
Exhibit 1.
drinking places.
Forestry payrolls (and employment) are estimated separately for (1) gum
The estimates for the railroads (except dining and buffet cars) were preturpentine and gum rosin production and (2) other forestry. Logging, it may
pared on the basis of a survey for 1929 and 1933 conducted by the Brotherbe noted, is classified in manufacturing rather than forestry.
hood of Sleeping Car Porters for the National Income Division, and extraBase-period estimates for the first segment, which accounts for most of the
polated to other years by the number of berth and seat passengers in sleeping
industry, are derived from Census of Manufactures data. Extrapolation to
and parlor cars (reported annually in Statistics of Railways) and estimated
other years has been based mainly on a total labor cost series, computed from
changes in the percent of passengers tipping and the average tip. Tips in
Department of Agriculture data. This is derived by multiplying the physical
dining and buffet cars are estimated at 12 percent of dining and buffet car
volume of production of turpentine and rosin from gum by estimates of labor
sales (reported annually in Statistics of Railways).
cost per unit of naval stores.
Tips in the taxicab industry are calculated at 15 percent of operating
Employment in other forestry is estimated as a residual between total emrevenues, on the basis of several studies of the industry in the midthirties.
ployment for the industry as shown by the Census of Population and employThe studies for New York and Illinois used in estimating tips in eating and
ment in gum turpentine and gum rosin production. To obtain payroll, the
drinking places also provided the basis of the estimates of tips to hotel and
average earnings of turpentine and rosin workers are assigned to this residual
club food service employees in 1939. The 1939 figures have been extrapolated
group of employees.
to other years largely on the basis of estimated hotel and club receipts from
Wages and salaries offisherieswere derived for 1939 from employment and
meals and beverages. The allowance made for tips of nonfood employees of
earnings data reported in the 1940 Census of Population. The census data
hotels—while based in part on studies of the New York State Labor Departcould be used directly, with only minor adjustment. The 1950 Census of Popment—is, of necessity, essentially arbitrary.
ulation provided another benchmark figure on employment, but the earnings
Tips in personal services are estimated at 5-8 percent of the receipts of
data reported there (for 1949) covered the self-employed as well as employees.
barber shops, beauty parlors, and baths and masseurs. The higher figure has
Payrolls for 1949, therefore, were estimated in conjunction with the income
been used for recent years.
of unincorporated business, with 1950 census data furnishing a control total
for both. Addition of corporate profits to this total yielded a combined aggregate of payroll and business income which was extrapolated to 1945 and 1947
by means of data on the value of the catch furnished by the Department of
Wage and Salary Disbursements
the Interior. Payrolls for 1945 and 1947 were derived by subtracting from
this, factor-income total the income of corporate and noncorporate business
"Wage and salary disbursements," a component of personal income, is
equal to wages and salaries plus the excess of wage disbursements over wage
6. In previous issues ol the National Income supplement, such solicitors were classified
accruals.
as proprietors, and their earnings were included to "income of unincorporated enterprises".

NATIONAL INCOME,

Because of retroactive wage and salary payments, it is necessary to adjust
wages and salaries from an accrual basis to a payment basis for inclusion in
the personal income estimates. The adjusted series is termed "wage and salary
disbursements." The adjustment item, the excess of wage disbursements over
wage accruals, reflects the difference in timing, as between receipt and earning, of retroactive wages.
The following example indicates the procedure of moving from wages and
salaries to wage and salary disbursements. In 1946 a retroactive wage payment of $30 million was made by the Western Union Telegraph Co., under
order of the National War Labor Board. The award applied to work performed in the years 1943, 1944, and 1945, in the amounts of $2, $14, $14
million, respectively. Wages and salaries, which reflect earnings on an accrual
basis, in this specific case are $2 million in 1943, $14 million in both 1944 and
1945, and 0 in 1946. The adjustment item, the excess of wage disbursements
over accruals is $—2 million in 1943, $—14 million in 1944 and 1945, and
$30 million in 1946. Consequently wage and salary disbursements are 0 in
each year 1943-45, and $30 million in 1946.
The adjustment of wages and salaries to wage and salary disbursements is
not intended to correct discrepancies between the two arising from all retroactive wage payments, but only for the more significant of these actions.
While in the case of the Western Union award noted above, it was possible
to secure direct information on these payments, more often such information
has to be approximated from news accounts or other less formal sources.

2. CONTRIBUTIONS FOR SOCIAL INSURANCE and
OTHER LABOR INCOME
This section describes the derivation of (1) Employer contributions for social
insurance, (2) Personal contributions for social insurance, a n d (3) Other labor income.

Of these series, the first and third together comprise Supplements to wages
and salaries (shown by type in table 34, Part V), a component of the national
income. The incomes on which personal contributions for social insurance
are paid are measured in the national income before deduction of these contributions. Both employer and personal contributions, however, are excluded
from personal income (the latter handled as an explicit deduction item in the
computation of the personal income total).
The two series on contributions for social insurance comprise items for
which highly reliable data are obtained, with virtually no time lag, almost
exclusively from the accounting records of the agencies administering the
programs. Employer contributions for social insurance currently account for
one-half of total supplements to wages and salaries, although from 1937 until
recent years the proportion was much higher. Estimates of Other labor income
are not so reliable. They are based to a lesser extent on comprehensive accounting data, and these become available with a lag of two to three years.
Considerable estimation is involved for the most recent years.

Contributions for Social Insurance
Social Security Programs
Regular contribution reports filed by employers with the administering
agencies or with the United States Treasury are the source of data on contributions made by employers under the old-age and survivors insurance
program, the State unemployment insurance and cash sickness compensation programs, the railroad retirement and unemployment insurance programs, and the Federal unemployment tax. The reported contributions
data are lagged (usually one-quarter year) to time them with the accrual of
the wages and salaries on which they were levied, rather than with the receipts of the Government funds.
Like covered payrolls, discussed in the notes on Wages and salaries, these
contributions data are a byproduct of operations under the social security
laws. They are subject to revision only to the extent that wage reports are in
error and that estimates made for delinquent reports are corrected on the

195 4

EDITION

The industry distributions of employer contributions under these several
programs—which are required for the industrial breakdown of the national
income—either are available from tabulations of employer reports or can be
estimated satisfactorily from taxable wage data.
Data by industry on employer contributions under the State unemployment
insurance programs have been obtained for years since 1940 from the Bureau
of Employment Security of the Department of Labor. They are summations of employer reports. For the years 1936—39, when reported data
were not available on an industry basis, estimates were prepared by extrapolating the 1940 industry figures back to 1936 on the basis of the National
Income Division's estimates of wages and salaries, and then adjusting the
results proportionately to the all-industry total for each year.
Beginning with 1951, the industrial breakdown of employer contributions
under the OASI program has been obtained by multiplying the contribution
rate by data on total taxable wages as reported by the Bureau of Old-Age
and Survivors Insurance of the Department of Health, Education and
Welfare. For the years 1941—50, the industrial distribution of these contributions was derived as the product of (1) the contribution rate and (2) reported
taxable wages under the State unemployment insurance programs plus estimated taxable wages of firms covered by old-age and survivors insurance
but not covered by the State programs chiefly because of the varying size-offirm exclusion provisions of the latter.1 The old-age and survivors insurance
data for small firms were estimated from periodic special tabulations by the
Bureau of Employment Security of the Department of Labor. In the absence
of taxable payroll data by industry prior to 1941, the estimates in each industry for that year were extrapolated to the 1937-40 period by total wages
and salaries in the industry, with appropriate adjustment to the annual allindustry aggregate.
The Federal unemployment tax has been allocated by industry on the
basis of taxable wages reported under the State unemployment insurance
laws.
The all-industry totals for employer contributions under the railroad retirement and unemployment insurance programs have been allocated among
the few industries in which there is coverage on the basis of total payrolls, as
derived in preparing the estimates of wages and salaries.
Cash sickness contributions by employers, confined to a few States, have
been distributed by industry in the same proportion as unemployment insurance contributions in those particular States.
Of the various programs of social insurance listed above, employees contribute to all except railroad unemployment insurance.2 As in the case of
employer contributions, data on contributions by employees are obtained
from the administering agency or the United States Treasury, and are lagged
so as to make the timing coincide with the payroll disbursements on which
the contributions are based.
In addition to employee contributions under these programs and under
the Government retirement and life insurance systems covered below, the
series on Personal contributions for social insurance includes contributions for old-

age and survivors insurance by the self-employed. (See table 35, Part V.)
They were first paid in 1952, on 1951 incomes, under amendments extending
coverage of the OASI system as of January 1, 1951. Data on such contributions, which are paid annually by self-employed individuals with their returns on Federal income taxes, are furnished by the Bureau of Old-Age and
Survivors Insurance.

Government systems
Payments made by the Federal Government and by its employees to its
civilian employee retirement systems are obtained from records of the
Treasury Department or of the agencies responsible for the administration
of the systems. Data on the Government5s contributions are reported on a
1. The available tabulations of total taxable payrolls under the OASI program were not
used lor this period in obtaining an industry distribution because they were based in large
part on a classification of firms, rather than establishments, and therefore were not comparable to the estimates of wages and salaries. Use of unemployment insurance wage data
for tnis purpose was made possible by the fact that the $3,000 taxable wage provision under
the State laws coincided with the OASI provision (which was changed to $3,600 effective
January 1,1951).
2. Under the State unemployment insurance laws, however, employees have contributed

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS

fiscal year basis, and the figures for adjoining fiscal years are averaged to obtain calendar year estimates. The Government's and individuals' contributions to the Government and National Service Life Insurance Funds are
compiled monthly from reports of the Veterans' Administration.
Estimates of national income by industry require a separation of Federal
Government contributions as between general government and government
enterprises. This poses no problem with respect to the numerous (and quantitatively minor) funds other than the civil service fund, since the functions of
agencies with separate funds are clearly defined. But since the Federal Government makes one lump-sum payment each year to the civil service retirement fund, it is necessary to make a statistical allocation of the data for this
fund between general government and government enterprises.
For ye?rs other than 1941—45, this allocation has been accomplished on the
basis of Treasury data on employee contributions to the retirement fund
classified by individual Federal agencies. To obtain estimates for the 1941—45
period, the 1940 estimate of the Government's contribution for enterprise
employees was extrapolated by the relative change in government-enterprise
employee contributions (adjusted for the July 1, 1942, rate change), and the
Government's contribution for general government employees was obtained
as a residual.
This procedure was adopted because, while employee contributions were
swelled by the expansion of payrolls, the Government's contribution was not
increased proportionately. Most of the war service employees, concentrated
in general governmental agencies, were expected to withdraw from the Federal service before attaining eligibility for retirement benefits, taking refunds
of their contributions instead of adding to the long-run liabilities of the fund
for benefit payments.
Estimates of employer and employee contributions to retirement systems
for State and local government employees have been furnished for years beginning with 1936 by the Division of Research and Statistics of the Department of Health, Education, and Welfare. Base year data for these estimates
were developed through a joint study by that Division and the Bureau of the
Census. Contributions for the fiscal year 1940-41 were estimated on the basis
of questionnaires on the operations of retirement systems sent to all State and
large local governmental units and to a sample of the smaller units. These
base year estimates have been extended to other years by data compiled by
the Census Bureau in its annual financial statistics series and in special reports, and from published annual reports for some of the larger retirement
systems. The fiscal year data have been adjusted to a calendar year basis by
averaging successive fiscal years. The estimates for 1929—35—definitely of
lesser reliability—were prepared by extrapolating the 1936 figure provided
by the Health, Education and Welfare Department by contributions data
obtained from a sample questionnaire survey of State and local government
units conducted by the National Income Division.
State and local government employer contributions have been allocated
between general government and government enterprises in proportion to the
breakdown of employee contributions for 1939 estimated from data furnished
by the Census Bureau. The enterprise portion is small, the 1939 estimate
amounting to only S3 million.

followed for later years, but greater use was made of data from the State
commissions.
The Division also estimates the relatively small amounts of court-awarded
benefits received by injured railroad and maritime workers, since these are
not covered by the compilations noted above. The estimates for railroad
workers are based on Interstate Commerce Commission data on payments
by railroads for injuries to persons (employees and passengers) and on the
numbers of employees and passengers killed or injured, as published annually
in Statistics of Railways. The estimates for maritime workers were derived for
1938 from data contained in the Labor Department Bulletin (No. 869) on
Workmen's Compensation and the Protection of Seamen, and extrapolated to other

years by maritime employment.
The industrial breakdown of the 1929—38 totals of workmen's compensation for injuries was prepared in several parts. Estimates were first made
separately for the following industries: Federal Government; railroads; maritime employment in water transportation; telephone, telegraph, and related
services; all of the mining industries except crude petroleum and natural gas;
and stevedoring, a component of services allied to transportation.
The sources of the data for railroads and maritime employment already
have been noted. Data for the Federal Government and for stevedoring were
obtained from the United States Employees' Compensation Commission.
Payments in telephone, telegraph, and related services were estimated by
raising the amounts of accident disability benefits and death benefits reported annually by the American Telephone & Telegraph Co. by the ratio
of total payroll in the entire industry to the payroH of that company. The
industry components of mining were estimated from tabulations of data reported by the accident compensation commissions in the principal mining
States.
For all other industries, total payments in 37 States for the period 1929-38
as a whole were tabulated from the report on Workmen's Compensation Experience Compiled in 7947 of the National Council on Compensation Insurance.3
To these figures were added data for three additional States compiled from
State reports. The 10-year aggregates for each industry were then distributed
by years in proportion to employment, and the resulting estimates for each
year were adjusted proportionately to the totals for all industries not independently estimated.
In the preparation of estimates by industry for years since 1939, the
Division's employment series has been used to extrapolate estimated 1938
payments in each industry except railroads, Federal Government, and
maritime employment (which have continued to be estimated separately by
the procedures indicated above). The results have then been adjusted to the
all-industry aggregate less data for the separately estimated industries.

Employer contributions under private pension and related
plans

Contributions in this category relate to the following types of private programs: (1) Pensions, (2) health and welfare programs, and (3) group insurance protection.
(1) The series on employer contributions to private pension plans covers
transactions under several different financial arrangements, including conOther Labor Income
tributions to self-administered plans (involving separate funds administered
by employers either directly or through a bank or other agent), the purchase
of group annuities under plans administered by life insurance companies
Compensation for injuries
(where usually there is no separate pension fund with segregated assets),
Estimates of benefits paid to workers (and their dependents or survivors)
direct payments by employers without the establishment of a fund (of minor
insured under State and Federal accident compensation laws, either on a
magnitude), and contributions to employees' profit-sharing trusts.
compulsory or voluntary basis, have been prepared annually since 1939 by
The totals for the period 1929-38 were built up as the sum of several estithe Division of Research and Statistics of the Department of Health, Edumated parts.4 Data for railroads were obtained annually from Statistics of
cation, and Welfare. These estimates are based on data for private insurance
Railways. Estimates for higher education were derived from contributions
companies from the Spectator Co.'s annual Insurance Yearbook, for State data furnished by the Teachers' Insurance and Annuity Association. Data
insurance funds from reports of the funds, and for self-insurers from informaon employer contributions by churches, the Young Men's Christian Assocition furnished by the State accident compensation commissions. Reports of
ation, and the Young Women's Christian Association were obtained annuthe United States Employees' Compensation Commission also are utilized.
ally for the period 1933—38 from the Church Pension Conference Report and
Data from these sources become available with about a year's lag, and a preliminary estimate is made by the Department of Health, Education, and
3. Data are given in tiais source for an extremely detailed industrial classification. The
time and labor in combining and converting them to the National Income Division classiWelfare from direct information for a few States and industrial injury data
fication prohibited the compilation ol separate data for each year.
compiled by the Department of Labor. The estimates for years prior to 1939
4. Contributions under profit-sharing plans, evidently ol inconsequential amount in this
were prepared by the National Income Division by methods paralleling those
period, were not included in the 1929-38 estimates for lack of data.

NATIONAL INCOME, 195 4 EDITION

Wage Developments. Studies by the Department of Health, Education, and Welextrapolated back to 1929 by church pension payments. The estimates for all
fare and the August 1946 Supplement to the periodical Labor and Nation also
other industries (in the aggregate) were derived for the years 1932—38 from
have been utilized.
direct and collateral information contained in the study by Murray Larimer
on Trends in Industrial Pensions. For the period 1929—31, with data lacking, Data on employer contributions to the principal plans have been obtained
they were made on the assumption that contributions dropped annually
for the most pprt directly from the administering organization. Thus, data
from 1929 to 1932 by one-half of the average annual drop from 1932 to 1934.
have been secured from the Amalgamated Clothing Workers of America,
the International Ladies Garment Workers Union, the United Mine WorkTotals for the period 1939—51 were derived as the sum of estimates for
ers of America, and the American Telephone & Telegraph Co.
employer contributions for pensions by religious organizations and instituFor other plans, estimates have been prepared by multiplying the number
tions of higher education (both obtained from the same sources as noted for
of employees covered by a plan (usually as reported in the general sources
the 1933-38 estimates), Federal Reserve banks (from the banks' annual recited above, or obtained directly from the union involved) by average earnports), and employer contributions in all other industries combined. The last
ings of employees in the industry to obtain estimated wages of covered workcategory was available for 1945—51 (as of July 1954) in the Internal Revenue
Service Statistics of Income publications, the reported data on corporate con- ers. These have been multiplied by estimated contribution rates (the modal
rate given in the above sources) to obtain the estimated amount of employer
tributions requiring only minor adjustments for inclusion in the series. It was
contributions.
estimated for the years 1943 and 1944 from special tabulations of pension
plans submitted to the Internal Revenue Service for approval for income-tax
The method of estimation, it will be noted, furnished the industrial disdeduction purposes under the Revenue Act of 1942. The tabulations were
tribution of employer contributions to health and welfare plans.
not designed primarily for statistical purposes, and the data on number of
(3) Employer contributions for group insurance are based upon studies
plans in operation and average annual contribution per plan derived from
for the years 1948 and 1951 made by the Department of Health, Education
them were not sufficiently accurate in time-period reference to yield more
and Welfare and for 1929 from information presented in Industrial Group
than rough orders of magnitude for these 2 years.
Insurance, 1929, National Industrial Conference Board. The 1948 and 1951
studies utilized reports by life insurance associations, the United States
Estimates for 1941 and 1942 were obtained by proportional interpolation
Chamber of Commerce surveys of accident and health insurance, Blue Cross
between the 1937 and 1943 values, using the number of plans in operation
and Blue Shield reports, and other sources. The 1929, 1948, and 1951 estias an interpolating index. Information on the number of plans in operation
mates were prepared for five categories of group insurance, and each has
was obtained from the Latimer study for 1937 and from the Internal Revenue
been interpolated and extrapolated by the National Income Division by data
Service for 1941, 1942, and 1943. Employer contributions in 1939 and 1940
on total premium receipts of the organizations furnishing the particular type
represent straight-line interpolation between the 1938 and 1941 estimates.
The corporate data reported in Statistics of Income—accounting for nearly of insurance coverage. The totals have been distributed by industry according to the relative distribution of employer contributions to private pension
all of the employer contributions total—do not become available until the
funds, after eliminating from the pension distribution the data for industries,
third year after the period to which they refer. In the interim, the current
such as coal mining and telephone and telegraph, which are known to have
estimates are prepared very largely by extrapolation on the basis of paywell established welfare funds (included in (2) above) providing group inrolls and of pension plan information from several sources. These include
the Bureau of Labor Statistics' monthly Current Wage Developments, which re- surance benefits.
ports coverage and contributions data relating to the more important new
plans and revisions of plans already in effect; data from insurance associaOther components
tions on premium payments under plans administered by life insurance
companies; and special tabulations of pension plan contributions reported
The remaining components of other labor income include pay of military
by corporations to the Securities and Exchange Commission. Extrapolations
reservists, Government payments to enemy prisoners of war, merchant marine
prepared from these materials have significant limitations, and the current
war-risk life and injury claims, directors' fees, jury and witness fees, compenestimates are subject to appreciable revision.
sation of prison inmates, and marriage fees to justices of the peace. These
Direct information on the industry distribution of employer contributions
items in 1950 amounted to only 11 percent of other labor income. Over the
to private pension funds is at present confined mainly to the comprehensive
entire period of the estimates only three—military reserve pay, payments to
Internal Revenue corporate tabulations for 1945-51 and to available data
enemy prisoners of war (covering the period 1943—46), and directors' fees—
permitting the preparation of separate estimates for several industries. These
have attained any appreciable magnitude. The other items have always been
include religious organizations; educational services, n. e. c. (taken as equal
negligible in amount.
to higher education); Federal Reserve banks; railroads; and telephone, teleData on the pay of military reservists have been obtained from the armed
graph, and related services (compiled from annual reports of the major
services or from the annual Budget of the United States Government on a fiscal
companies).
year basis, and averaged to obtain calendar year estimates. This type of supIn addition, an Internal Revenue Service tabulation of employer contribuplement increased sharply in the postwar period.
tions by industry covering the 5,116 plans approved through December 31,
Fiscal-year data on total Federal payments to enemy prisoners of war were
1944 was used as the basis of a distribution (apart from the separately estiobtained from the Department of Defense. These were converted to a calenmated industries) for 1944. For all other years of the period since 1929, the
dar year basis by use of data from that Department on the number of prisoners
1944 and 1951 estimates have been extrapolated, industry by industry, by
of war in the United States as an interpolating index. The estimated amounts
wages and salaries, with the resulting distribution adjusted proportionately
paid to prisoners of war working for civilian contractors were deducted from
to the all-industry aggregate exclusive of the separately estimated group of
the total, since such payments are included under wages and salaries, chiefly
industries.
in farming.
Employer pension contributions have increased greatly, both in absolute
The estimates of directors' fees are crude. They are prepared in two parts.
and relative terms, since World War II. For this period, except for the preFor the finance, insurance, and real estate industry, which accounts for about
liminary estimates for the two most recent years, it is to be noted that the
half of the total, the estimates are made by multiplying the ratio of directors'
pension series is based almost entirely, both in aggregate and by industry,
fees to compensation of officers in Federal Reserve member banks by the total
on comprehensive corporate tabulations of the Internal Revenue Service.
compensation of corporate officers reported by the Internal Revenue Service
(2) Contributions by employers under health and welfare programs have
in Statistics of Income. For other industries, a similar procedure is followed,
been derived by assembling data for the larger plans known to be in existence
but direct information on the ratio of directors' fees to compensation of
and preparing estimates for the remaining smaller plans.
officers was limited to the years 1929 and 1932.
Listings of existing plans, together with statements of their coverage and
Within each of these two broad groups—finance, insurance, and real
provisions, have been obtained mainly from publications of the Bureau ol
estate and all other industries—directors' fees are distributed by industry in
Labor Statistics, especially B. L. S. Bulletin 841 and the September 1946
proportion to compensation of corporate officers as reported by the Internal
Supplement to this Bulletin, Bulletin 900, and the monthly reports on Current Revenue Service.
291602°—54

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS

3. INCOME OF UNINCORPORATED ENTERPRISES
Apart from farm income, which has been studied systematically by the
Department of Agriculture for many years, no comprehensive body of data
covering any appreciable time interval exists for the income of unincorporated
enterprises. Estimation in this field has generally required the laborious
piecing together and adjustment of various types of data from numerous
sources, some only inferentially connected with noncorporate business
income. In the light of the experience gained in estimation and the changing
nature of source materials, the National Income Division has periodically
reviewed, and materially revised, its estimating procedures in an effort to
develop more refined estimates. No such review, however, has as yet produced really satisfactory results, for refinement of estimating techniques,
unfortunately, is not an adequate substitute for reliable source materials.
Still, the latest such revision, prepared for this 1954 edition of NATIONAL
INCOME, can be said to mark a significant step forward in the work. The
incorporation into the estimates of data on noncorporate business receipts and
number of proprietors from the postwar industrial and population censuses
was in itself of value. But reference is had mainly to the availability of information from the Internal Revenue Service which afforded for the first time a
sound basis for adjusting for understatement the net income data which
previously had been provided from tabulations of unaudited tax returns
submitted by individual proprietors and by partnerships. With the benefit of
this information, the estimates of total nonfarm unincorporated business
income for the later period may be adjudged reasonably reliable as to general
level.
Exhibit 1.—Income of Unincorporated Enterprises, 1949
Millions o.
dollars

Industry
Farms

Percent

12,718

Business
Retail trade and automobile services
Contract construction
Services (except professional service)
Wholesale trade,
Manufacturing
_
Finance, insurance, and real estate
Transportation
Mining
_
Agricultural services, forestry, and fisheries
Communications and public utilities
Total

11.3

2,386
987
227
219

7.1
2.9
.7
.7

17,144

Medical and other health services
Legal services
Engineering and other professional services, n. e. c
Accountants
___
___

37.8

3,819

Professional services

50.9

8,012
2,541
2,200
1,269

23.8
7.5
6.5
3.8

1,238
775
602
24 i
235
29

3.7
2.3

35,631

loa.o

General summary of sources and methods
The statistical approach and methods adopted in national income and
product estimation are primarily a function of the character of available data.
The force of this general proposition is clearly illustrated by the estimates of
the income of unincorporated enterprises. Three broad segments of the
estimates may be differentiated with respect to source materials and methods
used: Income of professional practitioners, business income (the nonfarm
total except for professional service income), and farm income. (See Exhibit
1.)
(1) Estimates of the net income of professional practitioners—amounting to
11 percent of the noncorporate total in 1949—are prepared very largely by
multiplying the number of persons engaged in independent practice in each
profession by their average net income. This method, adopted at an early
stage oi the official national income work, takes advantage of the basic data
on the number of practitioners from enumerations by the decennial Census of
Population (and of the records of professional associations and other sources
permitting extension of the census data to other years). The dearth of
requisite information on income, however, led the National Income Division

to undertake the collection of data on the average net income of independent practitioners in the various professions. Questionnaire surveys, first
made in 1933 to cover the years 1929-32, have been conducted at periodic
intervals. The results of three postwar surveys were published in the August
1949 Survey of Current Business for lawyers, the January 1950 Survey for dentists,
and the July 1951 Survey for physicians.
(2) Information for estimating the "business" segment of the income of
unincorporated enterprises—one-half of the total in 1949—has been generally
fragmentary. Comprehensive data are lacking except for 1945 and 1947, for
which years the Internal Revenue Service provided tabulations of the incomes of sole proprietorships and partnerships filing income tax returns. The
proportion of the total number of firms filing was very large because of
comparatively low income exemptions and the high levels of business activity.
For individual industries comprising this segment, the initial basic step in
procedure has been to establish a measure of the universe in terms of either
gross receipts or number of active proprietors. Gross receipts have then been
multiplied by a profit ratio (ratio of net income to receipts); the number of
proprietors, by an estimate of their average net income. For both methods,
the years 1939, 1945, and 1947 represent benchmarks, developed almost
entirely from Internal Revenue and Census materials.
Comprehensive data on receipts of sole proprietorships and partnerships
were reported for most of the larger industries for 1939 and 1947 or 1948 in
the industrial censuses and for all industries for 1945 and 1947 in the tabulations of income tax returns. Some of the censuses required some allowance
for undercoverage, and the Internal Revenue data had to be adjusted for
enterprises not filing returns and for differences in industrial classification
from that used by the National Income Division. Noncorporate business
receipts were also reported in a few of the 1929 censuses; but for all years
other than 1929, 1939, 1945, and 1947 or 1948 receipts almost always have
had to be estimated indirectly, generally by interpolation and extrapolation
by available data on total receipts (corporate and noncorporate combined)
or corporate receipts. The accuracy with which this could be done has varied
widely among industries.
Estimates by industry of number of active proprietors also have been
derived in large part from the industrial censuses, which for the period prior
to 1939 furnished information for this item more frequently than for noncorporate receipts. The other principal source has been the decennial Census
of Population. The 1940 and 1950 censuses, with their cross-tabulations of
the employed labor force by class of worker and detailed industry, were
more useful for this purpose than the 1930 census. Estimates of number of
proprietors by industry for noncensal years have been obtained by interpolation and extrapolation techniques utilizing, for the later period, chiefly the
business population series of the Office of Business Economics.
For all three benchmark years 1939, 1945, and 1947, the Internal Revenue
Service tabulations for sole proprietorships and partnerships filing returns
were employed in the estimation of profit ratios and average income per
proprietor by industry. It was necessary to adjust the data to represent the
universe through estimation of the profit ratios or average net income of
enterprises not included in the tabulations. Because of the difference in tax
return coverage, this adjustment was quite important for the 1939 estimates
but comparatively minor for the 1945 and 1947 estimates.
For extension of the base-year profit ratios or average income figures to
other years, Internal Revenue Service tabulations for sole proprietorships for
1941, 1943, and 1949 furnished the most directly relevant data. They required, however, difficult adjustments for differences in scope and other
aspects of noncomparability. To adjust, industry by industry, for firms not
filing returns in 1941 and 1943—as well as in benchmark year 1939—extensive use was made of the comprehensive IRS tabulations for 1945. Nonfilers were viewed as firms in the lower income and sales classes, and the
relationships found to obtain between the reporting (larger) and non-reporting (smaller) firms in the 1945 distribution were used to expand the markedly
less complete IRS tabulations for 1939, 1941, and 1943.
In the interpolation and extrapolation of the IRS-based estimates of profit
ratios and average income per proprietor, heavy reliance has been placed
on corporate profits data.1 These can be obtained annually from Internal
1. Where it appeared important to improve comparability with the noncorporate data,
compensation of corporate officers and sometimes net corporate monetary interest have been
added to corporate profits (before tax) prior to calculation of the ratio oi corporate profits to
sales or average income per corporation.

NATIONAL INCOME, 19 5 4 EDITION

Revenue tabulations except for the two or three most recent years, when
sample information must be employed. For the period after 1939, data for
smaller-sized corporations have been utilized. Prior to that, when smallcorporate data were lacking, the movement of noncorporate profit ratios or
average income was based to a great extent on data for all corporations.
While the source materials for estimating the income of unincorporated
nonfarai businesses have been generally unsatisfactory, a change in this

situation is in process. This steins mainly from the broadened coverage of the
Federal income tax and the plan of the Internal Revenue Service to mine
the comprehensive source of statistical data afforded by the returns. As
noted, the Service already has provided detailed industry tabulations of
proprietorship and partnership returns for 1945 and 1947 and of proprietorship returns alone for 1949. Proprietorship tabulations for 1951 are now in
process.
It is clear that prospect for further improvement in the basic data
situation for the entrepreneurial income segment of the national income
Exhibit 2.—Income of Unincorporated Enterprises, by Industry, 1929, 1939, must rest in the availability of comprehensive, current tax-return tabula1945, and 1949 l
tions. For, despite limitations, tax returns under a well-administered law
are the best source of annual information which it is feasible to secure on
[Millions of dollars]
the earnings of unincorporated enterprises. In the absence of such informa1945
1929
1939
1949
tion, the necessary resort to indirect data as the basis of estimation cannot
be very satisfactory, particularly on an industry basis.
14,017 111, 776 130, 941 33, 681
All industries, total
The reliability of any income estimates for noncorporate business is con6,033 4,378 11,972 12, 953
Agriculture, forestry, and fisheries
ditioned by the fact that this group characteristically includes a large
5,968 4,317 11, $21 12, 718
Farms
number of relatively small enterprises, which follow a diversity of account65
lil
148
235
Agricultural services, forestry, and fisheries.
ing practices and frequently maintain only rudimentary records. But now
54
243
108
61
Mining
2
3
5
5
Metal mining
that the income tax and the expanded social security system are covering a
2
3
4
1
Anthracite mining
very high percentage of business proprietors, it can be anticipated that
6
28
39
7
Bituminous and other soft coal mining34
63
169
42 I
Crude petroleum and natural gas
record-keeping and accuracy of reporting will improve with the passage of
10
11
6 !
26
Nonmetallic mining and quarrying
time. Not only will the individual firm require systematic records for
1,127
2, 541
646
Contract construction..
these purposes, but the growing audit program of the Internal Revenue
565
1,238
400 2, 361
Manufacturing
Service will tend both directly and indirectly to promote standardization
64
S87
215
88
Food and kindred products
and accuracy of reporting.
3
7
4
1
Tobacco manufactures
119
23
40
14
Textile-mill products
In this connection, it should be noted that results of the Internal Revenue
132
603
73
Apparel and otherfinishedfabric products.
185
85 II
38
30
Lumber and timber basic products
Service 1949 audit study have been incorporated into the estimates for the
93 / M73
18
17
Furniture andfinishedlumber products
30
5
Paper and allied products.
"business" segment of income of unincorporated enterprises. This was an
14
intensive audit, based on a representative sample, giving primary em165
130
101
52
Printing, publishing, and allied industries
04
31
Chemicals and allied products
15
31
phasis to business income reported by individuals. It was carried on by
5
7
Products of petroleum and coal
1
1
16
3
experienced field investigators through direct contact with taxpayers and
1
0
Rubber products
75
28
15
Leather and leather products
9 I
examination of their records.
42
47
23
Stone, clay, and glass products
12
137
26
Iron and steel and their products, including ordnance..
19
The IRS 1949 audit study permitted an adjustment to be made, by
123
24
»201
Nonferrous metals and their products
17
147
23
Miscellaneous manufacturing
18
industry, of the net income reported for tax purposes by individual proprietors. For lack of data, the same relative adjustment was applied to the
213
31
97
22
Machinery, except electrical
-31
3
10
3
Electrical machinery
income reported by partnerships. Analysis of collateral audit information
40
2
4
1
Transportation equipment, except automobiles.
14
indicated that, insofar as size-of-firm differences (as measured by "adjusted
2
14
2
Automobiles and automobile equipment
gross income") alone are determining, a lesser adjustment might have been
2,867 3,193 9,676
9,281
Wholesale and retail trade
382
1,269
478 1,739
Wholesale trade
in order. However, an estimate of the magnitude of difference involved
8,012
2,485 2,715 7, »37
Retail trade and automobile services-.
amounted to only a small percentage of total business income, and would
775
762
346
757
Finance, insurance, and real estate
tend to offset any extent to which the audit study could not uncover all
2
1
3
2
Banking
34
392
65
171
errors on the part of taxpayers resulting in understatement of income.
Security and commodity brokers, dealers and exchanges20
17
27
49
Finance, n. e. c.
162
226
144
340
(3) The Department of Agriculture furnishes the estimates of farm proInsurance agents and combination offices
186
119
330
350
prietors' income included in the national income. The estimation of
Real estate
220
249
426
602
Transportation
farm income is a principal part of the over-all statistical services rendered
0
0
0
0
Railroads
by the Agricultural Marketing Service. From the quinquennial Census of
0
0
0
0
Local railways and buslines
41
115
119
27
Highway passenger transportation, n. e. c
Agriculture, the Department's Crop and Livestock Reporting services,
289
173
452
Highway freight transportation and warehousing.
215
field surveys, and many other sources, it has developed both income and
1
4
10
Water transportation
14
balance sheet statistics for the agricultural industry.
0
0
Air transportation (common carriers) _
0
0
0
0
0
Pipe-line transportation
0
The aggregate net income of farmers is derived as the difference between
12
Services allied to transportation
5
17
3
!
gross income (calculated in detail by type of product) and production
Communications and public utilities
23
29
7 i
expenditures (estimated separately for about 40 different types of expense).
Telephone, telegraph, and related services-.
6
2i
6
Radio broadcasting and television
1
4
2
Such a complete development of income data by means of a synthetic
0
0
Utilities: electric and gas
0
4
19
Local utilities and public services, n. e. C—.
15
income and expense statement is unique with agriculture.
2,980 2,496 4, 530
6,019
Because the individual industry figures on noncorporate business income
Services
123
91
252
192
are subject to unusual estimating difficulties and are not so reliable as the
Hotels and other lodging places..
493
396
758
923
9
6
13
25
industry breakdowns for most other types of national income, only industrial
Personal services
345
168
172
451
Commercial and trade schools and employment agencies.
division totals are presented in table 17 of Part V. However, to show the
449
192 !
157
563
Business services, n. e. c
Miscellaneous repair services and hand trades
general composition of the division totals and the factors underlying their
112
50
28
73
Motion pictures..
157
48
52
130
Amusement and recreation, except motion pictures
movement over time, Exhibit 2 gives individual industry estimates of the
1,145
903 1, 527
2,386
Medical and other health services
income of unincorporated enterprises for selected years of a two-decade
763
571
553
987
Legal services
103
119
104
227
Engineering and other professional services, n. e. c
span. The exhibit does not extend beyond 1949, it may be noted, since
51
62
34
Educational services, n. e. c
62
that is the latest year for which noncorporate business income data by
industry are presently available from the Internal Revenue Service.
1 "Income of unincorporated enterprises" measures the net income of sole proprietorships
and partnerships, except that the series for wholesale trade includes estimated patronage
The following description of methodology is divided into the three areas
refunds and stock dividends paid by farmers' cooperatives (shown separately in table 12).
2 Because of changes in industrial classification, as discussed in the Introduction to Part III,
noted in the foregoing introductory remarks: Professional services, business,
basic data are not available for making 1949 estimates for the individual industry groups.
and farm.
Approximate eomparibility is possible, however, for the combined-group totals.

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS

cians, for which the percentage was as high as 45. Because of larger-sizec?
samples, the sampling error in the later surveys (covering the period since
1937)—aside from the question of possible bias in the response—is probably
The professional services cover the following industry groups for which
smaller than in the earlier surveys. This consideration is especially important
estimates are published in table 17 of Part V of this report: Medical and
with respect to the legal profession, in which the dispersion of income, and*
other health services, legal services, accountants (included in business
consequently the sampling error, is larger than in the curative professions.
services, n. e. c ) , and engineering and other professional services, n. e. c.
The generally low rate of response to most of the questionnaire surveys
For the medical group, aggregate net income is the sum of series for physiraises doubt concerning the representativeness of the sample data on average
cians and surgeons, dentists, osteopathic physicians, chiropractors, chiropoincome. Various tests, however, point to the probability of no marked bias
dists, private-duty trained nurses, veterinarians, and miscellaneous curative
on this score. It has been possible in many cases to check the representativeand healing services. For the engineering and "other" group, income is
ness oi the sample with respect to known characteristics of the profession
estimated separately for engineering and architectural service and for other
sampled, such as State of practice, size of city, and age of practitioner. In
professional services, n. e. c.
addition, study of average incomes in the various professions by age classes,,
Of these various professions, by far the largest are physicians and surgeons,
years-in-practice classes, city-size classes, and regions—and, in cases where
lawyers, and dentists. These three groups accounted for four-fifths of prothe sample was large enough, by cross-classifications of these characteristics
fessional service income in 1949.
—has been reassuring. The income patterns revealed were both uniform
and plausible.
Further substantiating evidence is afforded by the result of the specific
Medical and legal services
check on response bias made in the 1950 physicians' income survey. As
For the medical and legal service industries the income of proprietors
explained in the report in the July 1951 Survey of Current Business, the first
measures the earnings of all professional practitioners from independent
and second follow-ups of the first response modified its findings only slightly
practice. It is derived by multiplying (1) the number of professional perand indicated the absence of appreciable bias. Mainly because the initial
sons in independent practice (full or part time) by (2) average net income
response rate was so high, however, this result is not conclusively applicable
figures determined from questionnaire surveys of the professions.
to the earlier surveys.
(1) For some or all of the years 1930, 1940, and 1950, data from the
The questionnaire surveys for physicians, dentists, and lawyers have prodecennial Census of Population permitted the derivation of the total numvided average income data for almost all years of the period since 1929. For
ber of self-employed persons for the three major groups—physicians, denthese three professions, average income estimates for years not covered by
tists, and lawyers—and also for veterinarians and miscellaneous curative
National Income Division surveys have been made in various ways. These
and healing services. For the other medical and health service groups, the
include interpolations by the results of questionnaire surveys by other
universe numbers of persons engaged in independent practice have been
agencies (for physicians, by Medical Economics magazine; and for dentists, by
estimated in a generally satisfactory manner from such sources as reports
the American Dental Association), by reference to the movement of income
of the professional associations, mailing lists of the Fisher-Stevens Service,
in one of the other two professions, or by using disposable personal income to
Inc. (a mail-service company), and, for 1929, the report of the Committee
interpolate gross receipts and industry (professional) payroll data to interpoon the Costs of Medical Care. This Committee's report also furnished an
late expenses. A recent-period procedure by the Division has been to make
estimate of the total number of physicians in independent practice in 1929.
short surveys (based on a mailing of only 3,000-5,000 questionnaires) in order
For interpolation and extrapolation, the American Medical Directory of to obtain interim information for extrapolation purposes. Reports on such surveys, covering lawyers, dentists, and physicians, were given in the July 1950
the American Medical Association has provided data for most years since
and July 1952 issues of the Survey of Current Business.
1929 on the total number of physicians (including those not in practice),
and for some years on the number engaged in private practice. The American
For the remaining group of smaller medical professions, surveys by the
Dental Association has furnished information on the number of dentists
National Income Division provided average income data for most years of the
for years since 1941, with estimates for 1929 and 1931—39 being obtained
earlier period. Later estimates represent extrapolations from survey benchby straight-line interpolation and extrapolation of the 1930 and 1940 censusmarks for the year 1941 in the case of private-duty nurses and veterinarians,
based figures. Straight-line interpolation and extrapolation has also been
and for 1937 for osteopaths, chiropractors, and chiropodists. Because of evinecessary to fill gaps in the data for the other medical professions. This
dence of some past period correspondence, the average net income of physiis not, however, a source of any appreciable error in the medical services
cians has been generally used as an extrapolating series for these groups.
total, as these professions form only a small part of it.
Little direct information has been available on average incomes in the
For the number of lawyers, interpolations have been based mainly on
miscellaneous curative and healing services.
data obtained from the Martindale-Hubbell Law directory and from compilations of the number of attorneys listed in a selected group of city direcOther professional services
tories.
Estimates of the two remaining professional groups—engineering and other
In the estimates for physicians, dentists, lawyers, and veterinarians,
professional services, n. e. c. and accountants—are of lesser validity because
adjustments have been made for the changing number of professional
of the lack of directly relevant information for most years.
practitioners in the armed forces after 1940, on the basis of data obtained
With respect to the former, the component series on engineering and
from the Procurement and Assignment Service of the National Roster of
architectural service has been derived from combinations of numerous
Scientific and Specialized Personnel and from the Department of Defense.
sources, including income-tax return data, a survey of consulting engineers,
(2) Most of the income surveys yielding the data on average net income
by the National Income Division covering the 1929-32 period, and an index,
used in the estimates for the medical and legal services industries have been
of the value of all engineering construction contracts awarded as reported by
conducted by the National Income Division, usually in cooperation with
Engineering Mews Record. The other, much smaller, component, other prothe professional association in the field. In most cases, separate computafessional services, n. e. c , has been estimated from tax return data and use
tions of average entrepreneurial income were made for nonsalaried pracof the total net income in legal services as an interpolating and extrapolating:
titioners (those deriving all their net income from independent practice)
series.
and for part-salaried practitioners (those deriving income both from independent practice and from salaried work).
The net income of independently employed accountants was obtained for
1929-36 by multiplying their estimated number by average income data
All of the periodic questionnaire surveys have relied upon a voluntary
collected in National Income Division surveys. The total net income of
response to mailed questionnaires. The respondents were not identified.
accountants for the period beginning with 1945 was estimated on the basisQuestionnaires were mailed either to all persons in the profession or to a
of tax return data. For intervening years, it was estimated largely from the
representative sample of the profession. Information was requested in each
linear regression between the net income of accountants and that of lawyers
case for a series of years. Usable replies have been received, on the average,
in independent practice.
from about 15 percent of the mailing, apart from the 1950 survey of physi-

income of Independent Professional Practitioners

NATIONAL INCOME, 195 4 EDITION

Income of Business Enterprises
The aggregate net income of noncorporate "business" enterprises—the
nonfarm total other than professional service practitioners—represents the
summation of separate estimates for about 65 industry subgroups. Many of
these, however, are quite small. Three important industries—retail trade,
wholesale trade, and construction—largely determine the accuracy of the
business total. They accounted for 69 percent of it in 1949.
The following discussion of this segment is divided into the several timeperiods characterized by general similarity of source materials and procedural problems. It describes the preparation of the estimates of noncorporate business income prior to correction for audit. To the extent based
on tax-returns data, the estimates for each of the periods reviewed were
adjusted, industry by industry, by reference to results of the Internal Revenue
Service 1949 audit study discussed above. The necessity of using a single
adjustment factor for all years was somewhat unfortunate, but nonetheless
represented a substantial improvement over the situation when no systematic
basis was available for any period to allow for the understatement of income
reported in compilations of unaudited tax returns. As described in the 1951
NATIONAL INCOME supplement, the allowances that could be made for this
factor were informal and indirect.

Benchmark estimates, 1945 and 1947
The tabulations from tax returns provided by the Internal Revenue
Service for 1945 and 1947 represented such high coverage of all proprietors
in the business segment as to constitute, after certain necessary adjustments,
benchmark materials.
For both 1945 and 1947, the Internal Revenue tabulations showed receipts,
expense, and net income information by industry, separately for sole proprietorships (from the business schedule of the individual income tax returns)
and for partnerships (from the mandatory informational returns). The information for sole proprietors in 1945 and partnerships in 1945 and 1947 was
classified by receipts size-class of firm. The tabulations were based on complete coverage of the larger sized enterprises and on estimates developed
through scientific sampling for the smaller enterprises. The definition of net
income employed was very similar to that used in national income measurement. Only a few adjustments had to be made, on the basis of reported
data, to secure uniformity. These included the addition of depletion charges
for proprietorships and partnerships and the elimination of capital gains
and losses and property income received from partnership receipts, which
were reported inclusive of these items.
The Internal Revenue tabulations, it was evident, differed in some respects
as to industrial classification from that used in the national income estimates.
Also, the tabulations were incomplete to the extent of not covering firms
which did not file tax returns. Adjustments for both of these deficiencies were
accomplished through comparison of the universe number of proprietors or
gross receipts in each industry, as estimated by the National Income Division,
with the data reported by the Internal Revenue Service.
The estimates of number of proprietors in 1945 and 1947—included in the
Division's annual series on number of persons engaged in production (table
28, Part V)—were prepared by interpolating base-year estimates derived
from the industrial and population censuses by an index of the number of
noncorporate firms, adjusted for differences in the estimated number of
active partners per partnership on the basis of Internal Revenue compilations.
The index of noncorporate firms was constructed, industry by industry, by
subtracting the number of active corporations in each year from the quarterly
average number of operating firms estimated by the Office of Business
Economics as part of its business population series. The sources and methods
underlying this series were described in an article in the January 1954
Survey of Current Business. For some industries, the 1945—47 movement shown
by this index was modified on the basis of Internal Revenue Service tabulations of the number of sole proprietors and partners.
In the estimation for 1945 and 1947 of noncorporate receipts—the universe
"control" adopted in the important retail trade sector and in some of the
service industries—benchmarks were developed from the 1948 Census of
Business. The reported data were adjusted upward to allow for exclusion of
concerns which, although in operation during 1948, had gone out of business
before enumerators' visit in 1949, or for some other reason were not enum

erated. These adjustments, which reflected also any differences in industrial
classification, were made largely by comparing the Census of Business data
on the number of employees or proprietors with similar data from the social
security records or the Census of Population and Housing (the latter data
obtained by interpolations of 1940 and 1950 Census enumerations).
To derive estimates for 1945 and 1947 (as well as for other years of the
period since 1939), these 1948 receipts figures and similar benchmarks for
1939 were interpolated and extrapolated by available receipts data. In the
case of retail trade, the index of noncorporate receipts utilized for the purpose
was obtained by deducting corporate sales (as reported annually in the
Internal Revenue Service's Statistics of Income) from total retail sales as estimated by the Office of Business Economics through 1951 and by the Census
Bureau thereafter (described briefly in the section on Personal consumption
expenditures for commodities). For personal service industries, the censusbased estimates were extended to other years by utilizing as indexes the series
on consumption expenditures for personal services (described in the service
expenditure notes in Section 8). For both retail trade and personal services,
the interpolations and extrapolations were carried out in considerable typeof-store or industrial detail in order to obtain the advantages of proper
weighting.
In most industries, the National Income Division estimate of number of
proprietors or gross receipts for 1945 and 1947 somewhat exceeded the
Internal Revenue figure based on reporting for tax purposes; and the profit
ratio or average income shown for one of the smallest receipts classes was
assigned the nonreported receipts or proprietors in order to derive net income
not reported on the tax returns. This, together with an adjustment for unreported net income disclosed by audit (based on the 1949 study), was
added to the amount reported in the tax-return tabulations to secure the
estimate of total net income for the industry.
In some industries, however, the Division's estimate of number of proprietors was less than that compiled from income tax returns. The differences
were regarded as a matter of industrial classification.2 In wholesale trade, for
example, the excess of proprietors filing income tax returns was adjudged to
belong in the Division's retail trade classification. The average income per
proprietor in retail trade was assigned to this group of proprietors, and their
total income was added to the amount reported on income tax returns to
account for part of the income in retail trade not reported to the Internal
Revenue Service. In manufacturing, where the Internal Revenue total number of proprietors greatly exceeded the National Income Division estimate
the receipts and net income of proprietors in the under $10,000 or under
$15,000 receipts classes (varying among the 20 industries) were shifted from
manufacturing to miscellaneous repair services and hand trades. This shift
was intended to yield data comparable in scope to those for the 1929—39
biennial censuses, when the Census of Manufactures defined the industry (in
general) to include firms with $5,000 or more output, and for 1947, when the
Census definition of a manufacturing firm was changed to the similar one-ormore employees criterion. The results obtained by the receipts-class cutoffs
for 1947 generally approximated the Census of Manufactures data for that
year on number of proprietors, which were taken as benchmarks.
In general, then, noncorporate net income in the business industries in 1945
and 1947 was derived through adjustment of the tax return data by using
number of proprietors or gross receipts as a measuring rod.

Benchmark estimates, 1939
The coverage of Internal Revenue tabulations for 1939 was limited by
reason of the larger income tax exemptions then prevailing. Nevertheless,
because these tabulations covered the operations of both sole proprietorships
and partnerships in the same year for which Census enumerations were
available, there was opportunity to merge information from the two sources
to obtain a noncorporate income benchmark.
The principal method of preparing the base-year estimates for 1939 consisted of multiplying, separately for sole proprietorships and partnerships,
total receipts reported in the various industrial censuses by profit ratios
derived from Internal Revenue tabulations of data from the business schedule
2. Statistical differences were present here too, as well as in cases where the National Income
Division estimate exceeded the number reported by the Internal Revenue Service. The
Division estimates were subject to estimating errors, and the Internal Revenue data to
sampling errors. In most industries, a high proportion of proprietors was in the receipts
classes sampled. (For net income, however, the proportion of the total sampled was much
smaller.)

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS

of individual income tax returns and the mandatory informational returns
Interpolations, 1940-44 and 1946
filed by partnerships. The tabulations, published in Statistics of Income—Part 1
For other years of the period 1939-47, estimates of net income of unincorand Supplement were based on a complete count for partnerships and for sole
porated enterprises in the business segment were prepared by interpolation
proprietorships (in general) with income of 55,000 or more, and on sampling
of the 1939, 1945, and 1947 benchmarks. Two factors made the process
for smaller proprietorships. The sole proprietorship tabulations gave for each
difficult and impaired the accuracy of the estimates.
industry the receipts and net income of firms classified by gross receipts
First was the necessity of making sizable adjustments for noncomparability
classes.
of coverage of the data on sole proprietorships reported for several years of
Noncorporate receipts totals were available from the 1939 Censuses of
the period by the Internal Revenue Service. Secondly, the extensive use made
Retail Trade, Contract Construction, Service Establishments, Manufactures,
of corporate data to estimate the movement of noncorporate sales and inand Mineral Industries. The data reported for retail trade, construction, and
come—unfortunate in itself—was complicated by a shift of some firms,
mining were adjusted upward to allow for undercoverage in the manner
because of the tax advantages to be gained, from the corporate to noncorindicated in the discussion of the 1945 and 1947 benchmarks.'
porate form of organization in the war period, and by an opposite shift in the
Adjustment of the Internal Revenue data to take account of the many small
early postwar years after the removal of the corporate excess profits tax.
firms not filing tax returns in 1939 was necessary before they could be used to
1. For 1941 and 1943, the Internal Revenue Service provided tabulations
derive profit ratios to apply against the industrial census receipts figures.
of sole proprietorships' tax returns showing receipts, net income, and number
The principal complication in deriving aggregate profit ratios by industry
of proprietors classified by industry. Because of changes in tax laws and the
stemmed from the strong negative correlation between the profit ratio and
rising level of economic activity, the coverage of sole proprietorships afforded
the size of firm as measured by receipts. Because of this correlation, profit
by these tabulations was much higher than for 1939, though still incomplete
ratios computed from data for firms filing returns were almost always too low
in relation to the comprehensive data for 1945. Expansion of Internal Revenue
to be applicable to the entire noncorporate sector of an industry. The general
coverage over this period was such as to bring in an increasing proportion of
procedure, therefore, was (1) to deduct receipts reported to the Internal
small proprietorships, which, as noted, have very high profit ratios relative
Revenue Service from the census-based receiptsfigures,and then (2) to multito the large proprietorships. In the interpolation procedure, use of the
ply the resulting estimate of receipts of firms not filing tax returns by the
reported data directly, without adjustment for the differing proportions of
profit ratio calculated for one of the smallest Internal Revenue receipts-size
small-sized firms covered, would have imparted a strong upward bias to the
classes. The sum of estimated net income for the firms not filing income tax
estimates.
returns and the net income actually reported on the returns constituted the
aggregate net income estimate (prior to the adjustment for audit discussed
2. Most of our limited knowledge about the magnitude and nature of the
above).
shift in legal-form of organization is confined to its postwar phase.4 It is
evident that it was minor as to the number of firms involved, but appreciable
Two important variants of this general procedure were developed. One was
as to its effects on total sales and net income. The shift was largely between
based on the finding that for sole proprietorships in the nonprofessional comthe corporate and partnership forms, and it was restricted mainly to manuponents of the service industry the ratio of payroll plus net income to receipts
facturing, retail trade, wholesale trade, and contract construction. For these
tended to be constant throughout the reported receipts-size distribution.
industries—in which the relative movements of sales and income from 1939
Thus, the tendency of the profit ratio to decline as the size of firm increased
to 1945 and from 1945 to 1947 differed markedly for the corporate and nonwas just offset by the tendency for the ratio of payroll to receipts to rise.
corporate segments—several special procedures were followed to improve
Where payroll data by size of firm could be obtained from the industrial
the use of available statistical data for interpolation.
censuses, as in services and contract construction, the use of this relationship
The series used to interpolate noncorporate net income in "business"
permitted the estimation of small-firm profit ratios from data for larger firms.
industries between the 1939, 1945, and 1947 benchmarks were prepared as
This was helpful, since the data for proprietorships with receipts under $5,000
reported in Statistics of Incomefor1939 often were fragmentary or appeared to the product of either (1) receipts (sales) and profit ratios or (2) number of
proprietors and average income per proprietor. The first was generally the
be biased.
preferred method, although for some industries the choice was merely a
The second variant—utilized chiefly in retail trade and most of the manumatter of statistical convenience.
facturing industries—relied on relationships between small and large firms
The interpolations between 1939 and 1945 were carried out separately for
shown in the 1945 Internal Revenue tabulations, coverage of which wasi
sole proprietorships and partnerships. The chief purpose was to utilize the
virtually complete. This procedure is described below in connection with the
Internal Revenue Service tabulations of sole proprietorships for 1941 and
interpolations of the 1939 and 1945 benchmarks.
1943. Data for smaller-sized corporations then furnished the basis of the sole
For a few industries in which adequate data on gross receipts or profit
proprietorship interpolations for 1940, 1942, and 1944. The resulting proratios could not be obtained, the net income estimates were prepared as the
prietorship series was usually employed for interpolation of the 1939 and
product of the number of proprietors, taken from the population or industrial
1945 partnership benchmarks. Where small-corporation data (on the ratio
censuses, and average income per proprietor, derived by adjusting tax return
of profits to sales or average income per firm) agreed better with the 1939—45
data for incomplete coverage or from industrial census data on the reported
partnership movement, however, such data were used for the partnership
withdrawals of proprietors. Wholesale trade was the most important industry
interpolations as well. For all industries, the estimates for 1946 were obtained
in which this method was applied.
on the basis of interpolations utilizing data for small corporations, without
The foregoing brief account of the principal methods used to derive 1939
the necessity of making separate estimates for proprietorships and partnernet income estimates in the "business" area is an oversimplification. The
ships.
matching of Census and Internal Revenue receipts tabulations by size classes
The actual methodology for preparing the 1940—44 and 1946 interpolations
and the preparation of adjusted profit ratios and of average income per prowas considerably more diverse than indicated from the foregoing summary.
prietor were generally difficult processes subject to appreciable error. EmHowever, four aspects of the work were of general importance and provide a
phasis on the judgmental factor was necessarily considerable. Moreover,
convenient framework for describing it.
variations of, or departures from, the general methods frequently were
Estimation of number of proprietors.—For most industries, the method of internecessary in particular industries.
polating net income required separate estimates of number of proprietors and
average income. Base-year figures on the number of proprietors were obtained
3. In the case of contract construction, the adjustment was broader in scope than for the
from the industrial or population censuses. For the period since 1939, they
other industries. Labor-force data in the 1940 population census were used to establish the total
of employees and proprietors in contract construction. Subtraction of the National Income
Division estimate of employees in contract construction yielded the total number of proprietors, whether in establishments or own-account workers (such as carpenters and painters)
operating from their own homes. The estimate of average receipts (and of average net income)
assigned to the non-establishment group, which was not covered hi the Census of Construction, was based on fragmentary in'ormation. The total net income of this group was about
two-fifths of the Division's published total for contract construction in 1939.

4. This knowledge derives from a special Internal Revenue Service tabulation showing for
1946 the number of corporations, by industry, which had been sole proprietorships or partnerships in the prior year and, for all industries combined, their distribution by asset-size classes;
some overall annual data for the period 1945-48 from the Bureau of Old-Age and Survivors
Insurance on the number of covered firms undergoing reorganization (believed to comprise
mainly legal-form changes); and direct comparisons of Internal Revenue Service corporate
and noncorporate sales and income data for 1945 and 1947.

NATIONAL INCOME, 19 5 4 EDITION

the upper and lower portions of the sales distribution were calculated.
were interpolated by a series measuring the number of noncorporate firms,
The relative difference between the profit ratios (or average incomes)
with adjustment for changes in the ratio of partners per partnership shown
of the two groups was then applied to the reported profit ratio (or average
by Internal Revenue data for 1939, 1945, and 1947. The series was derived
income) of income taxfilersin the food group in 1939 to obtain the estimated
by deducting the number of active corporations (reported by the Internal
profit ratio (or average income) of nonfilers in that year.5
Revenue Service) from the Office of Business Economics estimates of the total
Use of this procedure of "filling in" the sole proprietorship distributions
number of operating firms. For most industries, the separate estimates of sole
thus enabled the calculation of sole proprietorship profit ratios or average
proprietors and of partners required by the method were also prepared by
incomes for 1939, 1941, and 1943 on a consistent basis with the data for
using the noncorporate-firm series as an interpolating index. But in many
1945 reported by the Internal Revenue Service. For retail trade and most of
of the 20 major types of manufacturing and in contract construction, a special
the manufacturing industries, as noted earlier, this procedure directly
procedure was adopted in the attempt to reflect shifts in legal form of organiprovided the data used for the 1939 benchmark.
zation. The number of sole proprietorships derived for benchmark years from
Census reports was interpolated on the basis of the total number of operating
Use of small corporation data.—The preparation of universe estimates of
firms, and the resulting series was subtracted from the estimated total number
receipts and number of proprietors and of profit ratios and average income
of proprietors for the industry in order to derive the number of partners.
per proprietor for sole proprietorships for 1941 and 1943 provided the frameThe rationale of this procedure stemmed from the fact (noted above) that
work for subsequent heavy reliance on small-firm corporation data to fill in
the legal-form changes occurred largely between corporations and partnerthe remaining estimates through interpolation. The relative movements of
ships.
either the ratio of corporate profits to sales or average income per corporation were used for interpolation of the similar averages for unincorporated
Noncorporate business receipts.—For some industries, mainly retail trade
enterprises.
and the personal services, the interpolation procedure required estimates
of noncorporate business receipts. As noted earlier, the receipts series for
For calculation of the corporate series, data from the Internal Revenue
retail trade was derived for benchmark years (1939 and 1948) from the
Service "Source Book", unpublished volumes supplementing Statistics of
Census of Retail Trade and extended to other years by an index computed
Income with more detailed information, were utilized. From the tabulations
by deducting corporate sales from total retail sales; and the series for the
showing the annual corporation income returns classified by asset-size
personal service industries were based on the Census of Service Establishclasses, data for the two or three smallest classes were taken. In order to
ments, with interpolations by means of the National Income Division
approximate the noncorporate income concept, the reported compensation
estimates of consumption expenditures for personal services.
of corporate officers was added to net profit before taxes prior to calculation
of either the ratio of profits to sales or average net income per corporation.
In principle, it may be noted, this procedure of estimating noncorporate
retail sales accounted for sales shifts due to corporations' changing their
Although the basis for generalization is still limited, it would appear that
legal form of organization. The measure, however, doubtless was somewhat
data for small corporations provide a fairly satisfactory index to the moveblurred by errors of estimation in the residual sales figures. In this connecment of noncorporate income—and are decidedly superior in this respect
tion, it may be noted that little could be done to correct for whatever into data for corporations in the aggregate. A striking example is afforded by
consistency was introduced into the corporate sales data by the change
the changes from 1945 to 1947. In nearly all industries, ratios of profits to sales
from the unconsolidated basis of filing through 1941 to permissive conderived from data for corporations in the aggregate were found to be wholly
solidated reporting beginning with 1942.
unsuitable for interpolation of the noncorporate ratios. Noncorporate profit
ratios declined markedly in most industries from 1945 to 1947, whereas
It was necessary to prepare separate receipts estimates for sole proprietorthe corporate ratios tended to be stable. Upon analysis, however, it was
ships and partnerships for the interpolations between 1939 and 1945, so as
found that this divergence reflected size-of-firm, and not legal-form, difto take account of the IRS sole proprietorship data for 1941 and 1943.
ferences. Industry-by-industry compilations of profit ratios (adjusted to inIn the case of retail trade, ratios of proprietorship sales to total noncorporate
clude corporate officer compensation) for corporations in the two or three
sales were obtained for 1939 from the Census of Retail Trade and for 1945
smallest asset-size classes showed the same pattern of decline as exhibited
from the Internal Revenue compilations. These ratios were interpolated
by the noncorporate ratios. The small-firm corporate data, it may be of
along a straight line for intervening years and then applied to the total
interest to note, generally showed stability from 1945 to 1946, with all of the
noncorporate receipts figures. For the personal services industries, similar
1945—47 decline occurring in 1947.
sole proprietorship ratios were computed for 1939 and 1948 from the Census
of Service Establishments and also interpolated in straight-line fashion.
Based on this and other favorable experience with the use of small corExpansion of 1941 and 1943 IRS data to full coverage.—Following the preparaporation data, a principle change in methodology in the revisions of nontion of universe estimates of number of proprietors or gross receipts by incorporate business income for the present report has been the fuller utilization
dustry, the next basic step was to adjust to a full coverage basis the sole
of such data. Their incorporation into the 1939-45 interpolations is the major
proprietorship tabulations provided by the Internal Revenue Service for
instance. As noted earlier, corporation income data by asset-size classes are
1941 and 1943. In order to obtain for each industry an interpolating series
not available in comparable industry detail for the period prior to 1939.
that was comparable over time, it was necessary to add to the reported
Internal Revenue data for 1939, 1941, and 1943 estimates covering the
Extrapolations, 1929-38
nonreporting proprietorships—assigning to them an average net income
or profit ratio appropriate to smaller-sized firms. In this procedure, which
There is comparatively little information for the 1929-38 period relating
required use of the universe estimates of receipts or number of proprietors
directly to the net income of unincorporated enterprises in the business
as a "control," use was made of relationships obtaining between small and
area. Noncorporate receipts data were compiled for 1929 in the Censuses
large proprietorships in the IRS tabulations for 1945. These tabulations,
of Retail Trade, Manufactures, and Mineral Industries. Usefvil data on
it will be recalled, provided practically complete coverage of sole proprietors,
number of proprietors were provided by the Census of Wholesale Trade in
classified by detailed industry and receipts-size classes.
1929, 1933, 1935, and 1939. A compilation of 1936 income tax returns for
The procedure adopted assumed that for 1939,1941, and 1943 the profit ratio
sole proprietorships and partnerships was made available by the Internal
to be assigned to nonreported sales—or the average income to be assigned
Revenue Service, but this could not be used in many industries either because
to nonreporting proprietors—bore the same relation to the reported profit
of large sampling errors in the tabulations or because they could not be
ratio (or average income) as shown by the two segments of the 1945 distribusatisfactorily adjusted to obtain comparability with 1939.6
tion estimated to correspond to the filing and nonfiling segments in those
previous years. As an example, if retail trade food store proprietors reporting
5. In principle, absolute instead of relative differences should perhaps have been applied
to the Internal Revenue Service in 1939 accounted for 40 percent of the
because of the probable tendency for income changes over different phases of the cycle (and
estimated total sales of all retail food store proprietorships, then the 1945
in the short run generally) to be relatively less volatile for small than for large noncorporate
distribution by receipts size was broken into two parts—one composed of
enterprises (chiefly because of the differing relative importance of proprietors' own and
family labor versus hired labor). However, tests showed that the amounts of difference insales in the highest receipts classes covering 40 percent of total sales and the
volved in the application of the two procedures were quite small.
other composed of sales in the receipts classes below that point. The ratios
6. Unlike later tabulations, where sampling was used only for the smaller-sized firms, the
of net income to sales (or average incomes) of the two groups represented by
1936 tabulation was based on a 20 percent nonstratified sample of all returns.

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS

With direct data on noncorporate business income limited largely to the
foregoing, the estimating methods for the period 1929-38 necessarily relied to
a very large extent on indirect measures. The preparation of estimates for
a substantial number of individual industries provided a basis for utilizing
available detailed information and for taking account of shifts in the importance of industrial components within the business total. The methods
used in a few of the larger industries may be summarized briefly.
In the important retail trade sector, the net income of unincorporated
enterprises was derived as the product of receipts and the ratio of net income
to receipts, each obtained by extrapolations of base-year figures for 1939.
Receipts were extended to 1929 by a series representing (1) Census values
for 1929 and 1939; (2) estimates for 1933 and 1935 derived by preparing
legal-form breakdowns of Census aggregates for those years by interpolating
between such reported breakdowns for 1929 and 1939 by weighted indexes
of chain store sales and independent store sales; and (3) interpolations for
all other years on the basis of the Office of Business Economics estimates of
total retail sales.
Following the derivation of the receipts series, the ratio of payroll plus net
income to receipts for noncorporate retail trade in 1939 was extrapolated to
1929 on the basis of similar data for corporations. Application of the resulting
ratios to the noncorporate receipt series and the deduction of estimated noncorporate retail payroll yielded the 1929—38 estimates of total net income.
For this extrapolation of the 1939 ratio of net income plus payroll to receipts,
the payrolls of corporations and of unincorporated enterprises were estimated
by methods analogous to those followed in obtaining receipts. Profits data
for corporations were those of the National Income Division, based on annual
Statistics of Income reports of the Internal Revenue Service.
The above method of estimating the ratio of net income to receipts was an
application of the relationship, noted above, developed from 1939 Census
Bureau and Internal Revenue Service materials for sole proprietorships in
the nonprofessional service industries—that throughout the receipts-size
distribution the ratio of payroll plus profits to receipts tended to be constant.
This relationship, reflecting the varying proportion of labor performed by
paid employees as against proprietors and their families, was assumed to be
valid with respect to corporate and noncorporate retail trade in a temporal
application. In retail proprietors' income there is a large and comparatively
stable element of labor return corresponding to retail corporations' payroll.
Analysis for 1939, it may be noted, indicated that the difference in profit
ratios between incorporated and unincorporated enterprises in retail trade
was accounted for very largely by differences in the relative importance of
payroll expense.
The income of proprietors in wholesale trade for the years 1929—38 was
estimated as the product of number of proprietors and average net income
per proprietor. The 1939 estimate of number of proprietors was extrapolated
to 1929 by a series comprising Census of Wholesale Trade data for 1929,
1933, 1935, and 1939 and straight-line interpolations for the other years.
Average net income per proprietor was derived for 1936 by adjusting the
Internal Revenue Service tabulations for incomplete coverage, and for all
other years of the period through interpolation and extrapolation by the
average net income estimates for retail trade.
The income of noncorporate enterprises in contract construction was
derived for the 1929-38 period by multiplying estimates of receipts by the
ratio of net income to receipts. Receipts of corporations, obtained from
Statistics of Income, were deducted from the estimated total value of contract
work to obtain a series on noncorporate receipts that was used to extrapolate
the 1939 estimate. Value of work performed was estimated for 1939, by four
major types of construction, from the Census of Construction. The 1939
values for these four types were extrapolated to earlier years by components
of the construction activity series (see notes on New construction), which
covers force-account as well as contract construction, and summated to
obtain total value of work performed. The 1939 noncorporate profit ratio in
contract construction was extrapolated to 1929 by the absolute changes from
year to year in the ratio of profits plus compensation of officers to receipts
for corporations in the industry.
The value of product of noncorporate enterprises in manufacturing was
taken for 1929 and 1939 from the Census of Manufactures. Separately for
the 20 major types of industries, estimates for the intervening odd-numbered
years were obtained by interpolation on the basis of the total value of product
of all enterprises reported in the biennial manufacturing censuses. The even

years were then interpolated by gross sales plus gross receipts from operations
of corporations in manufacturing, as published in Statistics of Income. The
resulting series was then multiplied by estimated profit ratios. These were
derived for each industry for 1936 from the special tax return tabulations
and extended to other years of the 1929-38 period chiefly through use of a
linear regression between noncorporate profit ratios for 1936, 1939, and
1941 and annual (adjusted) corporate profit ratios from 1929 to 1941.

Estimates for 1948 and 1949
After the preparation of the 1947 benchmarks, estimates of noncorporate
business income were next established for 1949. In large measure, these were
derived by extending the 1947 universe by changes shown for sole proprietorships in the Internal Revenue tabulations for 1947 and 1949. As noted,
partnerships' returns were not tabulated for 1949.
The actual use made of the sole proprietorship data for this purpose varied
by industry. In many of the 65 industry groups for which separate estimates
are prepared, the procedure was simply to extrapolate 1947 net income by
the income totals reported for proprietorships alone in the two years. In
certain other industries—again, notably retail trade—the sole proprietorship
figures were used to extrapolate the 1947 combined profit ratio for partnerships and proprietorships, as well as to furnish a check on the requisite
estimates of the sales universe. Analogously, the sole proprietorship data
were also used frequently to project average income per proprietor, which
was then multiplied by independent estimates of the number of proprietors.
Common to these several types of procedure was the application of the
1947-49 relative experience of sole proprietorships to the noncorporate
universe. This was not feasible, however, for industries where partnerships
bulked large in the noncorporate total. In such industries, mainly the 20
groups for manufacturing, separate treatment of the partnership segment was
indicated. The general procedure was (1) to extrapolate the total net income
of sole proprietorships by the reported IRS data and (2) to estimate partnership income as the product of sales and profit ratios. Sales were obtained
by multiplying number of partnerships (estimated from changes in the
number of noncorporate business firms) by average sales per partnership
extrapolated from 1947 by the movement of small-corporation data. Extrapolation of the profit ratios for partnerships relied either on the corporation
data (with absolute changes instead of relative changes utilized where the
size of the partnership and corporation profit ratios differed markedly) or on
the sole proprietorship data. In this and other instances, comparison of the
changes shown by partnerships, sole proprietorships, and small corporations
from 1945 to 1947 was a useful guide as to choice of procedure.
Interpolations for 1948 made extensive use of small-firm data for corporations. In the case of manufacturing, use was made of unpublished tabulations
from the Census of Manufactures of receipts of sole proprietorships and
partnerships. These data referred to the 1947 receipts of manufacturing
enterprises which were in a noncorporate status at the time the census information was collected, in the first part of 1948. As such, the totals for the
relatively small noncorporate segment of manufacturing were appreciably
affected by the shift in legal form of organization still progressing throughout
1947. Particularly for partnerships, the reported receipts figures were
adjudged for national income purposes to be a closer measure of noncorporate manufacturers' receipts for 1948 than for 1947. With timing
adjustments (generally minor) to convert the data for the census universe to
a 1948 basis, it was possible to obtain direct approximations of noncorporate
receipts in manufacturing for that year.7
While the sole proprietorship tabulations for 1949 were thus quite valuable,
lack of comparable data for partnerships made for difficulty and impaired
the accuracy of the estimates by individual industries. It may be noted,
however, that there is reason to believe that the errors by industry were
substantially offsetting in the aggregate. For total nonfarm unincorporated
business income (including the professional services), the relative changes
7. Earlier it was noted that the 1947 Census of Manufactures furnished the basis for benchmark data on number of proprietors. The number of establishments involved in legal-form changes
was relatively quite small, and the number-of-proprietors data were much less affected by
this factor than sales or income. Before utilizing the Census of Manufactures data as 1947
benchmarks, adjustments were made to convert the data from measures of number of proprietors as of early 1948 to the estimated average number during 1947. For this purpose, use
was made of the OBE quarterly data on number of operating firms and of the special Internal
Revenue tabulations of corporations changing their legal form of ownership in 1946.

NATIONAL INCOME, 195 4 EDITION

from 1947 to 1948 and from 1948 to 1949 were found to check closely against
information compiled by the Internal Revenue Service from income tax
returns of individual proprietors and partners. This information consisted of
data compiled from the "face" of the returns, not tabulations of business
income by industry. The data were available only as a single aggregate and
required adjustment for this purpose to eliminate the estimated amount of
net income reported by farmers. It is not believed that errors in this adjustment could affect the results appreciably.

Current estimates
Pending availability of noncorporate tax-return tabulations on an industry
basis, estimates of the net income of unincorporated enterprises in the business segment for current years must be prepared from fragmentary and
indirectly relevant data. At the present time, 1949 is the latest year for which
such tax return information (for sole proprietorships) is available.
For extrapolating the 1949 estimates through 1951, considerable use
was made of information for corporations from Internal Revenue tabulations, available by asset-size classes (for small corporations) through 1950
and for corporations in the aggregate through 1951. For the estimates
beyond 1951, corporate data employed in the estimation of noncorporate
business income were derived from sample compilations of Government
agencies, of private organizations in some cases, and of the National Income
Division from published income statements of individual firms. These
sample data are described in the section on Corporate profits. To obtain
the benefit of appropriate weighting, the extrapolations were carried out
in as much industry detail as feasible.

Exhibit 3.—Comparisons of New and Superseded Series for Income of Business
and Professional Unincorporated Enterprises, 1929-52
[Billions of dollars]
New series
1929
1830
1931
1932
1933

Superseded
series >

11.6
67
5.0

8.1
6.3
4 7
2.!)
3 4

3.1

1934
1935
1936
1937
1938

4.6
5.4
6.6
7.1
6.6

4.3
5.0
6.2
6.7
6.1

1939
1940
1941
1942
1943

8.5
11.5
14.3
17.0

6 9
7.8
10 2
12.9
15.1

1944
1945 .
1946
1947
1948

18.1
19.1
23.0
21.4
22. 1

1949
1950
1951
1952

21.0
24.0
25.1
25.5

17.2
18.8
22.4
21.3
22. 5
21. (
24 t
26. f
26.1

1. As published in the National Income Number (table !) of the July 1953 SURVEV
CURRENT BUSINESS.

For many industries—most of them relatively small—even reasonably
satisfactory corporate information is lacking (or entirely inappropriate) for
current extrapolations of the proprietors' income estimates. This generalization applies to wholesale trade, agricultural services, forestry and fisheries,
and most of the finance, nonprofessional service, and transportation and
public utility industries. For these groups, the movement of net income is
based on one or a combination of such series as number of proprietors
(extrapolated by the Office of Business Economics data on number of operating firms), average earnings of employees, wages and salaries, consumer
expenditures, and estimates of net income in related industries. For contract
construction, principal reference for this purpose is had to estimates of
wages and salaries in the industry and construction activity. For wholesale

trade, net income in current years is derived from a sales extrapolation
(based on the Office of Business Economics series) and a profit-ratio extrapolation based on estimates for retail trade.
For current extrapolations of noncorporate business income in the important retail trade area, use has been made for recent years of data contained in the year book issues of "Mail-Me-Monday Barometer of Small
Business," published by the Accounting Corporation of America. This
source summarizes the profit-ratio experience of over 6,000 small enterprises, primarily noncorporate, by line of retail operation. While it has not
yet been possible to check the representativeness of the Mail-Me-Monday
data against Internal Revenue noncorporate data, one indirect test has
been reassuring. It was found that the 1949-50 movements of the MailMe-Monday ratios were in good agreement with those shown for profit
ratios (adjusted to include corporate officers' compensation) reported for
small retail corporations by the Internal Revenue Service. As brought out
above, the profit ratio changes of the smaller-sized corporations accorded
closely with the noncorporate changes from 1945 to 1947.
In the past few years, it has been possible to make two general-type
checks of the current period movement of the estimated total of net income
in the business and professional industries. One, already discussed, is provided by Internal Revenue compilations of net business income reported by
individuals on the face of their Federal income tax returns. At present,
data of this type are available through 1951, and serve to corroborate the
income changes estimated to that point from the 1947 benchmark. A second
summary test is afforded by comparison of the movement of the noncorporate income estimates with that shown by a series derived from Federal
individual nonwithholding tax collections, appropriately lagged and adjusted for tax-rate changes. This series, also available only in the aggregate,
consists largely of taxes against the net income of nonfarm unincorporated
enterprises, but covers also personal income from higher-bracket salaries,
farming, rents, interest, and dividends, as well as capital gains and losses.
Allowance for these other sources of personal income is made in the comparison with the tax series; but because of its broader coverage and the
difficulty of adjusting for changes in tax rates, the measure of the relative
movement in total nonfarm entrepreneurial income which it affords is
far from precise. It nevertheless serves as a useful check, particularly in view
of the weakness of source materials underlying the individual-industry
estimates for very recent years. These estimates are subject to a possible
upward or downward adjustment from the analysis of the tax data.

Revisions of the estimates
In Exhibit 3, the 1929—52 estimates of the total net income of unincorporated
business and professional enterprises prepared for this report are compared
with those published in the July 1953 National Income Number of the
SURVEY OF CURRENT BUSINESS.

The new estimates, unlike previous ones, incorporated results of the 1948
Census of Business, the 1950 Census of Population and Housing, and the 1949
audit study of the Internal Revenue Service. The audit study, as discussed
earlier, was of particular importance since it furnished the first systematic
basis for adjusting the noncorporate business income estimates to the extent
based on compilations from unaudited tax returns.
In addition to use of new source materials, the current revision of the series
reflects improvements in procedures. These included, among others, (1) the
method adopted for expanding the 1941 and 1943 Internal Revenue proprietorship tabulations to a full coverage basis by use of the comprehensive
1945 tabulations as a frame of reference, and (2) the fuller use made of smallfirm corporation data to serve as a guide to the movement of noncorporate
net income.
It will be seen that the overall effect of this statistical reworking has been to
raise the level of the series from 1929 through 1944. Revisions for the earlier
war years are relatively somewhat larger than for the prior period, mainly by
reason of the first change in methodology just noted. The revisions of estimates
for the 1929-38 period stem mainly from the higher 1939 base-year figures
from which they were extrapolated. Although for a few industries the methodology used for this period was changed, the main procedure was to employ
the previous series as indexes for extrapolating the new 1939 estimates.
While, on the whole, the present revisions of noncorporate business income
are not large in the aggregate—particularly when the difficulties encountered

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS

in this area of estimation are considered—they were quite marked for a number of individual industries. In part, this was attributable to use of actual
audit information on an industry basis in contrast to the previous procedure of
making informal allowances where seemingly appropriate. In addition,
numerous other factors centering in the incorporation of the new Census data
and their integration with tax return materials had sizable effects in the
individual industry series, although operating largely to cancel out in the
all-industry total. This experience in the current revisions influenced the
decision to curtail the extent of industry detail published in table 17.
The estimates of total noncorporate business income published in the July
1953 SURVEY (as shown in the exhibit) had undergone, it may be noted, two
interim statistical revisions of appreciable magnitude. These occurred mainly
in the July 1949 and July 1950 national income reports. In the former report,
the principal change was to raise the war-period level. This revision—from
$16.9 billion to $18.8 billion for 1945—was based on the 1945 Internal
Revenue tabulations of sole proprietorships and partnerships. The earlier
estimates had not taken account of the war-period shift in legal form of
organization.
In the July 1949 report, total noncorporate business income was shown to
increase from $22.7 billion in 1946 to $24.7 billion in 1947. In the following
year—in the July 1950 report—the availability of Internal Revenue proprietorship and partnership data for 1947 resulted in a revision of the estimates to $22.4 billion in 1946 and $21.3 billion in 1947. This reflected a
previous missing of the sharp decline in noncorporate profit ratios in 1947,
noted earlier in this section. Like the legal-form shift, this was a phenomenon
that could not be discerned or measured from the statistical materials available when the preliminary estimates were made.

Net Income of Farm Proprietors
The estimates included in this report for the net income of farm proprietors
were prepared by the Agricultural Economics Division of the Agricultural
Marketing Service. They correspond to that Division's published series on
"total net income of farm operators from farming, including Government
payments." The farm income estimates are described in chapter 20 of The
Agricultural

Estimating

and Reporting Services of the United States Department of

Agriculture (Miscellaneous Publication No. 703), Washington, 1949, and the
description here is therefore limited to very brief compass.
Farming as an industry comprises about 5}i million independent enterprises, most of which do not keep accounts permitting them to calculate net
income on any uniform basis. However, an extensive body of both benchmark
and current statistics on farming operations in the aggregate has been
developed over a long period of time.
The general procedure used by the Agricultural Economics Division in
deriving the net income of farm operators is to make an independent estimate
for each item required for an income-and-expense statement covering all
farms, based on whatever combination of available data best represents that
item. Net income of farm proprietors is then calculated by summing the estimates for components of gross farm income and deducting the sum of the
production expense estimates, as illustrated in Exhibit 4 for the year 1949.
Basic data for preparing the farm income estimates are obtained partly
from the farmers themselves through the quinquennial Census of Agriculture
and a current Crop and Livestock Reporting system designed to include at
least one reporter in every farming township in the country. An important
part of the basic data, however, is derived from the auxiliary industries and
agencies which market, transport, store, process, or otherwise aid or regulate
the production or distribution of farm products. As the assembling and
processing of many of these products are either dominated by large firms or
are subject to sanitary inspection, and the individual products are fairly
homogeneous in nature, it is feasible to obtain from auxiliary industries very
reliable data (with little time lag) on the marketings and market prices of
such important products as meat animals, most dairy products, cotton,
tobacco, and sugar beeis.

Gross farm income
The major components of gross farm income are cash receipts from the
marketing of crops and of livestock and livestock products and the value of

food and fuel produced and consumed on farms. Cash receipts and home
consumption are calculated for each commodity by States from estimates of
the quantities involved and the average prices paid to farmers. The price
estimates are based on monthly mail questionnaire returns from about 30
percent of the 35,000 dealers and farmers to whom such questionnaires are
sent; the same price series are used in deriving cash receipts from marketings
and value of home consumption. The estimates of quantities marketed and
consumed on the farm are made in a framework in which production data
are reconciled with disposition data.
Crop production is estimated as acreage harvested times average yield per
acre. To obtain acreage and yield figures, benchmarks derived from the
Census of Agriculture and several annual State assessors' censuses are extended by sample data on acreage and yield changes indicated by a sample
of close to 100,000 reporting farmers. The changes reported currently are
adjusted on the basis of past relationships between the sample data and the
benchmarks.
Disposition of each farm product covers the respective quantities sold,
consumed by the farm family, used for feed and seed, and added to inventory.
Exhibit 4.—Derivation of Net Income of Farm Proprietors,

1949

[Billions of dollars]
GROSS F A R M INCOME

30.9

Cash receipts from farm marketings
Meat animals
Dairy products
Poultry and eggs
Cotton
Food grains
Feed crops
_
Other marketings...
Value of home consumption
__
Gross rental value of farm homes
Government payments
Value of change in farm inventories—

27.9
8.3
3.8
3.1
2.6
2.3
2.3
5. 5

_
_

2.2
1.5
.2
—. 9

LESS: PRODUCTION E X P E N S E S .

18.2

Depreciation
Feed purchased
Hired labor
Operation of motor vehicles
Livestock purchased

3.6
3.0
2.9
1.7
1.6

Net rents and Government payments to nonfarm landlords
Fertilizer and lime
Taxes
Farm mortgage interest
Other...

1.1
.9
8
.2
2.4

EQUALS: N E T INCOME OF F A R M P R O P R I E T O R S

12.7

It is generally estimated in percentage terms from annual mail reports filed
by a selected sample of producers—by 15,000 wheat growers, for example.
For most field and vegetable crops, these percentages are applied to production estimates, and the results for quantity sold are generally reconciled
with totals based on annual reports by producers accounting in many cases
for the bulk of the commercial movement. Reports from processors, handlers,
or sanitary inspectors provide such good coverage of certain other major crops
and livestock products that firm estimates of marketings can be based directly
on these. Cotton belongs to this class because of reports made by substantially
all ginners. Meat animals are another example, for which there are Federal
meat inspection reports, returns from a very large stratified sample of
butchering firms, and data from common carriers.
Nonrecourse loans to farmers made or guaranteed by the Commodity
Credit Corporation, net of current redemptions, are considered cash receipts from farm marketings. Such loans and redemptions are reported
currently by the Corporation, and net loans are added to the value of
farm marketings discussed above.
Gross rental value of farm dwellings covers housing on owner-occupied as
well as rented farms. It is derived by (1) calculating a return on dwelling
investment from the estimated value of farm dwellings and the average rate
of interest on farm mortgage loans, and (2) adding to this computed net
value the portion of total farm expenses estimated to be allocable to the
upkeep of dwellings. The basic estimates of the total value of dwellings are
prepared from Census of Agriculture data, with only the 1930 Census

NATIONAL INCOME, 195 4 EDITION
reporting separate data on dwellings as distinguished from other structures.
Value relationships are used to derive the proportions of the various expense
items allocated to dwellings.
Government payments in connection with the various farm programs
are reported from the fiscal records of the responsible agency, the Commodity Stabilization Service.
Change in farm inventories
The value of the change in farm inventories is measured as the difference
between physical quantities of crops and livestock on farms at the beginning
and end of the year, multiplied by year-end prices. It is derived as the sum
of separate State estimates for each crop and livestock item.
This component of gross farm income is entered directly in the gross
national product as a component of "Change in business inventories." No
inventory valuation adjustment is required, as in the case of estimating the
change in nonfarm business inventories, since the farm inventory changes
are computed directly from data on physical stocks and current prices.
Benchmark data on the number of each class of livestock on farms are
obtained every five years from the Census of Agriculture. These census
enumerations are adjusted, where necessary, to obtain complete coverage.
Current estimates of year-to-year changes in the number of livestock on
farms are prepared from surveys made each December. The rate of sampling
varies among States, depending largely on the needs of the individual States
for livestock data. In general, a sample of 3,000 to 6,000 farms is considered
satisfactory for a principal livestock-producing State. Special surveys (especially in States where the size of farm varies greatly); records of marketings,
slaughterings, and rail shipments; livestock tax assessment data; and State
farm censuses are used for checking the inventory estimates derived from
the basic survey data.
Estimates of year-end farm inventories of crops are prepared by one of
two methods. For all major crops except cotton and tobacco, farm stocks are
estimated quarterly. These estimates are based upon the results of mail
surveys covering about 80,000 farmers, from which the usable response is
approximately 30 percent. Each respondent reports the production of each
crop grown on his farm and the quantity on hand at the survey date. For
each crop the reported stocks on farms are expressed as a percentage of
total production for these farms, separately for each State. These percentages
are applied to the estimated total State production of each crop to yield
total stocks on farms at the end of each quarter. Studies made in 1948 substantiated the validity of this method.
The estimates of year-end inventories of crops derived in this manner do
not include crops which farmers own but may have placed in commercial
storage located off their farms. The magnitudes involved are not known,
but believed not to be large. Also, for certain crops a part of the estimated
stocks on farms may have been used to secure a Commodity Credit Corporation loan. As the proceeds of such loans are included in gross farm income,
it is necessary to deduct the quantity of these crops under loan from farm
inventories in order to avoid double-counting. The adjustment is made on
the basis of reported data on Commodity Credit Corporation loans and
redemptions.
For cotton and tobacco and a few relatively minor crops, inventory
changes are calculated in terms of inventories "held for ultimate sale."
Crops held for use as feed or seed on farms where grown are excluded. To
estimate the quantity of each crop still remaining to be sold on January 1 of
each year, the amount of the previous year's production of the crop actually
sold through December is subtracted from the total amount to be sold.
The prices used to value the change in physical quantities of crops are
the December 15 average prices received by farmers for their products as
sold at local markets or at points to which the farmers deliver them. For
livestock, inventory values per head as of January 1 are used, based on farmers' estimates of replacement costs.

centage rates of depreciation have been derived for dwellings from a 1934
survey covering 600,000 farms and for most other items from scattered
sample data on length of useful life. These are applied to estimates of current
value based on the Census of Agriculture and/or on cumulation of purchases
(as a measure of current gross increment), estimated for tractors and other
types of machinery and equipment from the annual Farm Machines and Equipment reports of the Census Bureau, adjusted to reflect current values on the
basis of Department of Agriculture price index series.
Purchases of feed are reported at 5-year intervals in the Census of Agriculture. For interpolation and extrapolation, an index calculated from price
and quantity data for 18 important feeds is used. Average price data are
based on monthly mail returns from 4,000 reporting merchants. Quantities
are estimated as production, indicated by reports from farm or factory
producers, plus imports, with the total adjusted for inventory change and
exports and other nonfarm uses.
The estimates of wages paid to hired farm laborers are described in the
section on Wages and salaries.
Farmers' expenditures for livestock, which are prepared by States, cover
purchases from all sources outside the State and from public stockyards
within the State. The estimates of cash receipts from livestock are defined
in a manner consistent with this treatment.
Estimates of livestock numbers shipped across State lines for stacker
and feeder purchases are made from inspection records of State veterinarians,
inspections by the Department of Agriculture at 66 public stockyards, and
data derived from truck and railway movements of livestock. Estimates of
the weight and price of the livestock purchased are obtained from records of
transactions at five important stocker and feeder markets, which handle
more than one-half of the transactions.
Motor vehicle operating costs are estimated separately for automobiles,
trucks, and tractors, and only 40 percent of the total cost for automobiles
is charged to farm production. The basic data on number of vehicles are
obtained from the Census of Agriculture and extended on the basis of sales
data on new tractors, less estimated scrappage, and truck and automobile
registrations in predominantly agricultural states. Costs per vehicle for
some items were obtained from a survey in 1936, and have been extended
on the basis of changes in prices. Consumption of gasoline and oil per vehicle
have also been obtained from surveys, supplemented by occasional spot
checks of mileage and average mileage per gallon in the case of automobiles
and trucks, and the number of days used and fuel consumption per day in
the case of tractors.
The series on net rents to nonfarm landlords is discussed in the section
dealing with Rental income of persons. This series comprises the only
rental figures explicitly included in the farm income statement. The explanation is as follows.
Rental flows within the farm sector do not appear in the statement shown
in Exhibit 4 because it is a consolidated statement in which intra-business
flows cancel out. Net rents earned by farmer landlords become merged
with the net income of farm operators and are not isolated statistically.
However, rents paid to landlords not living on farms must be recorded as
flowing out of the farm sector. Only net rents are shown explicitly. The
difference between them and the gross rents actually paid consists of expenses that are included among the various expense items of the statement.
Taxes on farm property cover all ad valorem taxes levied on farm property by State and local governments. Real estate tax rates are developed
from sample data from local tax officials or from farmers, and from real
estate tax data reported in the Census of Agriculture. The tax rate estimates
are applied to value of agricultural land calculated from the censuses and
interpolated by an index of farm land values constructed by the Department
of Agriculture. Personal property taxes are estimated from the real estate
taxes in conjunction with ratios of the amounts of farm real and personal
property on tax rolls as shown in published reports of State tax commissions,
boards of equalization, or similar bodies.

Production expenses
Estimates are made for each of some 40 categories of production expense.
Among the largest are depreciation, purchased feed, hired labor, purchases
of livestock, costs of operating motor vehicles, net rents to nonfarm landlords,
and taxes. These accounted for more than four-fifths of the 1949 total.
Depreciation estimates are made separately for seven categories of farm
property, on the basis of replacement cost, rather than original cost. Per

Characteristics of revisions
Revisions of the farm income estimates are made periodically by the
Agricultural Economics Division of the Department of Agriculture to incorporate results of the quinquennial Census of Agriculture and of special Department of Agriculture surveys designed to improve certain areas of the esti-

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS

mates. In addition, when the Agricultural Economics Division publishes
each Fall detailed income estimates for the preceding year, it usually presents also revised estimates for several years back, to incorporate newly
available or improved data on production, marketings, prices, etc. In 1952,
the Agricultural Economics Division introduced a comprehensive revision of
the farm income estimates to incorporate new benchmark data reported in
the 1950 Census of Agriculture.
The farm proprietors' income series shown in this report agrees statistically
for the period 1929 through 1950 with the Agricultural Economics Division's
series on "total net income of farm operators from farming, including
Government payments" presented in The Farm Income Situation, Sept.—Oct.,
1953, and thus includes all revisions made through that date. For 1951 and
1952, the present figures include, in addition, some subsequent statistical
revisions in component income series that were available from the Agricultural Economics Division at the time the present series was prepared. For
1953, the farm income figure is a preliminary estimate developed from
Agricultural Economics Division data.
Subsequent revisions to be made by the Agricultural Economics Division
will be incorporated insofar as possible in the present series. However,
because of differences in the Commerce and Agriculture publication schedules, it will not be feasible to maintain complete statistical conformity in the
series published by the two agencies.

this is a distinct advantage, the necessity of deriving the final figures in this
way has made for complexity in the statistical methodology, with consequent
danger of errors. In particular, it will be noted the final estimates are often
calculated as the difference between much larger items which, in turn, are
also obtained as residuals. Even small errors made at the various stages of the
estimating procedure may significantly affect the final results. Both as to
general level and relative movement the rental estimates must be regarded
as among the least satisfactory of national income statistics.
Exhibit 1 .—Components of Net Rental Income of Persons, 1950

Types of property
1. Rented nonfarm property
a. Rented dwellings
b. Royalty-earning.
c. Business and industrial
2. Owner-occupied nonfarm dwellings
3. Farm realty
Total

Millions of dollars
4,000

1,795
558
1,647
3,379
1,094
8,47*

The property-type components of the net rent estimates may be grouped
as above, to show their relative magnitude and the order in which they are
discussed in the following pages.

7. Rented Nonfarm Property
4. RENTAL INCOME OF PERSONS
Rent items appear on both sides of the national income and product accounts. Net rental income of persons is a distributive share of national income, and space rental value of housing is a component of personal consumption expenditures for services. Space rental value of nonfarm housing
is estimated at an intermediate stage in the derivation of persons' net rental
income arising from nonfarm rental housing or imputed to owner-occupancy
of nonfarm dwellings, and is discussed below in connection with these net
dwelling rents. Rental value of farm housing is estimated by the Agricultural Economics Division of the Agricultural Marketing Service of the
Department of Agriculture, and is described in the section on Income of
unincorporated enterprises.
Primary data on rent income are notably inadequate. Rents are received
by a large number of individual landlords who maintain only fragmentary
accounts. The only major attempt to obtain income statements from these
landlords is in connection with the Federal individual income tax. The rent
data tabulated by the Internal Revenue Service are derived from a sample of
the tax returns and are restricted to the net rent item. Lack of gross rent and
expense tabulations precludes systematic use of collateral source materials
to adjust the Internal Revenue Service data for inconsistencies due to inadequate bookkeeping and incomplete reporting.
The tax return tabulations were used to derive a 1941 benchmark which
covers net rent from property types accounting for about two-fifths of persons' net rents in that year. The remainder of the 1941 estimate and the
totals for other years have been derived by subtracting sample-based estimates of expenses from gross rent receipts computed largely from data on
rent paid as reported by tenants. Tax returns, census enumerations, and
sample surveys—the main sources of rental information—provide much
better coverage of rents paid than of rents received.
The resulting estimates of net rent are considerably less reliable than the
farm income series, which is derived by a somewhat similar formula. Although
the rent estimates pertain to an "industry" comparable in size to agriculture,
public interest in real estate renting as an industry has been insufficient to
justify any broad special program of data collection such as underlies the
farm income estimates. Moreover, the use of data from tenants in estimating
persons' net rental income is complicated by the necessity of excluding rent
paid to landlords other than persons.
Derivation of the net rent estimates via a detailed structural analysis ol
gross rent flows and expenses has the virtue of providing a framework which
facilitates the consistent use of all available data on rents. While on balance

Persons' net rental income from rented nonfarm property is derived in the
course of a rather intricate estimating procedure. The following synopsis will
facilitate understanding of the estimating sequence, details of which are
described later.
An estimate of persons' net rental income from rented nonfarm property
for 1941 was derived from net rents reported on individual Federal income
tax returns. For purposes of extrapolation, the 1941 total was broken down
into three groups: (a) Net rents from rented dwellings, (b) royalties, and (c)
net rents from business and industrial property.
(a) Personal net rents from rented dwellings are calculated annually as
the difference between gross rental receipts and landlords' expenses on all
such dwellings, after nonpersonal landlords' receipts and expenses have been
eliminated from these gross totals.
(b) Personal net royalties are estimated annually by applying suitable
corporate ratios to the series described below on rental receipts of persons
from business and industrial property.
(c) Personal net rents from business and industrial property were obtained
as a residual for 1941. Their extrapolation involves estimating persons'
gross rents from business and industrial property for 1941 and other years
as gross rents paid by business and government less gross rents received by
business and government from business and industrial property; deducting
the 1941 benchmark figure for persons' net rent from such property from the
1941 estimate of persons' gross rent to obtain persons' expenses as a residual;
breaking down this residual into component parts and extrapolating them
individually by use of corresponding expense items for corporate landlords;
and subtracting expenses from gross rents to obtain personal net rents.
Details of these procedures are discussed below.

Benchmark estimates
Total net rents and royalties of individuals and fiduciaries reported on
the rent schedules on forms 1040-41, as tabulated by the Internal Revenue
Service for 1941, were adjusted to cover nontaxable fiduciaries, individuals
reporting on the short form 1040A, and persons and nonprofit organizations not reporting. They were further adjusted to reflect losses on property rentals reported by some filers and to deduct an estimate of net room
rents reported, an allowance for neglected or misplaced expense entries,
and an estimate of net rents reported by farmers. The original total of $1.8
billion was reduced to a figure of $1.4 billion, representing net rent from
nonfarm property and net royalties.

NATIONAL INCOME, 19 5 4 EDITION

The taxpayer filing form 1040 may report his net rents either on the business schedule or on the rent schedule. These two schedules are adapted, respectively, to large and complex rental activities and to small or simple
transactions. It is reasonable to suppose, therefore, that most taxpayers who
receive rent as an occupational income fill in the business schedule, and that
rents which are merely a supplemental source of income or accrue to persons
without occupation are generally reported on the rent schedule. This distinction between occupational and nonoccupational income underlies the
distinction in national income measurement between the distributive shares
of income of unincorporated enterprises and rental income of persons.
Statistically, the use of the income tax data has serious drawbacks. Of the
total of $1.8 billion reported by the Internal Revenue Service for 1941,
nearly three-fourths is an estimate (for income classes under $5,000) based
on samples comprising less than 6 percent of the returns. Moreover, reporting
requirements are peculiarly difficult to enforce in the case of rental income,
because such income is received in small amounts by large numbers of landlords and because difficult accounting problems are involved in calculating
net rent. Finally, the various adjustments of the tax data made by the
National Income Division had in most cases to be based on fragmentary or
otherwise unsatisfactory data.
It would be possible to estimate net rents directly from income tax returns
for most other years as well as for 1941. However, the relatively high tax
exemption limits in effect in the earlier years meant that a very substantial
part of persons' rental income was not reported for tax purposes. After 1941,
the movement of net rents indicated by individual income tax return data
diverged substantially, not only from the prewar trend, but also from the
movement indicated by a rather substantial body of other data. These include sample series on net dwelling rents and synthetic income statements for
all rental housing, as well as corporation income tax tabulations showing the
net flow of rent out of the corporate sector of business. As individual income
tax data do not show gross rent or rent classified by property type, it has not
been possible to reconcile the net rent figures from this source with these
other data.

multifamily structures as well as by urbanization. Estimates for 1941 and
later years have been made without a structure-type breakdown, in the
absence of the required information on mean rents and (except for 1950)
number of units.
Next, cell estimates of landlords' total expenses for facility and utility
services included in rent are obtained by an analogous formula. Deduction
of these from the contract rent aggregates yields Space rent of tenant-occupied
nonfarm dwellings, a component of personal consumption expenditure and of
gross national product.
Landlords' other expenses are then estimated and deducted from space
rent to determine landlords' net rental income.
Finally, net rents of nonpersonal landlords are estimated and deducted to
obtain the nonfarm rented dwelling component of the rental income of persons.
The magnitudes involved in these calculations are illustrated by the 1950
values shown below.
Exhibit 3.—Calculation of Space Rent and Net Rent for Nonfarm Rented
Dwellings, 1950
Item
1. Rented nonfarm dwellings (number in millions)..
2. Times: Average annual rent (rounded to dollars),.
Equals: Total contract rent (millions of dollars)...

14,310
504
7,207

3. Less: Landlords' expenses for facility and utility
services included in r e n t . . .
4.
Use of cookstoves, refrigerators, furnishings
5.
Electricity, fuel, water, gas, and miscellaneous.
Equals: Personal consumption expenditure for
space rent

464
1,083

6. Less: Landlords' other expenses
7.
Depreciation...
8.
Taxes.
9.
Mortgage interest..
10.
Other
._
Equals: Net rental income of landlords..
11. Less: Nonpersonal landlord net income.

Exhibit 2.—Derivation and Breakdown of Persons' Net Rents From Rented
Nonfarm Property and of Royalties, 1941

Item
1. Net rents tabulated from tax returns
_
2. Less: Adjustments for coverage and concept
3. Equals: Persons' net rents from rented nonfarm property, and royalties
4. Less: Persons' net rents from rented nonfarm dwellings
5. Less: Persons'net loyalties
6. Equals: Persons' net rents from rented nonfarm business and industrial
property

Millions
of dollars
1,770
393
1,377
664
223
490

The estimating procedure actually adopted for years other than 1941 assumes that corporate tax returns provide a firmer statistical base than tax
returns of individuals. It may be noted that incentives to nonreporting of
rents received by individuals have increased with the requirement since 1941
that landlords file the long form 1040 instead of the much simpler alternative
forms available to most nonlandlords.
The derivation of persons' net rents from rented nonfarm property, and of
persons' royalties, in 1941 is summarized in lines 1, 2, and 3 of Exhibit 2.
For extrapolation the total is broken down as shown in lines 4, 5, and 6, corresponding to items a, b, and c in the synopsis given above for line 1 of
Exhibit 1. This breakdown and its extrapolation will next be considered.

Persons' net rents from rented nonfarm dwellings
The first step in preparing annual estimates of personal net rents from
rented nonfarm dwellings is to derive, separately for urban and rural nonfarm dwellings, midyear annual numbers of rented dwellings and of mean
annual contract rent per dwelling. Annual contract rent for each of the two
cells is then obtained by multiplication. For the period from 1929 through
1940, dwelling unit numbers and mean and total rentals were estimated
separately for each of four cells, being cross-classified between one- and

Rural
nonfarm

Urban

Equals: Net rental income of personal landlords
from nonfarm rented dwellings

3,649
343
1,251

8,458
1,630

1,168
878
1,391
602
1,868

Total

16,828
4,739

2,089
294
1,795

The published series for consumption expenditure for space rent also includes allowances, totalling $234 million in 1950, for certain lodging house rents and lodging received
gratis as a perquisite of employment. These allowances are rough approximations based on
a variety of census, income tax, social security and other data.

The derivation of the values in Exhibit 3 is of special importance for two
reasons. In the first place, substantially the same procedures and data sources
used here are used also in deriving estimates for owner-occupied dwellings.
Secondly, the estimated expense series for rented dwellings are used as
adjustment factors in extrapolating the expenses incurred by persons as
lessors of business and industrial property. For these reasons the exhibit will
be discussed line by line. The methodology for owner-occupied dwellings
will be indicated at the same time where convenient.
1. The total number of tenant-occupied nonfarm dwelling units has been
benchmarked on the decennial Censuses of Population and Housing for 1930,
1940, and 1950. Data for 66 cities included in the Commerce Department's
Real Property Inventory of 1934 were used in conjunction with 1940 Census
data from the same cities to derive an estimate for 1934. Census Bureau
data on the size and composition of the housing stock, based on interviews
with scientifically constructed samples of 20,000—30,000 families surveyed
in connection with the Bureau's Monthly Report on the Labor Force, were
used for the years 1944, 1945, and 1947. These benchmarks are interpolated
and extrapolated by estimates of the numbers of rental units, including
vacancies.
The estimated numbers of rental units have been derived by adding to
census- or survey-based benchmark totals the cumulative net number of new
multifamily units provided in each subsequent year by construction or conversion, and deducting an allowance for the number of units demolished.
The construction series rest on Bureau of Labor Statistics estimates of housing
starts, which are based chiefly on reports of building permits issued. (See
section on New construction.) The conversion and demolition series have
been derived, partly by graphic interpolation, in the process of reconciling
the decennial census totals and the Census Bureau's sample-based data with
the estimates for the same dates made by adding new construction cumulatively to the base stock. For the war and early postwar years, such recon-

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS

ciliations also required allowance for the shift of many dwellings out of the
by the total number sold during that period. Annual value of sales and numrental market to owner occupancy.
ber sold have been estimated basically from Census of Manufactures data,
which have been interpolated, extrapolated, and raised to cover distribuThe sums of the estimates for tenant-occupied units plus a similarly derived
tion cost by use of information from trade sources.
series for owner-occupied units have been checked for 1948 and subsequent
years against annual control totals, for all occupied nonfarm units, based on
For furniture, a sample-based average expense benchmark was derived
the numbers of households reported in the Census Bureau's Current Populafor 1933 in the Financial Survey of Urban Housing. This is extrapolated by
tion Surveys. These population surveys also provided the basis for estimates
Bureau of Labor Statistics price indexes, and the annual results are averaged
of the effects of the Bureau's adoption in 1950 of new criteria for distinguishover the back period without weighting the years.
ing urban, rural nonfarm, and farm dwellings (see its Current Population Re- The numbers of dwellings for which specific facilities are provided at the
ports—Population Characteristics, series P-20, No. 33, of February 12, 1951).
landlords' expense are estimated by applying annual percentage ratios to
The discontinuity in the statistical series between 1949 and 1950 which rethe series on total number of rental units described under (1) above. The most
sulted from the change in criteria has been smoothed out by wedging back
recent general benchmark for each of these ratio series was derived from the
to April 1947. The principal distortion remaining in the final estimates is an
Dwelling Unit Survey undertaken by the Bureau of Labor Statistics in 1949—
exaggeration of the rate of increase in the number of units between April
50 in connection with the revision of its Consumer Price Index. City averages
1947 and April 1950: of an indicated gain of about 5 million units in the total
from this Survey were weighted by an adaptation of the series of population
nonfarm housing stock, just under 1 million represents the smoothed effect
weights developed by the Bureau from preliminary census tabulations, for
of the classification change.
its 91-city Survey of Consumer Expenditures for 1950. The Dwelling Unit
Survey is described in the July and September 1951 issues of Construction, and
Besides tenant-occupied dwellings, line 1 of Exhibit 3 includes an allowance
the Survey of Consumer Expenditures is described in the April 1951 and
for units rented but temporarily unoccupied, based on Census and sample
August 1952 issues of the Monthly Labor Review.
information as to the composition of the stock of vacant units.
The final estimates of the number of rented units are adjusted to represent
Other base-year percentages of dwellings let furnished were determined
the average stock for each year.
from the 1940 Census of Population and Housing and from the 1934 Financial Survey of Urban Housing. These benchmarks are interpolated and ex2. Average annual rent for rented units likewise has been derived from the
trapolated by use of data gathered periodically by the Bureau of Labor
decennial censuses of 1930, 1940, and 1950 and the sample surveys made by
Statistics from families in the sample underlying its Rent Index.
the Census Bureau for 1944, 1945, and 1947. Minor adjustments have been
made in the decennial census data for nonreporting of rent and to convert
Percentages of dwellings let with refrigerator were estimated from the
the final means for April to an annual-average basis. The mean for the 1950
1934 Financial Survey of Urban Housing, the 1935-36 and 1941 studies of
Census date is based on a preliminary sample tabulation of census returns
consumer purchases, and the 1949-50 Dwelling Unit Survey. Interpolation
for about 46 thousand dwelling units in about 14,000 census enumeration
and extrapolation have utilized data analogous to those used in extrapolatingdistricts systematically selected from all enumeration districts throughout
the percentages of dwellings let furnished.
the Nation; arithmetic means for rent were not included in the Census
Most of the source materials for furniture and refrigerators cover only
Bureau's final tabulations of all returns. Values for other years represent
urban housing. Estimates for rural nonfarm units are based on those for
interpolations and extrapolations by reference mainly to the Rent Index
urban dwellings, using differentials indicated by the Census or the 1935—36
component of the Bureau of Labor Statistics Consumer Price Index. Also
Consumer Purchases Study.
used for this purpose were the mean rent data provided by the Financial
For cookstoves, the 1949-50 Dwelling Unit Survey provided the only data.
Survey of Urban Housing for a 12 to 15 percent sample of all families in
The percentages indicated by this source are held constant for all years and
52 cities, covering the years 1929, 1932, and 1933.
for both urban and rural nonfarm units.
The Rent Index is based on returns filed by about 40,000 families in 46
5. The aggregates in line 5 of Exhibit 3 are products cf total number of
cities. The National Income Division has modified the recent-year values in
rented units (described under (1)), percentages of units including the rethe Index to allow for the comparatively high rent of newly constructed
spective utilities in rent, and average cost per unit. The percentages indwellings (as indicated by properties mortgaged under Federal Housing Advolved have been based on the Financial Survey of Urban Housing, the 1949ministration guarantee) and for changes in the common practice of land50 Dwelling Unit Survey, and interim city surveys by the Bureau of Labor
lords with regard to the inclusion of facilities and utilities in rent. Data for
Statistics covering families in the sample underlying its Rent Index.
the latter adjustment are obtained through periodic Dwelling Unit Surveys
The cost averages are based on data for households purchasing utilities
by the Bureau of Labor Statistics.
directly, since data on payments through landlords are not available. The
3. Facility expenses and utility bills, although sometimes paid by the
principal benchmark was provided by the 91-city Survey of 1950 Consumer
resident family directly to the producer, are often included in contract rent
Expenditures mentioned above. The general procedure was to (a) derive a
and paid by the landlord. As outlays for these items are classified in gross
national average outlay, per surveyed family reporting outlay for the given
national product under personal consumption expenditures for household
utility, (b) estimate the implied average for families in dwellings of each
operation, it is necessary to exclude from the housing component the allowstructure type, and (c) combine these to obtain averages presumed appliance which landlords make for them in fixing rents. The total amount to be
cable to units where utility costs were included in rent.
excluded for each item is estimated by multiplying together two factors:
The weights used in (a) for the various cities were those developed by the
the average cost of providing the item for one dwelling; and the number of
Bureau of Labor Statistics. The technique for (£) involved reconstructing a
dwellings for which the item is provided at the landlords' expense. The deritype-of-structure breakdown for the utility costs represented in the survey.
vation of each of these factors is outlined below under (4) for facilities and
It utilized type-of-structure cost differentials from various sample surveys,
under (5) for utilities.
and a 1950 Census classification of units by structure. The latter was modified
to omit units with utilities included in rent, since these units were not repre4. The average cost of providing each type of facility (cookstove, refrigerasented in the survey averages. For step (c), the structure-type averages detor, or furnishings) for one dwelling is calculated for the present purpose as
rived in (b) were weighted together by the estimated number of one-family
the sum of annual depreciation plus maintenance cost, since this sum is the
and multifamily units respectively in which the landlords paid for the utiliextra amount which the rent must cover to make the inclusion of the facilities
ties. In deriving these weights, the total numbers of such units were obtained
in it worth while from the landlords' standpoint.
as percentages of the total numbers of rented units (see above), and disThe estimates of average maintenance cost (except for furniture) are flat
tributed by structure-type on the assumption that multifamily unit rents
rates based on trade opinion. Depreciation averages are calculated from the
rather commonly include utilities and that only a residual would consist cf
estimated original average price of the equipment in use, by straight-line
one-family units.
amortization over the estimated useful life of the equipment.
The resulting cost means pertained only to urban units. Corresponding
The length of useful life is determined for most items from studies made for
averages for rural nonfarm units were derived by applying urbanization
the Internal Revenue Service. The original average price which is amortized
differentials based largely on the 1935-36 Consumer Purchases Study. The
is generally calculated as a weighted moving average of annual prices coverfinal implied aggregates were reconciled approximately with the corresponding a back period equal to the length of useful life. For stoves and refrigeraing values shown in Part V, table 30.
tors, it is derived by dividing the total value of sales during the back period

NATIONAL INCOME, 195 4 EDITION
Annual estimates derived from reports by the Edison Electric Institute
and the American Gas Association could be reconciled fairly closely for 1950
with these benchmark averages for electric and gas utility costs, and are
used to extrapolate them. The 1950 benchmark averages for heating fuel
cost, and secondary benchmarks derived from the Financial Survey of
Urban Housing of 1934, are interpolated and extrapolated by an indicator
representing the product of the Consumer Price Index fuel component
times an index of heating season degree days as reported by the Weather
Bureau. Average water bills, estimated for 1950 by the procedure described
above and for 1932 and 1942 from water utility revenues reported to the
Census of Governments, are interpolated and extrapolated by city water
utility revenues per capita of population.
A 1940 average for the cost of such minor utilities as rubbish removal and
telephone service included in rent, based on data from the Federal Housing
Administration, Office of Price Administration, and other sources, is moved
from year to year by the weighted average combined cost of the other utilities
considered abeve.
6. The other expenses deductible from contract rent may conveniently be
described here for owner-occupied as well as for rental units. Most of these
estimates are initially made for tenant-occupied, owner-occupied, and
vacant units separately. Expenses on vacant units are subsequently allocated
between rental housing and home ownership in proportion to the rental
value of the vacant units of each type.
7. Depreciation is derived by applying a flat rate of 2 percent to the estimated original cost value of all nonfarm dwellings. The result is allocated
by tenure groups in proportion to aggregate value in each category.
The depreciation rate is based on several surveys of average length of useful life of dwellings, including in particular that made by the National Association of Real Estate Boards for the Internal Revenue Service.
Original cost value of all nonfarm dwellings is estimated by cumulating
annual estimates of original and subsequent construction outlays on units
still existing. A basic distribution of the stock of housing by year of construction was taken from the 1940 Census of Population and Housing. Unit mean
original cost of dwellings in each age group was estimated chiefly from the
building permit data described in the section on New construction, and was
multiplied by the number of units found by the Census in that age group to
obtain a census-year aggregate. The corresponding aggregates for noncensal
years are derived by adding subsequent-year construction outlays to (or subtracting previous-year outlays from) the benchmark.
The depreciation totals have been allocated between tenure classes in
proportion to assessed value rather than original cost, in order to allow for a
somewhat lower depreciation rate on owner-occupied than on tenant-occupied units. (The assessment ratios have been lower for owner-occupied than
for rental units.) To estimate assessed values for the years 1929—41, mean
rents or rental values were capitalized by use of a regression derived from
the 1940 Census of Population and Housing, and multiplied by assessment
ratios indicated in State and local government fiscal reports. The resulting
averages were then multiplied by the numbers of units involved. The value
aggregates so derived have been extrapolated forward from 1941 by originalcost values. These are calculated by cumulating construction outlays as described above, but separately for one-family and multifamily units and with
an adjustment for the shifting of units among tenure classes.
8. Taxes are estimated as a variable fraction of the property tax series
described in the section on Government receipts and expenditures. This tax
series is allocated among nonresidential property, rental housing, and
owner-occupied dwellings.
For the period from 1929 through 1941, the allocation was derived from a
detailed study of State and local government fiscal reports. For 1949, average
taxes per owner-type unit and per rental unit were based on frequency distributions from the Survey of Residential Financing taken in conjunction
with the 1950 Census. These 1949 benchmark means were consistent with
figures derived from the 1950 Survey of Consumer Expenditures, applying
to owner-occupied units, and with figures for rental units in a few cities surveyed by the Office of the Housing Expediter. They were multiplied by the
corresponding numbers of units to obtain benchmark totals. Interpolators
for 1942-48 and extrapolators from 1949 have been derived by allocation of
the overall property tax series: between nonfarm residential and other realty
by reference to 1941 taxable values as changed by new construction, depreciation, and trends in assessment practice; and within nonfarm residential
by aggregate assessed values.

9. Mortgage interest for 1950 was estimated primarily on the basis of the
Survey of Residential Financing mentioned above. Extrapolation utilizes the
products of estimated mortgage debt multiplied by estimated effective interest rates.
For 1950, amounts of debt and of interest liability for mortgage loans on
rental units and on owner units separately are estimated from distributions
of debt by interest rate classes reported in the Survey of Residential Financing. The Survey totals for debt held by savings and loan associations were
reconciled with similar totals based on lenders' reports to the Federal Savings
and Loan Insurance Corporation. The details of the reconciliation provided
a basis for adjusting the Survey debt aggregates to the timing, coverage, and
concepts appropriate for the present purpose. Together these adjustments
added about 9 percent to the aggregate debt figures reported in the Survey.
The Census of Population and Housing provided the basis for estimates of
owner-occupants' total mortgage debt and average interest rate paid in
1940. Interpolation (between 1940 and 1950) and extrapolation utilize the
Federal Savings and Loan Insurance Corporation's estimates of debt on oneto-four family properties, its tabulations of mortgage loans and interest income
of building and loan associations, and a variety of sample data. Census data
for 1940 corresponding to those used for owner-occupied housing were not
compiled for rental units. Debt and interest rates on mortgage loans secured
by rental housing are extrapolated from the 1950 benchmark by use of
the building and loan association data and corporate and other sample
information.
10. Other property expense consists of estimates for repair and maintenance, insurance, and miscellaneous costs.
Repair and maintenance cost accounts currently for two-thirds of the sum
of these three components. For each of a large number of regional, rentlevel, and city-size cells, benchmark averages derived from surveys by the
Office of Price Administration, from the 1935—36 Study of Consumer Purchases and from a similar but much smaller survey made in 1941 were multiplied by 1930 and 1940 census data on number of dwellings by tenure in each
cell to obtain cell subtotals. These, summed by tenure groups, represent
benchmark aggregates for repair and maintenance cost in 1930 and 1940.
For owner units, the 1950 Survey of Consumer Expenditures supplied the
basis for an additional benchmark. State sales tax and sample data on sales
of building material retailers and (since 1947) tabulations from the 3,000family Surveys of Consumer Finances made for the Federal Reserve Board
are used for interpolation and extrapolation.
Expenditures on rental units are extrapolated from 1940 through 1946 and
estimated for 1950 by use of survey data provided by Federal rent control
agencies. Estimates for other years have been interpolated or extrapolated
by reference to space rent and to average family income.
The foregoing estimates of facility, utility, and other expenses incurred on
rental housing are deducted from the estimated rentals of such dwellings to
obtain the figure for net dwelling rents of all landlords.
11. Rental housing, however, is owned by business enterprises and government agencies as well as by persons. In the absence of any direct information,
contract rentals and expenses on holdings of persons are derived by eliminating the business- and government-owned portions from the totals. In line
11 of Exhibit 3 only the net adjustment is shown.
For government, the estimates of rental receipts are derived chiefly from
reports and records of the Public Housing Administration.
Business dwelling-rent receipts are calculated as the sum of (a) real estate
corporation apartment building rentals; (b) other dwelling rentals received
by real estate corporations, and dwelling rentals of insurance companies; (c)
dwelling-rent receipts of corporations in banking, brokerage, and finance,
n. e. c ; (d) for all other corporations, an arbitrary five percent of their total
rent receipts as reported for income tax purposes; and («) for each of these
groups of industries, the same percentage of noncorporate as of corporate
total rent receipts. A special tabulation of about 500 returns selected at
random from the Survey of Residential Financing lent some support to the
total so derived, by confirming the indicated relationship of business to nonbusiness rentals from housing.
(a) For corporation-owned apartments, the base-year estimate was obtained by a reconciliation of total rent receipts shown on real estate corporation income tax returns for 1937, which excluded apartment buildings,
with those shown on returns for 1938, which included them. This estimate
was extrapolated over the 1929—41 period by total rent on multifamily dwellings. For 1942 and later years, it has been extrapolated in combination with

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS

the remainder of real estate corporation dwelling rentals (see (£)), as a variable percentage of total rental receipts of all real estate corporations filing
income tax returns. The percentage distribution of such corporations' rentals
between dwelling and nondwelling properties has been moved forward from
the 1941 benchmark by use of data reported in Moody's Manuals of Finance,
Insurance and Real Estate for corporate lessors of each type of property.
(b) The estimates of insurance company dwelling rentals and, for 1929-41
only, those of nonapartment dwelling rentals of real estate corporations utilize
tax return data to determine total rent receipts, which are distributed between residential and nonresidential by use of reported figures on value of
life insurance companies' investment holdings of dwelling and nondwelling
real estate.
(c) An analogous method is applied for banking, brokerage, and finance,
n. e. c , using reported data on types of bank-owned realty. Part (d) requires
no comment, and the noncorporate totals required for (e) are benchmarked
on Federal tax return data for sole proprietorships and partnerships and
extrapolated by the corporate series for the respective industries.
The resulting series for dwelling rental receipts of business is used in two
connections—as a deduction from total nonfarm dwelling rents in arriving at
dwelling rental receipts of persons, and as the basis for the estimates of
business firms' expense on rental housing, which are deducted from total
nonfarm dwelling landlords' expenses in arriving at dwelling rental expenses
of persons. For the latter purpose, the business receipts series is multiplied by
suitable corporate expense ratios. Separate ratios are calculated for interest,
depreciation, and the sum of all other expenses.
These expense ratios, and the corresponding ratios mentioned below for
the nondwelling properties of realty corporations, are based on a special
analysis of the corporate data, as follows.
Tabulations from the income tax returns of corporate owner-operators and
lessors of real property permit estimation of these corporations' rental income and associated expenses, but for dwelling and nondwelling properties
combined rather than separately. To distribute their rental income by property type, the relevant estimates described under (a) and (b) above are taken
as measuring the residential portion; and the difference between these and
the tax-return-based total is taken as a measure of the nondwelling portion.
Detailed expense ratios are derived, for dwelling properties and for nondwelling properties separately, from annual income statements appearing in
Moody's Manuals for a sample of several hundred concerns specializing in
one or another of the two types. These ratios are applied to the respective
rental receipts series to obtain estimates, for dwelling and for nondwelling
properties separately, of the dollar amounts of each expense item incurred
by realty corporations. Finally, the expense estimates so obtained are adjusted pro rata to the corresponding item totals from the tax return data for
both sorts of property combined. Expense ratios implied by these final adjusted estimates are attributed to business-enterprise lessors generally.
Expenses on public housing, like rental receipts, are estimated from fiscal
reports and accounting records.

Net royalty receipts
These are estimated annually by use of Federal income tax return data, on
the assumptions that (1) the ratio of royalty receipts to nonfarm nonresidential rental receipts is the same for persons as for corporations, and (2) the
ratio of net to gross royalty income is the same for persons as for corporations
specializing in royalty-yielding investments. Preliminary estimates for the
two most recent years, pending the availability of the tax return tabulations,
are made by extrapolation using a suitably weighted index of mineral production and an index of the net/gross ratio for nonfarm business and industrial
property.
Since the basic use made of these estimates of net royalties is in the allocation and extrapolation of the net rents and royalties total derived from the
individual income tax returns, any error in the 1941 level is balanced by an
opposite error in the benchmark level of persons' net rent from business and
industrial property. The net effect of any such error is therefore to mis-weight
the extrapolator series.

Rent on business and industrial property
In estimating net rental income of persons from nonfarm business and
industrial property, individual income tax return data for 1941 were adjusted

for coverage and concept and to eliminate net rent from nonfarm dwellings
and net royalties, as shown in Exhibit 2 above. The resulting benchmark has
been extrapolated as the difference between annual estimates of gross rental
receipts and of expenses. The calculations involved are illustrated in Exhibit 4,
Exhibit 4.—Persons' Net Rents from Business and Industrial Property,
and 1950

1941

[Millions of dollars]
Item

1941

1950

Rent on nonfarm business and industrial property:
3,681
1,360

4. Less: P E R S O N S ' E X P E N S E S as landlords of nonfarm business and industrial property
5. Equals: PERSONS' N E T R E N T S from such property-.

6,907
2,654

2,321

1. Paid by business and government
2. Less: Received by business and government-.
3. Equals: GROSS R E N T A L R E C E I P T S OF P E R S O N S from
nonfarm business and industrial property.
-

4,253

1,831

2,606

s 490 i

1,647

1. Derived as line 3 less line 5, in 1941 only.
2. Benchmark estimate based on data from Federal individual income tax returns. See
Exhibit *.

Gross rental receipts of persons from nonfarm business and industrial
property (line 3) are estimated by a residual method: business enterprise and
government rent receipts other than from dwellings and farm property (line
2) are subtracted from business enterprise and government rent payments
(line 1). Of the series used in this calculation, total business enterprise rent
receipts and payments are estimated primarily from Federal income tax
return data for corporations, partnerships, and sole proprietorships. Total
government rent receipts and payments are estimated from the Federal
Budget and fiscal reports of sample States and municipalities. Dwelling rent
receipts by government and business are derived as indicated above (in the
discussion of line 11 of Exhibit 3) and netted out of their total receipts. Rents
on farm property, likewise netted out, are estimated partly from government
fiscal records and partly by use of percentages from a 1945 study of a sample
of 150,000 farm owners.
Persons' expenses (line 4) were estimated for 1941 as persons' gross receipts
(line 3 obtained as described above) less their net rents (line 5 derived from
tax data as shown in Exhibit 2). This benchmark is broken down by categories
of expense, which are extrapolated by the corresponding expenses of corporate lessors of such property, adjusted in four steps as outlined below. The
estimates for persons' rental housing and for realty corporations' dwelling
and nondwelling property, which are introduced at various stages of the
procedure, have already been described. The sum of the extrapolated expenses is then deducted from persons' gross rental receipts to yield annual
net rental income of persons from nonfarm business and industrial property.
(1) To allow for the difference in expense patterns between personal and
corporate landlords, the itemized estimates of expenses for corporations
handling business and industrial property are multiplied for each year by
the ratios of persons' to corporations' expense for the same items in connection with rental housing.
(2) The resulting values were summated for 1941, and adjusted pro rata
to the global benchmark total for persons' expenses on business and industrial
property shown in Exhibit 2, line 4. The adjusted amounts were taken as
representing a breakdown of this global benchmark total.
To extrapolate them to other years, the unadjusted series obtained in the
first step are (3) adjusted for all years by the same percentage found necessary
for 1941 in the second step and (4) corrected for the difference between the
movements of personal and corporate rental receipts.
Adjustment (4) is necessary because the original series tended to vary
directly over time with the ratio of personal to corporate rental receipts from
housing, and did not reflect variations in the ratio of personal to corporate
rental receipts from business and industrial property. Each expense series
is accordingly divided by the former ratio series, based on 1941 as 100, and
multiplied by the latter, similarly based.
Tax return data become available at intervals of varying length for the
various items used in estimating net rent on business and industrial property.
Annual tabulations from corporate income tax returns are completed only
after a lag of 3 years; and periodic tabulations from individual and partnership tax returns must be extrapolated over periods ranging up to 4 or 5 years.

NATIONAL INCOME, 195 4 EDITION
The extrapolations necessitated by these lags have generally been based for
corporations upon samples of published corporate financial statements and
upon indexes of employment, payrolls, or industrial production; and for
noncorporate business, upon the rent series for corporations in the same
industries.

2. Owner-Occupied Nonfarm Dwellings
Imputed income derived from owner-occupancy of nonfarm dwellings
made up nearly two-fifths of total net rental income of persons in 1950, and
a somewhat smaller fraction in most of the earlier years. This imputed income
item is defined as the gross return which the owner-occupants of nonfarm
dwellings could theoretically have realized had they offered their houses for
rent, less their expenses. The implied option is considered from the standpoint of the individual owner-occupant, but without regard to any special
treatment accorded under rent control legislation to dwellings previously
owner-occupied.
In general, the methods used to estimate the imputed item of rental income
as well as the corresponding consumer expenditure component, Space rental
value of owner-occupied nonfarm dwellings, parallel those discussed above for

rental housing in the use of population census benchmarks, periodic sample
surveys, and the Rent Index. Even the statistical problem of facilities included in rental value occurs with owner-occupied as well as with rented
dwellings, since the 1940 Population and Housing Census, which provides
the sole benchmark for rental value of owner units, reported such value
inclusive of cookstove, refrigerator, and (for multifamily structures) any
utilities included in rent of other dwellings in the same structure.
Accordingly a separate description of the methodology underlying the
imputed rent estimates is not given. Only two points of difference between
imputed and contractual rent estimation need be noted. First, in the case of
owner-occupied dwellings it is unnecessary to allow for ownership by landlords other than persons. Secondly, the estimation of mean contract rental
value per unit is complicated for owner-occupied dwellings both by a relative paucity of data and by the more subjective character of such data as
exist.
The benchmark data for mean rental value of owner-occupied units are
estimates for the individual dwellings reported in the 1940 Census of Population and Housing. Enumerators were instructed to base the estimates on
rents actually being charged for similar dwellings in the neighborhood. In
deriving the benchmark means from these data, a systematic downward adjustment, amounting to about 2 percent, was made to eliminate the apparent
effect of enumerators having occasionally used a rule-of-thumb ratio to
market value in estimating rental value.
A direct estimate was also developed for 1930, based on Population Census
value data for that year used in conjunction with value-rent relationships
indicated by the 1940 Census. Estimates for 1932 and 1933 are extrapolations
from 1930 by data for 22 cities from the Financial Survey of Urban Housing.
They reconcile very closely with the results of extrapolation back from 1940
by series underlying the Rent Index compiled in the Bureau of Labor
Statistics.
Estimates of rental value for 1944 and 1945 were obtained by extrapolation
from 1940, as follows: (a) The mean rental value of all occupied units combined (rented as well as owned) was extrapolated by mean rent for rented
units, which in turn had been estimated from Census Bureau sample data;
(b) the means for all occupied units and for rented units were multiplied
respectively by the corresponding numbers of units, and (c) the products
were differenced to secure aggregate rental value of owner-occupied units.
This procedure was adopted primarily to take account of the effect of the
shifting of units from rental to owner-occupancy.
Mean rental values for 1947 and 1950 were estimated by extrapolation
from 1945, separately for urban and rural nonfarm owner-occupied units,
using the corresponding means for tenant-occupied units as extrapolators.
For other years, compilations made by the Bureau of Labor Statistics for
its Consumer Price Index have served as the chief basis for interpolating
and extrapolating mean rental value. The compilations used for 1935-39
were indexes of rent by rent ranges. Other interpolation estimates are based
in most cases on the published Rent Index.
For all years, the aggregates relating to owner-occupied units have been
increased by small allowances for summer homes and other dwellings temporarily unoccupied but held for the owners' use.
901«Q9°

3. Farm Realty
The basic series used in estimating net rent from farm property are prepared by the Department of Agriculture, using the data-collecting system
and some of the specific estimates described in the section on Income of unincorporated enterprises. In conformity with the Department of Agriculture
treatment, all farm net rents received by or imputed to landlords living on
farms are regarded as incident to the business of farming, and hence are
included in national income under the heading of net income of unincorporated (farm) business rather than under the heading of rental income of
persons. The magnitudes involved in the 1950 rent estimates are as follows:
Exhibit 5.—Persons' Rentals from Farm Property,

1950

Item

Millions
of dollars

1. Gross farm rent and Government payments to landlords

2,920

2. Less: Rent payable to farmer landlords, nonfarm business, and government -

1,053

Equals: Gross rental income of persons from farm property
3. Less: Expenses of personal landlords
4. Equals: Net rental income of persons from farm property

1,867
773
1,094

1. Gross rent payable to landlords includes crop share, livestock share,
and cash rents. It is estimated by the Production Economics Research Branch
of the Department of Agriculture from acreage and production statistics,
using relationships from Agriculture Census reports, Crop Reporter data,
and a special survey for 1936 of a sample group of 15,000 reporting landlords.
As used by the National Income Division, the series also includes income from
Government payments made to landlords qua landlords (as distinguished from
payments made to farm operators as such).
2. The distribution of the total by landlord groups is based on data from
the 1936 survey mentioned above and from over 150,000 returns to a 1945
survey. A primary distribution between landlords living on farms and other
landlords is calculated by the Department of Agriculture from these surveys,
and ratios from the 1945 survey are used by the National Income Division to
break out nonfarm business and government tent receipts for that year from
the total going to landlords not living on farms. For other years, the business
and government receipts are extrapolated by government fiscal and corporate tax return data.
3. Landlords' expenses represent those shares of farm overhead and production expense items such as taxes, depreciation, repairs, insurance, fertilizer, and seed (see discussion of farm proprietors in the section on Income of
unincorporated enterprises) which are borne by personal landlords. The total
paid for each item is allocated first between rented and owner-occupied
farms, generally by use of acreage or property value ratios derived from the
quinquennial Census of Agriculture. The major expense items involved for
rented farms can be assumed to be paid by the landlord rather than by the
tenant. Seed, fertilizer, and binder twine, however, illustrate a different
treatment, lessors being estimated to pay a fraction of these determined by
the ratio of share-cropped acreage to total crop acreage. The amounts of expenses ascribed to landlords are prorated between landlords living on and
off farms in proportion to the land owned by each, as indicated by the 1936
and 1945 surveys. Finally, expenses of landlords living off farms are prorated
between persons and nonpersonal landlords by use of the corresponding distribution of rental receipts described above.

Characteristics of the Revisions
As has been indicated above, the rent estimates are based upon a wide
variety of sources, many of which are nonrecurrent, or become available infrequently and irregularly or with substantial delay.
To the extent that the estimates of rents rely on corporate income tax data,
the figures for the two most recent years published each July are subject to
revision. However, revisions may extend further, for instance when new
benchmark data lead to the substitution of interpolations for previous extra-

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS

polation procedures over a number oi years. Important changes of this type
have resulted from the incorporation of data from the 1950 Census of Population and Housing, the Survey of Residential Financing, and the 1949-50
Dwelling Unit Surveys and Survey of Consumer Expenditures in 1950 by
the Bureau of Labor Statistics.
In addition, Part V of the present supplement incorporates substantial revisions made when preliminary estimates based on a more summary methodology were replaced by the results of the detailed calculations described
above. Further details of the new estimates were published in the June 1953

For a number of industries (particularly in manufacturing), the comparability of the 1929—47 estimates with the estimates for later years is impaired
as a result of changes in the industrial classification of basic data supplied by
the Internal Revenue Service. (See introduction to Part III.) Where quantitatively important discontinuities are involved, their nature and magnitude
are indicated by footnotes to table 18 of Part V of the present report.
In the following pages the base year estimates and their current extrapolations will be discussed in turn.

issue of the SURVEY OP CURRENT BUSINESS.

Base Year Estimates
All of the adjustments made in the tax return data are indicated in table
38, Part V. Exhibit 1 below lists for the year 1950 those which involve no
estimation, the required values being shown separately in the tax return data
or reported elsewhere on a complete basis. Further adjustments which must
5. CORPORATE PROFITS
be made using estimated values are shown in Exhibit 2.
The "Totals as reported" from tax returns are tabulated by the Internal
The basic data underlying the estimates of corporate profits are the annual
Revenue Service as Compiled net profit, Total tax (consisting of Federal intabulations of corporate income tax returns compiled by the Internal Revcome and excess profits taxes), and Dividends paid in cash and assets other
enue Service. The tabulations are available, for the most part, from its
than own stock, respectively. These totals provide the starting points for
annual Statistics of Income—Part 2, or are taken from the "Source Book", un- the estimates described in the present section.
published volumes supplementing Statistics of Income with more detailed information.
These data are sufficiently complete and reliable to overcome many of
Exhibit 1.—Adjustments Not Requiring Estimation in the Derivation of
the difficulties which are inherent in the estimation of profits. Filing of deCorporate Profits Before Taxes, Profits Taxes, and Net Dividend Payments, 1950
tailed returns is mandatory, and the returns are prepared in the knowledge
[Millions of dollars]
that they are likely to be audited. Although the measurement of profits involves many conceptually difficult problems, the imposition of administrative
Profits
Profits
Dividend
Item
rules and regulations during the long time period over which the Internal
taxes
payments
before taxes
Revenue Service reporting system has been in operation has gone far toward
Amounts derived from tax returns:
standardizing accounting practice for corporate income tax reporting.
17,317
Totals as reported
_ .
42,831
11,553
On the other hand, certain important problems still arise in the translation
Adjustments:
of the tax return data into estimates of corporate profits for national income
Domestic dividends received
-2.460
-2,460
-644
-644
Foreign dividends received_
purposes. The data must be adjusted in various ways to secure comparabil+1,709
ity with other entries in the national income and product tables. One of these
Depletion
_. __ _.
..
adjustments, in particular, involves a considerable amount of estimation—
Net capital gain
-1,129
-639
Net gam, sales other than capital assets
.
allowance for the additional profits disclosed by auditing. The auditing
+223
Net loss, sales other than capital assets
process to which returns accounting for the bulk of profits in any year are
Mutual nonlife insurance companies
-38
-16
+10
subjected requires about 15 years to complete, and its ultimate, full effect
-467
Foreign income taxes
_.
in revising the profits figures originally tabulated must be estimated from
reports of its progressive effect on tax liability as the auditing proceeds.
+197
+195
Amounts reported by Federal Reserve System.
+4
There is a time lag before the tax return data become available. This neces17,031
40,148
Totals from tax returns, as adjusted.
8,463
sitates reliance on extrapolation procedures to obtain estimates for the two
most recent years. As is indicated at the end of this section, such extrapolations have at times led to errors of significant size, particularly on an industry
Dividends received are deducted from profits and dividends to obtain unbasis. The situation in this respect has improved, however, due to progress
duplicated totals reflecting income originating in United States corporate
in the current reporting of corporate profits through the joint surveys of the
production; depletion is added to profits since it is not regarded as an element
Securities and Exchange Commission and the Federal Trade Commission.
of capital consumption in the national income and product accounts; and
These surveys have provided improved data on manufacturing since 1947.
capital gains and losses are eliminated from profits as not measuring incomes
The corporate profits estimates are classified industrially on the basis of
arising in current production.
companies, or firms, rather than establishments. As discussed briefly in the
The adjustment for mutual nonlife insurance companies will be commented
Introduction to this Part, this results in non-comparability with the income
upon in connection with a similar adjustment in Exhibit 2 for mutual life
shares that are classified on an establishment basis. The most serious pracinsurance companies. The adjustments for foreign dividends received and
tical limitations in this connection arise in the comparison of payrolls and
foreign income taxes paid also will be discussed under Exhibit 2, in connecprofits in certain industries.
tion with related international adjustments.
Use of the company, as against the establishment, as the unit of classificaFinally, reported data for the Federal Reserve Banks are added, since they
tion leads to an industrial distribution further removed from a product, or
are not included in the basic Internal Revenue Service tabulations. Reserve
activity, basis. This is so because the operations of companies are generally
Bank profits are measured by current net earnings, exclusive of capital gains.
more heterogeneous than those of establishments. Consequently, with comTaxes are measured by payments to the United States Treasury in lieu of
panies assigned to specific industry groups on the basis of their major activity
franchise tax, at a rate of about 90 percent on a base consisting of net earnas measured by receipts, there is more likelihood that movements in the
ings (including capital gains) less dividends paid.
industry series will reflect changes in classification of firms due to marginal
In addition to these adjustments, there are others which are made by use
changes in the composition of their activity, rather than substantive changes
of estimated rather than reported values. These are itemized in Exhibit 2.
in the type of industrial activity indicated by the industry designation. Special cases of shifts of this type resulted from Federal tax legislation affecting
the filing of consolidated and unconsolidated returns. In this respect, the inAudit adjustment
dustry breakdown of corporate profits in the periods 1929-33 and 1942 to
date is not strictly comparable to that for the years 1934-41, when, with cerThe tax return data shown in Exhibit 1 are compiled from the returns
tain exceptions, filing on an unconsolidated basis was required.
before audit. The first adjustment indicated in Exhibit 2 is the addition of the

NATIONAL INCOME, 195 4 EDITION

estimated profits and tax liability disclosed through subsequent audits by the
Internal Revenue Service. It should be noted that not all returns are audited,
and that even in the audited returns there may remain some understatement
of profits.
Furthermore, the national income estimates of the actual results of audit
are subject to error because they must be based on data rather unsatisfactory
for the purpose. In the first place, the auditing process is far from complete
for many of the years for which estimates must be made. Secondly, the results
of audit are reported in terms of the effect on tax liability only, and the effect
on total profits must be estimated from this.
The estimating procedure is carried out in three steps. The first is to determine the effect on tax liability to date of the auditing process for the given
tax year. Increases in tax liability are estimated by cumulating the gross
additional tax assessments made on that year's income by the end of the following June, by the end of the second following June, and so on up to the
latest reported. Since in some cases the audit process leads to a reduction in
tax liabilities, the indicated reductions must be derived and cumulated in
like manner. Their annual total is derived as the sum of refunds, credits,
and abatements.
The second step is to add the expected results of further auditing of returns
for the given tax year. These are estimated by applying experience-based
ratios to the totals obtained in the first step. The case of the tax year 1948 will
illustrate the method. At present (July 1954), data available for the first step
provide measures of the additional taxes assessed and original overassessments
found against 1948 income as a result of about 3 years of work by the auditors. Study of the auditors' rate of progress in auditing returns for earlier tax
years indicates that the fourth year of the process is likely to add about 24
percent to the gross additional assessments made in the first 3 years; the fifth
year is likely to add about 17 percent to the initial 3-year total; and so on.
Cumulating the percentages forward suggests that future auditing of 1948
tax returns may add about 76 percent to the gross additional assessments
already reported due to audit. The estimate obtained in step 1 is accordingly
raised 76 percent. The initial estimate of tax liability reductions is similarly
raised by the application of experience-based ratios. The net balance of additional assessments over reductions is taken as the audit adjustment applicable
to the tax liability total which was originally tabulated for Statistics of Income
from the 1948 tax returns.
The third step is to calculate the additional profits implied by the estimated
net additional tax assessments. The latter total is divided by the statutory
tax rate (representing a marginal effective rate) to derive the corresponding
figure for additional profits.

Exhibit 2.—Adjustments Requiring Estimation in the Derivation of Corporate Profits Before Taxes, Profits Taxes, and Net Dividend Payments,
1950
[Millions of dollars]
Profits
before
taxes

Item
Totals from tax returns, as adjusted per Exhibit 1...

...

Foreign income tax on dividends
Mutual life insurance companies

40,148

17,031

+556

Adjustments:
Profits disclosed by audit
"Rest of the world" adjustment

Profits
taxes

Dividend
payments

+207

+376
—226

8,463

+426
+241

-1,654

-59

+770

39,970

17,829

+77

-120
Final estimates

9,207

Besides revising upward the gross total of positive profits, the audit process
affects the all-corporation net total by revising downward the deficits of some
corporations. An allowance for this effect—amounting to about $100 million
a year in recent years—is made by including in the audit adjustment (1) an
estimate of the total of deficits originally reported by companies found upon

audit to have had taxable net income, and (2) an equal amount for deficits
reduced but not eliminated. Estimate (1) is based on tabulations by deficit
size class for selected years. Estimate (2) is arbitrarily made equal to (1).
Special complications have occasionally been introduced into the first and
third steps described above, mainly as a result of tax legislation in connection
with World War II and the Korean war. For the first step, adjustments
were made in the basic tabulations to eliminate the effects of recomputing
emergency amortization charges, and the effects of the carrybacks of net
operating loss and of the unused excess profits tax credit. The adjustments
applied to profits and/or taxes for these items are derived independently of
the audit adjustment, as indicated later in this section. Similarly, the effects
of the credits for debt retirement and postwar refund (under the World War
II excess profits tax) were eliminated, since tax liability is measured net of
these credits in the national income accounts.
For the third step, it was generally necessary to utilize separate estimates
of income tax assessments and excess profits tax assessments, and separate
estimates of marginal tax rates.
The results obtained by the auditors during the first three or four years
after the returns are filed are believed to provide a fairly adequate basis for
applying the method that has been outlined. For more recent years, the audit
adjustment must be based largely on judgment.

Adjustments for international flows
The international adjustments listed in Exhibits 1 and 2 are designed collectively to yield: for profits, an aggregate which includes profits and dividends
received from abroad but excludes profits and dividends paid to abroad; for
dividends, an aggregate which includes dividends received from abroad but
excludes dividends paid to abroad; and for taxes, a measure of liability to the
United States Government.
For profits, the tax return data as adjusted in Exhibit 1 exclude (1) the
dividends received by United States stockholders of foreign corporations. On
the other hand, these data include (2) dividends accruing to foreign stockholders of United States corporations and (3) profits to foreign corporations
from their branches in the United States. The "Rest of the world" adjustment added to profits in Exhibit 2 is a correction for all three of these characteristics of the data.
It is calculated as the total inflow of dividends (item 1 above) less the sum
of dividends paid to foreigners (item 2 above) and profits of foreign corporations' United States branches (item 3 above). All of the items in the adjustment are measured net of income taxes levied by the payer country, in accordance with the definitions used in calculating net foreign investment. The same
definitional principle requires that foreign taxes be netted out of the income
earned by United States corporations from their branches abroad; this is not
done in the tax return data and is accomplished by the second international
adjustment to profits shown in Exhibit 2.
For profits taxes, foreign taxes on both branch profits and dividends are
deducted (in Exhibit 1) from reported Federal tax liability, against which
they constitute a credit.
For dividends, the tax return data as adjusted in Exhibit 1 have three inappropriate characteristics. They exclude dividends received by United
States stockholders from foreign corporations. They include dividends accruing to foreign stockholders of United States corporations. Finally, they are
understated by the amount of foreign taxes on United States corporations'
dividend receipts, which have been netted out along with the dividend receipts themselves since the latter are reported (and deducted as in Exhibit 1)
gross of such taxes. In Exhibit 2, the "Rest of the world" adjustment (calculated as the total inflow of dividends less dividends paid to foreigners) and the
adding back of foreign income taxes paid by United States corporations or>
dividend receipts from abroad together correct for these characteristics.
Of the series entering into these international adjustments, foreign income
taxes are measured by the tax credits claimed on the corporate tax returns.
The series composing the rest-of-the-world adjustment are prepared in connection with the balance-of-payments estimates of the Office of Business
Economics. (See section on Net foreign investment.) The distribution of
foreign income taxes between taxes on branch profits and taxes on dividends
is based on the relative proportions of branch profits and dividends earned
from abroad.

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS

Exclusion of mutual insurance companies
Mutual companies are not considered part of the corporate universe for
national income purposes, and it is therefore necessary to remove from the
tax return data the values included for mutual insurance companies. For
mutual nonlife companies, the amounts to be removed are reported separately
by the Internal Revenue Service and are used as shown in Exhibit 7. Tax return data for mutual life insurance companies are tabulated in combination
with the data for stock life insurance companies, and must be isolated statistically to permit the adjustments for them shown in Exhibit 2.
The amount of the adjustment to corporate profits before tax is calculated
by subtracting an estimate of stock life company profits from the total of life
insurance company profits given in the tax return data. The required series
for stock life company profits is estimated as the sum of cash dividends paid
and Federal income tax liability less stock life company receipts of dividends.
The dividend payments and tax liability of life insurance companies as reported to the Internal Revenue Service have generally been applicable to
stock companies only. In the most recent years, reported tax liability has included amounts for mutual life companies as well. Estimates of these have
been excluded from the reported tax liability of life insurance companies in
this adjustment, and are also deducted from total corporate tax liability as
shown in the second column of Exhibit 2. The dividend receipts of the stock
companies are computed as 20 percent of the total dividend receipts reported
on life insurance company tax returns, the ratio being based on a special
tabulation from reports compiled by the Spectator Company for its Insurance
Yearbook.

The adjustment shown in the final column of Exhibit 2 for insurance companies represents the remaining 80 percent of the reported dividend receipts
of life insurance companies. These are ascribed to mutual life carriers, and
added back to net dividends to cancel the effect of their inclusion in the corporate dividend receipts previously deducted. The original overall deduction
and the corresponding adding back of dividend receipts of mutual nonlife insurance companies are shown in Exhibit 1.

Adjustments not applicable to 1950
A number of adjustments not applied for 1950 had to be made in the Internal Revenue Service data to derive profit estimates for other years. (See
table 38.) These included corrections for gross renegotiation refunds, emergency amortization acceleration, war losses, and the unjust enrichment and
Vinson Act excess profits taxes.
Renegotiation of war contracts led to refunds by the contracting corporations which reduced their profits and their tax liability from the amounts
originally reported, mainly for the war years. The totals tabulated from the
tax returns originally filed were adjusted accordingly, by use of special tabulations published in Statistics of Income for the years in which the item was
quantitatively important.
When World War II ended and emergency amortization charges on defense-connected facilities were recomputed retroactively (see section on Capital consumption allowances), both profits and tax liability for the war years
were reduced by comparison with the amounts originally reported. The effect
on tax liability for each of these years was estimated by use of data and procedures similar to those described above for carryback tax refunds. To determine the corresponding effect on depreciation charges and consequently
on before-tax profits, the annual adjustments in tax liability were divided by
the marginal tax rates as in the third step of the audit adjustment.
The tax return data on profits, for 1942 particularly, were net of deductions claimed by some corporations for losses due to enemy capture of properties they owned abroad. A minimum allowance for such losses was estimated
from the published income statements of United States corporations believed
to have such foreign holdings. This allowance was added back to profits as
reported in the tax return data, to bring the treatment of the losses involved
into conformity with the treatment of capital losses generally.
The unjust enrichment and Vinson Act excess profits tax collections reported by the Treasury Department were allocated to the years in which the
liabilities were estimated to have accrued, and were added to the profits tax
series for those years.

Industry breakdown of estimates
State income taxes
State income taxes are among the deductions made by the taxpayers in
arriving at the profits figures shown in the Internal Revenue Service tabulations, but are not shown separately from other taxes in these tabulations and
must therefore be ascertained from other source materials. For 1937 and subsequent years use has been made of statistics compiled by the Governments
Division of the Census Bureau on collections reported by the various State
governments under their corporation income tax laws. The total so reported
for each year has been taken as a measure of the tax liability incurred in the
preceding year, to obtain the amount of the adjustment illustrated in Exhibit
2. For the years prior to 1936, the adjustment was estimated from a sample
including States which in 1939—42 assessed about half of the national total of
such taxes. The raising ratio applied to the sample data was varied annually
to allow for the adoption of corporation income taxes by additional States.

Carryback tax refunds
These have been occasioned by statutory provisions allowing unused excess
profits tax credits and net operating losses for a current year to be carried back
and applied in recomputing the tax liability of a previous year or years.
The adjustment of tax liability to allow for reduction from this cause represents the reported amount of "tentative adjustments" claimed by the taxpayers, plus an estimate of the additional carryback refunds found by the auditors to be due. (As noted above, these refunds are not considered in making
the regular audit adjustment.) The latter estimate is based on Internal
Revenue Service tabulations for selected years, and is derived by a formula
similar to the first two steps of the audit adjustment described above. The
effect of auditors' disallowance of tentative claims is reflected in the regular
audit adjustment.
For the latest years covered by the tax return tabulations, the total of
"tentative adjustments" claimed to date provides the basis for preliminary
estimates of the carryback adjustment.

In the derivation of corporate profits, taxes, and dividends by industry,
such of the adjustments in Exhibits 1 and 2 as are applicable to more than one
industry are made separately to the respective Statistics of Income industry
benchmarks. The corrections illustrated in Exhibit 7 are generally available
in the required industry detail, with the exception of the item for foreign
income taxes which appears also in Exhibit 2. For those in Exhibit 2, the
relevant all-industry totals are distributed as follows: the audit adjustments,
proportionately to income and excess profits taxes as originally reported;
foreign income taxes, proportionately to foreign dividends and branch profits
received; and State income taxes, proportionately to Federal corporate income taxes.
Further adjustments are made in the industry estimates so derived to improve their industrial comparability. They deal with changes made by the
Internal Revenue Service in its classification system from time to time (mainly
in 1938), and, less important, with categories of firms whose precise industrial
attachment is not determined by the Internal Revenue Service.
Changes in the classification system cause minor industries previously tabulated under a major industry heading to be transferred to another heading.
Generally the resulting discontinuity is eliminated by transferring the prioryear values for the minor industry to the new heading. If the minor industry
values to be transferred are not reported separately for all years, those for the
missing years are estimated by extrapolation using the broader industry series
which contain them. Such statistical procedures, however, could not effectively be applied to correct the noncomparability introduced into several of
the manufacturing series by adoption of the new classification code in 1948.
To eliminate the "not allocable" categories in the industrial breakdown of
the tax return data, the values in these categories are generally prorated by
the corresponding values in the industries among which the "not allocable"
totals are to be distributed.
With the principal exception of industry series affected by the 1948 industrial classification change, formal comparability over time in the individual
industry estimates has thus been secured by reasonably satisfactory methods.
The more fundamental difficulties affecting comparison, for which no adjustment can be made, have been noted earlier.

NATIONAL

INCOME,

1954

EDITION

The measures of profits ("net income before Federal income taxes"),
Federal tax liability, and dividends in this survey are based on definitions
As indicated above, the tax return tabulations do not become available
similar to those used by the Internal Revenue Service except for the effects of
until more than 2 years after the year to which they refer. It is accordingly
(1) consolidated reporting and (2) more liberal rules in the survey for the
necessary to use extrapolation procedures to obtain the estimates of profits,
expensing of current additions to reserves. The chief variations between the
taxes, and dividends for the two most recent years. Extrapolators are applied
national income definitions and those used for the survey are therefore due to
to industrial benchmark estimates uncorrected for audit results, and an adthe items listed in table 38. The impossibility of adjusting for any of the
justment for audit results is then introduced into the resulting estimates.
latter (apart from the expected results of audit) inevitably introduces some
error into the estimates.
Although reporting corporations are classified by industry each year, the
Exhibit 3.—Components of Current Corporate Profits Estimates, by Basis
industry breakdown has some shortcomings, chiefly because of the general
for Extrapolation, 1950
use of consolidated returns for affiliated corporations.
In spite of these limitations, the Financial Report series provides extrapolaProfits before taxes
tors for these manufacturing industries substantially more reliable than those
Data used in extrapolation
Industry
(compiled from privately published financial statements as described under
Millions Percent
of dollars of total
3 below) used prior to the initiation of the Financial Report series in 1947.
2. Banking, transportation, and communications and public utility corAll industries, total, excluding Rest-of38,970
100
porations accounting for the bulk of the profits in their industries are subject
the-world.
1. Manufacturing, except newspaper Federal Trade Commission
23,025
69
to Federal regulation, and submit regular financial statements to the respecpublishing.
and Securities and ExchangeCommission, Quartive regulatory agencies—the Federal Deposit Insurance Corporation, the
tet ly Financial Repoit for
Interstate Commerce Commission and the Civil Aeronautics Board, the FedUnited States Manufacturing Corporations,
eral Communications Commission, and the Federal Power Commission. The
2. Banking; railroads, highway passen- Data reported to Federal
6,463
14
ger transportation, highway freight
regulatory agencies.
coverage of the data used in extrapolation for most of these industries is
transportation and warehousing,
consequently very good. On the other hand, neither the industry classificaair transportation, pipeline transportation; telephone, telegraph and
tion scheme nor the report forms can be made to match exactly the definirelated services; radio broadcasting
tions used in national income estimates; in some cases, there are important
and television; utilities: electric
and gas.
differences in concept or coverage. These discrepancies affect the level and
8. Mining; newspaper publishing; retail Tabulations of sample data
5,645
16
movement of the extrapolator series, and result in errors in the estimates
trade; real estate; hotels and other
from n o n g o v e r n m e n t
based on them.
lodging places, motion pictures.
sources.
3. For a number of industries covered neither by the Financial Report
4. Agriculture, forestry, and fisheries; Sales data and similar indi4.837
12
contract construction; wholesale
rect evidence.
series nor by reports to regulatory agencies, the estimates are extrapolated
trade; finance, excluding banking
and real estate; water transportawith the aid of sample data compiled from published financial reports of
tion, services allied to transporindividual companies. These samples include substantially every domestic
tation; local utilities and public
services, n. e. c ; services other
nonmanufacturing corporation for which the requisite data are published in
than motion pictures and hotels.
Moody's Manual of Industrial Securities. Nevertheless, their coverage is less
adequate in general than that of the data obtained from regulatory agencies^
and they fall short in coverage also of the manufacturing sample. Moreover,
The source materials available for the construction of extrapolator series
they are much less representative than the latter, since in general only large
may be classified into four categories. These are listed in Exhibit 3 together
corporations can be included. Their definitional comparability with the
with the industries for which they are used. The results of the individual
benchmark estimates is subject to the same general limitations as the extrapoindustry extrapolations are checked by, and occasionally modified in the
lators described under (1) and (2) above. Capital gains and losses, as well as
light of, independent estimates of total corporate profits derived from tax
charges to special reserves not allowable for tax return purposes, are elimcollection data. The estimates obtained by extrapolation and those based
inated to the extent permitted by the published details, in accordance with
on the tax data will be discussed in turn.
national income definitions. The results are tabulated and weighted in as
Estimates for the Rest-of-the-world industry, which is not included in
fine an industrial breakdown as the sample reports and the basic tax return
Exhibit 3, are discussed in the section on Net foreign investment.
tabulations allow.
Retail trade is by far the most important industry in this group, accounting
for about 60 percent of the profits listed in line 3 of Exhibit 3. Sample data on
Industry extrapolations of corporate profits
profits, dividends, and taxes are compiled for nine lines of trade (general mer1. The Quarterly Financial Report is by far the most important source noted chandise, food, apparel, furniture, autos and trucks, auto accessories, filling
in Exhibit 3, being used for manufacturing industries which accounted for
stations, drugstores, and restaurants) which together account for about fourmore than one-half the all-industry total of corporate profits in 1950. It is
fifths of total retail profits. For three other groups (auto repair shops; hardbased on regular reports from about 9,000 corporations in a sample drawn
ware, building materials, fuel and ice dealers; and a miscellaneous category),
primarily from among companies which filed 1949 Federal income tax rethe estimates are extrapolated by reference to sales series, with rough allowturns. The sample is stratified, and the sample data are expanded, in terms
ances for changes in profit-sales ratios.
of asset-size classes within each industry.
Published financial reports are available for about 200 corporations, which
Estimates for all manufacturing corporations with securities listed on an
together earned approximately 40 percent of total retail corporate profits in
exchange, and certain other registered concerns, are prepared in the Securi1950. Sample survey data compiled by various trade groups now provide
ties and Exchange Commission from reports filed by nearly all of such comsubstantial additional coverage for several lines of trade including general
panies. To adjust for any current nonreporting, these companies are crossmerchandise, apparel, furniture, and auto and truck dealers.
classified by industry and asset size, and the reported figures for each cell are
The coverage of the sample data varies widely among the nine lines of retail
multiplied by the ratio of the preceding-year assets of all registered corporatrade listed, depending in part on the prevalence of large corporations in
tions in the cell to the assets of reporting corporations in that cell. Estimates
each line. In general, benchmark profits for each line are extrapolated by
for unregistered manufacturing corporations are prepared in the Federal
the product of sample-based profit-sales ratios and sales indexes based on
Trade Commission, by multiplying the data for reporting corporations in each
estimated retail sales in each line of trade. (See section on Personal consumpasset-size class in each industry in the sample by the ratio of the estimated
tion expenditures for commodities.)
total number of unregistered corporations currently in that cell to the total
Adequate sample data on profits are not available for the other three trade
number reporting. A sample of nonrespondents for each quarter is queried
groups. Sales estimates are obtained, separately for each group, by extrapoto determine the effect of bias introduced in the statistics because of nonlating benchmark sales, as tabulated in the corporation income tax returns,
response.
by the corresponding components of total retail sales. Profit-sales ratios are

Recent Year Estimates

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS

obtained by moving the benchmark ratios by reference to the movement of
sample-based ratios in other lines of retail trade, and on the basis of available
limited information from trade sources.
It may be noted that the inclusion of these residual parts of retail trade in
line 3 of Exhibit 3 is somewhat arbitrary and dictated largely by expositional
convenience. The methodology is very similar to that applied to wholesale
trade, which is listed in line 4 and discussed below.
Retail (and wholesale) trade profits estimates for the year 1952 shown in
Part V were extrapolated from 1951 with the aid of sample series, unfortunately not continued in 1953, from the Quarterly Financial Report.
Other major components of the total in line 3 of Exhibit 3 are mining and
real estate, which account respectively for about 25 percent and 10 percent
of this total. The sample used in extrapolating each includes more than 100
companies. Both samples are unavoidably biased toward corporations
whose stock is not closely held.
Similar comments apply to the sample for newspaper publishing and in
lesser degree to that for motion pictures. Tabulations by the accounting firm
of Horwath and Horwath, based on reports from about 100 hoteb in more
than 50 cities, provide the indicators used for the hotel industry.
4. The final category of industries distinguished in Exhibit 3 consists of
those for which little or no current data on profits are available. For these
industries, base year profits estimates are extrapolated by tenuous procedures
involving, in general, indicators of total sales adjusted to allow for probable
changes in profit ratios.
Wholesale trade is by far the most important of these industries, accounting
for about three-fifths of the total in 1950. The basic estimate of corporate
sales is extrapolated by the sales of merchant wholesalers. The sources and
methods for estimating this sales series are the same as those for wholesale
inventories, summarized in the section dealing with the change in business
inventories. A basic ratio of profits to sales for corporate wholesalers is derived
from the income tax return data and extrapolated by reference to various
indicators including the corresponding sample-based ratio series for retail
trade. The resulting ratio series is applied to estimated corporate wholesalers'
sales to derive corporate profits.
For other industries in this group sales data are in general less adequate
than for wholesale trade and use is sometimes made of other indicators of
gross business volume such as payrolls. Applicable profit ratios are estimated
in principle by means of regressions of profits against these indicators based
on past experience.

Industry extrapolations of profits taxes and net dividends

than that of the corresponding profits series, because many corporations
report their dividends but not their profits.

All-industry estimate based on tax collections
The profits estimates obtained for the two latest years through industryby-industry extrapolation as described above are summed to obtain a tentative aggregate for all industries combined. This aggregate is checked, and
in some cases modified, by reference to an independent estimate of total
corporate profits based on collections of current Federal corporation income
taxes. These data are available with little time lag. The procedure followed
in deriving this estimate may be summarized in terms of five steps.
The first step is to estimate tax liability for the given year from tax collections for the following year, by use of an experience-based ratio. Liability for
the most recent past year must be estimated from tax collections made in
the current year, which are still incomplete. Collections reported to date in
the current year are raised to a full-year basis by use of past patterns.
The second step is to divide the estimated tax liability by an effective tax
rate, to obtain a figure for taxable net income of all corporations having net
income. The effective tax rate is determined from tax return data for the
recent years for which such data are available, and is projected forward with
adjustments to take account of changes in statutory tax rates.
The third step is to estimate and to deduct the total net deficit of corporations having no net income, since for national income purposes corporate
profits are calculated net of corresponding losses. The net deficit is estimated
by projection from recent years for which tax return data are available, its
movement being determined in the light of the total obtained in step (2) and
the relationships between the two series shown in the tax return data for
earlier years.
Taxable income of all corporations, as derived in step (3), is next increased
by estimates of tax-exempt interest income, the amount of prior-year operating loss carried forward, and the credit for dividend receipts. These three
items together represent the difference between taxable income and the
current Internal Revenue Service definition of "compiled net profit".
The interest item is estimated by projecting the trend shown in the tax
return data for recent years. The allowance for loss carried forward is likewise projected from tax return data, its year-to-year movement being based
on that of estimated (or reported) prior-year losses appropriately lagged.
The dividend receipts credit is extrapolated from the latest tax-return-based
estimate by the net dividend component of national income.
The final step is to proceed from the estimate of compiled net profit, obtained in step (4), to an estimate of corporate profits as defined for national
income purposes. The adjustments required are those indicated in Exhibits
7 and 2 (and in Part V, table 38). Some of them must be made on a more
or less arbitrary basis, in the absence of current data.
The procedure outlined is subject to significant error at several stages:
in the ratio of part-year to full-year tax collections; in the ratio of tax liabilities to collections; in the ratio of taxable profits to tax liabilities; in the
magnitude of corporate deficits; and in the adjustment items (notably for
capital gains and losses) between taxable profits net of deficits and profits as
defined for national income purposes. Consequently, a rough range of overall error is calculated. If the sum of the industry estimates falls outside this
range, their detail is reexamined and adjustments are made in the direction
indicated by the tax data.

For the industries listed in lines 1, 2, and 3 of Exhibit 3, the latest base-year
data on corporate profits tax liabilities are extrapolated in general by the
movement of series on "provision for Federal income taxes" taken from the
same sources. In instances in which such data are not available, or in which
they are subject to erratic movements, effective tax rates are estimated by
reference to base-year data with allowance for changes in tax rates. These
estimated rates are then applied to the estimates of profits before tax described
above. This latter procedure is used also for the industries listed in line 4.
It may be noted that the tax provision for carryback of operating losses
(and formerly of unused excess profits tax credit) prevents the determination
of actual corporate tax liability until the following year's operating experience
has been established. In the meantime, it is possible only to base adjustments
on the apparent trend of compiled net deficits.
Characteristics of the Revisions
Net dividends (dividends paid minus dividends received) are estimated for
each industry by extrapolating base-year figures by total dividends paid.
Since the estimates published three years after the event are based upon
Dividends paid by the industries listed in line 1 of Exhibit 3 are shown in the
much more nearly complete information (from the tax return data) than are
same source used for the extrapolation of profits before tax and taxes.
the initial preliminary estimates published with a lag of less than a year,
Dividends paid by industries listed in lines 2, 3, and 4 are extrapolated by
comparisons between the two cast some light on the reliability of the latter.
the corresponding industry components of the National Income Division's
Such comparisons are shown in the first four lines of Exhibit 4.
series on publicly reported dividend payments, compiled monthly from data
The preliminary estimates shown differed by a maximum of about 4 perin Moody's Dividend Record and published regularly in the Survey of Currentcent from those which replaced them when the tax return data became availBusiness. For these industries, the coverage of this dividend series is broader able.

NATIONAL INCOME, 195 4 EDITION

for large areas of the economy. Corporate interest transactions are covered in
income tax return tabulations published by the Internal Revenue Service in
its Statistics of Income—Part 2, and those of mutual financial institutions in reports of regulatory agencies or in other comprehensive summaries of basic
data. Information on government interest transactions is also, in large part,
comprehensive.
Personal landlords, unincorporated enterprises (farm and nonfarm), households and institutions, and the rest-of-the-world sector are the major remainExhibit 4.—Preliminary and Revised Estimates of Corporate Profits Earned
ing groups whose interest transactions must be taken into account in calcuin 1948-50
lating interestflowsfor national income purposes. The quality of the informa[Billions of dollars
tion with respect to them varies widely. In general, the estimates must rely on
distinctly less adequate and regular sources. The largest single item in this
Estimates for year—
group is mortgage interest paid by personal landlords.
Published in the Survey
Although the interest flows in national income measure amounts accruing
of Current Business
1950
to United States persons and government, these accruals cannot be estimated
directly, because of lack of information from individual recipients. Instead
July 19»_
2 27.6
they are measured as the payments less the receipts of relevant payer groups.
2 41.4
•28.3
1951 supplement.
27.1
139.6
July 1952
This residual method of estimating has some advantages, mainly because it
27.1
41.0
July 1953
leads to entries consistent with the measurement of corporate profits in the
40.0
1954 supplement.
26.2
income and product accounts. But it is subject to the shortcomings of all
residual estimating procedures, in which small errors in the minuend and
1. Extrapolated forward 1 year from tax return data base.
subtrahend may lead to significant ones in the remainder. The fact that the
2. Extrapolated forward 2 years from tax return data base.
recording of interest by creditors and corresponding debtors may differ both
as to coverage and timing introduces special hazards into the procedure.
special tabulations among the source data for the audit adjustment outlined
The above evaluation refers to years for which Internal Revenue Service
above, as well as associated refinements in the method of estimate.
corporate tax return tabulations are available. For the two most recent years,
In general, the industry extrapolations of corporate profits have been less
for which information is much less adequate, the reliability of the estimates
accurate than the sums of these. That is, errors in the individual industry
is reduced, particularly on an industry basis.
estimates have tended to compensate in the all-industry total.
As will become apparent, the definition of interest flows in the national
For the manufacturing division as a whole, recent year estimates have in most
income is a complex matter, mainly with respect to the imputed interest
instances required only comparatively minor changes when the tax return
flows arising in connection with financial institutions. In this section, the
data became available. Extrapolations for some of the groups within this dioperational procedures used in the determination of theseflowsare set down
vision have proved considerably less accurate for the years that can be checked,
precisely, with but little attempt to explain their basic rationale, which is
but the quality of such extrapolations for 1952 and later years is believed significantly improved. In the joint SEC-FTC Quarterly Financial Report upon which discussed in Part II.
The actual measurement of imputed interestflowsis based, in general, upon
the extrapolations are based, the Federal Trade Commission sample has
data of a high order of reliability, but accuracy is somewhat impaired by the
been strengthened and the technique employed was modified in 1951 to
necessity in some instances (as explained later) of substituting statistical assecure better figures for individual industries.
sumptions where the precise data called for by the definitions are lacking.
Among the industries for which extrapolation is based on data from regulatory agencies, differences of coverage and concept between the national
income estimates of railroad profits and the Interstate Commerce Commission series used as extrapolators have necessitated revisions of significant size.
Relation of Major Interest Flows
Among the nonmanufacturing industry estimates for recent years based on
nongovernmental sample data, those for retail trade have been subjected
The interest component of the national income, "net interest", measures
to percentage revisions somewhat larger than those for the group as a whole.
total interest (monetary and imputed, private and government) accruing to
The extrapolations for wholesale trade, the most important based on maUnited States persons and governments minus total interest paid by United
terials considered definitely inadequate, have likewise been revised by comStates governments. Government interest (Federal and State and local) is
paratively large percentages when the tax return data became available.
deducted because it is not considered income arising in current production.
Revisions in the preliminary estimates of taxes have been similar to those
It is necessary not only to exclude the portion of it paid directly to persons
in the profits estimates, since both are based largely on a common set of
and governments, but also to deduct the portion of it paid to business, because
source materials. Sample data for dividend payments are more adequate
the latter is reflected in the incomes paid out or retained by the business
than for profits or taxes. Revisions in the preliminary estimates of net divisystem.
dends have in general been smaller percentage-wise than the revisions in the
Since accruals to persons cannot be ascertained directly, net interest is obprofits series.
tained by estimating its algebraic equivalent—the difference between (a)
total interest paid by United States business and persons plus total interest
paid to the United States by foreigners, and (b) total interest received by
United States business plus total interest received by foreigners from the
United States.
The interest component of personal income, "personal interest income,"
measures total monetary and imputed interest paid to United States persons.
It is obtained algebraically by adding to the interest component of national
6. INTEREST
income the excess of interest payments by United States governments over
their interest receipts.
This section contains a discussion of the interest components of national
income and personal income, as well as of the three components of personal
The nature of these algebraic relationships can be understood from the
consumption expenditures for services which are estimated in an interrelated
following schematic presentation. Since for the economy as a whole total
statistical procedure. These are Interest on personal debt, the interest element of payments must equal total receipts, then the sum of total interest:
Brokerage charges and interest and investment counselling, a n d Services furnished with(1) Paid by United States business,
out payment by financial intermediaries except life insurance.
(2) Paid by United States persons,
The basic accounting data underlying the interest estimates and the re(3) Paid by foreigners to the United States, and
porting systems by means of which they are summarized are quite satisfactory
(4) Paid by United States governments

Revisions, usually of minor amounts, have been made in the estimates
from time to time after incorporation of the tax return data. These have
occurred primarily as a result of changes, based on progressively accumulating data for the given year, in the estimate of the effects of audit. Sizable
revisions made this year (shown for 1948—50 in the last line of the exhibit)
stem partly from this cause, but reflect chiefly the incorporation of certain

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS

must equal the sum of total interest:
(5) Received by United States business,
(6) Received by United States persons,
(7) Received by foreigners from the United States, and
(8) Received by United States governments.
By deducting (4), (5), and (7) from both sides of this equation, the receipts
side is converted into (6) + (8) — (4), the initial formula for the interest component of national income as defined above; and the payments side is converted into the equivalent formula by which this component is actually
measured using available data, (1) + (2) + (3) — (5) — (7).

The bulk of all interest stems from a comparatively small number of industries. Exhibit 2 shows these industries, and their respective contributions to the interest share of the national income, for selected years. The
problems of industrial classification and their treatment are substantially the
same for interest as for profits (see preceding section and the Introduction
to this Part). They have little effect, however, on the estimates of interest
shown by broad industry division in Part V or, because of the smallness of
the corporate interest series, on the industrial distribution of the national
income.

Exhibit 1.—Derivation of the Interest Components of National Income and
Personal Income, 1950

Monetary Interest Paid

Millions
of dollars

Item
Monetary interest paid
_
Imputed interest paid
Loss: Monetary interest received
Imputed interest received

9,879
5, 870
8,352
1. 48f>

Equals: Net interest (component of national income)

5,912

Plus: Net interest paid by government (excess of interest payments by United
States governments over interest received by United States governments) ._

4,716

Equals: Personal interest income (component of personal income) _

10,628

The interest component of personal income (6) differs from that of national
income in the formula (6) + (8) — (4) by including (4) and excluding (8). It
can therefore be calculated from the national income share by adding (4)
and deducting (8).
The derivation of the two interest series is shown in summary form in
Exhibit 1, and will be discussed in the same order in the text. The derivation
of the related components of personal consumption expenditures will be explained at appropriate stages of the discussion.
Exhibit 2.—Chief Industrial Sources of thu Interest Component of National
Income, 1929, 1939, 1945, 1950
[Millions of dollars]
1929
Agriculture

1945

1950

833

All other....

455

301

500

822
11

Farms.-

448
7

298
3

496
4

2,381
2,853
-472

597

414

333

480
79

516
81

379
35

286
47

422

Transportation

1,979 J 1,513
2,083
-104

599

Real estate
Allother

2,360
2,407
-47

Finance, insurance, and real estate..

Railroads

1939

350

446

349
73

289
61

311
135

Allother
Communications and public utilities
Utilities: electric and gas

323
71

1,768
-255

576

1,997

1,535
140

734
134

490
86

1,868

Private households

624

283

Allother—

577
47

127
156

130
-99

248

6,445

4,604

3,185

5,912

Allother
Services

Other industry divisions
Rest of the world
Allother
Total (Part V, table 23)

1,675

Corporations
Monetary interest paid by corporations accounted for about one-third of
total monetary interest paid in 1950. With the single exception of Federal
Reserve Banks, this item is based on Federal corporation income tax returns,
tabulated by the Internal Revenue Service in Statistics of Income—Part 2.
Where greater industrial detail is needed, it is obtained from the supplementary, unpublished "Source Book."
Adjustment of the tax return aggregate to the corporate universe as defined
for national income purposes involves for all years the deduction of estimates
for mutual insurance carriers and the addition of data for Federal Reserve
Banks. In both cases, adjustments have been negligible for the entire period.
For the latest two years, for which Internal Revenue data are not yet available, total corporate monetary interest paid is obtained by adding separate
estimates for banking and for the total of all industries except banking.
Banking interest is obtained by extrapolating the last base year estimate by
interest payments of insured commercial banks on time and savings deposits,
raised to the all-commercial bank level on the basis of yearly asset ratios
(Federal Deposit Insurance Corporation data).
Estimates for all corporations except those classified in banking are extrapolated by means of an index representing the regression of annual interest
paid against National Income Division estimates of corporate gross long-term
debt plus notes and accounts payable as of the beginning of each year. The
debt figures are based on Statistics of Income balance sheet data, and estimated
for current years by adding increments derived from Securities and Exchange
Commission, Federal Deposit Insurance Corporation, and Interstate Commerce Commission reports.
To obtain a breakdown of the nonbank total, direct estimates are made for
several industries. For farms, the latest Statistics of Incomefigureis extrapolated
on the basis of interest paid by unincorporated enterprises in that industry
(described below). For contract construction, extrapolation is by the value
of new private construction activity (described in the section on New construction). For railroads, telephone and telegraph, and electric and gas utilities, interest paid data (reported, respectively, to the Interstate Commerce,
Federal Communications, and Federal Power Commissions) are used as
extrapolators.
For each individual industry not listed above, the latest base year figure is
extrapolated by the regression-based total for all industries less the industries
for which specific estimates are made.

129
255

While the concept of national income calls for measurement of interest
flows on an accrual rather than cash basis, this distinction cannot be maintained in statistical practice. In Exhibit 7 the major components of the interest flows are labeled uniformly on a cash basis—as "paid" or "received."
In the subsequent detailed discussion the terms "paid" and "payable" and
"received" and "receivable" are used to indicate the exact nature of the
flows whenever possible.

The composition of total monetary interest paid in 1950 is shown in Exhibit 3.

Sole proprietorships and partnerships
In 1950, monetary interest paid by sole proprietorships and partnerships
amounted to about 12 percent of total monetary payments. The 12 percent
was almost evenly divided as between farm and nonfarm proprietors.
Farm.—The series for long- and short-term interest payable by farmers
(exclusive of that payable by nonfarm landlords) is obtained from the Department of Agriculture. In general, the computation of these interest charges
is based upon multiplication of the amounts of different types of debt outstanding by relevant interest rates. The long-term debt and interest rates
are estimates by the Agricultural Research Service of the Department of
Agriculture, based on Census of Agriculture benchmarks and sample reports
from lending agencies. The short-term debt to institutional lenders and

NATIONAL INCOME,

interest rates are based on reported information from Federal farm lending
agencies and from commercial banks. The short-term interest payable to
noninstitutional lenders (amounting to $193 millions in 1950) has been
described by the Department as "merely a rough approximation".
Nonfarm.—Total monetary interest paid in this sector is obtained as the
sum of industry estimates. For the years 1929 through 1941, 1939 is the
general benchmark. For many industries this benchmark was obtained by
multiplying estimated total receipts of all proprietorships and partnerships
in the industry (see the section on the Income of unincorporated enterprises)
by the ratio of interest paid to total receipts, taken from 1939 informational
partnership tax returns published by the Internal Revenue Service in the

195 4

EDITION

Interest paid by mutual nonlife insurance carriers, which is small, is based
on Internal Revenue Service data.
For savings and loan associations, interest paid and dividends paid to shareholders are together considered interest. The estimates are based on Federal
Home Loan Bank Board reports from member associations raised to cover
nonmembers. Dividends paid by credit unions (assumed to measure the whole
of interest payments on deposit and share accounts) are also estimated on the
basis of reports to official agencies.
Nonprofit organizations servicing business.—These organizations (mutual utility
companies, farmers' cooperatives, etc.) have been required to report their
operations to the Internal Revenue Service. Their combined statements were

Supplement to Statistics of Income—Part 1. In other areas, where total receipts

published in Supplement to Statistics of Income for 1943—Part 2. Reporting was

are not available, a frequently used method was to multiply interest paid per
partner (as calculated from the partnership returns) by the total number of
active proprietors.

incomplete by an indeterminate amount, but the total unreported was undoubtedly small. In general, the method used is to extrapolate the 1943
reported figure over the entire period by other relevant interest series.
Personal landlords {nonfarm).—Monetary interest payable by nonfarm individual property owners (other than professional real estate operators) represented 25 percent of total monetary interest paid in 1950. This component
includes interest payable on mortgages against farm property owned by nonfarm landlords, owner-occupied nonfarm dwellings, and other nonfarm residential and nonresidential property owned by individuals. The farm mortgage interest series is prepared by the Agricultural Marketing Service of
the Department of Agriculture, using sources and methods outlined above.
The two series on nonfarm mortgages are derived in connection with the
estimates of the rental income of persons. Revisions in these series, based on
the new methodology described in the section dealing with the latter estimates, are reflected in the back-year interest totals shown in Part V as compared with those previously published.

Exhibit 3.—Components of Monetary Interest Paid, 1950
Item
Corporations..
Corporations reporting to Internal Revenue Service
Less; Mutual insurance carriers (life and nonlife)- _
Plus: Federal Reserve Banks

Millions
of dollars
3,215

Percent

32.5

3,215
0
0
1,189

Mutual financial institutions.
Savings and loan associations

12.0

620
869

3,218

Farm
Nonfarm

32.6

734
367
0
344
23
25
2,459

7.4
3.7
.0

5.8

3.6
2

Households and institutions

Monetary interest paid entered under the heading "Households and institutions" amounted to about 20 percent of the total in 1950. The major share
of this represents nonmortgage interest paid by individual consumers.
1,956
19.8
Consumers.—Nonmortgage interest payable by individual consumers is of
Consumers. . . . ___
1,868
18.9
several types. The first embraces interest on (1) single-payment loans, (2) inNonprofit organizations servicing individuals88
.9
stallment credit held by financial institutions and (3) installment credit held
Rest of the world
301
3.0
by automobile dealers. The amount of each of these classes of credit is esti9,879
100.0
mated by the Federal Reserve Board, on the basis of monthly reports from a
sample of lending agencies and with a periodic adjustment to more comprehensive benchmarks. The portions of (2) and (3) consisting of automobile
sales credit extended to business purchasers are deducted, in line with the
Internal Revenue Service tabulations itemizing interest paid by industry
consumer-business allocation of automobile purchases described below in the
for both partnerships and sole proprietorships in 1945 were used directly to
section on Personal consumption expenditures for commodities, to obtain a
establish nonfarm benchmarks for that year. The coverage of these tabulaseries for personal debt in each category. To derive the corresponding amounts
tions was much higher in 1945 than in 1939. Also, partnership tabulations
of interest, these series are multiplied by the average effective interest rates
for 1947 permitted benchmarks for that sector and fairly reliable extrapolaindicated by fragmentary sample data from lending agencies. The estimates
tion from 1945 of the estimates for sole proprietors.
for 1929-39 are less reliable than those for later years, since the basic series
The general method of extrapolation and interpolation used to obtain inavailable for use in the formula described were somewhat less suitable in
dustry estimates is to employ the corporate interest paid series, adjusting to
detail for this use.
the three benchmark years. In the mining and manufacturing sub-groups,
No interest on charge account debt, service debt, or installment sales credit
value-of-product data for 1929 and 1939 from the Census of Mineral Inheld by dealers other than automobile dealers is included, for reasons of condustries and Census of Manufactures permitted a further adjustment for the
sistency with the data on interest received by these dealers. It is believed that,
changing relative importance of the corporate and noncorporate segments.
in general, business creditors do not enter in their books an explicit interest
item as received on such loans, but rather include the amount in the sales
price or in "other income."
Other private businesses
The second type of consumer interest payments arises in connection with
Mutual financial institutions.—Mutualfinancialintermediaries in 1950 ac- borrowings against life insurance policies. The interest payable to life insurcounted for about 7 percent of total monetary interest paid. For each of the
ance carriers is estimated by applying an average interest rate to the average
components the estimated series is based on reported information from a subamount of policy loans outstanding, both averages being based on data from
stantial portion of the industry and is reliable both as to level and to movethe Institute of Life Insurance. The third class of consumer payment is that
ment.
made to United States Government life insurance and adjusted service certificate funds.
Interest payments by mutual savings banks from 1943 forward are based
on data compiled by the Federal Deposit Insurance Corporation for insured
The total of these three categories is entered in personal consumption exbanks, raised to the universe level by asset ratios for all banks to insured
penditures as Interest on personal debt.
banks in each year. Prior to 1943, the series was estimated on the basis of
A fourth type of interest payments by individuals arises in connection with
Federal Deposit Insurance Corporation and Comptroller of Currency tabubrokers' loans. This segment was large in 1929, but in recent years has been
lations, reports on savings banks by the Commissioner of Banks in New York
of minor importance. The method of estimation here is to apply averages of
State, reports by the Commissioner of Banks in Massachusetts, and reports
quoted short-term money rates (New York Federal Reserve Bank) against
by the American Bankers Association.
average brokers' loans to customers (members only, New York Stock ExNonprofit organizations servicing business
Personal landlords (nonfarm) _

.2
24.9

100

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS

change). This item is also entered directly in personal consumption expenditures, as part of Brokerage charges and interest.
Nonprofit organizations servicing individuals.—Informational

returns by labor

unions, social groups, etc., to the Internal Revenue Service have been tabulated for 1943 and 1946. Undercoverage in these data is large percentagewise,
but the amounts involved are negligible. Larger in amount, but still relatively
minor in comparison with the monetary interest paid total, are the payments
made by other types of organizations such as churches, hospitals, and private
schools. Here only fragmentary data have been available and the estimates
take the form of average interest rates applied against estimated mortgage
indebtedness, or interest-to-receipts ratios applied against estimated total
receipts.

Rest of the world
Interest paid to United States residents by foreigners is estimated in connection with the United States balance of payments estimates of the Office of
Business Economics. The series is described in the section on Net foreign investment.

Imputed Interest Paid
In addition to monetary interest, national income and personal income include imputed interest flows. These arise in connection with the transactions
of financial intermediaries. In national income accounting commercial banks
are conceived of as paying out to their depositors the entire amount of property income received, so that imputed interest paid by commercial banks
equals their property income received less interest actually paid on deposits.
Correspondingly, they are conceived of as making a charge for the services
rendered to their depositors in excess of the monetary service charges actually
made. These imputed service charges are numerically equal to imputed
interest paid.
Exhibit 4.—Components of Imputed Interest Paid, 7950
Item
Corporations
Commercial banks
Federal Reserve Banks
Finance, n. e. c
Stock life insurance carriers-..
Other private businesses
Mutual savings banks
Mutual life insurance carriers.
Savings and loan associationsCredit unions
Total imputed interest paid

Millions
of dollars

Percent

3,624

61.7

2,927
67
207
423

49.9
1.1
3.5
7.2

2,246

38.3

292
1,594
32S
35

5.0
27.2
5.6
.6

5,870

100.0

To the extent that these imputed flows represent intrabusiness transactions,
they cancel out in the aggregate and have no effect on the size of national
income and product, although they do affect its industrial distribution. To the
extent that they reflect transactions between commercial banks and persons,
they result in matching entries in (a) the interest components of national and
personal income and (b) personal consumption expenditures for services.1
A similar procedure is applied to corporate financial institutions of the investment trust type.
An interest imputation is made also in connection with life insurance. Imputed interest is measured in this instance by property income received, which
in national income accounting is treated as accruing directly to policy-holders.
In turn, policyholders are assumed to make payments to life insurance companies to cover their operating expenses. Mutual financial institutions other
than life insurance are given a similar treatment.
Imputed interest paid is described immediately below, and imputed interest
received is described following the discussion of monetary interest received.
Imputed charges made by financial institutions (analytically distinct from
1. In tracing the detail of the imputed flows, it will be noticed that imputed interest and
service charge transactions between commercial banks and government are not recognized
and are instead treated as occurring between commercial banks and personal recipient*.

the imputec interest flows) are also discussed, to the extent that they are
derived in a statistically interrelated procedure. The charges for life insurance, for which the methodology is different, are covered in the section on
Personal consumption expenditures for services.
In general, imputed interest paid by financial intermediaries is measured
as the excess of property income received over property income actually returned in monetary form to owners of the funds entrusted to the intermediary.
As will be noted in the following discussion, the precise content of this formula
varies among the several types of financial institutions involved. The composition of imputed interest paid in 1950 is shown in Exhibit 4.

Corporations

Most of the imputed interest paid by corporations originates in commercial
banking.
Commercial banks.—In estimating imputed interest paid by commercia
banks, basic data are drawn from annual reports of the Federal Deposit Insurance Corporation for the period beginning in 1935 and from the Board of
Governors of the Federal Reserve System for the 1929-34 period. This departure from the general use of the Internal Revenue Service data in the
corporate area was occasioned by shortcomings in the industrial classification
of the Statistics of Income banking industry.2
Imputed interest paid by commercial banks is measured as the excess of
interest and dividends received over interest paid on demand and time deposits. Reported data for member banks (Federal Reserve System) in the
1929-34 period and for member banks (Federal Deposit Insurance System)
in later years are raised to all-commercial-bank levels on the basis of asset ratios
derived from the above sources and from Comptroller of the Currency data.
Federal Reserve Banks.—Imputed interest paid by Federal Reserve Banks
(measured as interest received less interest paid and profits) is calculated from
aggregate financial statements published by the Federal Reserve Board.
Finance, not elsewhere classified.—Imputed interest paid by corporations classified in the "Finance, n. e. c." group, mainly investment trusts, holding companies, and long-term and short-term credit agencies, is measured as property
income in the form of interest and dividends received less the sum of interest
paid and profits (before income and excess profits taxes and without deduction for dividends received).
When income accounts are not in such a form as to permit an isolation of
loan and investment activities from other operations, profits as reported
reflect both elements, and a statistical isolation of profits earned in loan and
investment activities is needed, in order that the imputation procedure be
confined to these activities. In view of the fact that operations other than loan
and investment activities play a significant role in the "Finance, n. e. c." industry, thi; refinement seems desirable.
To effect the separation, investment trust companies of the management
type are assumed to be institutions in which operations are substantially
limited to loan or investment activities. Relationships between imputed
interest paid and property income received for investment trust companies are
computed and applied to the total property income in "Finance, n. e. c." to
estimate total imputed interest paid by this group.
These ratios were based for years prior to 1938 upon a report of the Securities and Exchange Commission, Investment Trusts and Investment Companies,

Part Two (March 1939), and for 1938 and subsequent years on Statistics of
Income—Part 2, including unpublished detail from the "Source Book".
Series for interest and dividends received by the "Finance, n. e. c." group
generally are based upon Statistics of Income—Part 2 data and unpublished
detail from the "Source Book." Only data for the 1929-33 period and after
1941 have been used directly, because of the break in the series introduced by
corporate reporting for tax purposes on an unconsolidated basis from 1934
through 1941. For these years, estimates were interpolated by total monetary
interest and net dividends paid by all corporations. For the two most recent
years, the Statistics of Income series is extrapolated by the sum of (a) monetary
interest payments by all corporations except those in the finance industries,
and (b) publicly reported cash dividend payments by all United States corporations except those in finance. (The series on publicly reported dividend
payments is compiled by the National Income Division from data in Moody's
Dividend Record and published regularly in the Survey of Current Business.)
2. It may be noted that, as a consequence, net interest originating in commercial banks,
as estimated for Part V, differs from dividends received by banking, to which by definition
it should be numerically equal.

101

NATIONAL INCOME, 195 4 EDITION

Stock life insurance carriers.—The property income (monetary and imputed The estimates for banking (excluding Federal Reserve Banks) are obtained
by extrapolating the last base year estimate by income from loans and investinterest, dividends, and net rents) received by life insurance carriers is rements reported by insured commercial banks to the Federal Deposit Insurance
garded as being withheld to the account of policyholders and is treated as
Corporation (raised to the all-commercial bank level). Interest received by
though it were actually disbursed. Accordingly, a payment is imputed for
Federal Reserve Banks is available from the Board of Governors of the Federal
life insurance in Exhibit 4.
Reserve System. Current estimates for monetary interest received by stock
Basic data for the measurement of dividend and monetary interest receipts
insurance carriers are prepared jointly for life and nonlife carriers. Interest
of both stock and mutual life insurance carriers combined are taken from
Statistics of Income—Part 2, supplemented by unpublished detail from the receipts of all stock insurance companies (life and nonlife) are assumed to
vary with the corresponding series obtained for total life insurance. (See "Im"Source Book". Reported dividend figures from 1929 through 1939 were adputed interest paid, stock life insurance carriers.")
justed to include dividends received from foreign corporations. Receipts of
mputed interest are derived by procedures described below under Imputed
The recent-year estimates for all corporations except banking and insurance
interest received. Series for gross rents received, also taken from Internal
are prepared separately for interest received on holdings of taxable United
Revenue Service sources, are converted to net rents realized by means of netStates Government securities and all other investments. This break is availgross rent ratios. The break between stock and mutual life insurance carriers
able in the Statistics of Income data. Interest received on taxable United States
is estimated on the basis of data published in The Spectator Company's InGovernment securities is extrapolated by a series calculated as United States
surance Tear Book.
securities held by corporations and associations (excluding banks and insurExtrapolation of the series based on Statistics of Income to current years is ance companies) times the computed midyear average interest rate on the
Federal debt, both available in the Treasury Bulletin. All other interest received
accomplished by means of Institute of Life Insurance data. An extrapolating
is extrapolated by the series for monetary interest paid by all corporations
series is constructed by multiplying security and mortgage asset holdings
except banks and insurance companies.
(averages of year-end figures) by net earning rates.

Other private businesses

Exhibit 5.—Components of Monetary Interest Received,

1950

Mutual savings banks.—Imputed interest paid by mutual savings banks is
Millions
Item
of dollars Percent
measured as (a) property income received (interest and dividends) less (b)
interest and dividends paid depositors and interest paid on capital notes and
63.4
Corporations5,291
debentures. The nature of the series for (a) and (b) is described under
6,505
Corporations reporting to the Internal Revenue Service-.
"Monetary interest received" and "Monetary interest paid", respectively.
1,489
Less: Mutual insurance carriers (life and nonlife)
275
Mutual life insurance carriers.—The procedure for estimating imputed interest Plus: Federal Reserve Banks
paid by mutual life insurance carriers has been described above under "Stock
Sole proprietorships and partnerships..
108
1.3
life insurance carriers".
52
Security and commodity brokers..
.6
56
Finance, n. e. c .
Savings and loan associations.—Imputed interest paid by savings and loan
.7
associations is measured as total interest income less the sum of interest and
2,900
Other private businesses..
34.7
dividends paid. The twoflowsare identical to those entered under "Monetary
Mutual financial institutions
2,883
34.5
659
7.9
Mutual savings banks
interest received" and "Monetary interest paid", except for the addition to
1,513
18.1
Mutual insurance carriers (life and nonlife) .
the former of imputed interest received from commercial banks, estimated by
653
7.8
Savings and loan associations
58
.7
Credit unions
procedures described below.
17
.2
Nonprofit organizations servicing business
Credit unions.—Imputed interest paid by credit unions is measured as inter53
.ft
Rest of the world
est received less dividends paid (the latter taken as interest payments on both
Total monetary interest received.
8,352
100.0
shares and deposits). Interest received by credit unions is assumed to equal
interest paid to them by individuals. (See above "Monetary interest paid,
Households and institutions".) Dividends paid are obtained from compilaTo obtain further industrial breakdowns, direct estimates are made for
tions of annual reports to the Bureau of Labor Statistics.
railroads, pipeline transportation, telephone and telegraph, and electric and
gas utilities, in general by extrapolating the base year estimates by interest
received as reported to the respective regulatory commissions. The sum of
Monetary Interest Received
the estimates for these industries is deducted from the figure derived above
for all corporations except banking and insurance. The residual, amounting
to about one-tenth of the all-industry total, is used to extrapolate the latest
In the calculation of monetary interest received by business and foreigners,
tax-return-based figure for each of the remaining industries.
business recipients are defined to include all corporations (63 percent of the
total in 1950), unincorporated security and commodity brokerage firms and
miscellaneous proprietors in the finance, n. e. c. category (together about 1
Sole proprietorships and partnerships
percent of the total), mutual financial intermediaries (35 percent), and
nonprofit organizations servicing business (negligible). Interest received by
Monetary interest received by unincorporated security and commodity
the rest of the world from the United States accounts for less than 1 percent
brokers and certain loan companies classified under "Finance, n. e. c." is
of the total. Further details are shown in Exhibit 5.
assumed to be received as an integral part of business operations. It is deducted
in arriving at the interest share and correspondingly included in the receipts
of these enterprises in calculating their net income.3 Source materials are
Corporations
similar to those noted under monetary interest paid. Except for security and
commodity brokers in 1929, amounts involved are small.
The general nature of the basic data covering interest received by corporations has already been discussed under "Monetary interest paid". Interest
received by mutual insurance carriers (measured in conformance with the
Other private businesses
Internal Revenue Service definition of interest received) is removed by use of
the data described above, under "Imputed interest paid, stock life insurance
Mutualfinancialinstitutions.—In general, the source materials used for esticarriers". Interest received by Federal Reserve Banks is tabulated by the
mating monetary interest receipts of mutual financial institutions are identical
Board of Governors of the Federal Reserve System.
to those employed in the "Monetary interest paid" estimates.
For the two most recent years, for which tax return data are not available,
3. In general, monetary interest received by owners of unincorporated enterprises Is not
total monetary interest received by corporations is obtained by adding sepadeducted in computing net interest because it is assumed to be received by them in a personal
rate estimates for the banking and insurance industries and for all industries
rather than business capacity; and, correspondingly, it Is excluded in estimating incomes of
except banking and insurance.
unincorporated enterprises.

102

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS

Monetary interest received by mutual savings banks is measured as interest
and dividends on securities plus interest and discount on loans. The method
of estimation is similar to that used for monetary interest paid.
Monetary interest receipts of mutual insurance carriers are measured as
the sum of interest and dividends for national income purposes. (This accounts for the difference between the two entries for these institutions in
Exhibit 5.) The method of estimate for life insurance carriers has been described above, under "Imputed interest paid, stock life insurance carriers".
Receipts of mutual nonlife carriers are obtained from Statistics of Income tabulations, extrapolated by the method described under "Imputed interest paid,
stock life insurance carriers."
Monetary interest received by savings and loan associations is measured
on the basis of reports by member associations to the Federal Home Loan
Bank Board. Receipts by credit unions are assumed equal to payments by
individual borrowers, and are estimated by methods described above under
"Monetary interest paid, households and institutions".

These distributions are computed from Federal Deposit Insurance Corporation deposit data from 1934 forward, and from Federal Reserve Board deposit
data from 1929 to 1933. The sources are the Annual Reports of the Federal
Deposit Insurance Corporation a n d Banking and Monetary

Statistics.

2. The further distribution of the total received by persons and businesses
is based primarily on Derivation of Liquid Asset Distribution Estimates (mimeo-

graph), Board of Governors of the Federal Reserve System. This publication
gives the distribution of demand and time deposits by selected groups of
holders, as of the end of December, from 1939 forward. For the most part,
estimates presented in Solomon Shapiro's article on "Distribution of Deposits
and Currency in the United States, 1929-1939", in the Journal of the American
Statistical Association, December 1943, were used to extrapolate the Federal
Reserve figures back to 1929, using a December 1939 link.

Exhibit 6.—Imputed

Interest

Paid by Commercial

and Federal

Reserve

Banks, by Major Recipients, 1950

Nonprofit organizations servicing business.—The basis for estimation has been

described above, under "Monetary interest paid."
Millions
of dollars

Item

Percent

Rest of the world
Interest received by foreigners from United States residents is described in
the section on Net foreign investment.

Imputed Interest Received
The outflows from financial intermediaries of imputed interest paid become
imputed interest received when viewed from the standpoint of recipients to
whom such imputed interest accrues. It is necessary, consequently, to determine what groups receive the imputed interest that arises in each of the financial intermediaries. The underlying procedure in making this determination
is based upon the ownership of the funds by use of which financial intermediaries obtained property income.
Data on ownership are not generally available except for commercial banks,
for which there is indication of ownership by broad categories. It is necessary,
therefore, to solve the problem of ownership in most cases by use of assumptions.
A review of the several financial intermediary groups indicates the substantial validity of assuming that persons own all the funds entrusted to
mutual savings banks, life insurance carriers, savings and loan associations,
and credit unions. The corporate component of the finance, n. e. c. group,
comprising investment trusts, holding companies, and both long-term and
short-term credit agencies, is less clear-cut. It is quite possible for business as
well as persons to own securities of these companies. Lacking ownership data,
it is nevertheless assumed that for this intermediary group also ownership is
vested in persons. However, the consequent error of assuming that all imputed transactions in this area are with persons should be appraised in the
light of the fact that imputations among affiliated companies are eliminated
by the statistical estimating methods employed. (See the reference to the use
of consolidated returns under "Imputed interest paid, finance, n. e. a")
In summary, for all financial intermediaries except commercial banks the
flows of imputed interest paid by intermediaries are treated as going entirely
to persons. For commercial banks (including Federal Reserve Banks), imputed interest is allocated among recipients by use of estimates of the ownership of deposits. The main sources of data for the allocation to principal
classes of recipients are the published banking statistics of the Board of Governors of the Federal Reserve System and the Federal Deposit Insurance
Corporation, together with the Federal Reserve liquid asset surveys. The
distribution of imputed interest paid by commercial and Federal Reserve
Banks is shown in Exhibit 6.
This distribution is accomplished in three major steps:
1. Imputed interest received is estimated for three broad groups: (a) Federal Government, (b) State and local governments, and (c) persons and businesses. The procedure consists of allocating the elements of imputed interest
paid by commercial banks (total property income, interest paid on demand
deposits, and interest paid on time deposits) on the basis of percentage distributions showing the ownership of demand deposits and of time deposits by
the three groups, and then deducting the sum of the two interest paid estimates from total property income.

Imputed interest paid by commercial and Federal Reserve Banks
(see Exhibit 4); to be distributed among major recipients

2,994

Step 1:
United States Government
State and local governments..,
Persons and businesses

85
219

2.8
7.3

2,690

89.8

2,690

100.0

1,205

44.8

Step 2

Persons
Trust funds for individuals
-Nonprofit organizations servicing individuals
Individuals. __
_
Businesses (see Exhibit 1)

100.0

38
43

1.4
16
.

1,124

41.8

1,485

55.2

Corporations
.
Finance, insurance and real estate
Stock life insurance carriers
Stock nonlife insurance carriers
Other finance, insurance and real estate
Other industries
_

923
114
8
26
80
809

34.3

30.1

Proprietorships and partnerships

509

18.9

42
13
29
467
128
339

1.6
.5
11
.

Finance, insurance and real estate
Security and commodity brokers
Other finance, insurance and real estate.
Other industries
.
Farm
Nonfarm
Other private businesses
Mutual life insurance carriers
Mutual nonlife insurance carriers
Savings and loan associations

4.2
.3
10
.
3.0

17.4

4.8
12.6

2.0

28
Q
y
18

1.0
«]

.
6

Step 3 >
1 Consists of a further detailed industrial breakdown of allocations shown under step 2

3. This step consists of a further industrial breakdown, within the industry
groups specified under step (2), thus completing the allocation by major and
minor industries under the National Income Division industrial classification.
In general, the method is to distribute imputed interest to industries on the
basis of relative holdings of cash and deposits, as there is no further information on deposit ownership by industry.
Cash and deposits held by corporations filing balance sheets are tabulated
by industry in Statistics of Income—Part 2. The reported data are raised (by
industry) on the basis of ratios of total compiled receipts of all corporations
to total compiled receipts of those submitting balance sheets, and are adjusted
to the National Income Division industrial classification.
For sole proprietorships and partnerships, only indirect methods of estimating cash and deposit holdings are available. In general, ratios of cash and
deposits to total receipts for proprietorships and partnerships are assumed to
equal similar ratios for corporations with assets under $50,000 in the respective industries. These corporate ratios were obtained from Statistics of Income—
Part 2, for 1941, and extrapolated to all other years by similar ratios for all
corporations.
For both corporations and unincorporated firms, the relative distributions
of cash and deposit holdings are assumed to remain constant in the two years
prior to availability of the tax return data.

NATIONAL INCOME, 195 4 EDITION

Services furnished without payment by financial intermediaries, except life insurance
It is convenient to describe at this stage the derivation of the series, "Services furnished without payment by financial intermediaries, except life insurance", a component of personal consumption expenditures. This component
includes entries for commercial banks, corporate finance, n. e. c , mutual
savings banks, savings and loan associations, and credit unions.
Services furnished without payment by commercial banks to persons are
numerically equal to imputed interest received by persons from commercial
banks. For corporate finance, n. e. c. the entry equals the imputed interest
paid item whose derivation has been explained above, under "Imputed interest paid." For mutual savings banks, savings and loan associations, and credit
unions the entry equals imputed interest paid, calculated as explained above,
less income taxes and retained profits (before deduction of dividends). In
general, the series on retained profits and taxes are developed from the same
sources as the series on interest and dividend flows.

Net Interest Paid by Government
A breakdown of the government interest calculation is shown in Exhibit 7.
It should be noted that the transactions covered comprise not only those of
general governments (including trust funds) but also those of government
enterprises.
Exhibit 7.—Net Interest Payments by United States Governments, 1950
Millions
of dollars

Item
Excess of interest payments by United States governments over
interest received by United States governments

Monetary interest paid

100.0

5,804
624

State and local governments

4,716
6,428

Monetary interest paid by governments

Monetary interest received by governments

Percent

90.3
9.7

1,712

100.0

1,373
339

80.2
19.8

103

Monetary interest received
Federal Government.—Interest received by the Federal Government comprises interest income of the social insurance funds, interest income covered
into miscellaneous receipts of the Treasury, and interest received by government enterprises, as well as trivial amounts received by several other funds.
It may be noted that the bulk of these receipts is intragovernmental, and
offsets identical amounts under interest paid.
Interest received by the social insurance funds is reported in the Daily
Treasury Statement. Other miscellaneous interest receipts of the Federal Government are derived from annual analyses of miscellaneous receipts of the
Treasury as detailed in the Budget document, fiscal year totals being averaged
to obtain calendar year estimates. Interest received by Federal Government
enterprises is, in general, obtained on the same basis as the corresponding
interest paid component.
State and local governments.—Estimates of interest received by these governments, like those of their interest payments, are drawn from the various
Census releases on Government Finances.
Fiscal year data for State governments are available for the years 1929-32,
1937-40, and from 1952 on. Estimates for the 1933-36 period were obtained
by straight-line interpolation, while those for 1941-51 were interpolated by
reported investment earnings (not entirely confined to interest) of State pension, sinking, and trust funds. The fiscal year totals are averaged to obtain
calendar year estimates throughout the period.
The Census reports of interest received by local governments are fragmentary in most years. A comprehensive benchmark for 1931 can be established
from the 1932 Census of Governments, however, on the assumption that the
interest component of reported revenue from "highway privileges, rents, and
interest" for local units other than cities of more than 30,000 is proportionately the same as for cities of 30,000 to 100,000 (for which, along with the
larger cities, a more detailed breakdown is available). Sample-based Census
Bureau estimates are available from 1952 on, with a 1-year lag. Interpolations were governed primarily, through 1942, by reported data on investment
earnings of public trust, pension, and sinking funds of cities with populations
over 100,000. The basic annual interpolator series for 1943—51 cover only
cities of 250,000 or more.
Because of the time elapsed in compilation of the basic Census reports,
interest receipt estimates for the most recent year, both for States and for
local governments, have to be extrapolated in more or less arbitrary fashion,
with due regard for the trend of the series and for miscellaneous collateral
information.

Federal Government.—The largest component of interest paid by the Federal
Government is that paid or payable on the public debt. Data for all years are
available in the records kept by the United States Treasury Department. The
published source is the Daily Treasury Statement. Small amounts of interest are
also paid on several types of government-administered trust funds. Calendar
year estimates of the latter are obtained by averaging fiscal year data from the
7. PERSONAL CONSUMPTION EXPENDITURES FOR
Budget of the United States Government. Estimates of interest paid by Federal
COMMODITIES
Government enterprises are prepared in connection with the derivation of
the enterprise surplus or deficit. (See section on Government receipts and
Personal consumption expenditures for commodities—like wages and
expenditures.)
State and local governments.—Estimates of interest paid by State and local salaries—represent transactions that can best be estimated from business,
rather than individual, records. Unlike wages and salaries, however, congovernments, prepared separately for several types of government units, are
based upon data drawn from the Government Finances publications of the sumer commodity purchases involve indirect estimation. The business sales
Census Bureau, particularly the releases on Governmental Debt in the United data underlying the latter series neither generally nor uniformly distinguish
sales to consumers or to the other broad purchaser groups (such as business
States a n d t h e Summary of Governmental Finances in 1952.
and government) relevant to national income measurement.
Interest payments by State governments are available for fiscal years 1929The general problem, then, is to derive consumer sales, valued at prices
32 and 1937 forward, and for intervening years were interpolated on the basis
paid by consumers, from total sales. This qualification regarding prices is
of the reported gross debt of State governments. The latest fiscal year estimate
important. If the estimating procedure starts with sales (or output) at the
is obtained by extrapolation on the same basis. Adjacent fiscal years are
producer level and then adjusts them to cover sales of finished consumption
averaged to obtain calendar year estimates.
commodities only, there still remains the substantial task of raising their
Comprehensive coverage of local government interest payments can be obvaluation to a consumer-price basis.
tained from the Census reports for the years 1931, 1936, and 1940 forward.
Since the reported data represent diverse fiscal periods, minor adjustments of
timing are required to place them on a calendar year basis.
Nature of commodity flow method
In the years of incomplete coverage, total municipal interest payments are
assumed to move proportionately to those reported for the larger cities only,
This approach of starting with producers' sales (or output) is, in fact, the
while interest payments by other types of local government units are interbasic one employed in this report. Termed the "commodity flow" method, it
polated or extrapolated on the basis of reported gross debt statistics.
was used for the 1929-39 period and 1947 to derive estimates for consumer

104

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS

commodities making up over four-fifths of total consumer commodity
expenditures. (See Exhibit 1.)
First developed by Simon Kuznets of the National Bureau of Economic
Research and detailed in his National Bureau volume on Commodity Flow
and Capital Formation (1938), the procedure involves numerous estimating
steps. In broad outline, these entail securing commodity data at producers'
prices on the output of factories, farms, and fisheries; segregating for each
commodity the portion of total output not requiring further processing,
Exhibit 1.—Methods of Estimating Consumption Expenditures for Commodities,
1939 and 1947
1939

Item

Estimated by commodity flow method.._

Millions
Millions
of dollars Percent of dollars Percent
34,928

83.6

94,769

83.4

Estimated by other methods

6,873

16.4

18,901

16.6

Retail valuation method

5,148

12.3

14,652

12.9

3.869
•' 4, 408

3.4
3.9
3.2

Tobacco products—
New cars and net purchases of used cars
Gasoline and oil
Other fuel and Ice except fuel produced and
consumed on farms
Imputations
Food produced and consumed on farms
Fuel produced and consumed on farms
Standard clothing issued to military personnel
Miscellaneous
Flowers, seeds, and potted plants
Tips in purchased meals and beverages
Lightin
Other !
Total..

(')
1,679
2,181
1,288

4.0
5.2
3.1
3.0

3,630
2,745

2.4
2.5

2.7

2,895
2,532
134
229

485

1.1

1,354

1.2

191
117
86
91

.4
.3
.2
.2

475
429
(')
450

.4
.4

41,801

100.0

113,670

100.0

1,240
1,114
110
16

2.2
.1

1. Estimated by the commodity flow method.
2. Excludes expenditures for housing type trailers, which were estimated by the commodity
flow method.
3. Comprising the following: In 1939, paintings and art objects, products of custom establishments, n. e. c , and expenditures by United States Government personnel abroad; in
1947, expenditures by United States Government personnel abroad.

and destined for personal consumption; and then passing from finished
output at producers' prices to final costs to consumers by tracing the commodities through the various stages of the distributive system.1
The Census of Manufactures, with its vast commodity detail, is the basic
statistical source for the commodity flow method. This census was available
biennially for odd-numbered years of the 1929-39 period and for 1947.
The most important supplementary sources utilized by the method are the
Censuses of Retail Trade and Wholesale Trade, which, during the span
covered by this report, were taken for the years 1929, 1933, 1935, 1939,
and 1948. These censuses—together with the Censuses of Distribution of
Manufacturers' Sales (taken for 1929, 1935, and 1939 in conjunction with
the manufacturing censuses)—provide most of the basic information for
segregating consumer commodities from total output, tracing their flow,
and measuring their costs of distribution.
Taken at frequent intervals, the manufacturing and trade censuses furnished a comprehensive basis for estimating consumer commodity purchases
during the 1929-39 period. The gaps during this period left by the absence
of one or more of these censuses were filled, in generally satisfactory manner,
by an interpolation process carried out within the commodity flow framework. For this purpose, a wide variety of statistical series was assembled
from government and trade associations and other private sources, and some
reliance was placed on relationships developed from the census materials.
For the period after 1939, the infrequency of industrial census materials
has restricted use of the commodity flow method to the single year 1947.
Benchmark estimates for the commodity flow segment of consumer commodities for that year are presented for the first time in this report.
The commodity flow method is admittedly "roundabout" and complex.
It was adopted mainly because of the very detailed commodity classification
1. The commodity flow procedure was also used in the estimation of producers' purchases
of durable equipment for this period. This is covered more particularly in the section on
Producers' durable equipment.

and the comprehensive coverage of output afforded by the Census of Manufacturers. For both of these reasons, the method was distinctly to be preferred
to the principal alternative method employing the Census of Retail Trade as
the basic source. This method, the retail sales approach, involves adjusting
retail sales to eliminate all sales by retail establishments not made to consumers and then estimating independently, and adding in, that part of
consumer expenditures on commodities not made in retail establishments.

Use of retail sales for interpolation and extrapolation
While it has not been feasible to employ the simpler, more direct retail
sales approach in preparing benchmark estimates of consumer commodity
expenditures, retail sales data have furnished the principal basis of an interpolation and extrapolation procedure used in deriving estimates for the
years 1940-46 and subsequent to 1947. For commodity groups estimated by
the commodity flow procedure for 1939 and 1947, relative changes in retail
sales data have been used very largely to interpolate between the 1939 and
1947 benchmarks and to extend the latter forward into the current period.
Basing the movement of consumer commodity expenditures on retail sales
has significant limitations. In itself, the method cannot take account of
year-by-year changes in the relative importance of business purchases at
retail and consumer purchases outside retail trade—allowances for which are
difficult to make. Moreover, with the exception of department store sales
figures, the retail sales data are not available by commodities, but according
to a not very detailed classification by type of store. Thus, in the extrapolation
of consumer commodity expenditures from one census period to the next,
the general assumption is made for the various commodity groups that
benchmark relationships of consumer purchases to the sales of selected types
of retail stores remain valid.
Although estimates for the recent period continue to be derived through
extrapolation by retail sales, the feasibility of basing commodity flow estimates upon product data obtained in the Census Bureau's Annual Survey of
Manufacturers is receiving thorough study. This is a sample survey, begun in
1950, of manufacturers' shipments (and other data), and is utilized in the
producers' durable equipment estimates. (See Section 10.) Sampling variability in the manufacturers' shipments data is substantial, however, for some
consumer expenditure groups. Moreover, product information in the annual
surveys is much less detailed than in a full census, increasing the difficulties
of making consumer-nonconsumer allocations. Among other related problems, the most important has been that of obtaining current information on
retailers' markups. But given continued improvement in the annual manufacturing surveys and increased availability of auxiliary data, it may be
possible ultimately to institute annual commodity flow estimates.
In short, then, the bulk of all consumer commodity expenditures was
estimated by the commodity flow method for the years 1929—39 and 1947
and by interpolation and extrapolation based on retail sales for other years.
For certain commodities, different methods were considered preferable. For
still others, such as food and fuel produced and consumed on farms, the
commodity flow method was not appropriate.

Other estimating methods
The main alternative to the commodity flow method (with interpolation
and extrapolation by retail sales) was the direct approach of multiplying
estimated quantities purchased by consumers by appropriate average retail
prices. This procedure, which may be termed the "retail valuation"
method, was used in estimating consumer expenditures for passenger cars
and for gasoline and oil for all years; for tobacco products from 1940 to the
present; and for "other" fuel and ice (except fuel produced and consumed
on farms) for the years 1929-39 and 1947, with a retail sales interpolation
and extrapolation being employed for other years. These four groups accounted for 13 percent of the $114-billion commodity total in 1947.
The remaining estimates are of minor importance except for the imputed
item covering food produced and consumed on farms. This accounted for
about 2 percent of the 1947 total.

General considerations of reliability
The subsequent description of methodology will afford, at various places,
judgments about particular aspects of the estimates of consumption expendi-

NATIONAL INCOME, 195 4 EDITION

tures on commodities. Several propositions regarding their general character
may be worth noting at this point, with, however, the realization that any
appraisal of over-all reliability is necessarily indirect and cannot be definitive.
Concerning the estimates for 1929-39 derived by the commodity flow
method, there is the primary fact that they entailed lengthy procedures
processing large masses of data and resting at times to an uncomfortable
degree on judgment. Counterbalancing this are several considerations pointing toward the general appraisal that the final estimates of the totals are not
markedly in error.
The first is the wealth of census information on which the estimates for
this period were founded—information which, if not ideal, was adequate for
the requirements of most phases of the estimating process. Secondly, certain
evident sources of error in the individual commodity estimates—such as the
necessity of using type-of-store data in computing retail markups—-may be
assumed to have a tendency to compensate, or offset, in the total. Thirdly,
substantial temporal comparability in the estimates—that is, reliability of
movement over time—seems indicated from the use of census data having
a high degree of comparability and the application of uniform procedures
and assumptions.
Exhibit 2.—Comparison of Commodity Flow and Provisional Estimates for 1947
1939
Benchmark

Group

estimates

1947

Benchmark
esti-

mates

1947
Provi- Percent disional
vergence
estiof provimates ' sional from
benchmark
estimates

Millions of dollars

Food excluding food produced and consumed on
farms and tips
Shoes and other footwear
Clothing and accessories except footwear

6
1
3

17, 933
1,226
5,893

51,210
2,955
15,610

' 54.172
2,975
16, 105

Jewelry and watches
Toilet articles and preparations
Furniture
Kitchen and other household appliances
China, glassware, tableware, and utensils

355
486
949
774
475

1.463
1,245
2 552
3.179
1.348

1,348
1,208
' 2, 521
1
3, 012
1,442

Other durable house furnishings
Semidurable house furnishings
Cleaning and polishing preparations, and miscellaneous household supplies and paper products »

908
681

2,453
2,135

2,965
1,868

5
-13

508

1,523

1,146

-25

Stationary and writing supplies
Drug preparations and sundries
Ophthalmic products and orthopedic appliances.
Tires, tubes, accessories and parts

149
612
172
484

440
1,313
400
1,674

391
1.358
386
1,626

-11
3
-4

Books and maps
Magazines, newspapers, and sheet music 3
Nondurable toys and sport supplies
Wheel goods, durable toys, sport equipment,
boats, and pleasure aircraft
Kadio and television receivers, records, and
musical instruments

226
554
285

536
1,243
910

747
1,118
1,006

39
-10

228

972

761

Total«..

420

1,429

33,318

94,590

1.724
97,4'

-3
2

-5
7

11
-22
21
3

1. With exceptions indicated In footnotes 2 and 3, these were published in the July 1950
SURVEY OF CURRENT BUSINESS and the 1951 NATIONAL I N C O M E supplement and were

derived by extrapolating the 1939 benchmark estimates by retail sales.
2. Based on 1947 estimates published in July 1949 because adjustments influenced by the
1947 and 1948 censuses were made in the subsequently published estimates for these groups.
3. Retail sales extrapolation is not used in these groups.
4. The benchmark total for 1939 differs from the 1939 commodity flow figure in Exhibit 1
principally because of the omission above of the tobacco estimate amounting to $1,767 million.
In additioa, three small non-commodity flow items totaling $157 million are included in the
1939 total above for comparability with 1947. The benchmark total for 1947 is less than the
1947 commodity flow figure in Exhibit 1 because of the omission above of housing-type trailers,
amounting to $179 million.

The estimates for 1947 obtained by the commodity flow approach are o*
the same general character as the prewar benchmarks. The 1947 Census of
Manufactures, it may be noted, provided even greater commodity detail
than the biennial censuses of the 1929-39 period—a factor making for more
accuracy in the derivation of consumer product values at the manufacturers'
level. On the other hand, the postwar industrial census materials were somewhat deficient for purposes of the commodity flow work, notably in the lack
of the information provided in earlier censuses on the distribution of manufacturers' sales and on retailers' operating expenses. Certain changes in the
basic commodity flow method were therefore required, with some probable
impairment of reliability.
Because of the long intervals between the industrial censuses used for
benchmarks, the procedure of basing the movement of consumer commodity

105

expenditures on retail sales has assumed signal importance in the period
since 1939. A basis for judging the reliability of this procedure is provided by
Exhibit 2. This compares the new commodityflowbenchmarks with previously
published estimates for 1947. The last column of the exhibit—showing the
percent difference between the provisional and revised estimates—directly
affords an appraisal of retail sales extrapolations over the eight-year period
through 1947 marked by extensive war and postwar changes and a near
tripling in total dollar expenditures. (To the extent, of course, that the 1939
and 1947 benchmark estimates could not be made entirely comparable, this
factor also would be reflected in these percentages.)
The results are broadly satisfactory. Of first note is that the projection by
retail sales of 1939 consumer expenditures for commodities missed the commodity-flow benchmark total in 1947 by only 3 percent. The showing by
commodity groups, it will be observed, is mixed, although for most of them
the divergence is 7 percent or less. The series showing the widest percentage
discrepancy, moreover, are generally those for which retail sales data are
weakest for measuring consumer expenditure changes—usually because the
products involved are least closely identified with a particular type of store.
The estimates for the war years, it may be added, may have been subject
to special bias. It is possible that the substantial shifts which occurred in the
retail spending pattern were accompanied by temporary changes in the relationships of consumer expenditures for specific commodities to sales in the
lines of retail trade used for interpolation. For lack of data, little could be
done in the commodity estimates to allow for such changes.
The above record of revisions for the commodity flow portion of consumer
commodities might be broadened to note that the downward revision for
total consumer commodities for 1947 also amounted to 3 percent. Further,
consumer expenditures for services, as explained in that section, also underwent statistical revision—notably to incorporate results of the 1948 Census of
Business and the 1950 Census of Population and Housing—and, in total,
were raised by about 4}i percent for 1947. The net result was that the new
1947 total for commodities and services combined differed by less than one
percent from the previous total.
Of the commodity groups derived by methods other than the commodity
flow, it may be noted that the estimates for passenger cars, gasoline and oil,
and purchased household fuels are subject to a significant qualification.
The allocation of these commodities to consumers is based on limited information and may be considerably in error.
Though indirect and inconclusive, some evidence bearing on the general
reliability of the consumer commodity totals is afforded by the size of the
statistical discrepancy between the income and expenditure sides of the
national income and product account. For a component series as large as
consumer commodities—comprising in most years nearly half of the gross
national product—the small size of the discrepancy throughout the period
of the estimates may be taken as some external indication that the general
level of the series is not markedly in error. This is particularly the case since
considerable reliability can be attached to certain other large income and
product components, such as wages and salaries, corporate profits, and
government purchases of goods and services.
Additional indirect evidence on the reliability of total consumer commodity expenditures can be adduced. This stems chiefly from the relatively
close agreement between the Commerce and SEC estimates of personal
saving. (See table 6, Part V.) These two saving series, in very large degree,
are based on independent statistical sources. This is also true of disposable
income and the two consumer expenditure series (commodities and services)
which are subtracted from it to derive the Commerce personal saving estimates. Given these facts—plus the heavy statistical influence of the large
consumer commodity series on the calculation of personal saving—it seems
reasonable to conclude that the commodity series is relatively accurate. For
that not to be true, either of two seemingly unlikely situations would have to
obtain. Either (a) the level of personal saving as indicated by the Commerce
and SEC series would have to be substantially in error or (b) any marked
error posited for the consumer commodity totals would have to be offset
regularly in personal saving by errors in disposable income and/or consumer
expenditures for services.
The following, main section of the notes gives a description of methodology
in terms of the principal types of methods, as summarized in Exhibit 1. The
description is particularly limited for the large commodity flow segment,
since notes of this scope cannot deal with the numerous departures from

106

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS

general procedure or with the individual commodity groups, for which the
relative importance of the various steps in the estimating procedure (and
hence reliability) often varies significantly.

Commodity Flow Method, 1929-39
The individual steps in deriving total personal consumption expenditures
estimated by the commodity flow method are summarized for 1939 in
Exhibit 3. Each of these steps will be described briefly.
1. Distribution offinishedand mixed manufactured commodities.—The basic source

of manufactured commodities is the Census of Manufactures. Detailed output
data—for about 4,000 commodities in 1939—were reported there for odd
years of the 1929-39 period.
For the most part, the census data were comparable from year to year.
There were, however, several minor deficiencies. One was that census coverage was slightly less complete in 1933 than in other years. The 1933 census
data were raised whenever some indication was given of the degree of incompleteness in an individual industry—usually less than 2 percent. Another
minor deficiency stemmed from the fact that the reported commodity information was somewhat less detailed for some years, notably 1933, than others.
It was often necessary to break down combinations of commodities on the
basis of the details reported for proximate years.
Still other limitations lay in the difficulty of establishing strictly comparable
series over the 1929-39 decade for many commodities made in the textile
and apparel industries, and in the differing degrees of coverage of some of
these industries in particular census years. Aside from careful attempts to
achieve proper classification, little could be done to overcome these limitations. It is possible that, especially for 1935 and 1937, the figures for some of
the component commodities of the clothing and semidurable house furnishings
groups are slightly too low.
Following these and other minor adjustments of the reported census commodity values, the first major task was to classify the full array of commodities
into the categories of finished, unfinished, and mixed.
Finished commodities were defined to include (a) commodities that had
reached the stage at which they would be taken over by individual consumers
without further processing, and (b) durable equipment intended for multiple
use in production and with an average life of one or more years.2
Classification under (a) did not depend solely on the degree of processing; it
was based also on the use to which a commodity is put. Flour, for example,
was classified as finished if consumed in households but as unfinished if
consumed by a factory making bread or other products for which flour is a
raw material.
Unfinished commodities were defined to include (a) all commodities entering further into the productive process other than those with an average life
of one year or more; and (b) in the context of this statistical study, finished
commodities purchased by government and by nonprofit institutions serving
persons, as well as construction materials—all of which are accounted for in
other segments of the gross national product and estimated by methods other
than the commodity flow.3 Exports, counted under net foreign investment,
also are unfinished in this context. They were not classified as such initially,
but were eliminated at a subsequent step in the estimating process.
The mixed category is a tentative grouping for commodities having appreciable diversity in use, and which therefore could not be classified wholly as
2. The formulation under (a) covers the bulk of the consumer items. A more precise definition of a finished consumer commodity would add to the phrase "without further processing"
the qualification in manufacturing or the services. This qualification is needed to take account
of marginal cases in the application of the commodity flow method. If a commodity is further
processed outside manufacturing and the services, it is counted as finished in the present
context. For instance, clotn bought by custom tailoring establishments is classified as finished
because the output of such establishments is not listed in the Census of Manufactures, and
hence would be missed if purchases of materials by custom tailors were not classified as
finished. However, if a commodity is purchased by a service establishment and covered in
its service receipts it is treated as unfinished in the commodity flow method to avoid duplication, as it is accounted for in personal consumption expenditures for services. For instance,
spark plugs purchased and installed by automobile repair service establishments and covered
by their service receipts, rather than sold separately to consumers, are classified as unfinished
as they are reflected in consumer purchases of services.
3. One complicating element, which is explained in the section relating to producers'
durables and need only be mentioned here, is that for statistical reasons government purchases
of durable equipment were not eliminated as "unfinished" in the process of commodity classification, but at a later stage.

finished or unfinished. The mixed commodities belonged in part to the
unfinished grouping and in part to the producer durable and/or consumer
commodity groupings, and required allocation among them. In the strictest
sense, it is realized, most commodities are mixed, but it would not have been
feasible to allow for very small fractions of finished or unfinished use. Therefore, only when there was reason to believe that the secondary use of a
commodity was appreciable was it assigned to the mixed category for
allocation.
Exhibit 3.—Derivation of Total Personal Consumption Expenditures Estimated
by the Commodity Flow Method, 1939
[Millions of dollars]
1. Distribution of finished and mixed manufactured commodities, before deduction of government purchases of durable equipment
a. Finished
1. Producers' durables
_
2. Consumer commodities
3. Combined, allocated to
a. Producers' durables.
b. Consumer commodities
..
b. Mixed, allocated to
1. Producers' durables
2. Consumer commodities3. Unfinished_

_
_

25,978
12,327
1,714
9,188
1,425
206
1,219
13,651
1,112
8,210
4,329

2. Manufacturers' production of finished consumer commodities [la(2)-(-la(3b)-f18, 617

lb(2)]_

3. Subtract: Change in manufacturers' inventories.

18, 574

4. Equals: Manufacturers" sales of finished commodities

2,641

5. Producers' sales of finished nonmanufactured commodities

21,215

6. Producers' sales of finished commodities (4+5)

993

7. Add: Transportation charges

22,208

8. Equals: Producers' sales, inclusive of transportation charges, distributed to
a.
b.
c.
d.

Exports
WholesalersRetailers. _
Consumers

_.
_

9. Imports

504
12,669

10. Total purchases by wholesalers (8b+9).

106

11. Subtract: Change in wholesalers' inventories

12, 563

12. Equals: Cost of goods sold by wholesalers

2,767

13. Add: Wholesalers' markups

15,330

14. Equals: Wholesalers' sales of finished commodities.-

308

15. Subtract: Wholesalers' exports

15,022

16. Wholesalers' domestic sales, distributed to:

14,140
882

a. Retailers
b. Consumers
17. Total purchases by retailers (8c+16a)

170
12,165
8,778
1,095

22,918
_

231

18. Subtract: Change in retailers'inventories

22,687

19. Equals: Cost of goods sold by retailers

9,874

20. Add: Retailers' markups

32,661

21. Equals: Retailers'sales of finished commodities

34,538

22. Consumers'purchases exclusive of general retail sales taxes (8d+16b+21)
23. Add: General retail sales taxes

24. Equals: Personal consumption expenditures estimated by the commodity flow
method

34,928

The classification of commodities as finished, unfinished, or mixed was
greatly facilitated by the extent of commodity detail in the Census of Manufactures. This detail made it possible to classify as finished or unfinished many
product categories which, if combined, would have required allocation. For
example, soap chips, flakes, washing powder, cleansers, and similar products
were reported in 1939 broken down between packaged and bulk. While
consumers buy some of the latter and businesses and other "nonconsumers"
some of the former, the reported breakdown undoubtedly furnished a
satisfactory basis for distinguishing between consumer and nonconsumer uses.
On the other hand, the equally important granulated, powdered, and
sprayed soaps were reported without a breakdown between packaged and
bulk and therefore had to be allocated.

NATIONAL INCOME, 195 4 EDITION
The greater number of the commodities reported could be classified
directly as either finished or unfinished. An overwhelming proportion of
commodities in this initial finished classification could be assigned immediately to either the producers' durable or the consumer commodity category.
However, some finished commodities—household furniture and tools are
examples—fell into both of these categories, and so required allocation. This
combined group of finished commodities was not relatively large—as shown
for 1939 by the data in Exhibit 3—and its allocation was not a likely source of
appreciable error, particularly with respect to the gross national product
total. Misallocation between consumer commodities and producers' durables
would not lead to error in that total except for the addition of an inappropriate distributive cost element in passing from the producer value to the final
value.
Commodities which could not be classified directly as wholly finished or
unfinished—the "mixed" commodities—required special study to allocate
them among the categories of producers' durables, consumer commodities,
and unfinished. Fortunately, census reports provided two types of commodity
information that were very useful for this purpose: (1) Data in the biennial
Census of Manufactures on the quantity and cost of principal materials consumed in certain industries; and (2) data on the distribution of sales by class
of purchaser in the Distribution of Manufacturers' Sales for 1929, 1935, and
1939, and in the Census of Wholesale Trade for 1929, 1933, 1935, and 1939.
These census data were checked and supplemented by use of numerous
special commodity studies from both government and trade sources, and by
correspondence with business firms and commodity experts.
The materials consumed data were used to estimate the unfinished part of a
number of mixed commodity items in the large food group. Special commodity data were used in the allocation of durable equipment items. In some
cases, with adequate data lacking, the allocations had to be based on judgment, including outside expert opinion. But the method most generally
followed in estimating the nonconsumer portion of mixed commodities
involved application of the sales distribution data.
In the manufacturers' and wholesalers' sales distributions provided by the
censuses, sales to "industrial, commercial, professional, and institutional
users"—the 1939 designation, termed "sales to industrial users" for brevity—
were taken to indicate nonconsumer use. Included in the coverage of this
designation were private institutions and governmental bodies. In addition to
sales to industrial users by manufacturers and wholesalers, interplant transfers by manufacturers were included in the measurement of nonconsumer use.
Nonconsumer use of mixed commodities was estimated in two parts. First,
the percentages that manufacturers' interplant transfers and sales to industrial
users constituted of manufacturers' total transfers and sales were calculated
for industries representing the individual commodities most closely. In some
instances the industry sales and transfer data were adjusted by commodity
data to make their coverage more representative, and thus to prevent bias.
Secondly, the percentages of manufacturers' total interplant transfers and
sales formed by their sales to wholesalers were multiplied by the percentages
of wholesalers' sales (adjusted for duplication) made to industrial users, with
the lines of trade given in the wholesale census having to be matched with
the commodities involved.*
The two percentages were then added and applied to the detailed commodity totals. For mixed commodities allocated by sales distribution data,
the unfinished portion thus represented sales by manufacturers to "industrial
users" either directly or through the channels of wholesale trade. The
allowance for nonconsumer use represented by wholesalers' sales to industrial
users could have been estimated and deducted later, but was handled at the
manufacturers' level to simplify the estimating procedure.
By using the sales distribution data, materials consumed data, and special
commodity information, it was possible to achieve fairly reliable breakdowns
for most of the mixed commodities. Nevertheless, by their very nature these
4. Wholesaling in this analysis is defined to cover service and limited function wholesalers,
manufacturers' sales branches and offices, assemblers, and, in 1929 and 1933, chain store warehouses (classified in retail trade by the 1935 and 1939 censuses). Agents and brokers, included
'n the census definition oi wholesale trade, are generally excluded; their operations are covered
by sales distribution and other data reported by their principals, manufacturers and wholesalers. Also to avoid duplication, the sales distributions were adjusted to eliminate sales to
other wholesalers from the total sales and sales distributions of the trade making them. For
most trades, wholesalers' reporting of sales distribution data to the census was substantial
but not complete; in each such trade the data reported by each type of wholesaling (service
and limited function wholesalers, manufacturers' sales branches, etc.) were blown up to total
sales reported by that type and added to give the sales distribution of the trade.
29:1692°—54- - 8

107

breakdowns were approximations, and undoubtedly were subject to errors.
As computed from the data shown in Exhibit 3, allocations from mixed commodities formed 44 percent of the estimated value of manufacturers' production of finished consumer commodities in 1939.
At this point the procedure of estimating consumer commodities had
arrived at the manufacturers' value of finished production for odd years
of the 1929-39 period. This was computed, with reference to Exhibit 3, by
summing the values of consumer commodities (1) assigned directly as finished, (2) allocated from the combined total of finished output of consumer
commodities and producer durables, and (3) allocated from the mixed
commodity total.
The detailed commodity figures were next combined into groups (in
general, those shown in table 30, Part V). Further steps in the commodity
flow procedure related to commodity group totals, rather than to individual
products within the groups. In these steps, the various sales, output, inventory, foreign trade, and mark-up data—whether for commodities, industries, lines of wholesale business, or types of retail store—were always
first combined so as to correspond best with the commodity groups.
For the even years of the period, the estimates of manufacturers' output
of finished consumer commodities were of necessity based on partial information, which was utilized for interpolation between the census-based
estimates. Nevertheless, the intercensal figures are believed to be of a fairly
high order of reliability.
With respect to the actual procedure, either manufacturers' production or
manufacturers' sales were interpolated, depending on whether the best
available interpolating data related to production or sales. In instances of
the latter, the interpolation was carried out, of course, at the state of the
estimating procedure indicated by line 4 of Exhibit 3—where manufacturers'
sales had been derived by subtracting changes in inventories from manufacturers' production.
From a wide variety of sources were assembled as many different interpolating series for each commodity group as were available. These series, representing various product and industry data, were tested against one another
by examination of coverage and of relative movement from one census year
to the next. Reasonably good intercensal interpolations were obtained for
every commodity group.
2. Manufacturers' production of finished consumer commodities.—-Following t h e
lengthy process of classifying the biennial census data and then making
interpolations for other years, estimates of manufacturers' production of
finished consumer commodities were available for all years of the period
1929-39. (The procedural exception noted above regarding interpolations of
sales may be mentioned again.) The estimates represented manufacturers'
output for export and consumer use.
3. a n d 4. Subtraction of change in manufacturers' inventories to derive manufacturers' sales.—Annual changes in the inventories of finished consumer commodities held by manufacturers were estimated and subtracted (algebraically)
from the production figures to obtain manufacturers' sales of finished commodities. Much of the 1929 census data, however, already represented manufacturers' sales, and no adjustment was necessary.
Changes in manufacturers' inventories of consumer products for the years
1937, 1938, and 1939 were estimated from values of finished product inventories reported in the manufacturing censuses for 1937 and 1939. These
censuses obtained beginning and ending inventories broken down into
finished product inventories and all other inventories—materials, work in
process, merchandise, etc. The ratios of finished product inventories to total
products of establishments in each appropriate industry were applied to the
individual commodity values to obtain beginning and year-end inventories
of finished consumer commodities for 1937 and 1939. These were summed by
commodity groups, and the resulting inventory totals were differenced to
obtain the annual changes for 1937, 1938, and 1939.
For the years 1929-36 the inventory adjustments were based on inventory
and sales data compiled by the Internal Revenue Service from corporate
income tax returns, as given in Statistics of Income—Part 2 and the underlying
"Source Book," containing further industrial detail. Inventory changes were
not actually calculated for this period. Rather, the procedure for translating
the commodity output data to sales was to (1) compute sales-production
ratios for the commodity groups for the year 1937; (2) extend them to earlier
years by similar ratios computed from the corporate industry data; and (3)
multiply the commodity group production values by the resulting ratios.
A limitation of the 1937-39 inventory-change estimates stems from the

108

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS

fact that the census finished-product data on inventories were too broad in
soope for the purpose at hand, covering finished nonconsumer, as well as
consumer, goods. The corporate data used for the 1929-36 period were
much less satisfactory. They represented total corporate inventories (the
unfinished part generally being large and relatively volatile), and were
available in an industrial detail too limited to provide appropriate representation of many of the individual commodity groups.5 Little confidence can
be placed in the inventory adjustments for the earlier period. Fortunately,
however, they do not, for the most part, form an appreciable element of the
final consumer commodity values.
5. Producers' sales of finished nonmanufactured commodities.—Producers' sales of
foods reaching consumers without undergoing manufacture were added at
this stage. Since the initial basic data used represented sales, rather than production, no inventory adjustment was required.
Statistics on agricultural products, available annually, were secured from
the Department of Agriculture. Because substantial amounts of fruits, vegetables and other farm products are used in the manufacturing process, the
estimates of farmers' cash receipts from marketings had to be allocated
between finished and unfinished. The allocations for the many individual
products—believed, in general, to be fairly reliable—were derived largely
from data of the Department of Agriculture.
Nonmanufactured foods also included the products of commercial fisheries.
Estimates of the value of edible fish other than that canned, dried, or otherwise preserved (already covered under manufactured foods) were derived
chiefly from compilations of the Fish and Wildlife Service.
6. Producers' sales of finished commodities.—With the addition of producers'
sales of nonmanufactured foods to manufacturers' sales, there was obtained
a complete measure of finished commodity sales (f. o. b. at producers' prices)
for export and consumer use. In 1939, this measure accounted for 61 percent
of the final market value of consumer commodity purchases estimated by the
commodity flow method. Manufactured commodities represented 53 percent
of that value, and nonmanufactured foods 8 percent.
7. Aidition of transportation charges to producers' sales.—The transportation
allowances added to producers' sales covered transportation from producer
to the first buyer, whether retailer, wholesaler, or consumer, and to port
of export. Costs of transporting consumer commodities beyond the first
buyer were assumed to be included in wholesalers' and retailers' markups.
While this treatment was substantially correct, it very probably resulted in
some incompleteness of coverage of the transportation cost element.
The estimates of transportation charges were based almost wholly on data
from the Interstate Commerce Commission. The procedure followed was to
multiply producers' commodity sales by annual ratios of freight revenue
per ton to value per ton at point of production for most nearly appropriate
Interstate Commerce Commission commodity classifications. Ratios were
calculated for 89 of the Interstate Commerce Commission's 157 commodity
classifications found to be related to one or more of the consumer commodity
classifications.
Freight revenue per ton of freight carried was computed for each year of
the 1929-39 period from freight revenue and tonnage data published annually
by the Interstate Commerce Commission. Values per ton at point of production were obtained from Interstate Commerce Commission publications
for the years 1928, 1930, 1933, 1936, and 1939. Data on value per ton for
other years were derived for the relevant Interstate Commerce Commission
commodity classifications by interpolation on the basis of 1928-39 price
indexes constructed principally from wholesale price series of the Bureau of
Labor Statistics.
For lack of data on other forms of transportation, rail freight charges
formed the sole basis of the specific transportation allowances in the commodity flow estimates except for a rough supplementation to cover trucking in
the case of nonmanufactured foods. Truck transportation is important for
many consumer commodities, and to the extent that truck rates differed
from rail rates the procedure would lead to error in the estimated cost of
moving the commodities from the producer to first buyer.
8. Distribution of producers' sales, inclusive of transportation charges.—The
distribution of manufacturers' and other producers' sales among exports,
wholesalers, retailers, and consumers is a vital step in the commodity flow

5. Failure to take account of the differential movement of inventories in the small noncorporate sector, for which data for the 1929-39 period are fragmentary, was probably only a very
minor source of error.

method. Producers' exports are eliminated at this point since they are accounted for, by a different methodology, in the net foreign investment component of the gross national product. The three remaining channels are
differentiated because varied markup treatments must be applied to the
finished consumer commodities flowing through them.
No markups are applied to producers' sales direct to consumers, which
become immediately a part of the consumption expenditure estimates.
Wholesalers' markups are applied to commodities sold by producers to wholesalers and then either exported or sold directly to consumers. Cumulative
wholesalers' and retailers' markups are required for consumer commodities
sold by producers to wholesalers and then sold by them to retailers. Lastly,
only retailers' markups must be added to sales made by producers directly to
retailers.
The distribution of manufacturers' sales, inclusive of transportation charges,
was estimated for 1929, 1935, and 1939 very largely from data provided in
the census reports on Distribution of Manufacturers' Sales. With two qualifications noted below, appropriate percentage distributions were derived directly
from the reported data for detailed industry groups and applied to the consumer commodity groups. For intercensal years, the derived census-year
percentages, which did not change appreciably, were interpolated along a
straight line. The distributions of other producers' sales—nonmanufactured
foods—were based chiefly on estimates of farmers' sales distributions made by
commodity specialists in the Department of Agriculture.
In two particular aspects, sales distributions as reported by the censuses
required modification. First, since wholesalers' sales to industrial users had
been eliminated in arriving at manufacturers' sales of finished consumer
products, census data on manufacturers' sales to wholesalers were reduced
by the proportions of wholesalers' sales to industrial users which had been
employed in estimating the nonconsumer-use portion of mixed commodities.
Secondly, exports required special estimation since the census sales distributions showed manufacturers' exports separately only in 1939. The export
estimates derived for 1939 by applying the industry sales distribution data to
the commodity values were extrapolated to the years 1929—38 by selected
commodity data on exports obtained from Foreign Commerce and Navigation of
the United States, published by the Bureau of Foreign and Domestic Commerce.8 The 1929 and 1935 sales distributions and the annual estimates of
producers' commodity sales were then adjusted to eliminate exports, and
the distribution estimates were made in terms of domestic sales to wholesalers,
retailers, and consumers.
It would appear that the most significant limitations of the estimated
distributions of producers' sales stemmed from the necessary application of
industry and line-of-trade data to product data. Although every effort was
made to achieve appropriate matchings of these data, the distributions for
some commodities could have been appreciably in error.
9 and 10. Addition of imports to produces' sales distributed to wholesalers to arrive
at total purchases by wholesalers.—Imports are a source of commodities sold to
consumers and must be added to producers' domestic sales. In the commodity
flow process imports are handled entirely as purchases by wholesalers. In the
main, this accords with fact, as only a minor portion of consumer product
imports is made by manufacturers, by retailers, or by consumers directly.
Imports were estimated for the various consumer commodity groups for the
years 1929—39 from annual commodity data on "imports of merchandise for
consumption" (with "calculated duty" added) published in Foreign Commerce
and Navigation of the United States by the Bureau of Foreign and Domestic
Commerce. Nonconsumer use was not allowed for explicitly—that is, by
carrying out the sort of allocation process employed in classifying the domestic output of manufactured products. Instead, commodities shown in the
import statistics were selected by inspection to correspond with the various
consumer commodity groups, and reliance was placed on compensating
errors of inclusion and omission.
The estimated value of consumer imports, amounting to less than 2
percent of the final value of consumption commodities in 1939, was somewhat understated. Because of the nature of the basic data, the estimates
omitted ocean transportation charges from country of export to the United
States. Also, they did not cover handling, transportation, and related
charges between port of import and purchaser, although this factor is
minimized by the fact that to a considerable extent importers are located
in ports of import.
6. The derivation of the export series is discussed in step 15, deduction of wholesalers'
exports.

NATIONAL INCOME, 195 4 EDITION
11 a n d 12. Subtraction

of change in wholesalers' inventories to obtain cost of

goods sold by wholesalers.—The next stage in the commodity flow procedure
calls for estimation of changes in wholesalers' inventories of finished consumption commodities. They are subtracted from wholesalers' purchases
in order to derive the costs of commodities sold. To these costs can then be
added wholesalers' markups to arrive at their sales of consumer commodities.
The general procedure for estimating changes in wholesalers' inventories
of finished consumer commodities was to prepare inventory-cost of goods
sold ratios and to apply those ratios to the annual estimates of wholesalers'
purchases.' The procedure may be outlined as follows.
(1) Ratios of wholesalers' year-end inventories at cost to annual sales
(adjusted for duplication) were computed for the years 1929, 1933, 1935,
and 1939 from data contained in the Census of Wholesale Trade.
As the first element of these computations, total inventories reported by
type of operation—service and limited function wholesalers, manufacturers'
sales branches and offices, and, in 1929 and 1933, chain store warehouses—
in each relevant line of trade were prorated among sales to other wholesalers, sales to industrial users, and other sales (exports and sales to retailers
and consumers). The data did not permit of any other apportionment of
reported inventories, but it is believed that the assumption of a uniform
rate of inventories to sales within a single trade and type of operation was
substantially correct.
Inventories held against sales to other wholesalers were next prorated
between sales to industrial users and other sales. This was done by commodity groups, combining all trades and types of operation assigned to each
group.
In combining trades and types of operation to obtain rates of inventories
to sales for the consumer commodity groups, the weights used were the
appropriate census sales totals—exports and sales to retailers and consumers,
plus the prorated portion of sales to other wholesalers covering these categories.
(2) The ratios of inventories to sales for the census years 1929, 1933,
1935, and 1939 were converted to ratios of inventories to cost of goods sold
oy use of wholesalers' markup ratios (described below). With S = sales, M =
markups, C=cost of goods sold, and I=inventories, then C-f-M = S and p
, I /
,M\
was computed as 5 ( 1 -f—g- ) •
(3) The ratios of inventories to cost of goods sold so derived were multiplied
by wholesalers' purchases to obtain year-end inventories of consumer commodities for census years.
(4) In the estimation of year-end inventories for intercensal years, one
of two procedures was followed. For some commodity groups, the censusbased inventory-cost of goods ratios were interpolated and multiplied by
purchases. But the more general procedure followed, because of the nature
of available data, was to interpolate the census-year inventory figures directly.
The information on wholesalers' inventories by line of trade available
for interpolations was quite limited. The wholesale data used were sometimes not directly representative of the individual commodity groups, and
in many instances it was necessary to resort to use of retail inventory data.
For the years 1929-34, department-store inventory data from the Controllers' Congress of the National Retail Dry Goods Association were most
generally used for interpolation. For the 1935-39 period, the principal
interpolating data were sample series on wholesalers' closing inventories
compiled by Dun and Bradstreet and by the Bureau of the Census from its
monthly Wholesale Survey. For commodity groups for which other information was lacking, use was made for all or part of the 1929-39 period of
corporate wholesale trade data from Statistics of Income. These related, for
all wholesale corporations combined, to the ratio of total inventories to
cost of goods sold.
13 a n d 14. Addition

of wholesalers'

markups

to obtain wholesalers'

sales of

finished commodities.—Wholesalers' markups form an appreciable element
of the final market value of consumer commodity purchases, amounting
to 8 percent in 1939.
In the estimation of wholesalers' markups, ratios of operating expenses
to sales (adjusted for duplication) in 1929, 1933, 1935, and 1939 were de7. In deriving inventories, inventory-cost of goods ratios should be applied to costs of goods
sold, not purchases. Application to the latter yields only first approximations of inventories,
which could have been adjusted. This was not done because the quality of the data did not
warrant the labor involved.

109

rived for each commodity group from wholesale census data for appropriate
lines of trade. Because of the lack of a relevant breakdown of the reported
operating expense figures, the same sort of procedure was required as that
applied to census inventory data in estimating changes in wholesalers'
inventories of consumer commodities. In brief, total operating expenses for
each relevant type of operation in each trade were first prorated among
sales to other wholesalers, sales to industrial users, and other sales (exports
and sales to retailers and consumers), after which the operating expenses
prorated to sales to other wholesalers were divided by commodity groups
between sales to industrial users and other sales. The weights used in combining selected lines of trade and types of operation into a single operating
expense-sales ratio for each commodity group were the relevant sales totals,
covering exports and sales to retailers and consumers and a prorated portion
of sales to other wholesalers attributed to these categories as against industrial
users.
Principal sources used to interpolate census-year expense ratios for
intercensal years were the series of wholesale surveys made by Dun and
Bradstreet and the 1941 report on Distribution Costs, An International Digest
of the Graduate School of Business Administration, Harvard University.
When appropriate wholesale data were lacking, the movement of the comparable group expense ratio for retail trade was used.
It was necessary to add profit ratios (ratios of profits to sales) to the operating expense ratios to obtain gross margin ratios. The available information
on wholesale profits by line of trade was scanty. Some of the special wholesale
surveys were helpful, but frequent use was made of gross margin-operating
expense ratios developed for comparable retail trade groups. And for some
commodities the selection of the profit ratios had to be largely arbitrary.
Still, it should be noted, even large errors in the profit element of wholesalers'
gross margins would have little effect on the consumer expenditure estimates.
The annual wholesale gross margin ratios were converted to markups by
use of the equation M = J J p

where M is the markup percentage of cost,

and G is the gross margin percentage of sales.
15. Subtraction of wholesalers' exports.—The basic commodity data, representing production or sales for both exports and consumer use, were adjusted
at the producer level for domestic nonconsumer use but not for exports.
Exports were deducted in part from manufacturers' sales of finished commodities. Remaining at this stage of tracing the commodity flow was the
elimination of wholesalers' exports from their sales.
Wholesalers' exports were derived by deducting previously estimated
manufacturers' exports from an independent estimate of total exports. The
totals were obtained by a process of commodity selection. The selection was
made from the detailed commodity classification of exports (valued at port
of exportation) given annually in Foreign Commerce and Navigation of the United
States. Where the export classification combined products included in the
commodity groups with other products not included, the omission or inclusion of the classification was based on rough appraisal of the relative
errors involved.
The procedures for deriving wholesalers' and manufacturers' exports may
lead to error on several scores. The error involved, however, is less than
would obtain from treating total exports as either manufacturers' or wholesalers' exports. This is because of the difference in markup treatment accorded
commodities eliminated from producers' sales and wholesalers' sales.
16. Distribution of wholesalers' domestic sales.—Wholesalers' domestic sales
of finished consumption commodities are broken down into sales to retailers
and sales to consumers. The latter, as final sales, are segregated, whereas
sales to retailers are still subject to inventory and markup adjustments.
The Census of Wholesale Trade provided the basis for the sales breakdowns
for 1933, 1935, and 1939. These censuses collected data on sales to retailers
for resale and on sales to consumers. Only limited use could be made of the
1929 wholesale census, which obtained information on sales to consumers,
but not to retailers, and in certain other respects was deficient for this purpose.
The sales distributions as reported in the 1933, 1935, and 1939 censuses
generally were somewhat incomplete. They were raised to reported total
sales by line of trade and type of operation (service and limited function
wholesalers, manufacturers' sales branches and offices, and, in 1933, chain
store warehouses). The resulting figures were summed for retailers and consumers, and the relationship of the two employed to break down the commodity estimates of wholesalers' domestic sales. The trades selected for

110

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS

application to each commodity group were, to the extent possible, the same
as those utilized in deriving wholesale inventory and operating expense
ratios. Changes in classification of lines of trade were ratio-adjusted so far as
possible, but in some cases it was necessary to use 1935 retailer and consumer
proportions for 1933.
For some commodity groups, analysis indicated the appropriateness of
utilizing for 1929 the proportion of consumer sales to total sales less sales to
"industrial consumers" computed from census data. But for most groups it
was necessary to carry the 1933 or 1935 proportions back to 1929. In a few
instances, where fluctuations in the consumer and retailer proportions
appeared to be cyclical, 1939 proportions were used for 1929.
For intercensal years, percentage breakdowns of wholesale sales to retailers
and consumers were obtained (except where 1933 or 1935 percentages were
held constant back to 1929) by interpolating the census-based percentages
along a straight line. The smallness of the changes between census years
suggested that this procedure was not markedly in error.
17. Total purchases by retailers.—After the distribution of wholesalers'
domestic sales is accomplished, total purchases by retailers are secured by
summing wholesalers' sales to retailers and (from 8c) producers' sales to
retailers.
18 and 19. Subtraction of change in retailers' inventories to obtain cost of goods

sold by retailers.—Estimates of changes in retailers' inventories of finished
consumer commodities were computed from inventory totals derived from
a combination of two distinct procedures. (1) Tentative estimates were first
prepared, for individual commodity groups, by a procedure paralleling that
used in making the wholesale inventory adjustment. (2) Modifications of
these estimates for certain years were made after comparing the relative
movement of the commodity inventory totals with that of the series on yearend book values of inventories in retail trade derived in the process of calculating tht inventory component of the gross national product. (See section
on Change in business inventories.)
(1) Year-end inventories of consumer commodities for census years were
derived by (a) computing ratios of retailers' year-end inventories at cost to
annual sales for the appropriate type-of-store classifications, (6) converting
these ratios to ratios of inventories to cost of goods sold by applying retaileis'
markup ratios (described below), and (c) multiplying the inventoiy-cost of
goods ratios by the estimated retailers' purchases of the various commodities.
Inventory change estimates by commodity groups for other than census
years were arrived at by differencing totals computed either by interpolating
the census year inventory-cost of goods ratios and multiplying them by purchases, or by interpolating the census year inventory figures directly. In the
former procedure, the most important source used was the Internal Revenue
Service tabulations of inventories and cost of goods sold from retail corporations' income tax returns. The latter procedure of direct inventory interpolation utilized mainly the department store data published by the Controllers' Congress of the National Retail Dry Goods Association in Depart-

The estimates of retailers' markups in the consumer commodity series,
like those of retailers' inventories, represented an integration of the results
of two methods. (1) Estimates were first prepared for individual commodity
groups, and (2) these were modified for the years 1930-38 on the basis of
relevant retail trade industry data.
(1) The first step involved the estimation of retailers' markups in a manner
similar to that employed for wholesalers' markups. Census-based ratios of
operating expenses to sales were interpolated by noncensus source materials,
raised on the basis of these materials to gross margin ratios by the addition
of profit and loss allowances, and then converted to markup ratios.
Operating expenses as a percentage of sales for comparable types of stores
most closely related to the various commodity groups were derived for
1929, 1933, 1935, and 1939 from the retail censuses. For 1939, the census
reported only payrolls; allowances for other operating expenses were based
on the 1935 relationship of total operating expenses to payrolls. Since
only the 1933 census included a satisfactory allowance for the services of
proprietors and firm members of unincorporated establishments, a similar
adjustment to the expense data had to be made for the other census years.
This was done on a basis comparable with that for 1933.
Data from numerous sources were used to obtain, by interpolation,
operating expense-sales ratios for intercensal years. An important source
providing commodity data was the annual reports on Departmental Merchandising and Operating Results of Department Stores and Specialty Stores pub-

lished by the Controllers' Congress of the National Retail Dry Goods
Association. Studies made by Dun and Bradstreet, the Federal Trade
Commission, the Harvard University Graduate School of Business Administration, and various trade groups provided additional ratios for many types
of stores. These various sources also provided the basic information on profitsales relationships necessary to translate the operating expense ratios into
gross margin ratios.
Several factors bearing on the validity of these estimates may be noted.
First, it is likely that errors stemming from the use of type of store data to
estimate retailers' markups for commodities have a tendency to be offsetting,
or compensating, in the total—a type of assumption which is much less
valid when data on manufacturing industry or wholesale line of trade are
applied to commodity data. This is because the preponderant part of retail
sales is made to consumers; that is, the nonconsumer element of sales is less
in retail trade than in wholesale trade or manufacturing.
Running counter to this consideration, however, is the fact that for all
years of the 1929-39 period the data for estimating the volatile profit-andloss component of retailers' markups for individual commodity groups were
partial and generally inadequate. Moreover, the available information for
making the interpolations of operating expense-sales ratios between census
years was far from comprehensive.
These several considerations were taken to indicate that the commodity
totals of retailers' markups were probably not satisfactory in cyclical movemental Merchandising and Operating Results of Department Stores and Specialty
ment over the period.
Stores. The departmental breakdown of inventories given was detailed and
(2) This movement was checked against, and modified by, a series which
adaptable to the commodity groups. This source could be used only for the
may be termed "adjusted income originating in retail trade." It was derived
1929-34 period, as the inventory figures after 1934 were presented as stock
by two types of adjustment of the National Income Division's 1929-39 estiturns, unsuited to estimation of year-end inventories. For the later years of
mates of income originating in retail trade and automobile services. The first
the period, inventory series from a variety of sources, chiefly Dun and
consisted of subtracting the inventory valuation adjustment and adding
Bradstreet, were utilized.
depreciation, gross rental payments, and indirect business taxes.
(2) The relative movement of the total of commodity group inventories
The resulting series, while more nearly representing retail gross margins,
derived by the foregoing procedure was similar to that of the retail trade
was too broad in scope for the purpose at hand. It included certain lines of
industry data in the 1929-33 period but diverged in the subsequent period.
trade not covered by the commodity flow estimates (such as motor vehicle
The industry data were used to interpolate between the census-based comdealers, service garages, and filling stations) and certain others in which the
modity totals for 1933, 1935, and 1939. The differences between the revised
nonconsumer element was large (such as lumber dealers). Separate income
totals and those obtained in step (1) as the summation of commodity groups
data for these various lines of trade were not available. Accordingly a corwere prorated among the latter.
rection to reduce the scope of the adjusted income total was made by use of
operating expense data in the following manner.
This over-all check and modification on the basis of the retail industry
estimates was indicated by the weakness of the available data for interpoFor the census years 1929, 1933, 1935, and 1939 total operating expenses
lating census-based estimates for many of the commodity groups. This type
for retail trade and automobile services were divided into operating expenses
of check had not been feasible in the case of the wholesale inventory adjustexclusive of the various lines of trade noted above. These ratios, with straightment because of the large role of unfinished commodities in the operations
line interpolations for intercensal years, were then multiplied by the adjusted
of the wholesale trade industry.
income originating totals for retail trade and automobile services.
20 and 21. Addition of retailers' markups to arrive at retailers' sales of finished
The income series obtained by this second adjustment was used to intercommodities.—Retailers' markups are a very sizable element of consumer com- polate between the 1929 and 1939 estimates of retailers' markups obtained
modity purchases estimated by the commodity flow method. In 1939 retail
by summing the individual commodity groups. The relationship of 1939 to
markups formed 28 percent of the final consumer value.
1929 was similar in the two series, but the movement within the period

NATIONAL INCOME, 19 5 4 EDITION
differed appreciably, the income series showing a wider amplitude. The
absolute differences between the revised estimates of total retailers' markups
for the years 1930-38 and the original estimates obtained as the summation
of individual commodity groups were prorated among them.
This adjustment, though rough, probably improved both the estimates of
retailers' markups in the consumer commodity series and the statistical consistency between national income and gross national product. A similar
adjustment was not made for wholesalers' markups because of the greater
importance of unfinished products in the wholesale trade industry.
22.

Consumer commodity purchases exclusive of general retail sales

taxes.—The

final market value of consumer commodity expenditures, except for the
addition of general retail sales taxes, is arrived at by summing sales of finished
commodities to consumers by producers (8d), wholesalers (16b), and
retailers (21).
Exhibit 4.—Derivation of Total Personal Consumption Expenditures Estimated
by the Commodity Flow Method, 1947
[Millions of dollars]
Distribution of finished and mixed manufactured commodities, before deduction of government purchases of producers' durable equipment
a. Finished..

81,993
42,840

(1) Producers' durable equipment,.
(2) Consumer commodities
(3) Combined, allocated to

10,076
29,053
3,711

(a) Producers' durable equipment.
(b) Consumer commodities.._
b. Mixed, allocated to..

734
2,977
39,153

(1) Producers' durable equipment.
(2) Consumer commodities
(3) Unfinished

3, 657
18. 494
17,002

Manufacturers' shipments (or production) of finished consumer commodities
(la(2)+la(3b)+lb(2)]
Subtract: Changes in manufacturers' inventories

50, 524
187

Equals: Manufacturers' sales of finished commodities

60, 337

Producers' sales of finished nonmanufactured commodities

8,550

Producers' sales of finished commodities (4+5)

58,887

Add: Federal manufacturers' excise taxes

2,592

Add: Transportation charges

1,696

Add: Imports

975

Subtract: Changes in wholesalers' inventories

258

Add: Wholesalers' markups

6,699

Add: State excise taxes paid by manufacturers and wholesalers..

424

Subtract: Exports

2,613

Equals: Sales to retailers and consumers

68,402

a. Producers' sales directly to consumers
b. Wholesalers' sales directly to consumers-.
c. Retailers' purchases (14—14a—14b)
15. Subtract from retailers' purchases: Changes in retailers' inventories.
16. Equals: Cost of goods sold by retailers

3, 346
1, 325
63, 731
1,037

17. Add: Retailers' markups

25,886

18. Equals: Retailers' sales of finished commodities

88. 580

10. Consumers' purchases exclusive of retail taxes (14a+14b+18)

93, 251

20. Add: Federal retail excise taxes

521

21. Add: General retail sales taxes

997

22. Equals: Personal consumption expenditures estimated by the commodity flow
method

94, 769

23 and 24. Addition of general retail sales taxes to obtain personal consumption
expenditures estimated by the commodity flow method.—General retail sales taxes

and part of the alcoholic beverage taxes levied by State and local governments were the main taxes not covered by the trade markups in the 1933—39
period. Fiscal year data for that period were obtained from the surveys of
State and local government finances by the Bureau of the Census and shifted
to a calendar year basis. Adjustments of the tax totals to make them conform
in scope to the consumption expenditure estimates were made by using tax

111

collection data, by type of store, reported for a small number of sample
States. The adjusted tax totals then were prorated by the expenditure estimates among applicable commodity groups, with allowance for the exemption of food in certain jurisdictions.
After arrival at thefinalfigures,inclusive of taxes, the individual commodity
groups were classified as durable or nondurable, as shown in table 30 in
Part V. Durable commodities were generally defined as those having an
average life of three years or longer.

Commodity Flow Method, 1947
The commodity flow method used in making the benchmark estimates for
1947 followed the general approach outlined above for 1929-39. Basic values
were those of the 1947 manufacturing census, classified and allocated product
by product. These products, together with allowance for nonmanufactured
foods, were combined into consumption commodity groups and then raised
from producers' to consumer expenditure levels by adding estimated taxes,
transportation costs, and trade markups with lesser adjustments for exports,
imports and inventory changes. In the estimation of markups and inventory
changes, the 1948 wholesale and retail censuses were utilized, together with
retail margin data obtained from a sample of Federal income tax returns
for 1948.
The central procedure which gives the commodity flow method its name,
however, had to be modified because of the omission of sales distributions
from the 1947 manufacturing census. In the procedure for the prewar series,
as already described, manufacturers' sales to their various classes of customers
together with similar distributions of wholesalers' sales had been the basis
for tracing the flow of commodities through wholesale and retail channels,
as well as for estimating direct factory sales to consumers.
For wholesaling, it was necessary to give up the commodity flow approach
for 1947, since data for estimating wholesalers' purchases—the core of this
approach—were not available. The substitute procedure was to estimate,
by commodities, total wholesalers' markups and inventory changes and then
to determine the amounts applicable to consumers. This alternative, which
had been available at previous business censuses, may seem more direct,
but in actual practice (described below) proved complex and probably
less reliable.
For retailing, however, continuation of the commodity flow approach
proved possible. In the earlier estimates, retailers' purchases had been
derived by summing sales to retailers by manufacturers and sales to retailers
out of wholesale commodity flows—both unavailable for 1947 in the absence
of manufacturers' sales distributions. However, retailers' purchases of consumption commodities for that year could be obtained somewhat indirectly.
The basic commodity flow procedure with modifications dictated by lack
of manufacturers' sales distribution data yielded a composite total of sales
to retailers and consumers; and from this were then deducted estimates of
direct sales to consumers by (a) producers and (b) wholesalers. For the former
item, which accounts for only a small part of all consumer purchases, it was
necessary to follow the general practice of applying to 1947 manufacturers'
shipments percentages based on the 1939 sales distributions. Wholesalers'
direct sales to consumers were derived as part of the substitute procedure for
wholesaling noted above.
Exhibit 4 summarizes the 1947 commodity flow estimates. Following the
selection and allocation of basic product values, as well as minor adjustment
for manufacturers' inventory changes, sales offinishedconsumer commodities
by manufacturers and other producers appear as item 6. To these producers' sales were added manufacturers' and wholesalers' excise taxes (items
7 and 12), transportation charges (item 8), imports (item 9), and wholesalers' markups (item 11), while deductions were made for changes in wholesalers' inventories (item 10) and exports (item 13). Item 14 (derived from
items 6 through 13) consists of total sales to retailers and consumers. From
this total, direct sales to consumers by producers and wholesalers (items
14a and 14b) were deducted in order to derive retailers' purchases (item
14c). This served as the commodity flow base for estimating changes in
retailers' inventories (item 15) and—after this inventory adjustment to
obtain cost of goods sold by retailers (item 16)—for computing retailers'
markups (item 17). The addition of retail taxes (items 20 and 21) to the
total of items representing sales to consumers (14a, 14b, and 18) completed
the derivation of total consumer expenditures by the commodity flow
method (item 22).

112

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS

Except for those already discussed, procedural changes indicated by comparison of the 1939 and 1947 commodity flow exhibits were minor. Additional
taxes had to be estimated because the 1947 census excluded excise taxes.
Federal retail excise taxes, moreover, were adopted after 1939. State excise
taxes paid by manufacturers and wholesalers are shown separately in the
1947 exhibit (item 12), but in the 1939 exhibit were included as a matter of
convenience with wholesalers' markups (item 13). On the other hand, the
need for estimating manufacturers' inventory changes was narrowed to a
few industries, chiefly in food and clothing, by the fact that the 1947 census
generally collected shipments (sales) data and not production data, as in
the case of the 1939 census.
The effects of omitting manufacturers' sales distributions from the 1947
census were not limited to the procedural changes indicated by the exhibits.
They extended also to the underlying product allocations summarized in
item 1, Exhibit 4. In the earlier commodity flow work, data on sales to
industrial users had been employed extensively in allocating individual
commodities between consumer and nonconsumer uses. With such data
not available, it was necessary in the 1947 estimates to have recourse
largely to trade information and expert opinion concerning commodity uses.
Use was also made, as in the earlier period, of materials consumption data
collected in the census and of available commodity studies.
Following is a brief discussion of each of the steps in the 1947 commodity
flow procedure, as shown in the exhibit. This discussion is presented in light
of the preceding, lengthier description of the 1929-39 work, which contains
considerable information about the basic commodity flow procedure that is
not repeated here.
1. Distribution of finished and mixed manufactured commodities.—The problem
was to convert the product data in the 1947 manufacturing census, supplemented by other sources, into the consumer product base for the commodity
flow estimates. As in preparing earlier benchmarks, the first task was to
classify the full census list of commodities into the basic categories of consumer,
producers' durables, and unfinished—according to the definitions given in
the description of the 1929-39 procedure. For this, the 1947 census provided
data on about 6,000 separate products, compared with the 4,000 shown in
the 1939 census. Such additional detail serves to break up otherwise mixed
product items into products which can be assigned individually, thus reducing
the problem of allocation. It also strengthens the classification process in
respect to product items which may have appeared to belong entirely in
one use category but are shown by the additional census detail to include
products of another category or categories, which can then be properly
classified.
Another aspect of the 1947 classification of commodities concerned the
levels of consumer or nonconsumer use which were considered to require
allocation. Unavoidably, there are practical limits to the minor allocations
that can be made. Products subject to less important consumer use are
omitted altogether, while those with lesser degrees of nonconsumer use are
included fully. In the 1947 work, allocations were carried somewhat further
than had been attempted in earlier benchmarks.
The absence of manufacturers' sales distributions for 1947 has already been
noted as detrimental to the 1947 allocations. Except for a few foods, these
allocations had to be made without explicit assistance from the 1947 census.
The principal types of allocations employed in the 1947 estimates were as
follows:
(1) Adjustment of shipment values to allow for quantities used in further
manufacture—obtained from the 1947 manufacturing census for a few
products and estimated for others. Allocations of this type were employed
mainly in food, but were developed also for some other products. In the 1947
census, "net" shipment figures obtained for the important meat products
group represented a very considerable improvement over previously available
data, but the only other manufacturing use data reported were for sugar, the
bulk of wheat flour, and a few other food products in part.
(2) Deduction of purchases made by governments, institutions, physicians,
and others for nonconsumer use. These purchases in some cases were based on
reported information; in other cases, they were estimated from sample
surveys and other data. Important applications were in allowing for government purchases of food and clothing, for institutional purchases of food, and
for the nonconsumer use of pharmaceutical preparations and related
products. The allowance for business-use purchases of meals and beverages
was necessarily somewhat arbitrary.

(3) Use of sales distribution data as the principal basis for the allocation of
textile piece goods to consumers. The largest element in this allocation was
wholesalers' sales of piece goods to retailers and consumers, treated as the
consumer share of these products. Such sales were estimated in connection
with wholesalers' markups (see the description of item 11), by use of wholesalers' sales distributions from the 1948 census. Also included in this allocation were manufacturers' sales of piece goods to retailers—approximated by
applying manufacturers' distributed sales proportions for 1939 to their 1947
fabric shipments.
(4) Allocations in accordance with (a) expert opinion or (b) personal
judgment as to proportions of various uses. These types of allocations predominated outside of foods, clothing, and piece goods. In the "expert
opinion" category, use patterns were often suggested by industry or commodity specialists, obtained by them from trade papers, industrial studies, and
personal associations in the industries involved. Where such information was
not available, but allocation nevertheless required, recourse to judgment was.
necessary. This drew heavily on the 1939 percentage allocations, which
tended to be carried over to 1947 barring knowledge of changed conditions or
other considerations dictating different treatment.
Throughout the procedure of classifying manufacturers' shipments data
into the various use categories, the assignments and allocations made were
checked against those prepared by the Division of Interindustry Economics
of the Bureau of Labor Statistics in a task of generally similar nature. The
work of the BLS staff was of material assistance in this phase of the commodity
flow work.
2. Manufacturers' shipments (or production) of finished consumer commodities.—This is a simple summation of finished consumer products derived in step 1
through specific assignment, allocation of commodities combining consumption and durable equipment uses, and allocation of mixed commodities. The
equivalent producers' durable equipment items become the basis for coordinate estimates of expenditures for producers' durable equipment described
under that heading.
3 and 4. Subtraction of changes in manufacturers' inventories to derive manufacturers''
sales of finished consumer commodities.—This item of estimated changes in
manufacturers' inventories is much the smallest in Exhibit 4. The 1947 census
called generally for shipments (and interplant transfers) instead of production as in previous censuses. In the few industries for which production
data instead of shipments were obtained, it was necessary to make inventory
adjustments in order to derive product shipments. The changes in inventories
of finished products reported by these industries in the census were used to
estimate the adjustments.
5 and 6. Addition of producers' sales of finished nonmanufactured commodities to
obtain total producers' sales of finishei commodities.—Nonmanufactured products
entering the commodity flow estimates consist entirely of nonmanufactured
foods. As in the 1929—1939 estimates, data sources for nonmanufactured
foods in 1947 were the Department of Agriculture and the Fish and Wildlife
Service. Required allocations between fresh or unprocessed consumption and
use in manufactured foods were more largely available from published data
of the Department of Agriculture than for the 1939 and earlier estimates.
Combining nonmanufactured foods (item 5) with manufactured products
(item 4) completed the estimates of consumer products at producers' prices
shown in item 6.
7. Addition of Federal manufacturers' excise taxes.—These tax estimates were
introduced in the commodity flow procedure because the 1947 census
generally excluded excise taxes from shipment values. Internal Revenue
collections data were appropriately lagged to shift them to an accruals basis.
Where these adjusted excise taxes could not be assigned directly to a consumption commodity group, the general procedure was to use manufacturers'
shipments of the taxed products as the principal basis for any necessary
allocation between consumer and nonconsumer categories and apportionment
among commodity groups.
8. Addition of transportation charges.—Transportation charges were estimated
for 1947, as in 1939 and earlier estimates, by multiplying producers' commodity sales by ratios of freight revenue per ton to value per ton at point of production for most nearly appropriate Interstate Commerce Commission
commodity classifications. Changes in ICC classifications in 1947, however,
limited the applicability of the Commission's study for 1946—there was none
for 1947—of values per ton of products shipped. For many commodity
groups, it became necessary to estimate values per ton on a basis comparable
with the new ICC commodity classification for freight revenue per ton.

NATIONAL INCOME, 1954 EDITION

113

(2) Gross margins were estimated for merchant wholesalers, manufacturers' sales branches, and farm assemblers in each line of trade. Operating
expense ratios from the 1948 census were applied to the 1947 sales estimates,
and profits were added for merchant wholesalers and farm assemblers, by
use of profit ratios (ratios of profits to sales) based on "Statistics of Income"
data of the Internal Revenue Service and other available sources on wholesalers' profits.
Neither gross margins for manufacturers' sales offices nor profits for manufacturers' sales branches were allowed for, because these were believed to
have been covered by product values reported to the manufacturing census.
Commissions of selected types of agents and brokers, obtained by applying
commission rates from the 1948 census to the 1947 sales estimates, were
included in the gross margin calculations, while commissions of other types
were excluded on the grounds that they already had been covered in the
expenses of manufacturers or other wholesalers.
(3) Wholesalers' sales and gross margin ratios were adjusted for duplication—to eliminate sales to other wholesalers. Percentage distributions of
wholesalers' sales by classes of customers intbe 1948 census were used for this
purpose. In general, the nature of the adjustment was to reduce sales to a net
basis excluding sales to other wholesalers, while margins remained unchanged although at a higher rate to the reduced net sales.
The implicit assumption of such an adjustment was that the sales in question were made to other wholesalers in the same line of trade and type oi
operation. It was possible to improve upon this, however, in the case of
manufacturers' sales branches. Their sales to other wholesalers were assumed
to have been made to merchant wholesalers in the same line of trade, and a
proportionate share of their margins (actually, only operating expenses) was
transferred to margins of the latter.
(4) The estimates of wholesale sales and margins for lines of trade were
next transformed to a commodity basis. For sales, this was accomplished by
applying commodity percentages for each line of trade and type of operation
from the 1948 census to the estimated 1947 sales. Commodity margins were
derived by applying to the sales of individual commodities margin rates for
the lines of trade handling the major part of the commodity (separately by
types of operation). A single rate was selected if possible, but generally the
rates in two or more of the principal lines of trade handling the commodity
were averaged, using their sales of the commodity as weights. As a check on
the detailed estimates, the resulting margin rates on commodities were
compared with the margin rates of lines of trade in broad groups, and found
11. Addition of wholesalers' markups.—Estimating wholesalers' markups was to be in close agreement.
(5) As the final step preparatory to allocating wholesalers' margins, the
the area of most innovation in the 1947 benchmark procedure. As noted
commodity sales and margin estimates were broken down by customer classes
earlier, the lack of manufacturers' sales distributions for 1947 required a new
[exports, industrial users, retailers, and household consumers; other wholeapproach to wholesalers' markups.
salers had been eliminated in (3) and were no problem here] by use of
The principal problem in estimating such markups is to derive the volume
wholesalers' sales distributions from the 1948 census. Within each type of
of consumer commodities handled by wholesalers, because wholesalers'
operation, customer class percentages of lines of trade handling the major
markup rates cannot be applied to consumer commodity totals, but only to
part of each commodity were weighted by their sales of the commodity, and
the flow through wholesalers. Manufacturers' sales to wholesalers, estimated
the resulting pattern applied to total sales of the commodity. (Minor adjustfor individual consumption commodities from manufacturers' sales distriments were required to bring export sales thus derived from 1948 percentages
butions and combined into groups, had provided the solution in 1939 and
into conformity with actual 1947 exports.) Commodity margins were disearlier estimates. With the addition of imports and after inventory adjusttributed within types of operation in proportion to these customer class sales
ments, they had furnished the base to which wholesalers' markup rates were
of each commodity.
properly applied. The 1939 sales distribution patterns conceivably might
have been utilized again for 1947—in fact, were utilized in a limited way—
As noted, these estimates of the Bureau of Labor Statistics were the basis
but the degree of error that would have been involved was considered defifor deriving wholesalers' markups for the consumption commodity groups.
nitely greater than in the alternative adopted.
In general, the margins on sales to retailers and "household consumers" of
The key to this alternative 1947 procedure was allocation. Following the
selected commodities—as obtained from step 5—were classified as consumpderivation of wholesalers' sales and gross margins, the latter were broken
tion expenditures. In a few instances, where the customer class distributions
down by commodities. These commodity margins were then further broken
seemed inappropriate, other procedures were necessary. These included use
down between consumer and nonconsumer uses. In these breakdowns, or
allocations, of wholesale margins, it was practical to utilize the detailed
of the same pattern of allocations already made of manufacturers' shipments
estimates of wholesaling in 1947 by the Interindustry Economics Division of
of the products involved and development of markup estimates of the comthe Bureau of Labor Statistics. The preparation of these BLS estimates will
modity flow type on the basis of 1939 manufacturers' sales distributions.
be described below in five steps.
After this basic procedure of consumer allocation, it is to be noted, whole(1) Wholesalers' sales reported in the 1948 census were extended to 1947
salers' markups were still in terms of the wholesale commodity classification
by reference principally to the OBE published estimates of merchant wholeused in the 1948 census. Where this did not match the consumer commodity
saling. Although the extrapolating series were generally quite broad, the
classification of products, wholesalers' markups needed to be apportioned
extrapolation was carried out in full census detail with respect to lines of
among consumer commodity groups. This was based on producers' sales
trade (such as groceries, confectionery, and meats) and also types of operation
values of the individual products included in the wholesale commodity classes
(merchant wholesalers, manufacturers' sales branches, etc.). This was
under apportionment.
necessary for utilization of other census data available in similar detail.
The value-per-ton estimates were based, so far as possible, on quantities
and values in the 1947 manufactures census. Export statistics and other
shipping weight sources also were used. Due to data limitations, it generally
was not possible to develop values per ton for all products in a group. In such
cases, producers' sales of products for which values per ton could be obtained
were converted into tonnages, and the latter multiplied by freight revenue
rates for appropriate ICC commodity classifications. The ratio of freight
revenue to producers' sales from the summation of these individual product
items was applied to producers' sales for the entire commodity group to derive the transportation charges.
9. Addition of imports.—Imports for 1947—accounting for only about one
percent of the final value of consumption commodities—were handled in
virtually the same fashion as in the 1939 and earlier estimates. Consumer
products were selected from the full listing of commodity imports tabulated
by the Bureau of the Census. Consumer allocation of individual imports was
undertaken in only a few cases. "Calculated duty" figures, which were not
available for 1947 for the full product detail, were prorated among finer
categories of consumer imports. The area coverage of the import data
included offshore territories as well as the continental United States, but
adjustments to approximate the latter basis were made for the more important
foods involved.
10. Subtraction of changes in wholesalers' inventories.—In the estimation of
wholesalers' inventory change for each commodity group, the first step was
to compute the ratio of inventory change to sales for a single wholesale trade
selected as appropriate or representative. The selection was from among
trades included in the published merchant wholesaling estimates of the
Office of Business Economics—representing combinations of more detailed
trades in the wholesale census, on which the estimates are benchmarked.
Ratios of inventory change to sales of merchant wholesalers in 1947 from the
OBE series were modified to cover manufacturers' sales branches and farm
assemblers, for which 1947 estimates were not available, on the basis of
differences in ratios of beginning inventories (partly estimated) to sales in the
1948 census. These adjusted ratios of inventory change to sales then were
converted into ratios of inventory change to wholesalers' markups. For this
conversion, the markups by line of wholesale trade used were consistent with
the wholesalers' markups by consumption commodity groups (described
immediately below), to which the derived inventory change ratios were
applied to obtain commodity group estimates of wholesalers' inventory
changes.

114

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS

12. Addition of State excise taxes paid by manufacturers and wholesalers.—As dis- the cost of goods sold, using for this purpose the retailers' markup rate for
tinguished from general retail sales taxes (item 20), also largely imposed by
each group described under item 17. Finally, the base of reference was
the States, these are taxes on specified commodities payable by manufacshifted from the cost of goods sold to purchases, the resulting inventory
turers or wholesalers, or upon purchase by retailers, and hence properly
change ratios being directly applicable to retailers' purchases (item 14c).
included in costs of commodities to retailers. Data on State tax collections
Computed inventory changes were subtracted, yielding the cost of merwere obtained from the Census Bureau's Compendium of State Governmentchandise (finished consumer commodities) sold by retailers.
Finances and adjusted to the 1947 calendar year by prorating 1947 and 1948
17. Addition of retailers' markups.—The estimation of retailers' markups
fiscal year collections according to the number of fiscal year months in
by applying markup rates, largely from selected lines of retail trade, to the
calendar 1947.
cost of goods sold in each commodity group followed earlier procedure in the
13. Subtraction of exports.—Consumer items were selected from the detailed main. However, retail operating-expense information was not collected
in the 1948 census, and the computation of markups was based instead
Census Bureau listing of domestic merchandise exports and were allocated
largely on data from a sample of Federal tax returns for 1948 tabulated
between consumer and nonconsumer use in the same proportions as proby the Bureau of the Census and the Internal Revenue Service. The followducers' sales of the products. Such allocation of exports—a minor departure
ing five numbered paragraphs describe briefly the construction of retail
from 1929-39 procedure, where exports were based only on a process of
markup rates from these sample data, obtained for 20 selected lines of retail
product selection—was made necessary by the fact that domestic use patterns
trade.
had been applied to producers' total sales which covered exports as well as
domestic sales. As in the case of imports, the area covered included offshore
(1) The markup was defined in the first instance as the difference between
territories, but adjustments were made approximating a continental United
total receipts and cost of goods sold as measured by merchandise bought
States basis for the principal foods involved.
for sale less inventory change. The cost of goods sold reported as such on
14. Sales to retailers and consumers.—Following the various adjustments the returns was not used because it might include wages, materials, and
(items 7-13) of producers' sales (item 6), there were available at this stage of
similar costs which generally belonged in the commodity flow retail markup
the commodity flow work estimates of producers' and wholesalers' sales of
If these other costs in the reported cost of goods sold were large enough to
finished consumer commodities to retailers and consumers. In Exhibit 4, the
suggest the presence of manufacturing activity which might have been
overall total (item 14) is shown broken down into three parts: producers'
included in the manufacturing census, however, the individual firm was
sales directly to consumers (item 14a), wholesalers' sales directly to conremoved from the sample. This factor was important only for the apparel
sumers (item 14b), and retailers' purchases (item 14c), derived as a residual.
store sample (used for the clothing markup).
The first two are final expenditures except for the later addition of retail
(2) The sample was stratified into four classes: single unit firms in three
taxes (in items 20 and 21), but retailers' purchases require further adjustment
annual sales classes, divided at $100,000 and $1,000,000, and multiunit
for retailers' inventory changes (item 15) and retailers' markups (iteml7).
firms with four or more units. To obtain the average margin rate for each
line of trade, margin rates for these various classes were weighted by 1948
14a and 14b. Producers' and wholesalers' sales direUly to consumers.—For most
census sales data. (The sales of two and three unit firms, which had been
consumer commodity groups, manufacturers' direct sales to consumers were
omitted from the sample, were included in the sales weights for single unit
estimated by applying the same commodity group proportions as had been
firms.) The legal form pattern—a random element in the sample—was
used for 1939 (based on 1939 census product data and manufacturers' sales
found in the weighted sample sales figures to approximate closely that
distributions). For some groups (manufactured food, clothing, and a few
shown in the 1948 census.
others) for which suitable group proportions were not available from the
1939 estimates, direct sales estimates were prepared by applying detailed
(3) The margin rates thus obtained for individual lines of trade then were
manufacturers' sales distribution patterns for 1939 to 1947 data on products
adjusted to eliminate services. Service receipt percentages shown by the
in the commodity group. Manufacturers' direct sales of books and producers'
1948 census were used in this adjustment, the effect of which was to deduct
direct sales of nonmanufactured foods, however, were approximated entirely
service receipts in equal amount from both sales and margins, and reduce
from 1947 data. The manufacturers' and other producers' direct sales estithe margin rate accordingly. The assumption underlying this adjustment
mates, it may be added, include proportionate amounts of Federal manuwas that service costs had been included entirely or largely in margins as
facturers' excise taxes and transportation charges.
based on the original sample data.
Wholesalers' sales directly to consumers represented largely selected com(4) A further adjustment in these margin rates was made for sales to other
modity sales by wholesalers to household consumers from the wholesale
retailers. Such sales introduce a dupJication in sales but not in margins, and
estimates already described in reference to wholesalers' markups (step 5 of
thus depress margin rates for present purposes. To correct for this, sales
item 11). In the few instances in which this procedure did not yield the
were reduced to a net basis by 1948 census percentages of sales to other
allocation required for measuring personal consumption, resort was had to
retailers, and margin rates advanced accordingly. Such adjustment necesthe allocation patterns previously established for producers' sales. Where
sarily assumed the other retailers to have been in the same line of trade,
wholesale commodity classes did not match consumer commodity groups,
possibly entailing some errors which, however, should tend to offset in the
moreover, direct sales in these classes were apportioned on the basis of
aggregate.
producers' sales of individual products included in them.
(5) Finally, since the sample data were for 1948, it was necessary to
14c. Retailers' purchases.—As previously indicated, retailers' purchases were extrapolate the results for individual trades back to 1947. This was done on
obtained as a residual, representing purchases from producers and wholethe basis of margin rates computed from regularly published corporate
salers and also presumably some direct purchases of imports. They were the
returns to the Internal Revenue Service, departmental margin rates of the
base for calculation of retailers' inventory changes, and after inventory
Controllers' Congress of the National Retail Dry Goods Association, and
adjustment became the cost of merchandise sold to which retailers' markup
margin data of various other trade associations.
rates were applied.
In addition to the sample data, the sources just noted also were employed
15 and 16. Subtraction of changes in retailers' inventories to obtain cost of goods in the estimation of retail markup rates for some commodity groups. In the
sold by retailers.—Ratios of inventory change to sales in 1947 were obtained
case of the Internal Revenue statistics, however, proprietorship markup
for lines of retail trade from regularly published retail estimates of the Office
data were not tabulated for 1947 and had to be projected from 1945 by the
of Business Economics. To derive ratios for consumer commodity groups,
movement of corporate or partnership rates. The markup rates thus comthe inventory change ratios of the principal lines of trade handling computed for 1947 for certain lines of retail trade were weighted by 1948 census
modities in each group were averaged, using as weights the sales of these
sales of these legal forms of organization, and the same adjustments described
commodities by lines of trade as shown in the 1948 census. (This procedure
in (3) and (4) immediately above were then applied. In the case of the
was in contrast with the reliance in the 1929—39 estimates upon the indepartmental data of department and specialty stores published by the
ventory experience of single lines of retail trade selected for each group.)
Controllers' Congress, "workroom net costs" were added to the indicated
gross margin rates before conversion to a markup basis.
The inventory change ratios for commodity groups thus derived for 1947
were not directly usable because they related to sales rather than purchases.
For each commodity group, when appropriate, the markup rate of a single
However, they were readily transformed into inventory change ratios to
line of retail trade or department (in the department store data) was selected.

115

NATIONAL INCOME, 195 4 EDITION
In other instances, rates were combined by use of producers' sales of individual products in the group as weights. To obtain retailers' markups for the
various commodity groups, the estimated markup rates were applied to retailers' cost of finished consumer commodities sold (item 15).
18 a n d 19. Derivation

of retailers' sales and consumers' purchases exclusive of

retail taxes.—The addition of retailers' cost of goods sold and markups constituted retailers' commodity sales to consumers (item 18). To these were
added sales made directly to consumers by producers and wholesalers (items
14a and 14b) to derive total consumer purchases before retail taxes (item 19).
20—22. Addition of Federal retail excise taxes and general retail sales taxes to
obtain total personal consumption expenditures estimated by the commodity flow method.—

Retailers' excise and general sales taxes were the last adjustments necessary.
Federal retail excise taxes, which were treated as entirely chargeable to
consumers, were based on Internal Revenue collections lagged two months.
The necessary apportionment among commodity groups was made on the
basis of manufacturers' shipments of the taxable commodities. State and
local general sales, use, and gross receipts taxes required somewhat more
extended treatment, in conformity with earlier procedure. Collections of
these taxes by States, California cities, and other cities with populations of
25,000 and over were obtained from annual reports of the Bureau of the
Census entitled Compendium of State Government Finances and City Finances,
and from City Sales Taxes in California and More City Sales Taxes issued by

the California State Board of Equalization. Processing of the data included
conversion of fiscal year collections to the 1947 calendar year in accordance
with thefiscalyear months included; elimination of estimated taxes on services, nonconsumer commodities, and consumption commodities not in the
commodity flow estimates; and apportionment of the remaining taxes
among consumer commodity groups pro rata, but with approximate allowances for certain commodity exemptions in some tax jurisdictions. Addition
of these retail taxes completed the 1947 estimates of personal consumption
expenditures by the commodity flow method, totaled in item 22.

Extension of Commodity Flow Benchmarks
As indicated in the introductory remarks to this section of the notes, the
commodity group estimates established for 1939 and 1947 have been interpolated and projected into the current period primarily on the basis of
relative movements in retail sales. Retailers' excise taxes and applicable
general retail sales taxes have been estimated separately and added, except
in cases where the retail extrapolators covered such taxes (mainly the Census
Bureau retail sales series beginning in 1951).
The principal retail sales series that have been used in the consumer commodity interpolations and extrapolations are (1) retail sales, by type of store,
prepared through 1951 by the Office of Business Economics and since 1951
by the Bureau of the Census, and (2) department store sales, by type of
department, compiled by the Board of Governors of the Federal Reserve
System. In addition, some specific use has been made of unpublished compilations of State sales tax data, sales data from trade associations and other
private organizations, quantity and price data, and Federal retail excise tax
collections.
(1) The Office of Business Economics retail sales estimates represented
interpolations and extrapolations of sales totals by type-of-store groupings
given in the 1939 and 1948 Census of Retail Trade. The annual interpolations
and extrapolations of these benchmarks were based primarily on sales tax
collection data from a group of 10—20 States, accounting for about onefourth to one-half of all retail sales, depending on the period and kind of
business. Other data used included the Federal Reserve Board department
store sales estimates; Internal Revenue Service income-tax tabulations showing sales of corporate and noncorporate retail businesses by kind of business;
and tabulations of reports from the Bureau of the Census constant sample of
independent retail stores corrected by the Office of Business Economics for
changes in the retail store population.
The Bureau of the Census monthly retail sales estimates, starting with
January 1951, are based on sales data for all large organizations and a sample
of other stores in sample areas. Since May 1953, the large organizations
covered have included all those operating 11 or more retail stores in 1948 and
all department stores with 1948 sales volume in excess of $5 million, while the
sample areas have numbered 230. Small stores in these areas are sampled in
a way providing for inclusion of new stores.

(2) The department store sales data, by major departments, of the Federal
Reserve Board are based on departmental data reported by about 365
independent department stores located in various cities throughout the
country and accounting for about 50 percent of the estimated sales of all
department stores, including the national chains. Not all stores report data
for all of the departments asked; consequently, the sample for individual
departments is not so comprehensive as that for the major departmental
groups.
Under the method of interpolating and extrapolating consumer expenditures for 1939 and 1947, estimates for a particular commodity group often
have been moved by sales of one or more relevant types of stores (on the
assumption that sales of store groups tend to reflect the movement of sales of
commodities). However, when a commodity group is not handled almost
exclusively by specialized stores, or when data for these stores were not available separately, the movement of total sales of the commodity has been
estimated from the experience of departments handling that line in department stores or by use of combined relevant data for specialized stores and
department stores. Weights for combining these series usually were derived
from the commodity distributions of sales by kinds of business in the 1939 and
1948 Census of Retail Trade. Since departmental sales by type of department
more nearly represent commodity sales, they appear to provide a more
appropriate index than those specialized stores whose sales cover more than
one commodity group. Consequently, the department store data have been
given more than their proportionate weight in certain instances.
A significant shortcoming of retail trade data in these applications is that,
with the exception of department store sales, they cannot be broken down
by commodity groups. The type-of-store classification found in the basic
data assigns a store to a single classification on the basis of the commodity
accounting for the principal part of its business. But food stores, for instance,
sell goods other than food, and food is sold also in other kinds of stores,
including drug and department stores. With diverse movements in the sales
of various commodities, use of sales data classified by type of store to move
commodity groups will give rise to errors. This is borne out by the differences,
shown earlier, between the extrapolated 1947 estimates and the 1947 benchmarks for the various commodity groups. The presumption, however, that
these errors tend to offset in the total is also borne out, since adjustment to
the 1947 commodity flow aggregate amounted to only 3 percent for an
extrapolation covering a period of eight years.
Another limitation of retail sales data for the extrapolation of consumer
commodities arises from the fact that consumers buy from producers and
wholesalers as well as from retailers. In the general absence of data for estimating purchases from producers and wholesalers separately, they have been
assumed to vary with retail sales. Errors stemming from this assumption,
however, would necessarily tend to be minor because of the relatively small
volume of non-retail purchases—about 5 percent—involved in consumer
expenditures.
In the interpolation and extrapolation of the commodity flow benchmarks
by retail sales, it has been necessary, but difficult, to make some allowance
for the changing proportion of business purchases at retail. This has been
restricted largely to the war period. Downward adjustments were made in
that period for some commodities to allow for the apparent increase in the
relative magnitude of business purchases. There was very little quantitative
information on which to base the adjustments.

Retail Valuation Method
The main alternative to the commodity flow procedure (with retail sales
interpolation and extrapolation) is to multiply by an appropriate average
retail price the estimated quantities of consumer commodities purchased.
This approach—the retail valuation method—was used for passenger cars
and gasoline and oil from 1929 to the present; "other" fuel and ice (except
fuel produced and consumed on farms) for 1929-39 and 1947, with estimates
for other years based on the movement of retail sales data; and for tobacco
products beginning with 1940. In both 1939 and 1947, the groups for which
the retail valuation method was employed comprised about one-eighth of
total commodity expenditures.

116
Passenger cars

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS
consultation with specialists in the Office of Price Administration, the consumer allocation was reduced to 50 percent during the January 1942—May
1945 period, except that for April and May of 1945 all new cars were counted
as producers' durables.
The allocation of the passenger car estimates must be regarded as an
uncertain element. Errors in the allocation would affect both consumption
expenditures and producers' durables, but not the gross national product
total.
(4) The 1947 benchmark for housing trailers, which was a commodity flow
estimate, was extrapolated back to 1945 (when postwar trailer production
began) and forward from 1947 by a series based on data from the Trailer
Coach Manufacturers Association, and representing trailer coach production
valued at prices derived from the distribution of manufacturers' shipments
by price class. Housing-type trailers were omitted from the earlier estimates
because of their relative unimportance.

Preparation of the consumer expenditure series on "new cars and net
purchases of used cars" was carried out in four steps: (1) multiplication of
data on number of new cars by an average retail price; (2) addition of gross
margins on used car sales ("net purchases of used cars"); (3) allocation of the
totals of new passenger cars (after a deduction for government purchases)
and of gross margins between personal consumption expenditures and
producers' purchases of durable equipment; and (4) addition of housing-type
trailer coaches.
(1) The Automobile Manufacturers Association reported for the years
1929-41 the number of passenger cars sold at retail and an average retail
price at the factory. The latter was raised to cover estimated transportation
costs and also incidental charges by retail dealers. State and local retail
sales taxes were not included in the price, but were added separately.
With the discontinuance by the Automobile Manufacturers Association
of this retail sales series, the number of new passenger automobiles was
Gasoline and oil
estimated for the years 1942-45 from Office of Price Administration rationing statistics. Average prices for this period were obtained by extrapolation
For the period 1929—39, estimates of purchases of gasoline and oil—prior
of the 1941 price by use of data based on O. P. A. price regulations.
to consumer allocation—represent the sum of separate series for gasoline and
For the years 1946—50, the number series was new passenger car registraoil, each obtained by multiplying quantities by an average price.
tions compiled by the R. L. Polk Co., with a small upward adjustment for
The quantities of gasoline and lubricating oil used in passenger cars were
the estimated difference between registrations and dealers' sales. Beginning
estimates published by the Bureau of Mines in its Minerals Yearbook. The
with 1951, the number series on new passenger cars has consisted of dealers'
gasoline price was the 50-city service station average compiled by the
sales as reported to the Commerce Department's Business and Defense
American Petroleum Institute and published in American Petroleum Mews. The
Services Administration. For the period since 1946, the average retail price
50-city price excluding taxes was used, and these were estimated separately
of new cars has been based on the Bureau of Labor Statistics composite price
and added. Lubricating oil was valued at the Department of Agriculture
for Chevrolet, Ford, and Plymouth, adjusted upward to cover other makes
average of prices paid by farmers for medium grade motor oil.
of cars and factory installed extras.
For years subsequent to 1939, the procedure of estimating purchases of
(2) In the 1929—39 period the estimates of gross margins on used car sales
gasoline and oil has been changed somewhat. With the discontinuance of the
covered only used car dealers. Used car margins of new car dealers were
Bureau of Mines quantity series, the quantity of gasoline used in passenger
assumed to be covered by the average price series used in estimating purcars has been based since 1940 on estimates by the Bureau of Public Roads.
chases of new cars. The price series, being an average of list prices, was
The American Petroleum Institute average gasoline price inclusive of taxes
believed to have exceeded actual prices largely because it did not reflect
has been used. Finally, with the quantity series for lubricating oil no longer
excessive allowances for trade-ins. Used car margins of new car dealers were
available, a roughly equivalent quantity estimate was worked out for 1947,
introduced in successively larger proportions in 1940 and 1941, and were
carried back to link with 1939 and forward to 1953 by the movement of the
included entirely, along with the margins of used car dealers, from 1942,
gasoline quantity series, and valued in terms of the Department of Agriculture
when the full retail list price for new cars was assumed to have been realized,
average price series noted above.
through 1951. Beginning in 1952, a procedure of adjusting used car margins,
The figures so derived for expenditures on gasoline and oil were allocated
when necessary, for excessive trade-in allowances was adopted.
70 percent to personal consumption expenditures in the periods from 1929
Data for estimating gross margins on used car sales have been, for the most
through 1941 and beginning with 1946. During the war period, the following
part, inadequate. For the 1929-39 period, gross margins of used car dealers
percentages were used: 65 for 1942, 55 for 1943 and 1944, and 60 for 1945.
were based on retail census data on operating expenses and proprietors'
Errors stemming from this thinly based allocation, which was generally
compensation, with rough interpolations for intercensal years. The estimates
the same as that used in the passenger car series, would lead to error in the
for 1940-41 were obtained by extrapolating used car sales from the 1939
gross national product through their effect on consumer expenditures. The
retail census on the basis of sales finance company data and multiplying sales
business-use portion of gasoline and oil expenditures, unlike that of passenger
by gross margin ratios which had been adjusted upward moderately from
car purchases, is an intermediate product not included in the gross national
the 1939 gross margin ratio. Sales and gross margin ratios also have been
product, and therefore cannot counterbalance any error in the consumer-use
used for years since 1946. Used car sales from the 1948 retail census have
portion.
been extrapolated over this period by used car purchase estimates of the
Federal Reserve Board's Survey of Consumer Finances. Gross margin ratios have
Household fuels and ice
been developed from corporate tax returns of automobile and truck dealers
(1951 being the latest year for which this information is presently available
Expenditures for "other" fuels and ice (except fuel produced and confrom the Internal Revenue Service), partnership returns of automotive
sumed on farms) were estimated for the years 1929-39 and 1947 chiefly by
dealers for 1947, the Census Bureau—Internal Revenue Service sample of
multiplying quantity consumed data from the Bureau of Mines by retail
tax return data of used car dealers for 1948 (described above under commodprices selected from series maintained by the Bureau of Labor Statistics.
ity flow 1947 retail markups), and data of the National Automobile Dealers
Expenditures in other years represent interpolations and extrapolations on
Association for the period beginning with 1950. The used car margin estithe basis of Office of Business Economics estimates of retail sales of fuel and
mates for 1942-45 were interpolations on the basis of registrations of new
ice dealers. These are unpublished estimates developed from reported retail
cars and other cars weighted to provide a rough index of used car sales.
sales tax collections in 10-17 States.
The Bureau of Mines quantity data underlying the 1929—39 and 1947
(3) The totals of new passenger cars (after a small deduction for Federal,
estimates covered anthracite and bituminous coal, coke for domestic use,
State, and local government purchases) and gross margins on used cars were
fuel briquets, packaged fuel, kerosene, fuel oil No. 1 sold as range oil, distillate
allocated 70 percent to personal consumption expenditures and 30 percent
heating oils, and (in 1947) residual heating oils and liquified petroleum gases.
to producers' durable equipment except during the war period from January
The necessary allocations to consumer use were made after consultation with
1942 through May 1945. These proportions were derived mainly from surveys
specialists in the Bureau of Mines. The retail price data used to value conmade by the Bureau of Public Roads in 1934-37 to determine road use in
sumer quantities were obtained from the Bureau of Labor Statistics except
terms of mileage. The 70-30 allocation was also applied during the war
for kerosene, which was valued in part at average prices paid by farmers,
period to gross margins on used cars, since the distribution of used cars was
from the Agricultural Marketing Service. To these components derived
not controlled by rationing. For the new passenger car series, however, after

117

NATIONAL INCOME, 195 4 EDITION
mainly from data of the Bureau of Mines and Bureau of Labor Statistics were
added estimates for purchased firewood, based on Department of Agriculture data, and for ice. For the period 1929-39, the ice estimates were based
upon manufacturing census data marked up by an arbitrary 50 percent; for
1947, upon quantity and price data in the trade magazine Ice and Refrigeration.
In line with suggestions of the industry association, allocation to consumer
use was placed at 60 percent in the period 1929-39 and 20 percent in 1947.

None of the other miscellaneous items has been of sizable magnitude in
the period since 1929 exceptforexpenditures by U. S. Government personnel
abroad, which rose sharply during the war and reached a peak of $1.4
billion in 1945. This component is described in the section on Net foreign
investment.

Tobacco products
Expenditures for tobacco products for years after 1939 were derived from
quantities multiplied by average prices for each of three components: (1)
cigars, (2) cigarettes, and (3) other tobacco. The sum of the three series for
1939 agreed very closely with the commodity flow estimate for that year.
(1) Based on Internal Revenue Service reports, the number of large cigars
removed tax-paid (including those manufactured from both domestic and
imported tobacco) in each taxable price class was multiplied by estimated
average prices for the class. The estimated retail values of small cigars, taxfree large cigars, and imported cigars were minor special adjustments worked
out for 1947 and applied percentagewise to the cigar series throughout.
(2) The reported number of cigarettes removed tax-paid, lagged two
months, was valued at average retail prices of the Bureau of Labor Statistics
and the Agricultural Marketing Service. Purchases of tax-free cigarettes—
such as in PX's abroad and on merchant vessels—were estimated for 1947
and added for other years in the same proportion.
(3) The pounds of chewing and smoking tobacco and snuff removed taxpaid, lagged two months, were valued at average prices based on the pipe
tobacco retail price series of the Bureau of Labor Statistics and Agricultural
Marketing Service, with adjustment by 1947 manufacturing census data to
cover other forms of tobacco.

Other Methods
Imputation
Three imputed items, comprising 3 percent of consumption expenditures
for commodities in 1939 and 1947, are listed in Exhibit 1. Food and fuel produced and consumed on farms are discussed in the section on Income of
unincorporated enterprises. The third item, standard clothing issued to
military personnel, is covered in the section on Wages and salaries.
The consumer commodity estimates include one other imputation—
"food furnished government (including military) and commercial employees"—which is not shown in the breakdown of the estimates for 1939 in
Exhibit 1. An explanation of this omission may conveniently be used also
as a means of discussing an aspect of the commodity estimates not covered
in the notes to this point. That concerns the nature of the breakdown of the
large food group provided in table 30 in Part V.
For the 1929-39 period and again for 1947, food expenditures were estimated in total by the commodity flow method except for food produced and
consumed on farms, which is an independent imputation, and tips, which
were estimated and added separately. Purchased meals and beverages and
"food furnished" were components estimated for purposes of the breakdown
given in table 30, and food purchased for off-premise consumption was
derived as a residual by subtracting these two items from the commodity
flow food aggregate (exclusive of tips and imputed farm food). For the years
1940—46 and after 1947, however, these three types of food expenditures—
off-premise food, purchased meals and beverages (excluding tips), and "food
furnished"—represent separately estimated components of the food aggregate, with the last named assuming considerable importance as an imputation in some years.

Miscellaneous
The remaining, "miscellaneous" category, accounting for one percent of
consumer commodity expenditures in 1939, warrants only brief comment.
Expenditures for flowers, seeds, and potted plants and for lighting supplies
have been estimated primarily from retail censuses and other sources of
retail sales data, such as State tax collections. The tips series is described in
the notes on Wages and salaries.

8. PERSONAL CONSUMPTION EXPENDITURES FOR
SERVICES
In descriptions of national income methodology, resort is sometimes had
to the phrase, "constructed from a great variety of source materials." This
easy generalization is probably nowhere so apt as in the case of personal
consumption expenditures for services. The 55 service items for which expenditures are shown in table 30 of Part V are comprised of several hundred
separate series of estimates; and these represent the incorporation of numerous
types of data from many government and private sources, processed by
procedures virtually running the gamut of those used in national income
estimation. A primary factor in the detailed extent of estimation has been the
desire to take advantage of available sources of information, however piecemeal, and to minimize errors stemming from the estimation of broad components on the basis of data differing in scope or internal composition.
Perhaps a meaningful way of classifying the service estimates to facilitate
a general explanation of methodology is according to the broad types of
underlying statistical sources listed in Exhibit 7. This shows that for 1950
items comprising 23 percent of the $65.0 billion total were founded on comprehensive annual reports by government agencies and private sources;
that components forming 55 percent of the total were benchmarked on
periodic comprehensive sources, mainly the Censuses of Business and Population; that another 13 percent stemmed from sample information; and that
items accounting for 9 percent of all consumer service expenditures fell into a
"Miscellaneous" category.

Exhibit 1.—Personal Consumption Expenditures for Services, 1950
No sub- SubstanNo sub- Substanstantial tial allostantial tial alloTotal allocation cation Total allocation cation
problem problem
problem problem
Percent

Billions of dollars
14.8

13.5

22.8

20.8

2.0

Government agencies

5.8

4.5

8.9

6.9

2.0

Private sources

9.0

13.9

55.2

51.2

Comprehensive annual reports

1.3

2.6

4.0

35.9

33.3

Census of Population and Housing

21.9

33.7

Census of Business

10.1

7.5

15.5

11.5

Census of A griculture

1.4

°2

2.2

Census of Religious Bodies

1.6

2.5

1.3

Sample information

8.4

6.9

1.5

12.9

10.6

Miscellaneous

5.9

4.3

1.6

9.1

6.6

2.5

G5.0

58.0

7.0

100.0

89.2

10.8

Periodic comprehensive sources

Biennial Survey of Education..

Total

4.0

2.3

The exhibit affords some insight into aspects of both strength and weakness
of the estimates of consumer service expenditures. Thus, it is evident that—
contrary to an apparent general belief that statistical source materials on
consumer services are sparse and inadequate—a substantial body of data
exists for estimating this segment of the gross national product. Even so, the
reliability of the series is impaired by the necessary heavy reliance on periodic
(and sometimes rather infrequent) source materials. This consideration has

118

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS

particular relevance to estimates—comprising one-half of the service expenditure total—which are benchmarked on the Censuses of Population and
Business. In the present edition of the NATIONAL INCOME supplement are
published revised estimates (adjusted to the 1950 Census of Population and
1948 Census of Business) replacing previous provisional figures based on
extrapolations over a 12- or 13-year period.
Another key factor bearing on the reliability of the consumer service
estimates is brought out in Exhibit 1—that components adding to only 11
percent of the total in 1950 constituted a "substantial allocation problem."
First to be noted in this connection is that expenditures for consumer services,
like those for consumer commodities, are generally estimated from data on
producers' sales. In the case of services, however, the estimating procedure is
simplified (and, hence, reliability is enhanced) by two facts: (1) There are
no intermediary enterprises between the producer and consumer; and (2) in
very large degree, consumer-type services are by nature items normally
purchased only by persons. The area of estimation centering in the allocation
of producers' total sales between consumers and others is relatively small.
To quantify this latter aspect of the consumer services series, and to arrive
at the information given in the exhibit, the 1950 estimates were classified
according to those (1) representing items purchased wholly, or very nearly so,
by persons and thus not requiring an allocation of sales between persons and
business and government; (2) representing items purchased in appreciable
degree by other groups as well as consumers, but for which reliable information on the nonconsumer element was available; and (3) requiring a sizable
allocation for which the available data, if any, for making it were regarded as
inadequate.
This classification—in some measure a matter of judgment—resulted in the
finding that in 1950 components amounting to 89 percent of consumer service
expenditures did not involve any substantial problem of allocating producers'
sales to arrive at consumer purchases only. More specifically, components
forming as much as 69 percent of the total were classified in the first category,
as being normally purchased only by persons and thus presenting no problem
in this regard. Items comprising another 20 percent were assigned to the
second category, for which the problem of statistical allocation was taken
care of adequately (although, for the most part, only periodically) in the
basic data. Individual series constituting only 11 percent of consumer services
fell into the third category with the label of "substantial allocation problem",
and may be viewed as subject, on this score, to sizable error.
The following description of the estimates of personal consumption expenditures for services is outlined according to the four types of statistical sources
shown in the exhibit. Probably no broad statistical classification of the numerous and heterogeneous service items would be entirely appropriate, and the
present one is no exception. Some items, though relatively few, did not fall
readily into any one grouping. The difficulty was usually resolved by assigning them to "Miscellaneous."

The annual reports of the Federal Communications Commission contain
statistics on telephone operating revenues and excise taxes. Additional
supporting statistics in these reports are used to reduce total revenues to an
estimate of consumer payments for telephone service. This allocation,
regarded as satisfactory, is accomplished by means of formulae devised with
the assistance of the American Telephone and Telegraph Company.
Exhibit 2.—Consumer Expenditures for Services Based on Comprehensive
Annual Reports by Government Agencies, 1950
Millions of
dollars

Item
Services furnished without payment by financial intermediaries except insur^
ance companies

2,028

Telephone '

1,943

Railway (including commutation) and sleeping and parlor car

525

Intercity bus

315

Airline

___

177

Pari-mutuel net receipts

239

Bank service charges, trust services, and safe-deposit box rental

341

Athletic and social clubs—dues and fees'

182

Money order fees3
Total

_
_

51
_

5, 801

1. Component of Telephone, telegraph, cable, and wireless, item V-9 in table 30, Part V.
2. Component of Clubs and fraternal organizations except insurance, item IX-9 in table 30,
Part V.
3. Component of Other personal business, item VII-7 in table 30, Part V.

Passenger revenues are compiled annually by the Interstate Commerce
Commission for railways and intercity bus lines and by the Civil Aeronautics Administration for airlines. However, the statistical basis for adjusting
these comprehensive revenue data to measures of consumer expenditures is
limited.
For the railroad series, travel fares paid by the Federal Government are
first excluded from passenger revenues. Little direct information on Federal
outlays for rail travel has been available except for that regularly furnished
the National Income Division by the Pullman Co. For years since 1942,
railroad coach passenger revenues from sources other than the Federal
Government have been estimated by an indirect, though fairly adequate,
method utilizing data on collections by the Government from the tax levied
on the various types of transportation of persons. Of total railroad revenues
from sources other than the Federal Government, in all years the allocation
to consumer expenditures has been placed at 65 percent for railroad coach
transportation (excluding commutation) and 40 percent for Pullman service
(including both seat and berth charges).
These percentages were drawn from a study made in 1942 by the Office of
Comprehensive Annual Reports
Defense Transportation, which furnished similar information also with
respect to intercity bus transportation. Passengers arriving at major railroad
Regular comprehensive reporting systems exist for most of the servi ce
and bus terminals during the survey week were interviewed to determine the
requiring large aggregations of capital to produce. In some cases, generally
purpose of travel. The tabulated results of the study required some adjustwhere the producing industry is subject to government regulation, the basic
ment so as to reflect the source (consumer or business) rather than the
data for estimating consumer service expenditures are furnished by Federal or
purpose of expenditure.
State agencies. In others, the data are provided directly by private industries
with excellent facilities for the collection of statistical information.
The Interstate Commerce Commission data on passenger revenues of
motor carriers from intercity schedules have been reported since 1937.
These were extended to earlier years by data on total revenue from operation
Government agencies
of intercity motor bus companies compiled by Bus Transportation magazine.
Over the period since 1929, receipts from Federal Government travel have
The service items for which comprehensive annual data—before deduction
been estimated at 2 to 5 percent of the total. Seventy percent of the remainder
of any allowance for nonconsumer use—are collected by Federal and State
has been apportioned as receipts from consumers, as indicated by the 1942
agencies are listed in Exhibit 2, together with the 1950 consumer expenditure
survey of the Office of Defense Transportation.
value for each.
The reported passenger revenue data for the airlines, covering the period
The estimates of services furnished without payment by financial intersince 1935, were extrapolated to 1929 by data on passenger mileage flown.
mediaries are developed mainly from data furnished by the Federal Deposit
For the years 1939-41, the consumer source of passenger revenues was
Insurance Corporation, Board of Governors of the Federal Reserve System,
estimated as one-third on the basis of sample data presented at hearings
and Internal Revenue Service (from tabulations of corporations' income
tax returns, as published in Statistics of Income—Part 2). This series is described before the Civil Aeronautics Board and collected in questionnaire surveys
conducted by several of the airlines. This proportion has been modified for
in the section on Interest. As pointed out there, the necessary allocations of
other years as indicated by scattered information relating to business and
reported totals to derive measures covering only consumers can be made on
government use of airlines.
a generally satisfactory statistical basis.

NATIONAL

INCOME,

In addition to these several transportation components, estimates of (1)
bank service charges, trust services, and safe-deposit box rental and (2)
money order fees lack adequate data for making the sizable nonconsumer
allocations involved in their derivation.
The series on pari-mutuel net receipts includes the tracks' and States'
shares of amounts wagered and of breakage. Data are obtained from the
Census Bureau, as summarized in State Finances, and from reports of the
individual State racing commissions. The data are entered as consumer
expenditures without any nonconsumer allowance.
Estimates of dues and fees paid to athletic and social clubs are based on
Federal tax collections data. Only very minor estimation, for the nontaxable
portion, is required.

Private sources
Comprehensive annual data are available from private sources for estimating the types of consumer expenditures for services shown in Exhibit 3.
Vfc*ualiy complete data relating to the two insurance items in the
listing are collected annually by the Spectator Company and published
in its Insurance

Yearbook.

Data on the income and expenditures of hospitals are collected in annual
censuses of these institutions by the American Hospital Association. These
data, with minor adjustments, have supplied measures since 1946 of personal
consumption expenditures on privately controlled hospitals and sanitariums.
This component consists of payments by patients to proprietary hospitals
and of current expenditures (including depreciation) of nonprofit hospitals
in providing care of patients.
Prior to 1946, however, considerable estimation was required in the
absence of comprehensive annual data. Benchmark figures were derived
for 1930 from a study by the Committee on the Costs of Medical Care and
for 1935 from the Census of Hospitals. The movement for other years was
estimated, for the most part, as the product of the average daily number
of patients, published by the American Medical Association, and the hospital
price component of the Bureau of Labor Statistics Consumer Price Index.
For the entire period covered by the estimates, the Edison Electric Institute and the American Gas Association have reported annual data relating,
in effect, to sales to consumers separately from sales to other customers.
Thus, data of the Edison Electric Institute on revenues from residential or
domestic sales and from rural sales at distinct rural rates have had to be
adjusted only to eliminate revenue from farm business use to furnish a
measure of consumer expenditures for electricity (inclusive of landlords'
expenditures). And a similar measure of expenditures for gas has been
secured annually from data reported by the American Gas Association on
revenues from sales to residential consumers.

1954

relatively small numbers of large and responsible business enterprises keeping
adequate accounting records. The estimates of consumer expenditures
derived from them, involving only minor problems of estimation, may be
presumed to be subject to comparatively little margin of error.

Periodic Comprehensive Sources
The Census of Population and Housing yields benchmark data for items
aggregating 34 percent of the consumer service total in 1950; the Census of
Business for components amounting to 16 percent. Other periodic comprehensive sources furnish the underlying data for items forming 6 percent
of the 1950 services total. The expenditure components based on these various
sources are listed in Exhibit 4.
For most items classified in this category, periodic universe values of
consumer expenditures can be estimated with considerable confidence.
The accuracy of the benchmark estimates is somewhat affected, however,
by the fact that many of the reporting units are individuals or small business
enterprises and tend to have less adequate accounting records. Also, estimating adjustments of the reported data often are necessary.
Exhibit 4.—Personal Consumption Expenditures for Services Based
Periodic Comprehensive Sources, 7 9 5 0

Source and item

Space rental value of owner-occupied nonfarm dwellings
Space rent of tenant-occupied nonfarm dwellings
Domestic service

Millions of
dollars

Expense of handling life insurance

2,035

Accident and health insurance and mutual accident and sick benefit associations—premiums less claims '
_

497

Privately controlled hospitals and sanitariums

1,975

Electricity

1,955

Gas.

1,177

Street and electric railways and local bus lines
Total

1,388

Automobile repair, greasing, washing, parking, storage, and rental...
Cleaning, dyeing, pressing, alteration, storage, and repair of garments including furs (in shops), not elsewhere classified.
_
_
Motion picture theater admissions
Barbershops, beauty parlors, and baths
Laundering in establishments
Funeral and burial service '
Maintenance services for appliances and house furnishings a
Transient hotels and tourist cabins'
Photographic studios and photo developing and printing *
Radio and television repair
_
_
Shoe cleaning and repair
Other'

2,138
1,466
1,394
1,049

854
642
437
' 403
269
324
201

Census of Agriculture:
Rental value of farm houses.

1,448

Census of Religious Bodies:
1,630

Biennial Survey of Education:
Higher education (private)

822
35, 911

1. Included with cemeteries and crematories and monuments and tombstones in Funeral
and burial expenses, item VI-8 of table 30, Part V.
2. Consists of care of electrical equipment except radios and of stoves, upholstery and furniture repair, and rug, drapery, and mattress cleaning and repair, and is a component of Other
household operation, item V-ll of table 30, Part V.
3. Component of Other housing, item IV-4 of table 30, Part V.
4. Component of Other recreation, item IX-12 of table 30, Part V.
5. Includes the following recreation items: billiard parlors, bowling alleys, dancing, riding,
shooting, skating, and swimming places, amusement devices and parks—components of item
IX-10 of table 30, Part V; "other" commercial amusements, component of Item IX-12; legitimate theaters and opera admissions, component of item IX-8b; professional baseball and
football admissions, components of item IX-Sc. Also includes watch, clock, and jewelry
repairs, miscellaneous personal services related to clothing, and costume and dress suit rental,
components of item II-8; employment agency fees, component of item VII-7; and miscellaneous household operation services, component of item V-ll.
6. Component of Religious and welfare activities, item X I of table 30, Part V.

9,027

i Component of Medical care and hospitalization insurance, item VI-7 in table 30, Part V.

The American Transit Association publishes annual data on passenger
revenue receipts from operations of street and electric railways and local bus
lines. To them are added estimated taxes on electric railway fares to obtain
the consumer expenditures series.
The comprehensive annual data supplied by the several private sources
noted above are gathered through well-established reporting systems from

12,195
7,062
2,668

Census of Business:

Total—.
Item

Millions of
dollars

Census of Population and Housing:

Religious bodies 8
Exhibit 3.—Consumer Expenditures for Services Based on Comprehensive
Annual Reports by Private Sources, 1950

119

EDITION

Only to a small degree are the estimates in this grouping impaired by
serious difficulties of consumer allocation. Items amounting to 4 percent
of the 1950 services total were classified as constituting a "substantial allocation problem."
A major factor bearing on the reliability of the series in this group is that
the availability of comprehensive data only periodically necessitates the
development of interpolating and extrapolating indexes. In a number of
cases, these indexes must be based on data that are partial and unrepresentative or of only indirect relevance.

120

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS

It is thus to be expected that many of the individual series included in
Exhibit 4—mostly items not published separately in table 30, Part V—are
subject to appreciable error in relative movement, particularly for years
estimated by the projection of benchmark estimates over a considerable span.
Such errors, however, cannot be expected to be cumulative. On the contrary, it may be presumed on the basis of experience in estimating individual
components from masses of diverse data that errors in the individual series
will have a tendency to offset in the total. As the latest evidence on this
score, discussed later, recent adjustment of the relevant service expenditure
series to the 1948 Census of Business and the 1950 Census of Population and
Housing revealed an error in the extrapolating series amounting in the
aggregate to about 5 percent, with the range of error for the individual
series considerably larger.

Census of Population and Housing
The decennial Census of Population and Housing provides data on the
number of dwelling units in each tenure class, on the average monthly rent
of rented dwellings, and on the fair market value of owner-occupied units.
The census taken in 1940 also included a question on the rental value of
owner-occupied units. These basic data have been used to derive benchmark
estimates of the space rental value of owner-occupied nonfarm dwellings and
of space rental payments on tenant-occupied nonfarm dwellings. Their
derivation, along with the construction of estimates for intercensal years, is
explained in the section on Rental income of persons.
Expenditures for domestic service (cash payments and value of meals
furnished) are equal to wages paid in the Private households industry. These
wage estimates, based very largely on benchmarks derived from population
census data, are described in the section on Wages and salaries.

Census of Business
Service establishments were canvassed in connection with the 1933 Census
of American Business and the 1935, 1939, and 1948 Census of Business. In
addition, hotels (both year-round and seasonal) of 25 rooms or more and
most types of automobile servicing establishments were covered by censuses
in 1929. Power laundries and cleaning and dyeing plants, first included in
the Census of Business in 1939, were covered in conjunction with the Census
of Manufactures in odd years from 1929 through 1935.
Census coverage of service establishments was accepted as complete
throughout in making estimates for automobile repairs. It was necessary,
however, to make an estimated adjustment of the data on service receipts of
motor vehicle dealers given in the Census of Retail Trade for 1935, 1939,
and 1948, so as to include the value of parts used in making repairs—an
unidentified element of the reported sales totals. The census data on amusements for 1935, 1939, and 1948 also were taken as reported and used, with
the exception of motion pictures in 1935. The 1933 census data on amusements were used in only a few cases. Census coverage of hotels was considered
complete except for seasonal hotels in 1933, and for seasonal hotels in the
New England and Middle Atlantic States in 1939. (However, for 1929 it
was necessary to add estimates for hotels with less than 25 rooms, not canvassed by the Census.) Data on tourist courts were used as given by the
Census in all years.
For the consumer expenditure estimates, census data in the category of
personal services (apart from laundering and dry cleaning) were accepted as
reported except for 1948. For that year, moderate upward adjustments of
reported census figures were made in preparing estimates for barber shops
and beauty parlors, shoe cleaning and repair, and miscellaneous personal
services. These adjustments were based on information available from the
Census Bureau—chiefly results of its "Post Enumeration Survey", a sample
check on the completeness of the 1948 Census of Business—and on comparison of census data on wages and employment in personal service industries
with corresponding data reported under the social security laws.
In the preparation of consumer expenditure estimates relating to laundering
and dry cleaning, census data were used as reported except for 1933 and
1948. Upward adjustments of 8.7 percent and 17.1 percent, respectively,
were applied to all data for 1933 utilized from the Census of Power Laundries
and the Census of Cleaning and Dyeing Establishments. These adjustments
were based on information as to coverage reported by the Census Bureau.
For 1948, the census data were raised moderately before incorporation into

the service expenditure estimates—on a basis similar to that noted above for
personal services.
For most consumer service items based on the Census of Business, it has
been necessary to make some adjustments for differences in the definition
and type of data reported in the various years. These adjustments, based on
census data themselves, generally have been of minor magnitude.
Where appropriate, the estimates of consumer service expenditures derived
from the Census of Business generally represent the service receipts of retailers
(reported in the retail censuses) as well as of service establishments. Sales
data are tabulated by line of business, with a general distinction between
commodity sales and service receipts in each line. In general, the classification by line of business approximates the desired classification by type of
service. The instances in which the line-of-business receipts data could not
be taken to indicate expenditures by type of service have been relatively few.
The necessary allocations of receipts data in such instances did not affect
the consumer services total.
The series derived from Census of Business information that involve substantial problems of consumer allocation are as follows: automobile K5_pc:r,
greasing, washing, parking, storage, and rental; transient hotels and tourist
cabins; and miscellaneous household operation services.
The following summary for a number of the larger series based on the
Census of Business may serve to indicate more specifically the uses and
adjustments made of census data and the nature of the methods—sometimes
diverse and indirect because of the inadequacy of available source materials—that are employed for interpolation and extrapolation.
Automobile repairs
Expenditures for automobile repair, greasing, washing, parking, storage
and rental were based for 1929 (partly estimated), 1933,1935, 1939, and 1948
on Census of Business receipts data covering service and retail establishments.
As noted above, data on the service receipts of motor vehicle dealers were
raised to cover parts used in making repairs.
For the period prior to 1935, interpolations were made by the Motor and
Equipment Manufacturers' Association index of shipments of service parts
to wholesalers; for the period from 1935 to 1939, they were based on an index
of sales of parts and accessories stores computed from sales tax reports in
Illinois, Iowa, and Indiana. The estimates for years after 1939 represent
interpolations and extrapolations by an index based largely on payrolls in
the automobile repair services industry, as compiled by the Bureau of
Employment Security of the Department of Labor from summations of
employers' reports filed by the various State unemployment insurance
agencies. This index was extended from 1942, when the payroll data became
available, back to 1939 by a series representing the product of passenger car
gasoline consumption (from the Bureau of Public Roads) and the official
index on automobile repair prices (from the Bureau of Labor Statistics).
The estimates of total expenditures so derived have been allocated by the
proportion of consumer to total highway use of gasoline. This proportion
has been estimated as the product of ratios of (1) consumer to total passengercar use of gasoline and (2) passenger car to total highway use of gasoline.
The first ratio is the same as that used in the allocation of expenditures for
gasoline and oil (see section on Personal consumption expenditures for
commodities). The second has been derived from annual data of the Bureau
of Mines and Bureau of Public Roads.
Motion picture admissions
The 1939 and 1948 consumer expenditure figures for admissions to motion
picture theaters were taken from the Census of Service Establishments for
those years. Other years have been estimated chiefly by using gross receipts
from operation of motion picture theater corporations for interpolation and
extrapolation, with allowance for changes in the admissions tax, not reflected in the data reported to the Internal Revenue Service. For the two
most recent years of the series, when such data are not available, the estimates are made as follows: (1) total admissions to motion pictures and other
(largely spectator) amusements covered by the Federal admissions tax are
extrapolated by an index obtained by dividing the Federal admissions tax
rate into the total collections from this tax and adding the tax collections,
to the quotient, and (2) the independently estimated admissions to the other
amusements are deducted from the total to arrive at the figures for motion
pictures.

NATIONAL INCOME, 195 4 EDITION

Cleaning and dyeing
The consumer expenditure series on cleaning, dyeing, pressing, alteration,
and repair of garments is based on census values for the years 1929, 1931,
1933, 1935, 1939, and 1948 (adjusted for undercoverage in 1933 and 1948
as noted above). The census figures required numerous, but minor, adjustments for comparability from year to year. The problem of consumer
allocation was obviated by the type of data given in the census reports.
Most important in this respect was the provision of data on receipts from
cleaning and dyeing at retail (separately from wholesale) of cleaning and
dyeing plants, rug cleaning establishments, and power laundries. Estimates for intercensal years prior to 1935 were obtained by interpolation by
the American Institute of Laundering index of cleaning plant sales of its
member power laundries. The 1936-38 estimates were made by using the
Bureau of Labor Statistics index of payrolls of cleaning and dyeing plants
for interpolation. This index for 1939—42 extended to later years by State
unemployment insurance wage data has also been employed for interpolation
and extrapolation of the 1939 and 1948 census benchmarks. The unemployment insurance wage figures used for this purpose are the combined
totals for cleaning and dyeing plants and cleaning, pressing, alteration, and
garment repair shops.
Barber shops, beauty parlors, and baths
Census data, with 5 to 8 percent (the latter in recent years) added for
tips, provided the basis for estimating consumer expenditures for barber
shop and beauty parlor services for 1933, 1935, 1939, and 1948. Estimates
for 1930 were obtained by multiplying the number of employed persons in
these industries, as derived from the 1930 population census, by average
receipts per person estimated by reference to census data for later years.
For other years of the 1929-35 period, estimates were prepared by using
for both the barber shop and beauty parlor series consumer expenditures
for laundering as an extrapolating and interpolating index. To obtain
interpolations for the two series between 1935 and 1939, the barber shop
and beauty parlor service components, respectively, of the Consumer
Price Index were multiplied by an output index for laundry services, computed by dividing the Bureau of Labor Statistics index of payrolls in power
laundries by its index of average hourly earnings for the same industry.
For the 1940-47 period, it was possible to establish benchmark values
for 1945 and 1947 by use of receipts data for barber shops and beauty parlors
tabulated by the Internal Revenue Service from income tax returns of corporations, partnerships, and individual proprietors. Interpolations for other
years of the period were based largely on the BLS price indexes. For later
years, the 1948 Census-based total for barber shops and beauty parlors
has been projected by the product of (a) employment for the two types of
establishments combined as reported from unemployment insurance data
by the Bureau of Employment Security and (b) the barber shop and beauty
parlor price indexes of the Bureau of Labor Statistics weighted by the 1948
consumer expenditure values.
The portion of the estimate relating to baths and masseurs is quite small
—1.3 percent in 1950. It has been derived principally from data reported
in service censuses for 1935, 1939, and 1948, with interpolation and extrapolation by means of the series on consumer expenditures for barber shop
and beauty parlor services.
Laundering in establishments
As derived for the years 1929, 1931, 1933, 1935, 1939, and 1948 (adjusted
for undercoverage in 1933 and 1948 as noted above) from the Censuses of
Power Laundries, Cleaning and Dyeing Establishments, and Service Establishments, the figures on consumer expenditures for laundering in establishments include receipts from bundle work and family services of power
laundries, laundry receipts of cleaning and dyeing plants, and 80 percent
of the service receipts of hand laundries. (Payments from hand laundries to
power laundries were taken at 20 percent of the formers' receipts.) Receipts
of hand laundries for 1929, 1931, and 1933, not given in the census reports,
were estimated by the movement of the other components.
Estimates for intercensal years of the pre-1939 period were obtained by
interpolation by the American Institute of Laundering index of laundry
receipts of power laundries. For the later period, the 1939 and 1948 Censusbased estimates have been interpolated and extrapolated by an index of
laundry payrolls, based on Bureau of Labor Statistics sample data for the
years 1939—42 and on Bureau of Employment Security tabulations of unemployment insurance wage data for subsequent years.

121

Funeral and burial service
Consumer expenditures for funeral and burial service were obtained for
1935, 1939, and 1948 from census receipts data covering funeral directors'
and embalmers' services and coffins, plus an estimate of the funeral receipts
of combination furniture and undertaking establishments derived from the
1929 Census of Retail Distribution. Odd-year estimates prior to 1935
were obtained by extrapolating the 1935 figure by data on the value of
coffins and funeral supplies produced (from the biennial Census of Manufactures). These were interpolated for 1930, 1932, and 1934 by billings of
funeral directors and embalmers, as estimated by Rolf Nugent, Consumer
Credit and Economic Stability (Russell Sage Foundation, New York, 1939).
Estimates for other years (1936-38, 1940-47, and 1949-53) are interpolations and extrapolations by data on collections of sales taxes levied on funeral
directors' receipts in a number of States.

Census of Agriculture
Estimates of the rental value of farm houses, described briefly in the
section on Income of unincorporated enterprises, are prepared by the
Agricultural Economics Division of the Department of Agriculture, and
based on value data reported in the quinquennial Census of Agriculture.
The basis of estimation, however, is not a direct one. Census-based figures
on value are multiplied by an annual interest rate, and the product is then
converted to a gross measure of rental value by adding an estimate of farm
expenses allocable to the upkeep of farm dwellings.

Census of Religious Bodies
The "religious bodies" component of consumer services represents all
current expenditures by churches except for local cash relief and charity,
plus estimated depreciation of buildings. It is included in group XI of table
30, Part V.
Estimates of cash current expenditures were prepared for 1926 and 1936
from data reported in the Census of Religious Bodies, with a small adjustment for churches not reporting. The value of clergymen's imputed income
(see section on Wages and salaries) was added. For all other years of the
period since 1929, estimates of total current expenditures (cash and imputed)
have been obtained by interpolation and extrapolation on the basis of the
National Income Division series on total payroll of religious organizations,
as described in the section on Wages and salaries. Depreciation, estimated at
about 1.5 percent of the value of church edifices, was derived by a downward
modification of hospital building depreciation rates (see section on Capital
consumption allowances).

Biennial Survey of Education
Office of Education data reported in the Biennial Survey of Education, covering
school years ending in even numbers, form the principal basis of the consumer
service series on "higher education" and "elementary and secondary schools."
The estimated depreciation of educational buildings and equipment (see
section on Capital consumption allowances) is added to figures on current
expenditures by these institutions for educational services, as derived from
the Biennial Survey.

Estimates of current expenditures for intervening school years not covered
by the Biennial Survey are obtained by straight-line interpolation. For the
recent years of the series before the Biennial Survey becomes available, the
latest reported data are projected on the basis of partial information furnished by the Office of Education. The resulting school-year figures are
converted to calendar years by averaging. To obtain the estimate for calendar
year 1950, for example, the 1949-50 school-year data were weighted by 2
and the 1950-51 school-year data by 1.
It should be noted that the series for elementary and secondary schools is
less firmly based than that for higher education. The data published in the
Biennial Survey of Education for private elementary and secondary schools
include capital outlays, and these must be estimated and deducted. Moreover, the published data represent estimates based on reported enrollment
in these private schools multiplied by average expenditure per pupil in
public elementary and secondary schools. Accordingly, this series is rot
regarded as being based on periodic comprehensive sources, as listed in
Exhibit 4, but is included in the "Miscellaneous" category discussed below.

122

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS
Sample Information

Consumer service expenditures whose levels have been estimated from
sample data comprised 13 percent of the service total in 1950. These series
include expenditures for professional services (7.3 percent); interest on personal debt (2.8 percent); automobile insurance, net payments to labor
unions, postage, and telegraph, cable, and wireless (combined, 1.9 percent);
and foreign travel and remittances (1.0 percent).
The professional services category noted above includes separate expenditure estimates for the services of physicians, dentists, lawyers, osteopathic
physicians, chiropractors, chiropodists and podiatrists, private duty trained
nurses, miscellaneous curative and healing professions, and veterinarians.
The sample information used in making these estimates is obtained very
largely from periodic questionnaire surveys by the National Income Division,
generally with the cooperation of the professional associations. This information covers (1) average gross income from independent practice, (2)
percentage of persons in the profession engaged in independent practice,
and (3) the percentage of gross income (in the case of physicians, dentists,
lawyers, and veterinarians) received from government or welfare agencies
or business organizations, as contrasted with individuals.
These data are used in conjunction with available information on the total
number of persons in each profession to secure the consumer expenditure
estimates. The main sources of information on numbers in the various professions are the occupational data of the Census of Population, compilations
of the individual professional associations (such as the American Medical
Association, American Dental Association, and the American Osteopathic
Association), and the Fisher-Stevens, Inc. lists.
The methods of estimating consumer expenditures for professional services
are directly analogous to those used in deriving the total net income of independent practitioners in the various professions. These professional income
series are described at some length in the section on Income of unincorporated
enterprises.
Estimates of interest on personal debt, as noted in the section on Interest,
are based very largely on consumer credit data (compiled by the Federal
Reserve Board from sample reports adjusted periodically to more comprehensive sources), multiplied by fragmentary sample information on interest
rates applicable to the various types of credit.
Data from the 1935—36 Consumer Purchases Study (given in reports by
the National Resources Planning Board and the U. S. Departments of Labor
and Agriculture) provided benchmark materials for estimating the consumer
service series on automobile insurance (premiums minus claims paid), net
payments to labor unions (dues and fees paid minus cash benefits received),
postage, and telegraph, cable, and wireless. Little confidence can be placed
in these series. Apart from sampling or reporting errors in the basic data,
considerable estimation was required in utilizing the data to obtain the
benchmark consumer expenditure values; and the available information for
extrapolation is not adequate. Except for the labor union item, the presence
of large nonconsumer elements in the extrapolating data is an added difficulty.
The consumer service series relating to foreign travel and remittances
(net) are components of group XII in table 30, Part V. The estimation
of these series, which involves in substantial degree the problem of consumer
allocation, is based largely on questionnaire surveys. (See section on Net
foreign investment.)

For the most part, these seven series incorporate a great deal of relevant
statistical information (notably in the cases of social welfare and foreign relief
agencies, elementary and secondary schools, and brokerage charges and
interest and investment counseling). Difficulty of consumer allocation is
present for the series on moving and warehouse expenses, brokerage charges,
etc., and taxicab fares and tips, as well as for the estimates of water expenditures with respect to the data used for extrapolation of the 1940 base-year
figure.
Of the remaining items in the "Miscellaneous" category, nearly all are
relatively small. Source materials vary widely in adequacy among this group
of service items but are not satisfactory for many of them. It often is necessary
to use indirect estimating methods, and to rely on occasional and incidental
information obtained from public and private research studies, correspondence with trade associations, and informal sources such as magazine and
newspaper accounts.

Nature of Recent Revisions
As noted before, availability of data from the 1948 Census of Business, the
1950 Census of Population and Housing, and the 1950 Census of Agriculture
has permitted preparation of new benchmark estimates for numerous series
on consumer expenditures for services, as listed in Exhibit 4. In addition, a
review has been made of the data and procedures utilized in the estimates for
all other service items.
As a result of the incorporation of census materials and this additional
review work, about one-half of the items comprising the 55 service series
published in table 30, Part V have undergone statistical revision. The net
effect was a raising of the series. This amounted in 1950 to 5 percent for the
total of items that were revised and to 4}i percent for the overall consumer
services aggregate.
Adjustment to the postwar censuses revealed that, in total, the 30-odd
service items which had been extrapolated from the 1940 Census of Population and the 1939 Census of Business were low by 7 percent in 1950. About
5 percentage points of this revision may be attributed to deficiencies in the
extrapolators. The remainder occurred in the automobile repair series as a
result of correcting it to include parts used in making repairs.
The revision in this area is a modest one when viewed against the problem
of making 10-year extrapolations of series which, in total, increased by 145
percent. Still, it should be noted that this result reflected a netting of errors in
the individual components—a tendency for them to offset in the total. While
the degree of revision was tolerable for most components in this group, it
ranged up to 25 percent or more for some of them. Consideration of these
revision results, while gratifying in the overall, influenced the decision to
compress the extent of published detail on consumer services.
It may be added that not since the census of 1936 have benchmark expenditure data been available for the series on religious bodies, a component
of group XI in table 30. However, this series has been revised upward
considerably because of revision of the payroll estimates used as an extrapolator. These revisions, in turn, mainly reflected the incorporation of employment data from the 1950 Census of Population. (See section on Wages and
salaries.)

Miscellaneous
Consumer service expenditures for items classified under "Miscellaneous"
sources comprised about 9 percent of the 1950 total. A less rigid basis of
classification, as already indicated, might have considerably reduced the
proportion of expenditures in this category.
Of the items in this category, only five are shown separately in table 30,
Part V. These are elementary and secondary schools, taxicab fares and tips,
household expenditures for water, brokerage charges and interest and investment counseling, and bridge, tunnel, ferry and road tolls. Together with two
other relatively sizable items—social welfare and foreign relief agencies
(included in group XI of table 30) and moving and warehouse expenses
(included in item V—11)—-these series accounted for about three-fifths of the
1950 "Miscellaneous" total.

9. NEW CONSTRUCTION
The estimates of construction activity (see table 31) have been prepared
jointly by the Bureau of Labor Statistics and the Commerce Department
Building Materials and Construction Division. These estimates differ from
the totals used in the gross national product only because the latter include
petroleum and gas well drilling (in private construction) and exclude work
relief (from public construction). The value of work relief construction appears in gross national product as government expenditures for payrolls,
purchases of materials, etc.
New private construction is an independent element in the statistical determination of cross orivate domestic investment. New Dublic construction

NATIONAL INCOME,

is a component of government purchases of goods and services, which, however, are estimated as a total independently of the construction series. (See
the section on Government receipts and expenditures.)
New construction represents the value of progress made during the given
year in the production of fixed works and structures. The value of progress
made, or "work put in place," is defined as equivalent to the value of labor
and materials used plus overhead costs and profits accrued on operations
during the given period. It includes the installed value of equipment generally considered an integral part of a structure and commonly included in
the construction contract price.
Exhibit

1.—Components of New Construction Activity,
Principal Data Source, 1950
Private

Data source and class of construction

Diiect reports of work done or paid for
Public utility
_ Highway
Military facilities
Public residential building .
Public nonresidential building (Federal
and Federal-aid).
Other types of public construction (Federal and Federal-aid) _

Classified

Public

Millions
of dollars

Percent

Millions
of dollars

3,330

4,249

3.330

2,272
177
345
541

Percent
61

1954

EDITION

123

in these notes, are therefore generally somewhat better founded than those
for earlier years.
Modern techniques of systematic reporting and sampling are difficult to
apply to the direct statistical measurement of construction activity. Many of
the producers that should be covered are hard to identify. Much construction work is done by firms only intermittently attached to the industry; many
construction firms have no fixed and readily recognizable place of business;
and any firm in any industry may undertake force account projects. (The
several p?st censuses of construction, it may be noted, omitted by intent the
substantial volume of force account construction.) The alternative of covering the purchasers of construction work is generally subject to the same sort
of difficulties.
This problem of identifying the units to be covered affects both the enumerative and the sampling approaches to data collection. In particular, it
makes enumeration expensive. Sampling, the theoretical validity of which
rests on the homogeneity and continuity of the universe sampled, must deal
here with large, unstandardized, nonrepeating projects, many arising out of a
special local need. Under these circumstances, estimation relies heavily on
indirect evidence of construction activity, as is explained below, and is subject to considerable uncertainty as to coverage, valuation, and timing.

Summary of sources

The construction estimates are developed from several different types of
statistical sources and methods. These may be summarized very briefly as
follows.
Contract awards.
4,064
2,751
39
18
From certain special classes of buyers, regular current reports are received
Private nonresidential, except farm and
on the actual progress of, or expenditure for, their construction work. In genrmblic utility
3,777
eral, Federal Government and Federally-aided projects are covered by curPrivate residential, except farm—nonhousekeeping
175
rent reports on progress, and construction done by or for public utility com"All other private"
112
Public nonresidential building (State
panies is regularly reported from accounting records.
and local)
1,843
Other nonfarm nonresidential construction is generally estimated from
Other types of public construction (State
and local)
908
monthly data on value of contract awards.
Other nonfarm residential building is estimated chiefly from monthly reBuilding permits
10,605
46
ports of building permits issued.
Private residential, except farm—new
For some types of construction, the foregoing kinds of information are indwellings in permit-issuing areas l and
additions and alterations
10,605
adequate or unavailable, and estimates must be made from a variety of data
of varying appropriateness and reliability. A small part of nonfarm resiOther sources
4,734
21
dential construction, all farm construction, and oil and gas well drilling are
Private residential, except farm—new
included in this miscellaneous category.
dwellings in nonpermit-issuing areas ' . .
1,820
The relative importance of these various sources and methods in deriving
Farm
1,635
Oil and gas well drilling
1,279
the new construction estimates is illustrated in Exhibit 7. Each component cf new construction (as given in tables 2, 3, 5, and 24 of the May
Total
- ..
100
100
7,000
22,733
1953 Statistical Supplement to Construction and Building Materials) is here
classified according to the principal type of source material used in estimating
1. Breakdown of new dwellings between permit-issuing and non-permit-issuing areas is
rough; based on unpublished data.
its value.
The four classes of source materials distinguished in Exhibit 1 may be comFixed works and structures include not only dwellings and other buildings
pared briefly with one another in terms of coverage, quality of value data,
but also dams, bridges, roads, canals, and the like. Certain types of works,
and the indication given as to timing of the construction work done.
such as mine tunnels and farm ditches, which might be classified as construcDirect reports of work done or paid for are obtained through formal reporting
tion, are not included. They are probably unimportant quantitatively, and
systems involving the regular and sometimes mandatory cooperation of
a substantial portion of them is likely to be charged to current expense.
parties to the construction contracts. Coverage of work done by or for the
Hence it is believed that their omission from gross national product does not
categories of purchasers included in these systems is generally excellent. The
result in any appreciable discrepancy in the national income and product
value information reported, being taken on a fairly standardized basis from
accounts. Also, the estimates of private residential nonfarm construction
accounting records appropriate to the purpose, is also quite satisfactory.
exclude certain "speculative" profits, because these are regarded as reflecting
Finally, the reported timing of contract construction work is based largely
sales rather than construction activity. These profits should be part of the
on engineering inspections made to check contractors' claims for progress
new construction component of gross national product; they are omitted
payments, and therefore accords very closely with the conceptual requirebecause there is no satisfactory way of estimating them.
ments of the estimates.
The factual content of the present notes is largely limited to a summary of
Contract award reports (which take into account subsequent cancellations)
descriptions published in the Building Materials and Construction Division's
provide reasonably good value information for projects covered, particularly
May 1953 Statistical Supplement to Construction and Building Materials andin periods when escalator clauses or other similar arrangements are not
in the Bureau of Labor Statistics bulletin on Techniques for Preparing Major important. As will be seen, however, the coverage of these data is far from
BLS Statistical Series, revised. No attempt is made to indicate differences complete, and an estimate for the noncovered areas must be made. Furtherbetween the estimating methods underlying back-year values and the
more, there is a varying time lag between the reported date of a contract
methods currently in use; only the latter are described below. Although the
award and the start of actual construction, and there is further variation in
basic sources and methods have been the same throughout the period since
the rate of progress after the start. The allocation of contract values to the
1929, a number of important improvements have been made. It should be
particular time periods during which the work is presumed to have been done
noted, however, that most of them did not cast light on back-year moveis based on past activity patterns and cannot be precise.

914

124

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS

ports and they are therefore classified under this heading. For some other
of not indicating the time period during which the work is done and undergo
years their classification under "other sources" (see below) would have been
a similar timing adjustment in the course of deriving the estimates. The
more appropriate.
valuations entered on building permit applications are generally Jess reliable
Direct Federal construction of housing as carried on during the depression,
than are values to which the parties are committed by contract. An adjustdefense, and war periods under the Lanham Act was estimated from progment for undervaluation, and an allowance for lapsed permits are made on
ress reports by the Public Housing Administration on the number and cost
the basis of sample studies. The coverage of the permit data is very high in
of units built. Construction of low-rent units and slum clearance expenditures
the areas where building permits are required.
The miscellaneous sources used in estimating the remainder of construction by State and local agencies with Federal loans and grants under the Housing
Act of 1949 are estimated from progress reports made available by the Public
activity vary widely in quality. In general, they yield results less reliable
Housing Administration. Estimates of the value of work accomplished on
than those derived by the use of the other three types of source materials.
the locally financed New York City projects have been based on the progress
reports used to determine payments to contractors.
Of the 1950 total value of public nonresidential building, about one-fourth
Estimates Based on Direct Reports of Work
was Federal or Federally aided; all but a small part of this was covered
Done or Paid For
by progress reports.
In hospital and institutional construction, a major item under this heading,
Direct reports are the chief basis of components accounting in 1950 fcr
two large programs are involved: that of the Veterans Administration and
15 percent of estimated private construction and 61 percent of estimated
the National Hospital Program. Estimates of the value of veterans hospital
public construction. Exhibit 2 shows the components estimated wholly or
building are based on monthly progress reports supplied to the Office of the
in large part from materials of this sort. They consist primarily of projects
Chief of Engineers and to the Veterans Administration by project engineers
in which the Federal Government is involved—as a contracting party, as a
in the field. The National Hospital Program is one of Federal aid. Estimates
source of aid funds, or through agencies which regulate the purchaser's indusof the value of work done under this program are prepared from progress
try. However, private corporations and trade associations also perform an
reports on individual projects submitted to the Hospital Facilities Division
important service in data collection, as is indicated by the list ofreporting
of the Public Health Service by State agencies administering the program.
systems included in the exhibit.
The rest of public hospital construction, not aided by the Federal GovernThe estimates for privately owned public utilities generally involve only
ment (included in the total shown in Exhibit 2, since its value is not published
minor problems with respect to coverage, valuation, and timing. Totals from
separately), is evaluated by applying activity patterns to contract award
annual reports by railroads, electric utilities, oil companies, and members of
values compiled from F. W. Dodge Corp. reports (see below) and other
the Bell Telephone System are adjusted to reflect construction by or for
sources. The value of other construction included in public nonresidential
small concerns which do not report. The values reported for petroleum pipe
building, consisting chiefly of work done for the Public Buildings Administralines and electric and gas utilities include some expenditures for the purchase
tion, is estimated from progress reports of the supervising agency.
of existing facilities or producers' durable goods; statistical adjustments are
made to eliminate these. With respect to timing, the annual reports for public
Exhibit 2.—Components of New Construction Activity Estimated Chiefly
utilities are somewhat less appropriate for these estimates than are the
from Direct Reports of Work Done or Paid For, 1950
progress reports upon which most of the other values shown in Exhibit 2 are
based. However, there is no reason to expect any important timing discrepMillions
ancy on an annual basis.
Reporting agency
Component
of dollars
For the most recent year, financial data on construction outlays are generally not yet available for public utilities except the large railroad systems.
3,330
Private construction..
Preliminary estimates are based mainly on the utility companies' previously
Public utility:
Federal Power Commission
1,268
Electric light and power
announced plans for construction and checked against current sample series
1,102
Manufactured and natural gas.. American Gas Association
on plant and equipment expenditures, such as the quarterly CommerceAmerican Telephone & Telegraph
435
Telephone
Co.
Securities and Exchange Commission estimates. Construction plans are
315
Interstate Commerce Commission,
Railroads
Association of American Railroads.
ascertained from reports compiled either by trade sources or by the same
165
Interstate Commerce Commission..
Petroleum pipe-line..
agencies which later tabulate the financial data.
40
American Transit Association
Local transit
5
Western Union Telegraph Co
Telegraph
More than one-half cf all public construction covered by reports of
4,249
Public Constructionwork done or paid for consists of road-building. Monthly estimates of
Highway, by source of funds:
the value of work accomplished under the Federal-aid highway program
Federal
46
Bureau of Public Roads
_
are prepared from reports of the Bureau of Public Roads showing State
397
Federal-aid
....do
State and local
Bureau of Public Roads (through
1,829
"earnings," which are based primarily on reports by engineers of the progress
State highway departments).
made on individual projects. The Bureau of Public Roads also compiles
Military facilities l
Department of Defense
177
annual reports of highway construction on Federal lands. State, county,
Public Housing Administration;
345
Public residential building i
New York City Housing Authority.
and municipal highway, road, and street construction outside the Federal541
Public nonresidential building (Fed- Federal agencies responsible; Bureau
eral and Federal-aid).
of the Budget.
aid program is estimated mainly from special financial reports submitted
914
Other types of public construction Federal agencies responsible; Bureau
annually through State highway departments to the Bureau of Public
(Federal and Federal-aid).'
of the Budget.
Roads.
1. Public residential construction by the Department of Defense is included under "MiliFor military facilities, the expenditures reported represent the volume of
tary facilities." Housing at the sites of reclamation and flood control projects is included in
all construction, regardless of type, at Federal military installations. The
the "conservation and development" category among "Other types of public construction."
relatively small amounts of military construction by the States (armories,
rifle ranges, and the like) are included with other public construction cateA minor part of the total shown under public nonresidential building in
gories according to type of construction. The data for the two major conExhibit 2 represents construction for the National Advisory Committee for
struction agencies of the Department of Defense—the Office of the Chief of
Aeronautics, the Bureau of Prisons, and similar agencies which engage in
Engineers and the Bureau of Yards and Docks—are based on monthly progconstruction only occasionally or on a small scale. These agencies usually do
ress reports for all construction projects by service engineers.
not have sufficiently large construction staffs to warrant setting up regular
progress reporting systems. Estimates for them are made by applying activity
Public housing construction progress reports are gathered for Federal and
patterns to contract award data from the agencies, supplemented by annual
Federal-aid housing by the Public Housing Administration and are prepared
statistics from the Budget of the United States Government.
for locally financed projects in New York City by the local Housing Authority.
The remainder of public residential construction is based on local government
The "Other types of public construction" distinguished in Exhibit 2 conestimates of the cost, duration, and starting date of projects reported to
sist largely of outlays to conserve, develop, or control the Nation's water
regional offices of the Bureau of Labor Statistics. In 1950 the preponderant
resources. The bulk of these expenditures is estimated from monthly progshare of the public residential building estimates was based upon direct reress reports by Government engineers on projects of the Bureau of Recla

125

NATIONAL INCOME, 195 4 EDITION
mation and the Civil Works Division of the Office of the Chief of Engineers.
The Tennessee Valley Authority also provides monthly summaries of actual
cost of its construction activities. The small balance of conservation and development work included in Exhibit 2 is carried on by the International
Boundary and Water Commission and similar agencies, and is evaluated
from annual fiscal data shown in the Budget. Civil airport construction activity is estimated primarily from monthly progress reports to the Civil Aeronautics Administration; and Federal construction of a few other nor.conservation items of minor size is approximated from Budget data.

Estimates Based on Building Permits
Building permits are the most important data source for private nonfarm
residential construction. This category of construction is estimated in four
parts: construction of dwelling (housekeeping) units in areas in which building permits are required; construction of dwelling units in other areas; construction of nonhousekeeping units; and additions and alterations. The following tabulation illustrates the relative importance of each of these parts.
Exhibit 3.—Components of Private Nonfarm Residential Construction,

Estimates Based on Contract Awards
Monthly reports of the value of contracts awarded are used to evaluate
construction projects which collectively account for 18 percent of the private
construction and 39 percent of the puHic construction included in the 1950
gross national product. (See Exhibit 7.)
The chief source of data on contract awards (including information on subsequent cancellations) is the F. W. Dodge Corp., whose local correspondents
keep informed of new projects through personal contacts in the construction
and related industries, press reports, permit-issuing offices, and a variety of
other sources. Values of projects thus located are generally ascertained directly from the contracting parties. It is obviously difficult to avoid the omission of a considerable amount of construction activity when data are gatheied
in this way. The system is considerably more effective than the difficulty of
the task would suggest, however. Its relatively good coverage is due to the
long experience of the Dodge organization, which initiated this work in 1901,
and to financial support from contractors and suppliers who keep in touch
with (heir markets through such information.
To derive estimates of construction work dene, the Building Materials and
Construction Division adjusts the contract awards data for coverage and
timing.
The first adjustment of coverage is required because the F. W. Dodge
Corp. data apply only to the 37 States east of the Rocky Mountains. Western
State figures comparable to the Dodge tabulations are estimated chiefly
from building permit information and reports on construction contract
awards appearing in various trade journals.
A further coverage adjustment is applied to the national totals so obtained,
because neither the Dodge materials nor those available for the West purport
to cover all construction projects in the categories estimated from contract
awards. For private construction in each of these categories, a raising ratio
is computed by use of estimates based on the 1939 Census of Construction and
trade sources. Allowances for undercoverage of public construction are based
on extensive correspondence with State and local government officials.
After these adjustments, the data represent estimates of the value of construction work of each type for which contracts have been let during the
month. Some projects undoubtedly are started within the same month in
which contracts are awarded; others will not be started until 2 or 3 months
later. In the absence of definite information on the patterns of these delays,
it is more or less arbitrarily assumed that their average is one month; the
estimated value of contracts let in the given month (excluding those subsequently cancelled) is accordingly taken to measure the total value of projects which will be started in the following month.
Most construction projects take several months to complete after they are
started. Through surveys of thousands of actual projects, the Building Materials and Construction Division of the Department of Commerce has established typical activity patterns for various types and sizes of projects, showing
percentages of value "put in place" in successive months. These patterns are
used to translate the value of starts into construction activity.
Modifications of these patterns were made during the war years from data
collected by the War Production Boai d, and also during the immediate postwar years, when materials shortages delayed construction, on the basis of
data collected by the Commerce Department for the Civilian Production
Administration. The patterns are subjected to constant revision as additional
information becomes available and on the basis of judgment gained through
experience over a decade of investigation.
A final adjustment in the resulting estimates of work put in place is made to
eliminate offices, warehouses, and other buildings constructed by public
utilities, all of which are classified as public utility construction.

Item
Dwelling units built under permit
Other dwelling units >
Nonhousekeeping units
Additions and alterations
Total

Millions
of dollars

1950

Percent

9,705
1,820
175
900

77
15
1
7

12,600

100

1. Breakdown of the total of these items is rough; based on unpublished data.

Estimates of the third item are based upon the contract awards data which
have already been discussed. Estimates of the second item are based upon
procedures explained below. Those of the first and fourth items are based
upon information on building permits, and will be described next.

Nonfarm dwelling units built under permit
Most nonfarm residential construction is carried on under building permits. The permit-issuing officers of the responsible local governments compile
totals for number of dwellings and estimated value from the records of permits issued, and they report these totals to the Bureau of Labor Statistics on a
monthly questionnaire form.
Coverage of permit-issuing localities is not far from complete—about 90
percent of all such localities report each month. To allow for the remainder,
the individual localities are first cross-classified into cells according to type
of jurisdiction, location, urbanization, and population size. A raising ratio
for each urban cell is then computed by dividing the number of localities reporting for the month into the total number of localities in the cell. For each
rural nonfarm cell, the raising ratio is computed from 1940 population census
figures, as the ratio of dwellings in all localities to dwellings in lociditi^s reporting.
Reported values raised by these ratios are next adjusted to allow for permits
lapsing, and then for the understatement of ultimate construction values
which is generally characteristic of estimates entered on building permits.
Periodic field studies are made by the Bureau of Labor Stati tics to determine
the appropriate percentage allowance for each of these factors.
The timing adjustments next applied—of the same general nature as those
of the contract awards data—utilize activity patterns based upon Bureau of
Labor Statistics investigations. Specifically to be noted is that the estimates
of the lags which occvir between the issuance of permits and the start of the
projects are based upon Bureau of Labor Statistics field studies instead of the
summary assumption used in the case of the contract awards data.

Additions and alterations to nonfarm dwellings
Most local jurisdictions with building-permit systems require permits not
only for new structures but also for additions and alterations to existing
structures. However, compliance with such regulations is much Jess complete
in the case of additions and alterations, particularly in rural nonfarm areas.
Special problems are therefore met in translating the permit data on additions and alterations into estimates of the value of work done. For the urban
United States, the procedure is substantially the same as for new dwelling
units except that no specific adjustment is made for lapsed permits. The
resulting estimates of value of work in place are then expanded to cover
rural nonfarm activity, using relationships between rural nonfarm and
urban construction of new units. Studies of family expenditures—notably
the Consumer Purchases Study of 1935-36—provide the basis for a final
adjustment which allows both for understatement of value in permit applications and for undercoverage of projects.

126

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS
Estimates Based on Other Sources

Nonfarm dwelling units not built under permit
As is suggested by Exhibit 3, a significant fraction of residential construction
occurs in rural nonfarm areas where no building permit is required. Representatives of the Bureau of Labor Statistics cover a sample (currently, nonpermit-issuing parts of 96 counties) of such areas, and report numbers of
units started as well as prevailing average construction costs. Reported numbers are raised to full coverage by a method similar to that applied to building
permit data for rural nonfarm areas and multiplied by average construction
cost. The results are then distributed forward over succeeding months by
normal activity patterns.

Farm construction
Annual estimates of construction on farms are prepared by the Agricultural
Economics Division of the Agricultural Marketing Service, Department
of Agriculture, and described in Agricultural Estimating and Reporting Services

(Washington, December 1949). They are based chiefly on data from sample
surveys of construction expenditures of farm operators in 1934—37, 1939,
1946, and 1949. Estimates for other years are made by interpolation and
extrapolation, based in part on inferences from data on farm electric lighting
systems, windmills, silos, etc., reported in the annual Farm Machines and
Equipment reports of the Census Bureau. The bulk of the dollar amounts
involved, however, for other than benchmark years represents approximations
based on changes in indices of farm construction costs and in indicators such
as estimated consumption of lumber, sales of building materials in rural
areas, and nonfarm residential construction. The Commerce Department's
farm construction series represents the expenditure series of the Agricultural
Economics Division adjusted to exclude estimated expenditures for building
repairs.

Oil and gas well drilling
Oil and gas well drilling is not classified as new construction in the classification system employed by the Building Materials and Construction Division of the Department of Commerce, which prepares the estimates, but is
included as such in gross national product. All costs of drilling are covered,
including the cost of casings (but not the cost of installed production equipment).
Estimates for the base year 1939 were derived for each State from data
gathered in the 1939 Census of Mineral Industries and compilations of
reports to trade publications. These estimates have been projected from 1939
by using figures on the number of wells completed, as reported in trade
sources, multiplied by the average cost per well. The latter is determined by
adjusting the 1939 average cost in each State to take approximate account
of changes in labor costs and efficiency, material costs, proportion of wildcat
ventures, and average depth of wells.

Characteristics of Revisions
New data and methodological or conceptual changes have necessitated
occasional major revisions in the estimates of certain components of construction. For the most part, these revisions have not been of such a nature
as to cast light on the degree of reliability attained in the currently published
series. There is evidence, however, that some of the components of new
private construction may be somewhat understated.

10. PRODUCERS' DURABLE EQUIPMENT
The estimates of producers' durable equipment shown in table 32, Part V
represent statistical revisions for the entire period since 1929. These reflect
the incorporation of new data, mainly from the postwar censuses of manufactures and business. Also, in accordance with 1947 Census of Manufactures

practice, the Standard Industrial Classification of 1945 was adopted as the
basis of commodity classification. (See Exhibit 1.) Use of new basic data
and a different classification scheme entailed a reworking of the estimates
back to 1929. In the course of this, the opportunity was taken to review all
of the earlier estimates and to introduce a number of improvements in
methodology.

Exhibit 1.—Commodity Classification of Producers' Durable

Content in
terns of the
Standard
Industrial
Classification •

Product group

Furniture and
fixtures
_
Cutlery and hand tools.
Fabricated metal products (except cutlery and hand tools)
Engines and turbines
Tractors
_
_
Agricultural machinery (except tractors)
_
Construction machinery
Mining and oil field machinery
Metalworking machinery
Special-industry machinery n. e. c
General industrial machinery

_
_

Trucks, busses, and trailers
Passenger cars
Aircraft
Ships and boats.
Railroad equipment
Instruments
Miscellaneous equipment

25
3421-25
34
351
3521
3522
3531
3531,3532
354
355
356,3591

Office and store machines
--Serrfce-industry and household machines
Electrical machinery

Equipment

357
358
36

—

371
371
3721
373
374
3S

1. This column refers to code numbers of group? listed In the J045 Standard Industrial
Classification for Manufactures (Office of Statistical Standard?, Bureau of thp Budget).
2. Includes producers' share of the following: Miscellaneous manufactures (Group 39);
Motorcycles (Group 37511); Transportation equipment, n. e. c. (Group 3790); Motor vehicle
heaters (no code): Textile mill products (Group 22); Miscellaneous fabricated textile products
(Group 239): Lumber and wood products, except furniture (Group 24); Sadd'.ery, harness,
and whips (Group 3192); and Stone, clay, and glass products (Group 32).

The commodity flow method, summarized in the section on Personal
consumption expenditures for commodities, is the principal one used in
estimating producers' purchases of durable equipment. It accounted for 66
percent of the total in 1939 and 88 percent in 1947. (See Exhibit 2.)
For the 1929-39 period and for 1947, the availability of requisite data,
mainly from the manufactures and trade censuses, made it possible to carry
out the method in detail. The numerous estimating steps entailed segregating finished producers' durables from total manufacturing output and
then tracing their flow and measuring their distributive costs so as to arrive
at the final costs to purchasers. (See Exhibits 3 and 4.)
For years since 1940—except 1947—lack of industrial census materials
has prevented a detailed application of the commodity flow method. For the
period 1942 through the first half of 1946, the method was used in an abridged
form to establish "secondary" benchmarks, based mainly on information,
arising out of production-control programs, on the commodity breakdown of
manufacturers' sales in the metal fabricating industries. Government purchases and exports were eliminated from the sales data, and imports were
added. It was not possible, however, to trace the flow of manufacturers'
domestic sales of finished equipment through the various distributive channels. Adjustment for inventory change was ignored and transportation
allowances, wholesalers' markups, and retailers' markups were added to
manufacturers' domestic sales by application of percentages obtained by
straight-line interpolation of those computed from the 1939 and 1947
benchmarks.
Similar "secondary" benchmarks were made possible for the period 1950—
52 by commodity data on manufacturers' shipments collected by the Bureau
of the Census in its annual sample Survey of Manufactures. Government
purchases and exports were deducted from manufacturers' sales, and adjustment was made for inventory change. Estimates for other steps in the procedure were based, for the most part, on relationships derived from the 1947
benchmark.
Estimates for the commodity flow segment of producers' durables for the
remaining periods—1940-41, the second half of 1946, and 1948-49—were
also prepared within the framework of the commodity flow method. With

127

NATIONAL INCOME, 195 4 EDITION
some variation among these periods, the method accounted separately for
manufacturers' commodity sales, government purchases, transportation
allowances, exports, imports, inventory changes, and wholesalers' and
retailers' markups. The estimates for these periods are to be distinguished
from the "secondary" benchmarks in that it was necessary to rely upon
interpolations to derive manufacturers' commodity sales as well as the other
major elements of the commodity flow buildup.
As described in the section on consumer commodities, the commodity flow
portion of personal consumption expenditures was estimated for the years
1940-46 and 1948-53 by interpolating and extrapolating the 1939 and 1947
commodity group estimates very largely on the basis of sales of retail stores.
This was feasible because a very high proportion of consumer commodities
is purchased at retail (and purchases by nonconsumers do not bulk large in
the retail sales totals).
For the producers' durables groups, however, the procedure of utilizing a
single series for interpolation or extrapolation would not be valid. These
goods are purchased in large volume both from manufacturers and wholesalers. Also, substantial quantities of durable equipment are channeled
through manufacturing and wholesale trade for government use and export, and these (particularly government purchases) have fluctuated widely
in relative importance. Continuation of the commodity flow approach for
non-censal periods was necessary to provide the basis for separate measurement of these major elements.
For a few of the producers' durable groups, as shown in Exhibit 2, it has
been found preferable to prepare estimates by methods other than the commodity flow. The largest such group is business passenger cars, which
formed 17 percent of the 1939 total and 11 percent of the 1947 total. The
general method used for this group consists of multiplying the estimated
number of units purchased by producers by an appropriate average price.
A similar procedure was used to estimate truck purchases for all years except
1947, 1951 (second half), and 1952—for which benchmark values were
computed by the commodity flow method.
Expenditure data reported by the Interstate Commerce Commission
were the basic source for estimating producers' outlays on railroad and transit
equipment prior to adoption of the commodity flow method in 1947. The
ships and boats series, of minor quantitative importance, was estimated by
the commodity flow method in the 1929—38 period. For subsequent years,
it has been derived mainly from 1939 and 1947 Census of Manufactures
data and various information provided by the Maritime Administration
and the Bureau of Customs.

Considerations regarding reliability
In the section describing the sources and methods of estimating consumption expenditures for commodities, the conclusion is reached that the Censusbased benchmark totals for the large commodity flow segment of consumer
commodities are "not markedly in error." Analysis of the essential differences in the application of this method to the consumer and the producer
durables series indicates that even higher reliability may be attached to the
latter. Two points, amplified later, are of main relevance.
First, the problem of allocation was less in the producer durable series.
In larger degree than in the case of consumer commodities, manufacturers'
sales of finished producer durables (apart from the special problem of government purchases) could be derived from detailed product data in the
Census of Manufactures through (a) selection of items in their entirety or
(b) allocation of "mixed" items having relatively little other use. In general,
estimation and judgment—and hence possible error—are involved to a
greater extent in allocation than in the selection offinisheditems.
Secondly, and more important, the successive estimating adjustments to
manufacturers' sales required by the commodity flow method, as illustrated
in Exhibits 3 and 4, were relatively smaller for producers' durable equipment than for consumption commodities.
As would be expected, commodity flow estimates of producers' durables
other than for 1929-39 and 1947 are of lesser reliability. Nonetheless, the
availability of substantial amounts of requisite data (particularly on manufacturers' sales) and the satisfactory record with regard to revisions, as set
forth later, warrant the conclusion that the totals for these non-benchmark
periods are generally adequate.
The estimates for 1940 and 1941 are least firmly based. For these years, it
was necessary to interpolate manufacturers' commodity sales by industry

sales data, which have significant limitations in such use, and statistical
information on government purchases was sparse. In addition, the 1940-41
estimates are affected by weaknesses in the 1942 secondary benchmarks.
The secondary benchmarks prepared for 1942-46 are subject to error
mainly from two sources: (1) elimination of parts and other unfinished
products from sales at the manufacturers' level and (2) the deduction of
government purchases, which it is believed may err in the direction of being
somewhat too large. For most of the commodity groups, purchases of durable
equipment by government during the war exceeded those by business and
were difficult to estimate. The quality of source materials for the 1942-46
period varied, the data for 1944 being most adequate. The estimates for this
period are believed, in general, to be considerably more reliable than those
for 1940 and 1941, but less reliable than those for 1947 or 1950-52.
The estimates for 1948 and 1949 (as well as for the second half of 1946)
represent interpolations carried out within the commodity flow framework.
They benefit materially from the high quality of the benchmarks for proximate years, and may be regarded as generally satisfactory.
The 1950-52 secondary benchmarks, which rest principally on the Census
Bureau's special annual surveys of manufacturing, are subject to sampling
variability at the manufacturers' sales level—although for most producer
durable groups this is small—and to errors stemming from the use of 1947
relationships to determine the major elements of distributive costs. GovernExhibit 2.—Producers' Durable Equipment, 1939 and 1947
1939

1947

Millions
of
dollars
Estimated by commodity flow method
Estimated by other methods:
Tracks, busses, and trailers
Passenger cars
Ships and boats
Railroad equipment
Total producers' durable equipment

_ _- _

Percent

Millions
of
dollars

2,749

14,542

489
715
57
170

12
17
1
4

1,889
236

11
1

4,180

100

16,667

100

Percent

ment purchases were of increased relative importance in this period, particularly in 1951 and 1952, but the available data on such purchases are
believed to be reasonably accurate.
Concerning the commodity groups based on methods other than the commodity flow, it is to be noted that the largest one—business passenger cars—
depends on an allocation between consumers and business which is based on
limited information. However, errors in this allocation do not affect the gross
national product total. The accuracy of the estimates for trucks and busses is
impaired by the necessity of making several sizable adjustments on the basis
of partial information.
The series on railroad and transit equipment is regarded as relatively
accurate. The same generalization applies to the ships and boats series for
1929-39 and 1947—for which Census of Manufactures data furnished the
principal basis of estimation—but the figures for other years are interpolations and extrapolations derived from not very satisfactory information.
A rough check on the postwar estimates of producers' durable equipment is
possible through comparison with the results of the New Plant and Equipment Survey conducted jointly by the Office of Business Economics and the
Securities and Exchange Commission. This series differs in definition from
the producers' durable estimates (it is confined to nonagricultural industries,
includes plant as well as equipment, but excludes purchases of equipment
charged to current expense, to mention the major differences), and adjustments to secure comparability cannot be made in a fully satisfactory way.
However, to the extent that comparisons are possible, they have been
broadly reassuring for most of the postwar period.
The 1953 estimate of producers' durable equipment is preliminary. Pending
the availability of the Census Bureau's Annual Survey of Manufactures, it
has been based on an overall extrapolation technique utilizing New Plant and
Equipment Survey results in conjunction with a variety of information for a
few important commodities.
The balance of this section describes the estimates of producers' durable

128

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS

equipment prepared by the commodity flow approach—separately for
1929-39, 1947, 1940-46, and 1948-52—and by the other methods.

Commodity Flow Estimates, 1929-39
As already noted, the commodity flow method was used to derive estimates
for the 1929-39 period for producer durable groups comprising 66 percent
of the 1939 total. The method was employed extensively for this period also
in the estimation of personal consumption expenditures for commodities
(yielding 84 percent of the 1939 total), and was explained at some length in
the section describing that series.
The application of the method in the estimation of producer durables and
consumer commodities was substantially similar, so that no attempt has been
made here to repeat the description in the earlier section. However, there
were several particular aspects in which the methodology differed. Further,
individual steps in the estimating procedure varied widely in relative importance between the two series and have marked bearing on their statistical
reliability. These two types of differences may be summarized by reference to
Exhibit 3, which outlines for 1939 the individual steps in the derivation of
total producers' durables estimated by the commodity flow method.
Distribution of finished and mixed manufactured commodities, before deduction of
government purchases of durable equipment.—(Line 1.) As noted in the section on

consumer commodities, producers' items are defined as durable equipment
for multiple use in production and with an average life of one year or longer.
Even if the latter criterion were changed to as much as three years, it may be
added, the statistical measure of producers' durables would be affected only
slightly.
From product detail presented in the biennial Census of Manufactures, it
was possible to select and assign in their entirety commodities which comprised 56 percent of the 1939 total (line 2) of manufacturers' production of
finished producers' durables (before deduction of government purchases).
Seven percent represented allocation from the combined group of finished
commodities having appreciable use both by producers and consumers. The
remaining 37 percent was derived from allocations of the "mixed" category.
This category included commodities which could not be classified directly as
wholly finished or unfinished. They belonged in part to the unfinished category and in part to the producer durable and /or consumer commodity
categories, and required allocation among them.
The foregoing percentages were sharply affected by revision work undertaken for the 1954 edition of the NATIONAL INCOME supplement. In the

earlier series shown in the 1951 edition, direct selection and assignment of
values reported in the Census of Manufactures accounted for 84 percent of
the 1939 factory value of producer durables (before the government deduction). Reduction of this figure to 56 percent stemmed from revisions of assignments and allocations based mainly on detailed product relationships
developed for the 1947 benchmark study. In large degree, it reflected the
fact that small allocations were made for many commodities which previously had been assigned wholly to producers' durables or to one of the
other categories.
The changes in classification appreciably improved the estimates of manufacturers' output for producer durables of the type customarily charged to
current expense, rather than amortized through depreciation allowances. On
the basis of the greater product detail in the 1947 Census of Manufactures
and additional research into product uses, many such items formerly regarded
as producers' durable equipment were reclassified wholly or in part as intermediate products. In the segment of producers' durables represented by
products commonly charged to current expense—such as miscellaneous
types of small equipment—the problem of classification as between parts and
finished equipment is at best difficult. Apart from this fringe segment—that is,
for the preponderant part (well over 90 percent) comprised of items capitalized by business—the classification changes (mainly a general resort to more
allocation) were a refinement which sharpened the accuracy of individual
commodity groups but had little effect on the total.
Earlier, the generalization was made that, because of the greater emphasis
on estimation and judgment, allocation from "mixed" groups tends to involve
more error than does the direct selection offinisheditems. When the producer
durable and consumer commodity series are assessed from this standpoint,
comparison of the percentages of manufacturers' value derived from "mixed"

groups—37 and 43 percent, respectively—may be somewhat misleading. It
should be supplemented by the consideration that to a larger extent the
producer-durable percentage was based on product values for which the
allocation—and hence possible error—was relatively small.
There were two related statistical differences between the producer durable
and consumer commodity estimates with respect to the classification of
finished and mixed manufactured commodities.
(1) In the allocation of consumer commodities primary use was made of
information on the distribution of sales by class of purchaser given in the
Census of the Distribution of Manufacturers' Sales. Data reported under the
designation of "Sales to industrial, commercial, professional, and institutional
users" were taken to indicate the unfinished part. This could not be done in
the case of producers' durables since finished producers' durables as well as
unfinished commodities are included in sales to these user groups. It was
necessary, therefore, to allocate the mixed category for producer durables on
the basis of various types of specific commodity information, with some resort
to judgment and outside expert advice.
(2) Unlike the procedure that could be followed in the consumer commodity
estimates, where the government deduction was made jointly with all other
nonconsumer elements except exports, this deduction was carried out as a
subsequent, separate step. Since the available data for making the adjustment
related to government purchases, the deduction was made after manufacturers' sales had been derived from manufacturers' production by adjusting
for changes in inventories.
Deduction of government purchases of durable equipment.—(Line 5.) Apart from

the fact that Exhibit 3 refers only to commodities estimated by the commodity
flow method, it is to be noted that line 4 is not a complete measure of government purchases of durable equipment. Rather, it is a special-purpose measure which, in general, is restricted in scope to business-type items.
Comprehensive information on government purchases of durable equipment was lacking. Federal purchases were estimated by drawing on a
number of different sources, which generally pertained to one or more of
the years 1937-39 only, and required adjustment for differences in definition
or timing. For earlier years, it was frequently necessary to employ indirect
methods, which for the most part were not satisfactory. Such methods were
necessary for estimating State and local purchases in all years of the period.
The annual (1929—39) information on Federal aircraft purchases supplied
by the Departments of the Navy and the Air Force was quantitatively the most
important source of data on government purchases of durable equipment
Aircraft purchases alone accounted for two-fifths of the estimated government
total and considerably enhanced its accuracy.
The source most generally used in estimating Federal purchases of other
items was the tabulations by the Bureau of Labor Statistics of orders under
the Walsh-Healey Act, available on a quarterly basis beginning with 1937.
These tabulations excluded orders classified as secret or confidential or
amounting to less than $10,000. No adjustment for this incompleteness of
scope was attempted. The reported data were always shifted ahead, generally
by one quarter, to time them more nearly with actual deliveries. It fre-'
quently was necessary to estimate, and deduct, the amount of parts and other
unfinished products included in the Walsh-Healey data, and also to adjust
for differences in commodity definitions underlying these data and the
producer durable series.
For a number of the commodity groups, data on Federal purchases were
available for 1938 from the report of the Temporary National Economic
Committee on Study of Government Purchasing. These data, too, generally
required adjustment for unfinished products or for differences in commodity
definition.
Data on Federal purchases of durable equipment furnished by the Treasury
Procurement Division could be utilized for a few of the commodity groups.
For two groups—electrical apparatus and equipment and office machinery—•
data obtained for part of the period from several large manufacturing
concerns formed the basis for estimating Federal purchases.
The estimates of government purchases of durable equipment for the 1929—
39 period are probably conservative. Walsh-Healey data, as mentioned, are
not complete, and State and local purchases were estimated for only those
commodity groups in which such purchases were presumed to be of appreciable magnitude.
In this period, however, government purchases were not large. Even an
error of 20 percent—which seems unlikely, particularly in view of the relative

NATIONAL INCOME, 195 4 EDITION
accuracy of the aircraft item—would have affected the 1939 estimate of
manufacturers' sales of finished producers' durables (line 6, Exhibit 3) by
only 2 percent.
The estimated deduction for government purchases was negligible or less
than 5 percent of manufacturers' sales before this deduction (line 4) in special
industry machinery, mining machinery, general industrial machinery, metalworking machinery, agricultural machinery, tractors, fabricated metal products and instruments. It exceeded 15 percent only in construction machinery
and aircraft.
Exhibit 3.—Derivation of Tofal Producers' Purchases of Durable Equipment
Estimated by the Commodity Flow Method, 1939
[Millions of dollars]
1. Distribution of finished and mixed manufactured commodities, before deduction
of government purchases of durable equipment

25,978

1. Producers' durables
2. Consumer commodities
3. Combined allocated to
a. Producers' durables
b. Consumer commodities
b. Mixed, allocated to

1,714
9,188
1,425
206
1,219
13,651

1. Producers'durables
2. Consumer commodities
3. Unfinished

1,112
8,210
4,329

2. Manufacturers' production of finished producers' durables, before deduction of
S, 032

government purchases [la(l)+la(3a)+lb(l)]

-23

3. Subtract: Change in manufacturers'inventories.
4. Equals: Manufacturers' sales of finished producers' durables, before deduction
of government purchases

2,790

6. Equals: Manufacturers' sales of finished producers' durables
7. Add: Transportation charges

59
2,849

C. Equals: Manufacturers' sales inclusive of transportation charges, distributed to.
Exports
Wholesalers
Retailers
Businesses and nonprofit institutions, for own use
. _

3,055
265

5 Subtract: Government purchases of durable equipment

9. Imports

outline, the deduction of manufacturers' sales flowing into exports was
approximately offset by the additions for wholesalers' and retailers' markups
on commoditiesflowingthrough trade channels. Only these three adjustments
were of any quantitative importance; even unexpectedly large errors in them
would not have had substantial effect on the final total.
Two further, minor differences in the application of the commodity flow
method to producer durables and consumer commodities in the 1929-39
period may be noted.
First, in the consumer commodity series exports were eliminated partly at
the producer level and partly at the wholesale level. In the producers'
durable estimates, exports were eliminated in their entirety at the producer
level. They were deducted (in step 8a) as part of the distribution of manufacturers' sales, inclusive of transportation charges.
The second difference is that the consumer commodity estimates, but not
the producer durable estimates, required a final adjustment for the addition
of general retail sales taxes.

12,327

a. Finished

a.
b.
c.
d.

129

___ .

1,131

10. Total purchases by wholesalers [8b+9]_
11. Subtract: Change in wholesalers'inventories
12. Equals: Cost of goods sold by wholesalers

499
1,114
1«8
1,068

6
..

1,125
249

13. Add: Wholesalers' markups

267
1,107

About nine-tenths of the 1947 total value of producers' durable equipment
was estimated by the commodity flow procedure. For the producer durable
series, the 1947 statistical basis for this procedure was an improvement over
that for the 1929-39 period. The principal factors were the greater extent of
product detail furnished by the 1947 Census of Manufactures and the availability from specific commodity studies of more information on product uses.
These factors facilitated and strengthened the process of selecting and allocating individual product items to arrive at manufacturers' sales of finished
producer durables. As in the 1929-39 period, the adjustments necessary to
convert manufacturers' sales to final market value did not bulk large in the
procedure and were virtually offsetting.
Lack of data on distribution of manufacturers' sales and on retailers'
operating expenses which had been provided in previous censuses handicapped the producer durable estimates comparatively little. As discussed
earlier, the sales distribution data cannot be employed in these estimates for
the allocation of "mixed" commodities in the classification process. Further,
distributors' markups—for which both the sales distribution and retail operating expense data would have proved useful in the 1947 work—are relatively small elements of the producers' durable totals.
The following description of the 1947 commodity flow estimates of producers' durable equipment is geared to Exhibit 4. Like the description just
given for 1929—39, it does not repeat numerous aspects of the basic commodity
flow method already covered in the section on Personal consumption expenditures for commodities.

1,374

14. Equals: Wholesalers' sales, distributed to.

Commodity Flow Estimates, 1947

a. Retailers

Classification of manufactured products

In the classification of manufactured product items, stricter criteria with
respect to commodity allocation were employed for producer durables for
7
1947 than in the 1929—39 estimates published in earlier national income
15. Total purchases by retailers [8c-H4a]
reports. In those estimates, simple assignments had been the general rule; and
428
16. Subtract: Change in retailers' inventories
possible allocations of commodities involving durable equipment use in either
146
17. Equals: Cost of goods so!d by retailers
very large degree or very minor degree were passed over. While reflecting
574
18. Add: Retailers'markups
importantly a lack of more detailed information on product composition and
19. Equals: Retailers' sales
use, this procedure rested on the general assumption that the inclusions and
2,749
exclusions entailed by such resort to direct selection and assignment would
20. Producers' purchases of durable equipment estimated by the commodity flow
tend to offset.
method [8d+14b+19]
Other steps ofprocedure.—Manufacturers' sales offinishedproducers' durables In the commodity flow benchmark estimates for 1947, greater use of small
(line 6) account for all producers' sales of finished durable equipment estiallocations was facilitated, and indicated, by the finer product detail in the
mated by the commodity flow method; there are no nonmanufactured pro1947 census—about 6,100 separate products as compared with about 4,000
ducer durables. In the derivation of consumer commodities by this method,
in the 1939 census—and by the extensive amount of specific commodity
the value of nonmanufactured foods (agricultural and fishery products) had
information that was available from both public and private sources. Asto be accounted for and added to manufacturers' sales.
signment and allocations made by the National Income Division staff
It has been noted that the problem of commodity allocation was less for
were checked and often modified on the basis of special commodity studies
producers' durable equipment than for consumer goods. Of further releand the advice of outside experts. The most important such check was
vance in gauging the comparative reliability of the producers' durable series
furnished by the Division of Interindustry Economics of the Bureau of Labor
is that the estimates in it which had to be made to convert producers' value
Statistics, which for a study of similar nature drew not only on published
to final market value were relatively small. The central fact here is that only
information but also on data obtained from special inquiries and other
a comparatively small volume of producers' durables flows through the retail
unpublished sources. For the producer durables work, an important inchannel, whereas retailers handle the large bulk of all commodities purchased
stance of the latter was a sample survey undertaken by the Bureau of the
by consumers. In 1939, manufacturers' sales of finished durable equipment
Census on the types of items included as "materials" (in contrast to plant
were virtually the same as the final value of producers' durables. In broad
and equipment) on reports to the 1947 Census of Manufactures.
b. Businesses and nonprofit institutions, for own use.

435

130

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS

As already noted, relationships developed from the more intensive 1947
classification process were used for review and revision of the manufacturers'
sales estimates for 1929-39 (as well as for other, "secondary benchmark"
periods). By this revision, the 1939 proportion of manufacturers' sales of
finished producers' durables (before deduction of government purchases)
obtained through allocations from the combined or mixed categories was
increased from 16 percent to 44 percent. Although, it may be added, the
corresponding figure for 1947 is only 30 percent, the reduction from the
revised 1939 percentage resulted largely from the inclusion of railroad
equipment and trucks in the 1947 commodity flow table.
From the commodity analysis summarized in line 1 of Exhibit 4, manufacturers' sales of finished producers' durables (before deduction of government
purchases) were obtained by summing three cf the listed categories. These
include producers' durables (1) assigned directly as finished, (2) allocated
from the combined category of finished consumer and producer durable
goods, and (3) allocated from "mixed" commodities belonging in part to the
unfinished category.
The detailed commodity figures were next combined into broad categories
as listed in table 32, Part V. Further steps in the commodity flow procedure—
from the elimination of government purchases shown in line 3 through the
derivation of the final purchase value in line 16-—were carried out in terms of
the broad commodity groupings.

Government purchases of durable equipment
The estimates of Federal and State and local government purchases of
producers' durables utilized in the 1947 commodity flow work were prepared
largely by the Division of Interindustry Economics of the Bureau of Labor
Statistics. Since they were based for the most part on reported expenditure
data and constituted (for all commodity groups combined) only a 3 percent
adjustment of manufacturers' sales, it is very improbable that error in the
government-purchase estimates was the source of any appreciable inaccuracy
in the producer durable benchmarks.
In deriving Federal Government purchases, which formed about half of the
total government purchases for which an estimate was required, the Bureau of
Labor Statistics obtained detailed expenditure data, by commodities, for the
Army (including Air Force), Navy, Post Office, War Assets Administration,
Bureau of Public Debt, Bureau of Engraving and Printing, and Government
corporations (in total). In addition, a single control total of expenditures for
all other civilian agencies combined was furnished by the Treasury Department. This was distributed by commodities according to the pattern shown
by a sample of five agencies: Justice Department, Public Health Service,
Bureau of Old-Age and Survivors Insurance, Patent Office, and Food and
Drug Administration.
For a few commodities, where adjudged more reliable, estimates of Federal
Government purchases based on tabulations of contracts awarded under the
Walsh-Healey Act were substituted by the Bureau of Labor Statistics for those
derived from the agency expenditure data. The series were also checked
with BLS industry analysts, and modified in a few cases on the basis of
their independent estimates relating to Government purchases of durable
equipment.
In deriving the series on State and local government outlays for durable
equipment, the Bureau of Labor Statistics first prepared separate estimates
for States, cities, counties, and townships, towns, and special districts according to afive-wayfunctional breakdown: highways, hospitals, schools (primary
and secondary), higher education, and "all other." Equipment expenditures
under these five functions were next summarized for all State and local
governments and allocated to the various commodity groups. In the data
sources utilized, noted below, the commodity breakdowns either were available along with the totals by types of governmental unit and function or
could be estimated satisfactorily from collateral information.
The estimates of equipment expenditures for highway purposes, which
comprised about three-fourths of the State and local aggregate for 1947, were
based on data from the Bureau of Public Roads. The necessary data for
hospitals were compiled from directories of the American Hospital Association. The Office of Education—both through its regular reports and special
compilations of unpublished data—was the principal source of the estimates
relating to primary and secondary schools and to higher education. Basic
data for the estimates in the "all other" category of functions were taken from
reports by the Bureau of the Census on State, city, and county government

finances, as well as the decennial census publication on Government Finances in
the United States: 7942. The most recent equipment data tor counties referred
to 1946; they were moved forward to 1947 by data for cities. Equipment
purchases by townships, towns, and special districts were available only for
1942; they were extrapolated to 1947, separately for broad functions, by
means of estimates for counties.
Exhibif 4.—Derivation of Total Producers' Purchases of Durable Equipment
Estimated by the Commodity Flow Method, 1947
[Millions of dollars]
1. Distribution of finished and mixed manufactured commodities, before deduction of government purchases of durable equipment
a. Finished

81,993

42,840

1. Producers' durables.
2. Consumer commodities
3. Combined, allocated to
a. Producers' durables

10,076
23,063
3,711
734

39,153

b. Consumer commodities
b. Mixed, allocated to

2,977
-

1. Producers' durables
3,657
2. Consumer commodities
_ 18,494
3. Unfinished..
._
_ 17,002
2. Manufacturers' sales of finished producers' durables, before deduction of government purchases [la(l)+la(3a)+lb(l)]
3. Subtract: Government purchases of durable equipment

14,467
__

4. Equals: Manufacturers'sales of finished producers'durables

451
14,016

5. Add: Federal manufacturers'excise taxes.

137

6. Add: Transportation charges...

339

7. Add: Imports

8. Subtract: Changes in wholesalers'inventories
9. Add: Wholesalers'markups..

139

1,437

10. Subtract: Exports

2,154

11. Equals: Sales to retailers and final users

13,682

a. Manufacturers' and wholesalers' sales to final users (11-llb)

10,385

b. Eetailers' purchases.

3,297

12. Subtract from retailers'purchases: Change in retailers'inventories
13. Equals: Cost of goods sold by retailers

144
—

3,153

14. Add: Retailers'markups

1,004

15. Equals: Retailers'sales

4,157

16. Producers' purchases of durable equipment estimated by the commodity flow
method (lla+15)

14, 542

For most of the commodity groups the estimates of government equipment purchases required allocation between finished and unfinished products.
This was done (for Federal and State and local government purchases combined) on the basis of the proportions used to allocate factory sales.

Other steps in the procedure
Deduction of government purchases of durable equipment yielded manufacturers' sales of finished producers' durables, as shown in line 4 of Exhibit 4.
Up to this stage, the commodityflowprocedure for producer durables differed
from that for consumer commodities in respect to (1) the elimination of
government purchases as a subsequent, separate step instead of in the classification of Census of Manufactures data, (2) the omission of any adjustment
for manufacturers' inventory changes (all data relating to durable equipment
were reported on a shipments, or sales, basis in the 1947 Census of Manufactures), and (3) the omission of any allowance for production outside of
manufacturing since there are no nonmanufactured types of producer durable
commodities. Line 4 of the exhibit, therefore, corresponds directly to line 6 of
the 1947 commodity flow exhibit for personal consumption commodities.
With the exception that inventory adjustments were, in general, required
for the biennial 1929-39 benchmarks, the 1947 procedure for deriving
manufacturers' sales offinishedproducers' durables was generally the same as
in the earlier work. Thereafter, the procedure—like that for consumer commodities—required modification principally because of the unavailability of

NATIONAL INCOME, 1954 EDITION
1947 census data on the distributions of manufacturers' sales. These data,
together with corresponding distributions for wholesalers, had been used in
the basic commodity flow method for measuring the volume of producer
durables moving from manufacturers through wholesalers, and then through
retailers. In essence, they provided the basis for (1) immediately segregating
manufacturers' direct sales of finished durable equipment to final users
(businesses and nonprofit institutions), (2) applying wholesalers' markups to
goods sold by manufacturers to wholesalers and then sold directly to final
users, (3) applying cumulative wholesalers' and retailers' markups to goods
sold by manufacturers to wholesalers and then sold by them to retailers, and
(4) adding retailers' markups to sales made directly by manufacturers to
retailers.
In the 1947 method, omission of sales distributions from the manufacturing
census required foregoing the commodity flow method for wholesaling, since
data were lacking for estimating the amounts of finished durable equipment
purchased by wholesalers. Instead, as in the parallel case of consumer goods,
the resort was to estimate total wholesalers' markups (and inventory changes)
for each commodity and then to determine the amount allocable to finished
producer durables. On the basis of this innovation, and given the inability to
segregate manufacturers' direct sales to final users, a combined total consisting of sales to final users and to retailers was derived. {Exhibit 4, line 11.)
The latter sales were then estimated directly as the sum of retailers' purchases
from (1) manufacturers (by reliance on 1939 sales distribution patterns) and
(2) wholesalers (largely as a byproduct of the substitute procedure for
deriving wholesalers' markups). Through this estimation of retailers' purchases it was thus possible to (1) continue the commodity flow approach for
retailing and (2) obtain as a residual manufacturers' and wholesalers' sales
of finished durable equipment to final users.
By comparison of the 1939 and 1947 commodityflowexhibits, it can be seen
that the modifications of method were basically similar for producers' durables
and consumer commodities. For both series, necessary abandonment of the
commodity flow approach to wholesaling and the estimation of wholesalers'
markups (and inventory changes) through a special substitute procedure
yielded a composite total of sales to (1) retailers and (2) final users. And for
both series, direct estimation of one of these elements permitted the commodity flow approach (as modified) to be carried through to completion. A point
of specific note is that the element of direct estimation—retailers' purchases
in the case of producer durables and producers' direct sales to final users in
the case of consumer commodities—was chosen because it was very much the
smaller. The alternative of deriving it as a residual between the total and a
direct estimate for the larger element would have been a weaker procedure.
There follows, with reference to Exhibit 4, a brief outline of the various steps
entailed in converting manufacturers' sales to the final value of producers'
purchases of durable equipment estimated by the commodity flow method.

131

cation used in the producer durable series, and the producers' share (as
distinct from the consumer and intermediate) was allocated by proportions
computed for wholesalers' aggregate markups.
Except for this final step of allocation, the 1947 estimates of wholesalers'
inventory changes were prepared by the Bureau of Labor Statistics.
Addition of wholesalers' markups.—Basic to this step in the 1947 method
was the estimation of wholesalers' margins by wholesale commodity groups.
This was a four-step procedure—performed by the Bureau of Labor Statistics—which has been described in the section on consumption expenditures
for commodities. The fifth step in the BLS analysis of wholesaling, which
broke down the total margins by customer classes, could not be employed
for the producer durable series to indicate the proportion of the total that
was allocable to finished commodities. (This was chiefly because the "industrial users" category included sales of parts and other unfinished products
as well as finished equipment for the manufacturers' own use.) Instead,
after the wholesale commodity margins had been arranged according to
the producer durable classification, they were allocated by the National
Income Division to the producer and other (consumer and unfinished)
categories chiefly on the basis of the original allocations used for manufacturers' sales.
Subtraction of exports.—Export commodity data were obtained from the
Census Bureau's detailed tabulations. The same allocation factors generally
were applied to each specific commodity as had been applied to manufacturers' sales.
Distribution of sales to retailers and final users.—At this point, the 1947 com-

modity flow procedure for producers' durables arrived at the composite
total of sales to retailers and final users discussed above. Sales to retailers
("Retailers' purchases") were estimated separately, and sales to final users
thereby became available as a residual estimate. Unlike retailers' purchases,
these were at final market value and required no further adjustment.
Retailers' purchases, as noted, were estimated as the sum of purchases
from manufacturers and from wholesalers. In the estimation of the former,
it was assumed that the same proportion of a given type of producers' durable equipment was sold by manufacturers to retailers in 1947 as had been
shown for 1939 by the sales distributions data in the Census of Manufactures.
Manufacturers' sales to retailers thus computed were converted to retailers'
purchases by adding excise taxes, where applicable, and a transportation
allowance. Retailers' purchases from wholesalers were derived from the
BLS study (noted above) that formed the basis of the estimates of wholesalers' markups. In this study, step 5 obtained breakdowns of wholesalers'
sales (by wholesale commodity groups) according to customer classes. The
amounts of wholesalers' sales to retailers for the various wholesale commodity groups were arranged according to the producer durable classification, and then were allocated to the producer durable and other categories
Addition of excise taxes, transportation charges, and imports.—It may be seen that by use of the same allocations that had been employed at the manufacturers' sales level. This procedure was thus directly analogous to that
the first three adjustments of manufacturers' sales of finished producers'
followed for wholesalers' markups.
durables consisted of the addition of Federal manufacturers' excise taxes,
transportation charges, and imports. For these three estimates—all of minor
Subtraction of retailers' inventory changes.—The amount of retailers' inventory
magnitude—procedures were similar to those already described for consumer
change to be subtracted from retailers' purchases so as to derive the cost
commodities. It may be noted, however, that the computations of transportaof goods sold by retailers was estimated by (1) computing ratios of inventory
tion charges were not based solely on Interstate Commerce Commission data;
changes to retailers' purchases by line of trade and (2) applying these ratios
for three of the commodity groups (Electrical machinery, Trucks and buses,
for relevant lines of trade to the various producers' durable groups. Paralleland Railroad equipment) estimates obtained from the Bureau of Labor
ing the procedure for consumer commodities, inventory change-sales ratios
Statistics took account of means of transport other than rail. Also, the
based on Office of Business Economics data were converted for this purpose
estimates of imports relied mostly on allocation (on the basis of the producerto inventory change-purchase ratios.
durable share of manufacturers' sales of the same products), rather than on a
Addition of retailers' markups.—The cost of goods sold for the various proselective matching of import data against final product data, as was done for
ducer-durable commodity groups was multiplied by markup rates computed
the consumer commodity estimates.
for 1948 by weighting selected subsamples of Internal Revenue Service
returns by Census of Business sales data, and then extrapolated from 1948
Subtraction of wholesalers' inventory changes.—Ratios of inventory change to
to 1947 by means of Internal Revenue and trade association data. In this
sales were computed for a detailed list of wholesale commodities by extrainstance, too, the procedure was closely similar to that described for perpolating beginning-year inventories as shown in the 1948 Census back to the
sonal consumption commodities.
beginning of 1947 on the basis of Office of Business Economics data for
mei chant wholesalers, modified (as in the consumption commodity estimates)
Producers' purchases of durable equipment estimated by the commodity flow method.—
to include manufacturers' sales branches. The ratios of inventory change to
Addition of retailers' markups to the cost of goods sold by retailers yielded
sales were converted into ratios of inventory change to markups, and these
retailers' sales of finished producers' durables. (Line 15.) There remained
were applied to wholesalers' aggregate markups (derived in the step below)
only to combine retailers' sales and manufacturers' and wholesalers' sales
to obtain aggregate inventory changes by wholesale commodity groups. The
(line lla) in order to obtain the final total of producers' durable equipment
wholesale commodity estimates were next arranged according to the classifiestimated by the commodity flow method. (Line 16.)

132

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS

Commodity Flow Estimates, 1940-46
As noted in the introductory remarks, a modified commodity flow method
was followed in estimating producers' durable equipment for 1940—46 for
those groups to which this method was applied in detail for the 1929-39
period. In terms of the basic step of estimating manufacturers' sales, the
figures for 1942-46 may be characterized as "secondary" benchmarks and
those for 1940-41 as interpolations.
The same commodity flow steps, except for omission of the adjustments for
inventory change, were followed in deriving estimates for 1940-46 as for the
earlier period. Because of the nature (or lack) of available source materials,
however, the methods, described briefly below, were different.

Derivation of manufacturers' sales
For most of the producer durable groups, comprehensive and detailed
commodity sales estimates (before deduction of government purchases and
exports) could be derived for the years 1942—45. The primary source was the
reports submitted on Form WPB-732 by the largest private and governmentowned plants engaged in fabricating or assembling metal products beyond
the primary stages. These reports—made quarterly from the fourth quarter of
1943 through the second quarter of 1945 and then monthly through the
second quarter of 1946—were collected and tabulated by the Bureau of the
Census for the War Production Board, and published in the Census
Facts for Industry releases. The "732" tabulations accounted for an
estimated 90 percent of sales in the metal-products industries covered. These
were raised to full coverage on the basis of similar commodity information for
the first quarter of 1945 compiled by the Census Bureau for the Smaller War
Plants Corporation.
The detailed commodity data derived from the "732" reports as supplemented by the Smaller War Plants Corporation data, were extrapolated from
the fourth quarter of 1943 back through the third quarter of 1942 on the
basis of unpublished commodity sales figures collected and compiled by the
Census Bureau for the War Production Board. These compilations covered
about 3,100 large metal-products plants accounting for four-fifths of all
fabricated metal products in the first quarter of 1945.
The individual commodity data were then extended from the third quarter
of 1942 through the first quarter of that year by less detailed commodity data
compiled from an earlier and smaller Census-War Production Board sample.
The number of individual commodity items which could be derived from
the "732" and related data was substantially less than that given in the
Census of Manufactures. The necessary product assignments and allocations
were made almost entirely on the basis of relationships developed for 1947,
although in some instances the availability of specific information from either
Government or private sources permitted a modification of the postwar ratios.
Apart from failing to account for changed composition of the commodity
groups between the war and postwar periods, the general use of 1947 relationships in the classification of manufacturers' sales may have resulted in
some understatement of the allowance for parts and other unfinished products (and an overstatement of finished commodity sales) because of their
probably more widespread use during the war.
Estimates of manufacturers' sales of producers' durables (before deduction
of government purchases and exports) were obtained for 1940 and 1941 by
interpolation between the 1939 and 1942 estimates on a commodity group
basis. For this purpose, commodity data were almost wholly lacking.
As much information as possible was gathered from specifically relevant
sources. For example, the mining machinery series was interpolated by an
index based on capitalization of the Oklahoma tax on sales of oil field equipment and of the California tax on sales of oil well and refining supplies. As
part basis for interpolation of the metal working machinery series, sample
figures on machine tool sales were obtained from the War Production Board.
For tractors, comprehensive sales data were available from the Bureau of the
Census. However, it was also necessary to make considerable use of less direct
indicators, such as industry payroll and sales data, chiefly the annual corporate sales tabulations of the Internal Revenue Service.

categories—Federal military agency purchases, Federal civilian agency
purchases, Federal Government purchases for Government-owned defense
plants, and State and local government purchases. Federal military purchases were computed for the years 1942-45 as it was believed that such
purchases during 1946 were negligible.
Navy Department purchases of selected items of equipment were estimated
largely on the basis of unpublished data on contracts awarded by fiscal years.
As a rough allowance for the lag between contract awards and deliveries,
these data were treated as deliveries during the calendar year in which the
fiscal year ended. For the most part, the data used to derive Army purchases
for the years 1942—45 (exclusive of Government defense plants) were those
available on a calendar-year deliveries basis in Statistical Review, World War II,
A Summary of ASF Activities, Statistics Branch, Control Division, Hq., A. S. F.,
War Department. For both the Navy and Army, the producer-durable share
of total purchases for a given type of commodity was derived either by the
application of producer-total ratios observed in manufacturers' sales allocations or by the selection or omission of items in their entirety.
For some commodity groups, the largest of which was office and store
machines, the Navy and Army data were not available in sufficient product
detail to use as the basis for estimating military agency purchases. Instead,
the estimates were derived from "claimant agency" data shown in CensusWar Production Board Facts for Industry reports. However, these data, which
recorded the value of products allocable to military claimants, were not
strictly appropriate for the purpose. It is believed that they might also have
covered to some extent products allocable to final users (such as privately
owned manufacturing plants engaged in war output).
Federal purchases of equipment for Government defense plants were
estimated in the aggregate for the entire period 1942-45 from data furnished
in Report on Government Owned Industrial Plants As Of September 30, 1947, War

Assets Administration. This aggregate was distributed by years on the basis of
the equipment value of Federally-financed facilities put in place, as shown by
the Census-Civilian Production Administration report on Facilities Expansion, July 1940-June 1945. It was then necessary to distribute the total for each
of the years 1942—45 among the producer durable commodity groups. This
was done mainly on the basis of the claimant agency data noted above—
after, however, they had been adjusted (largely on the basis of the Army and
Navy tabulations) to exclude estimated amounts allocable to military agencies
as distinct from Government-owned defense plants.
The methodology underlying the 1942-45 estimates of equipment purchases
by Federal civilian agencies and by State and local governments is described
below under "Commodity Flow Estimates, 1948-52."
Chiefly because of weaknesses centering in the estimates of Federal equipment outlays for Government defense plants, the government-purchase
deductions for the years 1942-45 may be somewhat too large, and the breakdowns by commodity groups are clearly subject to considerable error. This
limitation of the government-purchase totals, however, may be viewed in
conjunction with the probable overstatement of the manufacturers' sales
estimates (as noted above) because of inadequate elimination of parts and
other unfinished products. The two biases, though not at all necessarily of
similar magnitude, would tend to offset.
For the years 1940 and 1941, the principal source of data for estimation of
government purchases of producers' durable equipment was the CensusCPA report on Facilities Expansion, July 1940-June 1945. From this report,
ratios of non-Federally financed equipment put in place to total equipment
put in place were calculated for industries considered to be the main purchasers of the commodoties in each major producer durable group. These
ratios were used to interpolate between ratios for 1939 and 1942 of private
domestic sales to total manufacturers' sales (before deduction of government
purchases and exports), and the ratios so derived for 1940 and 1941 were
applied to total manufacturers' sales for those years. In this process, explicit
allowances for State and local government purchases were made for some
commodity groups in order to avoid evident bias.
The facility equipment data were not very appropriate for this type of use.
The matching of equipment values classified by industry of purchaser with
producers' durable equipment purchased was necessarily quite rough.

Subtraction of government purchases

Other adjustments

For the period under review (except 1940 and 1941), estimates of government purchases of producers' durable equipment were made for four broad

As in the census-year benchmark estimates, the export adjustments for
1942-46 and the import adjustments for 1940-46 were based on detailed.

NATIONAL INCOME, 195 4 EDITION
commodity tabulations of the Bureau of the Census. To them were applied
the same producer-total ratios as used in deriving manufacturers' sales.
For 1940 and 1941, exports were covered in the step eliminating government
purchases.
For each of the producer durable groups, transportation charges, wholesalers' markups, and retailers' markups were estimated for the years 1940—46
by applying percentages obtained by straight-line interpolation of the
percentages which each of these several elements constituted of manufacturers' sales of finished producers' durables in the benchmark years 1939 and
1947.

Commodity Flow Estimates, 1948-52
For the commodity flow portion of the producers' durable series, the method
for 1948—52 entailed the following series of estimates: (1) derivation of
manufacturers' sales (prior to the government deduction) for the major
commodity groups, (2) addition of Federal manufacturers' excise taxes, (3)
deduction of government purchases, (4) addition of transportation charges,
(5) deduction of exports, (6) addition of imports, (7) subtraction of changes
in wholesalers' and retailers' inventories, and (8) addition of wholesalers' and
retailers' markups.

Derivation of manufacturers' sales
The Census Bureau's annual Survey of Manufactures provided the basis of
the estimates of manufacturers' sales (before deduction of government
purchases) for the years 1950—52. Covering all large establishments and a
representative sample of smaller establishments, the survey collected data on
manufacturers' shipments (sales) which, with respect to producers' durable
equipment, were available in satisfactory detail and showed generally small
sampling variation. In the task of classifying the census product data, the
assignments and allocations used were largely carried over from the 1947
benchmark study.
For the various producer durable groups, the commodity sales estimates
for 1948 and 1949 largely represent interpolations of the 1947 and 1950
benchmarks on the basis of industry sales data from the manufac urers' sales
series of the Office of Business Economics—derived from a sample of reporting
companies which currently account for about 45 percent of total manufacturing sales. Exceptions to this general procedure were afforded by construction machinery and aircraft, for which groups Census current reports on
manufacturers' commodity sales were available. In addition, the 1948-49
interpolations for cutlery and hand tools and railroad equipment were made
directly in terms of final cost to purchasers, not manufacturers' sales. Sales of
hardware stores from the Census Bureau's monthly retail trade sample were
used for the cutlery and hand tools group; Interstate Commerce Commission data on equipment purchases of Class I railroads, for the railroad equipment group.
Use of industry data on which to base the movement of commodity
sales has drawbacks. The data include indeterminate amounts of unfinished
and consumer products; and they are also inappropriate for any particular
group to the extent of including secondary products classified in other producer durable groups and of omitting products in that group included in the
sales of manufacturing industries other than the one used for an index.

Deduction of government purchases
In the derivation of Federal military agency purchases of producers'
durable equipment for the years 1948-51, estimates for 1947 and for the
latter half of 1951 were used as benchmarks. The 1947 estimates, as already
described, were based on detailed expenditure data reported by the Army
(including Air Force) and Navy. The second-half 1951 figures were made
from quarterly data reported by the National Production Authority on the
basis of tabulations by the Bureau of the Census from a sample of approximately 8,000 of the largest plants engaged in fabricating or assembling metal
products. The plants included in the sample had produced approximately
90 percent of the products of these industries in 1947.
For the reporting plants, the NPA data for the third and fourth quarters of
1951 showed for each commodity (in the same detail as the Census Annual

133

Survey) both total sales and those having military rating symbols. Only total
sales, however, were available for the first and second quarters. To obtain
estimated purchases by Federal agencies for the third and fourth quarters,
military-rated sales were raised to full coverage by the relationship of total
sales for the year reported in the Census Annual Survey to those shown in the
NPA reports. This procedure probably erred somewhat in the direction of
overstating Government purchases for items which could be used either as a
facility or as a component, since some purchases of this type by private firms
were accorded military ratings. In line with the usual procedure, the share of
total purchases allocable to the producers' durable category was estimated
from proportions applied in the allocation of sales at the manufacturing level.
For the period between 1947 and the third quarter of 1951, estimates of
Federal military agency purchases were obtained through interpolation by a
series based on Navy contracts awarded and Army obligations incurred.
These data, available in considerable commodity detail, were moved forward six months so as to make them reflect more nearly the period of actual
deliveries.
Purchases by Federal military agencies during 1952 also were based very
largely on the NPA data. However, for one important group—metalworking
machinery—the military rating treatment by NPA differed from that for
other commodities. It included many purchases by private firms and, therefore, could not be used to derive purchases by Federal military agencies.
For this commodity group, military purchases during 1952 were estimated at
the same proportion of manufacturers' total sales as obtained for the last
quarter of 1951.
For purchases of producers' durable equipment by Federal civilian agencies, benchmark estimates were prepared for 1951 from information collected
by the Bureau of Labor Statistics from the individual agencies. These estimates closely paralleled the ones that were made for the 1947 benchmark
study. Figures for 1948-50 were obtained by interpolation on the basis of the
National Income Division series (appropriately adjusted) on Federal purchases of goods and services for nonwar purposes. The same series—available
only in total and not in a commodity breakdown—was used to obtain estimates for 1942-46 and 1952 through extrapolation of the 1947 and 1951
benchmarks.
With respect to the State and local government series, the 1947 benchmark
figures were extrapolated to other years of the 1942—52 period by estimates of
equipment outlays by types of governmental unit and function, based on
data from governmental finance reports of the Bureau of the Census. To
derive these estimates, reported data on total capital outlays for equipment
for each type of unit were broken down by broad functional categories
according to Census data on total capital outlays (covering land and bi'ilrlings as well as equipment).

Other adjustments
Following the deduction of government purchases to arrive at manufacturers' sales of finished durable equipment by commodity groups, the first
adjustment made in the 1948-52 estimates consisted of the addition of Federal
manufacturers' excise taxes. For this relatively small item, concentrated
largely in the truck series, data were readily available from Internal Revenue
reports. Transportation charges were next added to the commodity group
estimates of manufacturers' sales. For this element, resort was mainly to the
application of 1947 percentages, although for some groups the figures based
on these percentages were modified after a summary check into the annual
changes indicated by ICC data on freight revenue.
The export and import adjustments of the various producer durable
groups for 1948-52 were made on the same basis as for the prior period.
Detailed product tabulations of the Bureau of the Census were grouped into
producer durable categories and then allocated on the basis of proportions
utilized in the classification of manufacturers' sales.
Adjustments for changes in wholesalers' and retailers' inventories—generally of negligible importance—were based mainly on the inventory series for
trade maintained by the Office of Business Economics. Inventory changes
computed for the benchmark year 1947 for major commodity groups were
projected by the OBE relevant line-of-trade figures.
The addition of wholesalers' and retailers' markups to manufacturers'
sales after 1947 was made through application of 1947 relationships.

134

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS

coaches, on the basis of data of the Automobile Manufacturers Association
on the number of units sold and average factory value. The Census
Bureau reported data on factory sales of truck trailers. These series were
Business motor vehicles
converted to final purchase values by adding the same percentage allowances
The passenger car estimates have been discussed in the section on Personal
for transportation costs and dealers' markups as used for 1941, deducting
consumption expenditures for commodities. They consist of the business share
estimated government purchases, and adding 10 percent (again largely
of the combined consumer-business total of new car purchases and gross
arbitrary) of the final value of new trucks and busses for dealers' margins on
margins on used car sales. The percentage allocation between consumers and
sales of used vehicles.
business is based on limited information for the 1934-37 period and has been
The next step was the computation of a series to interpolate between 1947
held constant except for modifications in the World War II period to take
and the third quarter of 1951. Beginning with that quarter, the availability of
account of the probable effects of rationing.
NPA Government-purchase data (as noted above) again made the appliThe estimation of producers' purchases of trucks, truck trailers, and busses
cation of the commodity flow method feasible.
has varied during the period. For the years 1929—41, the method was essenThis interpolating series consisted of (1) the value of trucks and busses,
tially one of multiplying number of units by an estimated average price. For
derived as the product of estimated average price and the sum of new truck
1947, the second half of 1951, and 1952, the commodity flow method was
registrations and domestic shipments of motor coaches adjusted to exclude
used. Estimates for other years of the period after 1941 represent interpolations
civilian government purchases and (2) the value of truck trailer shipments,
on the basis of a series obtained by multiplying number of units by average
based on current Census reports. For the period 1947—49, average prices
price.
used for the truck and bus series were computed from Automobile ManufacFor the 1929-41 period, the number of trucks and busses purchased by
turers Association data on the total factory value of sales and number of
producers at retail was derived by deducting estimated government purunits sold, with adjustment to exclude exports as reported by the Bureau of
chases from comprehensive totals reported annually by the Automobile
the Census. To forestall the possibility that shipments of military vehicles
Manufacturers Association in Automobile Facts and Figures. The number of
might again make the price series based on Automobile Manufacturers
units purchased by producers directly from manufacturers was taken as 20
Association data inapplicable to private purchases, a different method of
percent of the number purchased at retail. This was a rough estimate based on
estimating average price was adopted for 1950 and 1951. The 1949 average
data in the 1929, 1935, and 1939 Census of the Distribution of Manufacturers'
price of trucks and busses was extended to the third quarter of 1951 by a
Sales covering sales of trucks, busses, passenger cars, bodies, parts, and
quarterly series computed in somewhat indirect manner. A constant dollar
accessories.
series was first obtained by multiplying new registrations for each of six
The number of trucks and busses purchased directly from manufacturers
size classes (from the R. L. Polk Co.) by a rough estimate of average price for
was multiplied by an annual average factory price as computed from data
1948. The quarterly totals of the six classes were converted to current dollars
in Automobile Facts and Figures and raised to cover transportation charges. The by means of the Bureau of Labor Statistics index of wholesale prices of trucks,
latter were estimated on the basis of information provided by the Office of
and the current dollar totals were then divided by total new registrations.
Price Administration. Producers' purchases at retail were multiplied by this
average price series after it had been further increased to allow for dealers'
markups, computed from data on passenger cars published in Automobile Railroad and transit equipment

Other Methods

Facts and Figures.

The estimated total value of trucks and busses purchased by final users
both directly and at retail was adjusted to include bodies sold separately from
chassis.
Purchases of truck trailers were estimated separately and added. The value
of truck trailers produced, benchmarked on Census of Manufactures data for
1935, 1937, and 1939, was adjusted to exclude exports and government purchases and to include transportation charges. A markup allowance was added
to the estimated portion of the total sold through dealers.
The methods employed for making the prewar estimates were not suitable
for the years 1942-45. The price series used in the 1929-41 estimates were
greatly affected during the war by the large volume of high priced military
vehicles. Also, the methods of estimating government purchases would not
have been satisfactory for the war period, when such purchases were of substantial magnitude.
Data on the numbers of heavy, medium, and light trucks and busses shipped
to civilian domestic users—the approximate measure desired—were supplied for the years 1942—45 by the Office of Defense Transportation. Separately for the three size classes of vehicles, numbers shipped were multiplied
by price series representing special estimates for 1939 extrapolated to 1942
by indexes of the Bureau of Labor Statistics and to 1945 by unpublished
data of the Agricultural Marketing Service. The weights used were for 1939
in order to exclude the effects of war-period military purchases.
The Office of Defense Transportation also provided figures on the number
of truck trailers shipped for civilian domestic use during the years 1942-45.
These totals were multiplied by an average 1939 factory value extrapolated
to 1942 and then to 1945 by the series for light trucks (noted above) used in
estimating new truck purchases.
Dealers' gross margins on sales of used vehicles, assumed to be reflected in
the average price data used for the 1929—41 estimates, were explicitly added
to the series beginning with the 1942 estimates. For the years 1942-45,
such margins were taken as 15 percent of estimated purchases of new trucks
and busses.
For the interpolating series, the 1946 and 1947 estimates involved, first,
derivation of the total factory value of domestic sales of trucks and motor

The most important component of this group, equipment expenditures of
class I railroads, was obtained from the Bureau of Railway Economics of the
Association of American Railroads for the prewar and war periods and from
the Interstate Commerce Commission for 1946. This series was raised (about
6 percent) to allow for the estimated expenditures of class II and class III
railroads. Other components of the group total include (1) equipment
expenditures of transit corporations for electric cars and trolley coaches, data
for which have been published annually by the American Transit Association
in its Transit Fact Book; (2) expenditures for Pullman Corporation cars, as
published in Statistics of Railways by the Interstate Commerce Commission:
and (3) the value of tank car purchases (not included in the railroad equipment figures), estimated by multiplying the number of tank cars as reported
by the American Railway Car Institute by the average value of tank cars as
published annually in Statistics of Railways.

As covered earlier, this series was transferred to the commodity flow category of producers' durable equipment beginning with 1947.

Ships and boats
For the years 1929-38, business purchases of ships and boats were derived
by the commodity flow method. The estimates since 1939, which are subject
to significant limitations, have been prepared as the sum of separate series for
subsidized ships, ships completed under private contract, and boats.
The Maritime Adiminstration has provided data on sales of subsidized merchant vessels of 2,000 tons or more. Valuation is at cost to the purchaser,
exclusive of the Government subsidy. In order to match the timing of entries
in the government account, no attempt has been made to convert sales to
value of work in place.
The Maritime Administration also has provided lists of merchant vessels
completed under private contract. These have been valued at figures given by
the same source for comparable vessels, either subsidized or Government
purchased, and for recent years with the aid of specific price data furnished
by the National Federation of American Shipping. In addition, for the postWorld War II period allowance has been made for the capitalized cost of
repairing ships and converting them to peacetime use. This was done largely

NATIONAL INCOME, 1 9 5 4 EDITION
on the basis of information reported in the Marine Engineering and Shipping
Review.
The estimates for smaller craft—covering private business purchases of
motor vessels and barges, lighters, and other unrigged boats—represented
about three-fifths of the ships and boats total (excluding conversion cost) in
1947. The series is benchmarked on Census of Manufactures data for 1939
(value of work done) and for 1947 (value of deliveries), adjusted to exclude
exports and Government expenditures on vessels built in private ship yards.
The figures for 1940-46 and 1948-52 are interpolations and extrapolations
based on a series representing annual tonnages of private vessels under 2,000
tons documented for commercial use (after elimination of the estimated
tonnage of used vessels documented) as published by the Bureau of Customs,
adjusted for price changes by the Maritime Administration index of construction costs.

Nature of Recent Revisions
As mentioned in the introduction to this section, the series on producers'
purchases of durable equipment shown in table 32 of Part V represent a
revision of previous estimates for the entire period since 1929. Important data
not previously available were incorporated into the estimates, a number of
changes in procedure were made, and the Standard Industrial Classification
(1945) was adopted as the basis for the producer durable commodity groupings. As a general result, the new estimates are believed to constitute a
significant improvement over those published in previous editions of the

135

Incorporation of this new information, it may be noted, has permitted
publication of a commodity breakdown of producers' durable equipment for
1946 and subsequent years, as well as for the prior period. Until this revision
work, the basic statistical data were not suitable for extension of the commodity groups on a satisfactory basis after 1945.
Exhibit 5 presents a comparison of the new and previous estimates of
producers' durable equipment for the years 1929- 52. It will be seen that for
a number of years the revisions were appreciable. In very large degree they
occurred in the segment of the series comprised of products customarily
charged by business to current expense, instead of amortized through depreciation allowances. As indicated earlier, this "fringe" segment of producers' durables is difficult to measure.
For the large bulk of the producers' durable total comprised of items
normally capitalized by business, the statistical revisions were, on the whole,
rather small. They reflected, of course, a tendency for changes in the underlying data to be offsetting. For example, the estimates of manufacturers'
sales of finished producers' durables for 1942—45 were revised downward
considerably, but this change was substantially counterbalanced in the final
estimates by the marked reduction that was made in the subtraction for
government purchases. Also, although the revisions (in the capitalized segment) are not relatively large for the total, they represent varying and
partially compensating changes in the commodity groups.

NATIONAL INCOME supplement.

Exhibit 5.—Comparison of New and Superseded Series for Private Purchases
of Producers' Durable Equipment, 1929-52
[Billions of dollars]

New series
Year
Total

Superseded series

Capital
Capital
outlays Excluding
outlays Excluding
charges
charges
charged to current Total' charged to current
to current expense
to current expense
expense
expense

1929

5.8

0.3

5.6

6.4

0.6

5.8

1930
1931
1932
1933
1934

4.5
2.8
1.6
1.6
2.3

.2
.2
.1
.1
.2

4.2
2.7
1.5
1.5
2.1

4.9
3.2
1.8
1.8
2.5

.5
.4
.3
.3
.3

4.4
2.8
1.5
1.5
2.2

3.1
4.2
5.1
3.6
4.2

.2
.2
.2
.2
.2

2.9
4.0
4.9
3.5
4.0

3.4
4.5
5.4
4.0
4.6

.4
.5
.5
.4
.5

3.0
4.0
4.9
3.5
4.0

5.5
6.9
4.3
4.0
5.4

.3
.4
.3
.4
.5

5.2
6.6
4.1
3.7
5.0

6.1
7.7
4.9
4.1
5.7

.7
.8
.6
.5
.6

5.4
6.8
4.3
3.6
5.2

. . . -.

7.7
10.7
16.7
19.1
17.8

.5
.7
.8
.9
.8

7.2
10.0
15.8
18.2
17.1

7.5
12.3
17.1
19.9
18.7

.7
1.4
1.6
1.9
1.7

6.8
10.9
15.5
18.0
17.0

21.1
23.2
23.3

.9
1.1
1.0

20.2
22.3
24 fi
22 1
22.3 ! 25.4

2.1
2.6
2.8

20.2
22.1
22.6

1935
1936
1937
1938
1939

.
.

1940
1941
1942
1943
1944

1945
1946
1947
1948
1949
1950
1951
1952

-- --

1. As published in the National Income Number (table 2) of the July 1953 SUBVEY OF
OUEEENT BUSINESS.

Statistical sources from which new data were obtained for the producers'
durable series consisted mainly of the 1947 Census of Manufactures, the 1948
Census of Business, the Census Bureau's annual (sample) surveys of manufacturers for 1950—52, tabulations of Government purchases of producers'
equipment for military purposes during World War II, and reports of the
National Production Authority containing Government purchase data for
1951—52. In addition, it was possible through the availability of specific
commodity studies and the cooperation of specialists, both Government and
private, to improve the assignments and allocations of data on manufac-

11. CHANGE IN BUSINESS INVENTORIES
This section deals with the change in nonfarm business inventories and the
inventory valuation adjustment. Farm inventories are covered in the section
on the Income of unincorporated enterprises.
The basic sources of the nonfarm inventory estimates are reported accounting data on the value of inventories. These data have a high degree of coverage. Internal Revenue Service tabulations from annual corporation tax returns alone account for about four-fifths of the estimated value of nonfarm
inventories. Periodic data on the value of noncorporate inventories are available from Internal Revenue Service and Census Bureau compilations.
The adequacy of the inventory estimates included in national income
statistics is, however, less than might be suggested by the coverage of the
book value data and the reliability of the basic sources from which they are
drawn. The extension of reported values to full coverage introduces seme
uncertainty into the estimates, but their main source of error stems from the
fact that the accounting methods underlying the reported data are divergent
and inappropriate for national income purposes. Inventory calculation at the
level of the individual business firm is a complex problem, and existing accounting methods vary widely both with respect to the scope of the cost elements (especially overhead costs) included in the inventory account and with
respect to the costing procedures used to charge goods to cost of sales and to
inventories, respectively.
The scope-of-cost limitation of the basic data reported by business is accepted in estimating the inventory components of national income and
product. However, a uniform and appropriate costing procedure is substituted for the divergent procedures used by business firms (such as first-in,
first-out and last-in, first-out). This results in a measure, for inclusion in the
gross national product, of the physical volume change in inventories valued
at average prices during the period. The excess of this measure over the bookvalue change in inventories represents the "inventory valuation adjustment."
This adjustment is added to the business-income components of national income and secures measures of earnings from current production consistent
with the treatment of inventories in the gross national product.
This adjustment of the reported book value data is a quite difficult procedure, involving the revaluation of the entire volume of nonfarm business
inventories given only limited knowledge of the prices reflected in them.
Also important is that the estimates of inventory change included in national income and product are calculated as the difference between large and
usually volatile inventory totals at two points of time. Even small errors in the
data on total inventories can lead to large relative errors in the estimates of

136

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS

Finally, it should be noted that the comprehensive accounting data on in*
ventories become available only after a lag of several years. Current estimates
must be based upon less satisfactory sources.

The following comments deal with those steps of the estimating procedure
which need amplification.

Step 1: The book value aggregates
General Estimating Procedure
The procedure for deriving the current value of the physical change in
nonfarm business inventories and the associated inventory valuation adjustment is carried out separately by detailed industry groups. The limitations
already noted of the all-industry estimates of the inventory valuation adjustment attach to the individual industry estimates to an even greater degree.
The general procedure of estimation involves six principal steps, as summarized below.
(1) Reported book values of year-end inventories are raised to complete
coverage.
(2) Estimates of the portion of total book value that is reported on a last-in,
first-out (LIFO) basis are deducted from the totals and separately processed.
This step is necessary because the valuation procedure underlying LIFO
inventories requires an adjustment procedure which differs from that applicable to the remainder of business inventories.
(3) The estimates of book value of non-LIFO inventories are converted to
a constant price basis by means of price deflation procedures.
(4) The change in these inventories at constant prices is obtained by subtracting beginning from ending inventories at constant prices.
(5) The current value of the physical change in inventories is obtained by
multiplying the change in inventories at constant prices by the ratio of current prices to the constant price base.
(6) The inventory valuation adjustment is obtained by subtracting the
change in the book value of inventories from the current value of the physical change in inventories.
Step (5) yields the inventory component (other than LIFO) of gross national product. The result of step (6) constitutes the corresponding adjustment to corporate and noncorporate enterprise incomes, which are calculated initially on the basis of the inventory accounting methods underlying
reported inventory data.

Sources and methods of estimating the book values differ for the corporate
and noncorporate sectors, and as between past periods and the recent years
for which final information is not yet available.
The final source of data on the book value of corporate inventories is
Statistics of Income—Part 2, the annual compilation of corporate income tax
returns published by the Internal Revenue Service. The reported totals are
raised on the basis of cost of goods sold (by about 1 percent) to take account
of corporations not reporting balance sheet data. Since corporations account
for about four-fifths of nonfarm inventory holdings, a substantial portion of
the estimates of the total book value of nonfarm inventories rests upon a
source considered to have a high degree of reliability.

Exhibit S.—Estimated Book Value of Total Corporate and Noncorporate
Inventories and Industrial Breakdown of Noncorporate Inventories, End of
1950
Item

Millions
of dollars

Percent

Total, all industries

69,343

100.0

Corporate.-.

55,101

79.5

Noncorporate

14,242

20.5

159
630
1,238
11,801

1.8
17.0

2,189
9,612

3.2
13.9

Mining
Contract construction
Manufacturing
Wholesale and retail trade
Wholesale trade
Retail trade
Services

.2
.9

414

As can be seen from Exhibit 2, the bulk of estimated noncorporate invento-

Exhibit 1.—Derivation of Change in Business Inventories and Inventory
ries is in wholesale and retail trade. Estimates are also made for mining, conValuation Adjustment for the Corporate Sector of the Apparel Manutract construction, manufacturing, and services. Data on noncorporate infacturing Industry, 1950
ventories in finance, insurance, and real estate; transportation; and comValue data in millions
of dollars

Item

1949
1. Book value of year-end inventories.

- -

1,012
95.1
95.2

3. (a) Index of cost valuation (1947=100)
(b) Index of market valuation (1947=100).
(e) Year-end inventories in 1947 dollars (line 1 divided by line 3a
or 3b, whichever is lower)

1,004

1950
1,501
110.2
114.4
1,362

4. Change in inventories in 1947 dollars (from line 3c)

298

5. (a) Index of current valuation (1947=100)
(b) Change in inventories in current dollars (line 4 times line 5a) _

100.2
299

6. (a) Change in book value of inventories (from line 1)
(b) Inventory valuation adjustment (line 5b minus line 6a)

489
-190

The estimating procedure is illustrated in Exhibit 1 by actual data for a
single industry. Calculations of a similar nature are made for mining, construction, transportation, communications and public utilities, wholesale
trade, retail trade, and for about 20 industries in manufacturing. In the
alcoholic beverages and tobacco manufacturing industries, however, direct
quantity data instead of deflation procedures are used to estimate changes in
inventories.
To simplify the exhibit, an industry was selected in which LIFO inventories
are negligible, and consequently step (2) is omitted. Also, the exhibit is confined to the corporate sector of the industry. Similar calculations are made
for the noncorporate sector of each industry listed above for which book
value estimates are available. As will be seen, the derivation of book values
differs for the two sectors. However, the data and methods used in the revaluation of these book values are the same within each industry.

munications and public utilities are lacking. The amounts involved must be
insignificant and are not included in the estimates.
The main sources of the noncorporate inventory estimates for trade were the
Censuses of Wholesale and Retail Trade for 1929,1933,1935,1939, and 1948
and Internal Revenue Service tabulations for 1939 from the income tax returns
of sole proprietorships and partnerships. The procedures for estimating noncorporate inventories in trade vary considerably according to the nature of
the available information. For some years census data on total inventories
are available which can be accepted as benchmarks. For non-Census years
prior to 1939 the procedure involves the multiplication of noncorporate sales
series derived in the estimation of noncorporate business income by inventorysales ratios. These ratios are benchmarked on tax return and industrial
census data for unincorporated business. Corresponding corporate inventorysales ratios are used widely for interpolation and extrapolation of the noncorporate ratios. Since 1939 the interpolation and extrapolation of census
benchmark estimates of noncorporate trade inventories for 1939 and 1948
have been based on the movement of the noncorporate components implicit
in the published wholesale and retail inventory estimates of the Office of
Business Economics.
A diversity of procedures is followed for estimating noncorporate inventories
in industries other than trade. As can be seen from Exhibit 2, the amounts
involved are very small.
As already noted, the final sources for estimating the book value of inventories, both corporate and noncorporate, become available only with a
considerable lag. Prior to the receipt of this information, inventory book
values are extrapolated on the basis of interim data. The extrapolation for
the large manufacturing sector—accounting for 50 percent of the nonfarm
total at the end of 1950—is based upon the Industry Survey of the Office of
Business Economics. Reports of inventory holdings tabulated in connection

NATIONAL INCOME, 1954 EDITION
with this survey cover more than one-half of the estimated total and are
weighted by industry group and asset size class.
The extrapolation of wholesale inventories (15 percent of the nonfarm
total) is on the basis of the Office of Business Economics series on wholesale
inventories. This is derived mainly from a sample of inventories of merchant
wholesalers reporting to the Bureau of the Census, together with Department
of Agriculture data on warehouse-stocks of selected farm products. These two
sources cover about one-tenth of total stocks, and the data tabulated are
weighted by kind of business.
The extrapolation of retail trade inventories (one-fourth of the 1950 nonfarm total) is on the basis of the Office of Business Economics series on retail
inventories. This in turn rests upon Census Bureau estimates of total year-end
inventories in retail trade built up from a complete count of large multi-unit
organizations and geographic area samples of all other stores.
Other nonfarm inventories are extrapolated into the current period mainly
by data collected by the Securities and Exchange Commission for its reports

137

Step 3: Conversion of non-LIFO inventories to constant
prices
Separate composite price indexes are constructed to deflate the book values
of total non-LIFO inventories in each industry. For this purpose it is necessary, first, to select commodity price indexes that are representative of the
commodities included in inventories; second, to weight these price indexes in
accordance with the relative importance in the book value of inventories of
the commodities which they represent; and, third, to determine the periods
to which the unit prices reflected in the book value data pertain, so that the
price indexes to be used for deflating the book values can be related to these
same periods.

Construction of composite price indexes

The selection and weighting of the price series used in the construction of
on Working Capital of United States Corporations.
the composite price indexes was for the most part an interrelated operation,
based upon the estimated commodity composition of inventories in each
industry.
Step 2: Adjustment for UFO inventories
The estimates of the commodity composition of inventories in manufacturing were built up mainly from the 1939 and 1947 Censuses of ManufacEstimates of LIFO inventories are deducted from total book values and
tures tabulations of inventories held by industry. Similar estimates for trade
separately processed because the revaluation procedure for non-LIFO invenwere derived from the 1939 and 1948 Censuses of Wholesale and Retail
tories is not applicable to them.
Trade, which showed the distribution of inventories by kind of business. In
The estimates of LIFO inventories in manufacturing are based primarily
most instances, the type of inventory commodity involved could be identified
on two special questionnaires, the first for 1947 and the second for 1951,
on the basis of the census designation of the industry or kind of business
which were submitted to manufacturing corporations in connection with the
Industry Survey of the Office of Business Economics. (For a summary of the holding the inventory. The full industry and kind-of-business detail given in
the censuses, together with the further breakdown of manufacturing invenresults of the 1951 LIFO survey, see "LIFO Inventories and National Income
tories into finished products and materials, supplies, etc., was utilized in
Accounting", SURVEY OF CURRENT BUSINESS, May 1953.) Additional informaestimating the commodity composition of inventories. More summary
tion on the relative importance of LIFO inventories in 1947 was found in a
study of the LIFO method by J. Keith Butters and Powell Niland. (Effects methods were used in instances in which price information was lacking to
match the full detail of the commodity breakdown.
of Taxation—Inventory Accounting and Policies, Graduate School of Business
Other sources consulted for this purpose included the Census of ManufacAdministration, Harvard University, 1949.) Ratios of LIFO to total inventures tabulations of materials consumed in selected industries; materialstories derived from these inquiries were applied to total corporate inventories
consumed data published by private industrial research groups; material
by industry and asset size class to estimate total LIFO inventories in manufacturing. Information from Moody's Manual of Industrial Securities is used to requirements studies of the War Production Board; financial reports of
certain large corporations in the iron and steel industry giving information
extrapolate these ratios and also to derive similar ratios for department
on the commodity composition of their inventories; Internal Revenue
stores, the only other industrial sector in which LIFO inventories appear to
Service data on industrial inventory holdings included in the "Source Book"
be important. Noncorporate LIFO inventories are neglected throughout.
underlying Statistics of Income—Part 2; and sales and value-of-product data,
The concentration of the LIFO method among larger firms indicates that
when more pertinent information was not available.
the omission is insignificant.
With few exceptions the monthly price series used in the construction of
The Internal Revenue Service has recently completed a special tabulation
the composite price indexes were taken from the wholesale price index of the
for 1950 wherein reported year-end corporate inventories in each major
Bureau of Labor Statistics. The BLS index, prior to its revision in 1952, conindustry are classified into seven separate categories according to the invensisted of approximately 900 separately coded commodity price series comtory accounting method used by the reporting firm. The returns can be
bined into 49 subgroups, 10 major groups, and 5 economic groups. The
readily regrouped into three categories, viz., firms using only the LIFO
revised wholesale price index includes over twice as many individual commethod, firms using LIFO as well as other valuation methods, andfirmsnot
modity price series as the earlier index as well as a greater number of major
using the LIFO method. Since the inventory data for firms using LIFO as
group and subgroup composites. In addition, over 200 product class indexes
well as other methods are not broken down into separate LIFO and nonhave been developed to represent groups of related commodities with generLIFO shares, it is possible to obtain only upper and lower limits within
ally similar price movements. The new index, on a 1947-49 = 100 base, is
which the correct LIFO ratio falls. The final tabulation is planned for release
available in full detail for the period beginning January 1947, and was
in 1954; preliminary results are generally consistent with the sample-based
incorporated into the estimation of net inventory change and inventory
LIFO ratios used in estimating net inventory change.
valuation adjustment beginning in 1948.
The estimated value of LIFO inventories currently represents roughly oneFor several reasons, BLS subgroup and product class indexes were used
tenth of the total book value of nonfarm inventories. In some individual
most frequently in the construction of the composite price indexes. It was
industries the proportion is much higher.
not possible, in general, to estimate the commodity composition of inventories
To the extent that the physical volume of inventories increases, changes
in a detail sufficient to calculate weights for individual price series. Also, in
in the book values of LIFO inventories already reflect changes in the physical
the cases in which the available price information did not match the estivolume expressed at current prices and no adjustment of these book values
mated commodity composition of inventories it was thought that the use of
to national income definitions is needed. To the extent that physical volumes
group rather than individual price series would tend to give the better
decrease, changes in LIFO book values reflect these decreases in prior-period
representation of inventory price movements.
prices and a conversion to current prices is made. The price data used in
Two other considerations favored the use of subgroup and product class
each industry are the same as those described below. To date, price adjustindexes. Because of specification changes, the elimination of existing series,
ments for declines in LIFO inventories have been negligible.
and the introduction of new ones, it is frequently difficult to maintain the
continuity of the individual commodity price series. Also, in many instances
Gaps in the basic information may cause sizable errors in the estimates of
the portions of the inventories which could be related to individual comthe change in LIFO inventories. However, in view of the fact that LIFO
modity price series were too fragmentary, from the point of view of the total
inventories are a small fraction of the total, the possible error introduced
industry group, to warrant separate treatment.
into the overall figures is much less significant.

138

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS

Further limitations of the composite price indexes may be noted. The price
series underlying them do not take full account of quality change and of
divergences between quoted prices and prices actually charged in market
transactions. In addition to these shortcomings generally encountered in
price deflation, two others appear in connection with the deflation of inventories because the price series (1) do not consistently measure the prices of
purchased inventories at the transaction stage at which they are acquired
by the inventory ho'der and (2) do not measure directly the costs that are
reflected in the valuation of goods-in-process and finished product inventories.
With respect to the weighting system employed, it should be noted that
it is not strictly appropriate for the purpose at hand. Prior to 1948, fixed
weights based on the relative commodity composition of inventories in 1939
are used to combine price index series selected from the unrevised Bureau of
Labor Statistics wholesale price index into a composite inventory deflator for
each industry. Starting at year end 1947 a new set of fixed weights, based on
the distribution of year-end inventories in the 1947 Census of Manufactures
and of beginning inventories in the 1948 Censuses of Wholesale and Retail
Trade, is used to combine the price index series selected from the revised
BLS wholesale price index. Ideally, a system of shifting weights reflecting
the changing annual commodity composition of inventories should have been
used in constructing the inventory deflators, but this could not be done for
lack of information. However, inventory deflators for the various industries
calculated on the basis of 1939 and of 1947 weights were in general very
similar. This suggests that the error introduced by using fixed weights over a
long period is not likely to be significant. Revisions in the estimates of the
inventory valuation adjustment for years since 1948 are mainly due to the
adoption of more comprehensive price data from the revised wholesale
price index rather than to weight changes.

allow for the fact that the use of a single turnover rate for each industry,
instead of separate rates for inventories having a different turnover, overweights inventories that have a relatively quick turnover. These three factors
cannot be accurately measured, but they were believed to be of sufficient
importance to warrant increasing by 50 percent the turnover periods as initially calculated.
The calculation of inventory turnover periods for trade was based upon the
1939 and 1948 Censuses of Wholesale and Retail Trade. Separate calculations were made by kind of business. Census data were used because they
covered noncorporate establishments, which are of particular importance in
trade, as well as corporations. Since the cost of goods sold was not reported
in these censuses, sales had to be used as the numerator of the turnover rates.
This tends to understate the turnover period, since sales include a gross profit
margin whereas inventories are valued at cost. To offset this bias, as well as
the three factors already mentioned, the turnover periods initially calculated
were increased by 75 percent.
The cost valuation indexes applicable to year-end inventories were obtained by averaging the composite price indexes for a number of months prior
to the year-end equal to the estimated turnover periods.
In addition to the uncertainties that have already become apparent, it
may be noted that the calculations involve the assumptions that for the years
for which estimates of turnover periods were made the size of year-end
inventories was an approximation to the average of the inventory holdings
during the year, and also that the turnover periods estimated on the basis of
1939 and 1947-48 data are applicable to the entire periods 1929-47 and 1948
to date, respectively. With respect to the latter assumption, experimentation
with alternative turnover periods has indicated that even considerable modification in their assumed length does not in general greatly affect the statistical result.

Synchronization of composite price indexes with year-end
book values

Step 5: Conversion of deflated change to current prices

To take account of the widespread practice of valuing inventories at the
lower of "cost" or "market," separate deflating indexes are constructed
to represent each of these valuations at the year-end, and the lower of the
two is used to deflate year-end inventories. Indexes of market valuation
are derived by averaging the composite price indexes for December and
the following January in order to approximate year-end prices. Market
indexes are not calculated for the transportation, communications, and
public utilities industries, where inventories consist largely of purchased
materials customarily valued on a straight cost basis.
The construction of indexes of cost valuation is difficult. The particular accounting method used by business firms to charge goods out of inventory to
cost of sales determines the period whose prices are reflected in the year-end
inventories valued on a cost basis. The construction of the cost valuation
indexes applicable to year-end inventories is adapted in the first instance to
the first-in, first-out (FIFO) method, which is the basis of valuation of the
bulk of non-LIFO inventories. Owing to the lack of information, no separate
procedure is developed for other methods of inventory accounting except
LIFO—such as the specific identification and average cost methods—which
underlie some of the book value data. It is believed that the implicit allowance for them described below gives generally satisfactory results.
The prices reflected in year-end inventories valued on a FIFO-cost basis
are the prices of a period immediately preceding the year end, the length of
which depends on the rate of turnover of inventories. The period for which
the composite monthly price indexes for each industry had to be averaged
in order to reflect the cost prices implicit in year-end inventories was based
on the estimated inventory "turnover period" in the industry. Initial calculations of turnover periods for industries other than trade through the year
1947 were made by dividing year-end inventories in each industry into the
total cost of goods sold, as reported in Statistics of Income—Part 2 for 1939, and
then dividing the resulting turnover rate into 12, the number of calendar
months. Starting with the deflation of year-end 1947 inventories, these turnover period calculations were based upon 1947 Statistics of Income.
The turnover periods so calculated were then lengthened for three reasons:
first, to take account of non-FIFO inventories (other than LIFO), whose
general effect is to extend the length of the prior periods whose prices are reflected in year-end inventories; second, to give effect to the lapse of time between the purchase and delivery dates of inventory goods; and third, to

The indexes used to convert the deflated value change of inventories to
current prices represent the annual average of the monthly composite price
indexes already described. Thus, to recapitulate, the same composite priceindex series are used for computing the "market," "cost," and "current"
indexes. The three differ only with respect to the time period to which they
refer—that is, to the span over which the monthly price indexes are averaged.

Characteristics of Revisions
The annual inventory estimates published each July are based upon preliminary data for at least the two most recent years. Under the present schedule, the Internal Revenue Service corporate income tax return tabulations,
on which the book value of corporate inventories is based, are not available
for the two latest years. Revisions may affect earlier years also, mainly because the noncorporate book value estimates are based on less regular benchmarks. Introduction of new benchmarks, such as periodic industrial census
tabulations, may change prior year estimates through the substitution of interpolation for previous extrapolation procedures.
Revisions of the inventory change estimates for recent years occasioned by
the incorporation of comprehensive data are sometimes quite sizable. As
noted earlier, even small percentage revisions in the book value aggregates
can cause substantial revisions in the increments computed from them.
Revisions are usually much larger in the "change in business inventories"
item than in the "inventory valuation adjustment." Revisions in the latter
typically are not large. The bulk of revisions in the underlying book value
estimates is generally reflected in the change in business inventories rather
than in the inventory valuation adjustment. Also, the price information used
to revalue business inventories becomes available fairly promptly, and subsequent routine revisions of it are usually minor.
The smallness of the revisions in the inventory valuation adjustment should
not be taken to mean that this item, or the underlying revaluation of book
values, is firmly based. Quite to the contrary, as already has been emphasized, this is the most difficult step in the estimating procedure. The absence
of major revisions in these estimates signifies only that the final sources of
price information do not differ significantly from the preliminary information
on which the estimates are initially based.

NATIONAL INCOME,

12. NET FOREIGN INVESTMENT
The net foreign investment component of gross national product measures
the net export balance on goods and services (less the net outflow of gifts),
which is necessarily financed by international investment. It is taken from
the official balance of payments of the United States, where it appears as
the "Balance on goods and services and unilateral transfers."' Accordingly,
the statistical sources and methods discussed below are those of the Balance
of Payments Division of the Office of Business Economics. The balance of
payments of the United States is published quarterly in the Survey of Current
Business, and in occasional bulletins, the latest of which is The Balance of
Payments of the United States, 1949-51, a supplement to the Survey of Current

Business (Washington, United States Government Printing Office, 1952). A
more detailed description of the methods of estimating the international
transactions of the United States appears in that volume.
These methods also produce an alternative estimate of net foreign investment in terms of the change in international assets and liabilities. Usually
there is a statistical discrepancy (labeled "errors and omissions" in the
balance-of-payments statement) between the two estimates. As has been
noted, it is the former estimate which is included as a component of gross
national product, although for most years it cannot be assumed to be more
exact than the one based on changes in assets and liabilities.
Official estimates of the United States balance of payments have been prepared for all years beginning with 1919. Over this period, the sources and
methods underlying the estimates have changed significantly. This section
is devoted primarily to a description of the current methodology.
A substantial increase in the accuracy of the estimates, especially in the
last decade, has stemmed from the inauguration of new techniques and data
sources discussed below. In spite of the improvement of the data, it should
be recognized that net foreign investment is subject to possibly large percentage errors of estimation because it is calculated as the difference between
gross outflows and gross inflows which are usually large in relation to the
net balance.
The following discussion deals in turn with net factor payments to the
United States and with net purchases from the United States (including
gifts), which together compose the "Balance on goods and services and unilateral transfers". The balance is obtained as gross receipts of the United
States less gross payments by the United States. In the following discussion,
the gross receipts and payments are described separately, with no further
reference to the fact that they are differenced to obtain the net entries for
net foreign investment.
The balance on goods and services and unilateral transfers reflects all current transactions of the United States with the rest of the world. Hence, a
large number of the flows differenced to obtain net foreign investment also
become explicit elements (with appropriate sign) of various other components
of national income and national product. Thus, net factor incomes received
from abroad become elements of the wages and salaries, interest, and corporate profit components of national income and personal income, and net
purchases made abroad (including gifts) become elements of personal consumption expenditures for commodities and services and of government
purchases of goods and services. The estimation of these elements is described
below. However, only in the sections dealing with the national income and
product components in which they are included are they explicitly identified
as constituting such elements. For instance, net interest received from abroad
is described in the present section under the heading Net payments of
factor income, but the fact that this item is included in the interest component
of national income and personal income is stated explicitly only in the section
on Interest.
1. An adjustment is made for geographical coverage, since United States territories and
possessions are considered part of the United States for balance-of-payments purposes but
are included with the rest of the world for national income purposes. (Statistically, the
adjustment was confined to 1941-46 when its quantitative importance called for a rough
order-of-magnitude calculation in spite of the absence of solid data.) Itshould be noted also
that in the official balance-of-payments statement account is taken of unilateral transfers
in kind, which are ignored in table 11, Part V of this report. Exclusion of these transfers
affects debits and credits equally, and does not alter the net balance of transactions. Other
differences between table 11 and the balance-of-payments statement are matters of classification and will come to note as the derivation of the entries in table 11 is described.

291692°—54- - 1 0

195 4

EDITION

139

Net Payments of Factor Income to the United States
Factor income transactions consist of wage and salary receipts and the
international flows of property income. The latter represent interest, dividends, and branch profits. Undistributed profits of foreign subsidiaries are
not included. All property incomes are measured net of taxes levied by the
paying country.

Wages and salaries
This item (included in "private miscellaneous services" in the official
balance-of-payments classification) represents wages and salaries received
by United States residents in this country from (1) foreign governments and
(2) international organizations. Component (1) is estimated from fragmentary
information supplied by certain foreign missions. Component (2) is reported
by the international organizations.
It will be noted that, from the standpoint of the definitional framework
set out in Part II of this report, this series is incomplete because it does not
segregate the net wages and salaries of "border workers." (It does not include
the wages and salaries of United States residents whose place of work is
abroad, and it does not deduct payments by United States employers to
foreign residents working in the United States.) Statistical information for
making this segregation is lacking.

Interest
United States receipts of interest from abroad are estimated in four parts.
(1) Interest from foreign branches and affiliates (including subsidiaries)
of American corporations is estimated from a 1950 benchmark provided by
the Commerce Department's census of American direct investments abroad
(Foreign Investments of the United States, a supplement to the Survey of Current

Business, Washington, United States Government Printing Office, 1953).
This benchmark figure is extrapolated and linked to a previous benchmark
based on the Treasury Department's 1942 Census of American-Owned
Assets in Foreign Countries (Form TFR 500) on the basis of quarterly sample
company reports, supplemented by information taken from income tax returns, annual reports to the Securities and Exchange Commission (Form
10K), and annual corporate reports to stockholders. Currently the quarterly
sample reports cover about 350 companies accounting for around 75 percent
of total direct investment; about 90 percent of total investment income (interest, dividends, and branch profits) earned from foreign branches and affiliates
is actually reported in one or more of the sources used for extrapolation of the
1950 benchmark.
(2) Interest received by the United States Government is reported by the
recipient agencies.
(3) Interest on foreign dollar bonds is estimated chiefly from regular
questionnaire surveys of the debtors' fiscal and paying agents in the United
States, corrected for basic coverage by reference to holdings disclosed in the
1942 Treasury Census.
(4) Other foreign interest received by the United States is calculated by
applying average bond yields, as reported from the principal issuing countries,
to holdings series benchmarked on the 1942 Treasury Census and extrapolated
by reference to foreign bond purchases and sales reported on Foreign Exchange Forms S—1/3. These statistics of purchases and sales, it should be
noted, do not distinguish the bonds by country of debtor or by currency in
which payable. The extrapolation, therefore, is a relatively rough process.
However, the series appears reasonable when checked against official estimates for Canada, which accounts for most of the receipts in this category.
United States payments of interest are estimated as the sum of (1) interest
subject to withholding tax, and (2) interest not subject to withholding tax.
(1) Interest subject to withholding tax paid by the United States to
foreigners is reported to the Internal Revenue Service on withholding tax
return forms 1012 and 1013, for corporate and Federal bonds, and Form 1042,
for other obligations. Special tabulations from these returns are made available to the Office of Business Economics. Net income payments by fiduciaries
are allocated somewhat arbitrarily between interest and dividends. The tax
return data are not available in time for use in the estimate for the latest year,
which is therefore made by extrapolation with reference to reported changes
in foreign holdings.

140

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS

(2) Interest not subject to withholding tax—about 60 percent of the total
in 1950—represents largely payments on foreign government holdings of
United States Federal Government long- and short-term issues, and to a
much smaller extent payments on foreign holdings of State and municipal
government bonds and payments to certain countries which are exempt from
withholding taxes by international treaties. It is estimated in the main by
applying average-yield series to amounts of foreign holdings. Foreign government holdings of long-term Federal issues are benchmarked on the Treasury's
1941 Census of Foreign-Owned Assets in the United States, and extrapolated
by reference to estimates of annual changes in such holdings, based for recent
years on reported transactions and certain data on amounts held in custody
in the United States. Data on foreign government holdings of short-term
Federal issues are obtained from monthly Treasury reports.

Dividends
United States receipts of dividends are estimated using sources and methods
analogous to those applied in estimating components (1) and (4) of interest
receipts. United States dividend payments to the rest of the world are estimated in general like taxable interest payments. For the latest year, payments
by subsidiaries of foreign corporations are extrapolated by reported payments
of about 115 sample foreign-controlled enterprises, and other payments are
extrapolated by the product of appropriate sample dividend rates times
estimated holdings.

Branch profits
The sources and methods used in estimating the inflow of branch profits
are the same as those for interest received from foreign branches and affiliates.
The outflow of branch profits is estimated from special tabulations from tax
returns (Form 1120) on which such profits must be reported to the Internal
Revenue Service. Pending the availability of the tax return data, preliminary
estimates are made by extrapolation using data from the sample of 115
foreign-controlled enterprises mentioned above.

Net Purchases from the United States
It is convenient to discuss sales and purchases by the United States in terms
of the components distinguished in the official balance-of-payments statement—merchandise trade, transportation, travel, etc. The method of separating transactions of United States business, government, and persons, in the
manner of table 11, will be indicated in the discussion of each of the components. In table 11 sales include cash gifts received, and purchases include
cash donations made. In the balance-of-payments statement these unilateral
transfers are shown separately. The exclusion of unilateral transfers in kind
from table 11 has been noted.
Merchandise trade accounts for the vast bulk of the transactions summarized under the heading of net purchases. The estimates represent chiefly
exports and imports shown on declaration forms filed with the Collectors of
Customs and tabulated by the Foreign Trade Division of the Census Bureau,
and transactions carried out and reported by agencies of the Federal Government. The major limitation on the accuracy of these estimates is the likelihood
that the stated values may differ in some cases from the actual prices paid for
the goods.
Transportation service receipts and payments consist largely of ocean
freight charges and port expenditures of ocean carriers and are estimated
mainly on the basis of questionnaires filed by the operators with the Office
of Business Economics.
Travel receipts and payments are estimated from expenditure averages
based on questionnaire returns from travelers, multiplied by the adjusted
numbers of such travelers reported (in most cases) by the United States
Immigration and Naturalization Service.
The major components of the Miscellaneous services category are government payments (reported to the Office of Business Economics by the agencies),
film rentals (benchmarked on the Commerce Department Census), and
insurance charges (estimated from annual questionnaires filed with the
Office of Business Economics). Unilateral transfers by private parties are
estimated chiefly from data provided by forwarding banks, the Post Office

Department, and charitable institutions; government transfers are reported
to the Office of Business Economics by the Federal agencies involved.

Merchandise
United States business receipts from merchandise exports are estimated
as follows.
(1) The chief data sources are the official tabulations of United States
exports; these, together with the corresponding tabulations of imports, are
described in some detail in Foreign Commerce and Navigation of the United States

for the calendar year 1946. Merchandise trade is valued f. a. s. ("free alongside ship") port of shipment.
(2) Recorded merchandise exports, including reexports, are adjusted to
eliminate certain components not giving rise to business-sector claims on the
rest of the world: shipments abroad by general government and persons;
business exports known not to represent merchandise sales—for example,
motion picture films shipped abroad for rental and the movement of United
States-owned grain to Canada for storage; and exports to the Panama Canal
Zone. The data for most of these adjustments are taken directly from the
export statistics; the government shipments to be excluded, however, are
evaluated from the records of the responsible Federal agencies.
(3) To the residual are added several items not covered which do give
rise to business-sector claims: sales by government enterprises from their
stocks abroad, as reported by these enterprises; exports of silver, which the
Census Bureau reports separately from merchandise exports; and the increase
in official gold holdings less net purchases of gold from abroad.
United States business purchases from foreigners are estimated from the
statistics of general imports, with adjustments analogous to those described
above. Adjustments have also been made for a few known instances of differences between declared import valuations and the actual dollar payments
made to foreigners.
United States general government purchases from and sales to foreigners
are estimated from reports filed by the government agencies involved. Such
important items as United States Government sales of surplus and other
property located abroad, and purchases for the use of the Armed Forces
stationed abroad, not shown in the trade statistics, are included.
It may be noted that all of the large wartime and postwar purchases of
foreign raw materials by the United States have been classified as businesssector purchases, since the public purchasing agencies were government
enterprises rather than executive departments or other administrative
agencies of general government.
Purchases of foreign merchandise by United States persons except when
traveling abroad are generally made through business middlemen, and are
covered by the estimates of purchases by United States business described
above. United States persons' shipments to foreigners consist almost entirely
of gifts and, like foreign-aid shipments of government-procured items, are
excluded as unilateral transfers in kind giving rise to no claims for payment.
It is difficult to make any categorical statement about the reliability of the
foreign trade statistics. For exports and for nondutiable or specific duty
imports, where the Customs Service does not have a pecuniary interest in
securing a correct valuation, it is probably safe to say that some instances of
incorrect valuation go undetected, although certain checks are made. The
reported values theoretically include inland freight and other services performed in the country of export; one of the likeliest sources of error is the
omission of some of these service costs in valuing United States exports.
Imports subject to ad valorem duties are frequently assessable (and entered
in the statistics) at values which may differ from the prices actually paid.
Again, in the case of imports from foreign branches or subsidiaries, there are
possibly differences between the values entered for customs purposes and
the prices at which the articles are taken up on the domestic companies'
books for income tax purposes. On balance, it is not clear whether the net
effect of all the possible sources of error would be to overstate or to understate net exports.

Transportation
International transportation transactions involving the United States are
treated as United States business-sector transactions, except that passenger
fare payments to foreign carriers are allocated between the business and
personal sectors. This allocation is described below under Travel.

NATIONAL INCOME, 195 4 EDITION

Ocean freight
Ocean freight revenues of United States ship-operators from abroad consist
of freight on United States exports and on shipments between foreign ports.
(Freight on United States imports carried by United States lines is classified
as a domestic transaction, being denned as paid by the importer because the
value placed on merchandise trade includes no allowance for ocean transportation cost.)
United States ocean freight revenues from foreigners are now estimated
from financial statements filed by the carriers with the United States Maritime Administration or from data furnished directly to the Office of Business
Economics.
For 1945 and earlier years, estimates of revenues from the carriage of
United States exports have been based on Census Bureau or Maritime Administration data on tonnages of various commodities or commodity groups
carried by American ships to various destinations abroad, multiplied by
appropriate freight rates. The rates used have been taken chiefly from rate
schedules of the various steamship conferences filed with the Maritime Administration. Benchmark revenues were derived in this way for 1940 and
1944 and interpolated and extrapolated by tonnage totals with allowance
for changes in general freight rates and in the commodity composition of
the trade.
Revenue received for carrying freight between foreign ports in years prior
to 1946 has been estimated as a percentage (varying up to around 5 percent,
and based on rather fragmentary information) of the combined revenues
from carriage of United States exports and imports. Freight on imports has
been estimated for this purpose by methods similar to those described above
for freight on exports.
Payments to foreign ship-operators consist of freight charges for the carriage
of United States imports. For 1951 and later years the estimates are based
on a compulsory questionnaire to foreign ship-operators. Estimates for years
back to 1946, which were reconciled with the questionnaire-based series in
1951, were derived separately by type of service (liner, tramp, and tanker)
by multiplying Census Bureau data on total tonnage carried by foreign shipoperators by estimates of average freight rates per ton, based largely on
industry information. For earlier years the estimates were derived by much
the same methods and types of data as were used prior to 1946 in estimating
American carriers' revenue from freight on exports.
Ocean passenger traffic
Passenger revenues of United States carriers consist of receipts from foreigners traveling to and from the United States. United States payments for
ocean passage are those made by United States residents to foreign carriers.
Average fares plus shipboard outlays per passenger are ascertained through
systematic sampling of passengers, and are multiplied by estimates of numbers based on United States Immigration and Naturalization Service records
of arrivals and departures.
Expenditure information is secured from United States residents returning
and from nonresidents departing, as described below in connection with the
travel account. Since fares and shipboard expenses vary widely according to
type of accommodation and route and purpose of travel, etc., the averages
are weighted to take account of such variations, the relative importance of
each category being estimated from Immigration Service records and passenger manifests supplied by carriers.
The Immigration and Naturalization Service records the number of
arrivals and departures, classified by residence of traveler and also by flag
of carrier. However, the data must be adjusted somewhat to fit exactly the
categories appropriate for balance-of-payments estimation. These adjustments
are summarized below under Travel.
Port service
For 1951 and later years United States port receipt estimates are based on
the questionnaire to foreign ship-operators mentioned in connection with
the ocean freight estimates. These were extrapolated back to 1946 by estimates made separately for cargo liners, passenger liners, tramps, and tankers.
For cargo liners, Census Bureau export and import totals carried by foreign
cargo liners were multiplied by average port expenditures per ton. The
averages for 1951 were pieced together largely from industry information
and for earlier years were adjusted for changes in stevedoring rates, a major

141

determinant of total port expenditures. The estimates for passenger liners
and tramps were derived as the product of the number of voyages times expenditure per voyage. The number of voyages was based on Census Bureau
data on arrivals and departures and tonnage carried, and average expenditures per voyage on Maritime Administration operating cost data and
various port cost studies. The 1951 benchmark for tankers was derived from
the questionnaire and extrapolated back to 1946 by reference to Census
Bureau data on export and import tonnages carried by foreign tanker
operators.
Prior to 1946, United States port receipts from foreign vessels were estimated as fixed percentages of the vessels' gross revenues from the carriage
of United States trade, the sources and methods for which are indicated
above. Ratios were based on fragmentary information from foreign lines.
For 1948 and later years foreign port expenditures of United States operators have been derived from the carriers' financial statements filed with the
Maritime Commission and data supplied by questionnaires to the Office of
Business Economics. These estimates have been carried back to 1946 on the
basis of Census Bureau data on the volume of cargo carried by United States
operators in those years. For years prior to 1946 foreign port expenditures
were calculated in a manner similar to United States port receipts in those
years. Ratios of port expenditures to gross earnings (for cells cross-classified
by type of cargo and whether direct or wayport trade) were based on the
carriers' financial statements and on supplementary details supplied by some
of the largest American dry cargo operators.
Air traffic
Receipts and payments on account of air traffic include freight, passenger,
and port cost components generally analogous to those described above for
ocean shipping. Data supplied by the major United States international
airlines to the Office of Business Economics supplemented by financial reports
filed with the Civil Aeronautics Board provide the essential information for
the estimates of United States carriers' receipts and payments for 1949 and
later years. The estimates for 1946-8 have been derived from the financial
statements filed with the Civil Aeronautics Board. These cover United States
and foreign operations combined, and have been adjusted to exclude domestic
transactions on the basis of the data available for 1949 and later years.
Estimates of receipts for years prior to 1946 were calculated from tonnages
of freight (benchmarked on official trade statistics for certain years), numbers
of passengers (based on the Immigration Service records), and published
rates. Expenditures abroad were estimated from the financial reports filed
with the Civil Aeronautics Board and information supplied by the industry.
Beginning with 1951 payments and receipts of foreign airlines are based
on a compulsory questionnaire. The receipt series has been carried back to
1946 by allowing for changes in the numbers of passengers carried by foreign
airlines and scheduled flight arrivals in the United States. Payments by
foreign airlines are small. Earlier years were derived by methods similar to
those used for United States lines.
No estimates for air transportation were made prior to 1940.
Rail traffic
Rail traffic receipts by the United States from the rest of the world consist
of (1) freight earnings of United States railroads operating in Canada and
(2) freight on foreign merchandise carried in transit through the United
States. Component (1) represents freight on United States exports and intraCanadian shipments. It is evaluated from information furnished by the railroad companies to the Office of Business Economics. Component (2) arises
largely from Canadian and Mexican export and import trade with countries
other than the United States. It is estimated by applying general average
freight rates to data on the weight or value of such shipments. The rate
averages used are compiled by the Interstate Commerce Commission. The
shipments data are derived from official trade statistics recorded by the
Dominion of Canada and, for Mexican trade, from the official trade statistics
of the United States.
Rail traffic payments by the United States comprise operating expenses in
Canada of the United States railroads operating in that country, as well as
payments to Canadian railroads for hauling United States freight in transit
through Canada. The item of operating expenses, like the corresponding
revenue considered under (1) above, is reported directly by the carriers.
A rough allowance for Canadian railroad freight revenues from the United
States is based on railroad enterprise data reported to the Canadian Government.

142

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS

Other transportation
Ship charter transactions between United States and foreign shipping lines
are evaluated on the basis of financial statements filed by the United States
lines with the Maritime Administration and reports to the Office of Business
Economics. The estimates for Great Lakes shipping represent freight revenues
and expenditures only; passenger fares on the Lakes are included with travel
receipts and payments, which are described below. Average freight rates on
the principal commodities, furnished by the Lake Carriers' Association of
Cleveland, are multiplied by commodity tonnage data taken from statistics
of the Census Bureau. Foreign mail earnings accruing to United States air
carriers are determined from data reported by the carriers to the Civil Aeronautics Board, and estimates of ocean mail receipts are benchmarked on data
reported to the Maritime Administration. The revenues of United States
pipeline companies for transporting Canadian petroleum products in transit
are obtained from reports to the Interstate Commerce Commission. Receipts
and payments for the interchange of railroad freight cars between United
States and Canadian and Mexican railroads are calculated from the number
of cars exchanged as reported to the Association of American Railroad:;
multiplied by a standard rental rate.

Travel
Inbound and outbound ocean and airplane fares and expenditures on
board ship have been considered above under the heading of transportation.
All other payments made by nonresidents in connection with travel in the
United States, or made by United States residents in connection with travel
abroad, are included under the heading of travel.
All foreign visitors' travel expenses in the United States are considered to
be foreign purchases from United States business enterprises. American
travel expenditures abroad, as well as the passage payments discussed above
under Transportation, are allocated between business and personal outlays.
For overseas travel, this allocation has been based on occasional sample
studies of passport applications (on which the purpose of travel is stated).
Information as to the purpose of travel to Canada or Mexico is obtained
from the expenditure questionnaires.
The basic estimating formula, as in the case of passenger transportation,
involves the multiplication of numbers of travelers by sample-based average
expenditures per traveler. For these calculations, data on foreign visitors
are cross-classified into cells by purpose of visit and country of last permanent
residence, while data on United States travelers abroad are cross-classified
according to means of transportation and region of the world visited. Further
stratification is used where it is appropriate and feasible, as illustrated above
in the discussion of ocean passenger transportation. Numbers of travelers
are derived in general by adjusting data from immigration and emigration
records. Expenditure averages are computed from questionnaires completed
and returned by travelers upon or after completion of their trips. For estimating purposes, foreign travel is divided into three major segments: overseas,
Canadian, and Mexican. Each of these will be considered in turn.

Overseas
Overseas travel by United States residents accounted for 44 percent of
United States payments for travel in 1950, and United States travel by
visitors from overseas accounted for 40 percent of United States receipts
under this heading.
Basic data on numbers of travelers from the records of the United States
Immigration and Naturalization Service are adjusted to exclude travel
between the United States and Mexico and Canada (other than travel
through Canada en route between the United States and overseas areas).
In addition, the data for citizens' travel are adjusted to exclude estimated
travel by government employees and by residents working abroad for foreign
employers or for foreign branches or subsidiaries of American firms; and the
alien resident travel data are adjusted to reflect the de facto breakdown between temporary visits and migration. Immigrants are considered United
States residents from the time of their admission into this country, while
emigrants are treated as United States residents until they are admitted into
a foreign country.
The data from which average expenditures of United States travelers are
calculated are received by mail from a sample of returning residents, to whom
questionnaires are distributed by mail or through Immigration Service

officers at the port of entry. The possibility of bias due to failure of some
travelers to complete and return their questionnaires was checked in 1948
and 1949, by comparing questionnaire results with conceptually comparable
results obtained from interviews with a random sample of residents arriving
at the Port of New York; this check disclosed no statistically significant bias
in the results of the questionnaire sampling. However, expenditures do vary
widely among individual travelers, and the possibility of significant sampling
error must therefore be recognized when conclusions are drawn from the
travel estimates
Average expenditures of overseas visitors to the United States are likewise
estimated from questionnaire data. Alien visitors receive questionnaire mailIng cards (printed in English, Spanish, and French) from inspectors of the
Immigration and Naturalization Service at the time of their arrival in the
United States. They are asked to complete and mail the questionnaires
shortly before their departure from this country.
Canada
Travel in the United States by Canadian residents accounted for about
one-half of United States receipts from foreign travelers in 1950. The estimates are made by the Dominion Government, using methods similar to
those described above in connection with overseas travel of United States
residents.
United States residents' average expenditures for travel in Canada are
determined from sample questionnaire data gathered by the United States
Department of Commerce from United States residents returning from
Canada by rail, boat, plane, or long-distance bus, and sample questionnaire
data gathered by the Dominion Government from visitors entering by other
means of transportation, chiefly automobiles. The data on numbers of
travelers, which are collected by the Canadian authorities, are adjusted in
several respects. In particular, a deduction is made for passengers in direct
transit through Canada from one point in the United States to another.
Mexico
The Bank of Mexico and the Office of Business Economics cooperate in
estimating the expenditures of travelers between the United States and
Mexico. Border travel and travel to the interior of each country are estimated
separately. Border travel payments by the United States are made partly
in pesos, partly in dollars which subsequently return to this country via
nonbanking channels, and partly in dollars subsequently deposited with
United States banks by their Mexican correspondents and others. Current
data on the third type of transaction are raised to full coverage by use Oi
ratios derived from a 1945 survey of banks, exchange dealers, businessmen,
and customs officials in border towns. Border travel receipts by the United
States are estimated by parallel methods.
United States receipts from Mexicans traveling to the interior of this
country are estimated from questionnaire data. Each Mexican resident
legally entering the United States for a stay of more than 24 hours or for a
destination beyond the border area is handed a questionnaire by the United
States immigration inspector, to be filled in shortly before the Mexican
resident leaves this country. The number of questionnaires distributed
provides a basis for estimating the number of persons entering, and average
expenditures are calculated from the completed questionnaires returned.
Data on the number of United States citizens traveling to the interior of
Mexico are collected by the Mexican Government. Average expenditures
per traveler in recent years have been determined largely on the basis of
occasional questionnaire sample surveys by the Mexican Government or
by the Bank of Mexico.

Miscellaneous services
Estimates of the miscellaneous service transactions to which the United
States Government is a party are based on information supplied to the Office
of Business Economics by the responsible Federal agencies. These transactions include (1) purchases and sales by the Department of Defense and other
administrative agencies, (2) purchases and sales by the Post Office Department and other government enterprises classified, for national income purposes, in the business sector of the United States economy, and (3) personal
expenditures of military and civilian employees of the United States Government abroad, which are treated as sales to United States persons. Purchases
under (1) include certain items not obviously classifiable under this head: real

NATIONAL INCOME, 19 5 4 EDITION
property bought abroad for government use, and expenditures connected
with official travel, as well as United States current payments to international
organizations (such as the United Nations) of a character other than purely
humanitarian. Item (3) is derived from the total reported disbursements to
employees in foreign countries by deducting such employees' personal remittances through Army Post Offices and Army Finance Offices, their cash
purchases of war bonds, and net proceeds of Army Post Exchanges and Navy
Ship Stores.
Miscellaneous service receipts and payments not involving the United
States Government are estimated from a variety of materials. They include:
(1) Insurance; (2) royalties, home office expenses and related items; (3) motion-picture rentals; (4) electric power transactions; (5) international communication charges; and (6) foreign representation in the United States.
Except for the labor cost element in (6) which has been discussed above
under the heading of factor income, all of these are treated as purchases from
or sales to United States business.
(1) Insurance receipts by the United States consist chiefly of reinsurance
claims paid by foreign companies, and payments consist chiefly of premiums
for such reinsurance. The estimates are based on an annual questionnaire
survey of United States companies which provides virtually complete
coverage.
(2) United States receipts of royalties and related items are benchmarked
for 1950 on the Commerce Department's census of American direct investments abroad, and extended to other years on the basis of questionnaire
returns showing United States companies' receipts from their foreign branches
and subsidiaries. Royalties from independent licencees in most foreign
countries are necessarily omitted, in the absence of data on these. United
States payments of royalties and related items to foreign countries are estimated from tax return and questionnaire data by methods generally analogous to those described above for taxable interest.
(3) Motion-picture rentals received by United States companies are estimated by reference to the benchmarks provided by the 1950 Commerce
Department census and the 1942 Treasury Census of American-Owned
Assets in Foreign Countries, which are linked and extrapolated chiefly by
questionnaire data from the companies.
(4) United States exports and imports of electric power are reported annually to the Federal Power Commission by United States electric utility
corporations.
(5) International cable, radio and telephone companies furnish the Office
of Business Economics with data on their receipts and payments.
(6) The item of foreign representation covers the administrative expenditures of foreign governments and international organizations in the United
States. Disbursements for real property are included. The estimates for
foreign governments are based on rather inadequate sample information, as
is indicated above. The figures for international organizations, which since
1945 have made up an important part of the total, are derived from published fiscal reports or obtained directly from the fiscal officers of these
organizations.

Unilateral transfers
Cash gifts to foreign countries by United States persons and the United
States Government are included in table 11 of Part V with sales by the rest
of the world to persons and government respectively.
Personal remittances from the United States (included in table 11 of Part V
in sales to United States persons) are estimated on the basis of reports from
a very large proportion of the banks and other institutions handling such
remittances. The bank-reported figures are expanded by use of ratios based
on Treasury experience with wartime Foreign Funds Control, and added to
totals for postal money order business reported by the Post Office Department.
Since no allowance is made for currency sent out through the mails, or remittances in the form of personal checks or other domestic instruments which
may be cashed abroad, the estimates may well be too low. On the other hand,
some of the postal money orders and some of the transactions reported
by the banks as personal remittances may actually represent commercial
payments.
During the war and postwar years, deductions from the wages of imported
alien workers for remittance to their banks or relatives at home have also
been included, using data or estimates from the Departments of Agriculture
and Labor and other agencies.

143

Institutional remittances, which are also treated as sales to the personal
sector of the United States economy, are estimated chiefly from replies to an
annual questionnaire, response to which has been substantially complete in
recent years.
Foreign purchases from United States persons as shown in table 11 include
personal remittances from abroad. These are estimated from data on post
office money orders from each foreign area, by use of raising ratios based on
the proportion of money orders in total remittances sent to that area.
Unilateral cash transfers from the United States Government to foreign
countries are entered in table 11 as sales to the government; transfers to the
United States Government from abroad, as purchases from the government.
Both are determined from the official records of the Federal agencies involved.
Such transfers to abroad include United States contributions to international
organizations of a purely humanitarian character and pensions and claim
payments to nonresidents of the United States, as well as disbursements under
foreign aid programs. The transfers from abroad include cash lend-lease
settlements and special currency supplied to United States Government agencies by occupied countries without cost to the United States Treasurv

13. GOVERNMENT RECEIPTS A N D EXPENDITURES
The annual estimates of the government receipt and expenditure components of the income and product flow are based primarily upon budgetary
statistics of the various governmental entities in the United States. The availability of such statistics permits a generally high standard of reliability of the
estimates. (See tables 8 and 9 in Part V for a presentation of them in the form
of a comprehensive statement of government receipts and expenditures.)
However, accuracy is impaired to some extent by two broad limitations of
the basic budgetary data. They are incomplete for most years with respect to
governmental units covered; and they are inadequate for all years—from the
standpoint of national income accounting—with respect to types of transactions identified. Appreciable possibilities of error are inherent in the techniques employed to overcome these shortcomings.
Even in the case of the Federal Government, where financial reporting of
most (but not all) activities is channeled through a central set of accounts
maintained by the Treasury, the adaptation of budgetary data to the conceptual mold of the national income statistics presents numerous problems
requiring the use of corollary information not susceptible to precise integration with the basic Treasury accounts.
For the 48 State governments, a somewhat less uniform, but still substantially complete, budgetary record is available for most years since 1929 from
the compilations of the Governments Division of the Bureau of the Census.
Modifications to fit the data into the national income framework are necessary in all years, however, and alternative sources and methods are required
for the interval 1933—36, when the Census reports on State finances were
suspended.
The Census Bureau also provides summary financial statistics with respect
to the more than 100,000 units of local government. Comprehensive summary
records for all levels of local government are available from the decennial
censuses of government (1932 and 1942), and from a survey for 1952 in which
cities with populations over 25,000 were completely enumerated and other
local government units sampled. (Summary of Governmental Finances in 1952.)

Only for cities with populations of 100,000 or more, however, are data available annually throughout the period since 1929 (although the lower size
limit extends to 25,000 for years since 1942 and to 30,000 prior to 1932).
County finance data are available for the period 1943-46, and for years since
1945 the Census Bureau has been publishing a report covering all local
government revenues. But, with these exceptions, there are no compilations
for the smaller cities, counties, school districts, or other minor local units
except for 1932, 1942, and 1952.
In view of the incompleteness of the basic data, the entire range of local
estimates for the intercensal years prior to 1942 is subject to the hazards of
broad interpolation and extrapolation procedures, described below, which
rely in part on supplementary information regarding the movements of
major components of local government receipts and expenditures. For years
subsequent to 1942, available Census reports are fully utilized insofar as they

144

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS

provide coverage, but for all years except 1952 there remain several gaps to
be filled by extrapolations or interpolations based upon supplementary information or upon assumed analogies to trends in the units for which annual
tabulations are available. In terms of dollar aggregates, the types of governments for which these improvisations are necessary [in all years after 1942
(except 1952) for expenditures, but only in 1943 and 1944 for receipts] account for well under half of the State and local totals and for a relatively inconsequential share of the grand totals for all levels of government.

Adjustments for classification and timing
With regard to the Federal Government, to State governments except in
the period 1933—36, to all local governments in decennial census years and
1952, and to certain types of local units or phases of local operations since
1942, the development of appropriate estimates for inclusion in the national
income accounts is essentially a matter of ciassification and timing.
The classification problems are twofold. In the first place, since what is
desired is in the nature of a consolidated current operating account, it is
necessary to distinguish and exclude all government loans and other financial
investments, repayments thereof, borrowing and debt retirement, and purchases or sales of land and existing depreciable assets, as well as certain
charges and credits which represent mere intragovernmental transfers. Large
amounts of receipts and expenditures in these categories are included in the
basic budgetary statistics (especially for the Federal Government), but are
not germane to the present United States national income accounts. It
should be noted that the process of consolidation involves, besides the exclusion of intragovernmental transfers, the combination with the basic budgetary
accounts of transactions of certain government trust and other funds not
ordinarily reported as an integral part thereof.
Secondly, revenues and outlays must be subdivided among the receipt and
expenditure classifications employed for national income purposes. Primary
subdivision in each case is in terms of four major categories cutting to a large
extent across the usual budgetary classifications. These are, for receipts:
direct personal tax and nontax receipts, direct taxes on corporate income,
indirect business tax and nontax accruals, and contributions for social insurance; and, for expenditures: purchases of goods and services, transfer payments, net interest paid, and subsidies less the current surplus of government
enterprises.
In this phase of the classification, certain budgetary items are shifted, with
appropriate change of algebraic sign, from the receipt to the expenditure
side of the account (or vice versa). For example, interest income, operating
revenues of government enterprises, and certain general government sales
are netted out of various classes of expenditure, rather than recorded as
receipts. Conversely, tax refunds, which formerly were reported by the
Federal Treasury as budgetary expenditures, are netted out of tax receipts
in the national income series.
To a considerable extent, both phases of classification can be accomplished
by reference to detailed components of the basic budgetary statistics. The
latter, however, are inadequate at many points. With regard to receipts, the
principal difficulty is that of distinguishing, among classes of revenue which
are homogeneous for budgetary purposes, the respective amounts paid by
businesses and by individuals as such. In connection with expenditures,
trouble arises mainly because of the fact that budgetary statistics are almost
invariably compiled on a functional or organizational basis, without utilizable object classification. For these and related reasons, many pertinent details must be gleaned from secondary sources—usually specialized
individual agency records—which are not always fully compatible with the
basic overall accounting records. While a degree of error is undoubtedly
introduced through this necessary reliance upon unintegrated source materials, the resultant impairment of accuracy is not believed, generally
speaking, to be serious.
The timing problems involved in adapting standard budgetary data to
national income purposes arise chiefly from the necessity of articulating government transactions with corresponding payments and receipts recorded
for other sectors of the economy. Since the budgetary accounts are very
largely on a cash basis, they must be modified whenever this record diverges
widely from accrual records of the same transactions maintained by private
business. Similarly, foreign transactions of the Government must be adjusted
in some instances to conform to the timing reflected in the United States

balance of international payments, and certain other budgetary charges
have to be synchronized with corresponding components of the personal
sector account.
With reference to receipts, the most important divergences of accrual from
cash timing appear in connection with business taxes—especially those on
corporate profits. On the expenditure side of the account, analogous divergences have arisen from the lag between deliveries of goods to the Federal
Government and Treasury checks in payment therefor, from Federal Government advances and prepayments on purchases, and from retroactive renegotiation of war contracts. These and other less significant reasons for
modification of budgetary timing are discussed more fully later in this section.
A minor, but pervasive, timing problem is that of converting fiscal year
data to a calendar year basis. For nearly all of the States, utilizable budgetary
statistics are available only in terms of fiscal years, and calendar year estimates must be derived by interpolations of varying reliability. The same
situation exists with respect to some detailed components of the Federal account. Except in the case of unusually spasmodic transactions, however, the
errors resulting from even the crudest conversions of fiscal year data can
scarcely be significant, and they tend, moreover, to cancel out over fairly
short intervals. In many instances, relevant information (e. g., on the movement of a tax base or of a correlated expenditure series) is available to guide
the interpolations; but in others, the expedient of allocations yielding smooth
progressions is employed.
The dates upon which the fiscal years of local governments end are extremely diverse, and no attempt is made, either in the basic Census reports
or in the national income estimates, to adjust them to a uniform basis. Since
the average of these fiscal year-ends is closer to December 31 than to June 30,
the data are treated as if they covered calendar years. In general, the latter
correspond to the nominal years of the Census reports, but the 1932 decennial
census data, which differed in time reference from subsequent Census compilations, are allocated to calendar 1931.
More specific discussions of the estimates of government receipts and
expenditures follow.

Government Receipts
For the Federal Government, complete accounting records covering all
the relevant receipts except corporate profits tax accruals in the two most
recent years are readily available. With that one exception (discussed in the
section on Corporate profits), difficulties arise only with respect to minor
problems of Classification.
For State governments, the Census financial reports (State Finances and
predecessors) provide the basic data for all years except 1933-36, when the
Census reports were suspended. For this interval, chief reliance was placed
upon Tax Yields, a publication of the Tax Institute of the University of
Pennsylvania, compiled mainly from questionnaires sent to State tax officials.
With respect to local governments, there is a rather sharp dichotomy
between the estimates for years prior to 1942 and those for subsequent years.
For the former period, the basic Census reports are extremely fragmentary,
being confined in most years other than that of the decennial census to cities
with populations of 100,000 or over. The only comprehensive coverage of
local revenues in these intercensal years is provided by the estimates of the
National Industrial Conference Board, which are based upon the available
Census material, reports of tax commissions or similar agencies, correspondence with public officials, samples obtained by questionnaires, and a
miscellany of other sources. While the National Industrial Conference Board
data are not presented in suitable detail for national income purposes, they
can be used in conjunction with the decennial census breakdowns to establish
generally adequate interpolations from 1932 through 1941, as well as extrapolations back to 1929.
Since 1945, the Census Bureau has undertaken comprehensive annual
estimates of local revenues, based upon complete reporting for cities over
25,000, upon local tax data obtained from State agencies, and upon sampling
of numerous minor local units. Inasmuch as Census reports for 1943 and
1944 covered all counties, as well as cities having populations over 25,000,
the only serious gaps in the data since 1942 are for cities under 25,000, school
districts, special districts, and certain types of townships in the years 1943 and
1944. These gaps are readily filled through interpolations guided by trends
in the smaller of the reported cities. The classification of aggregate local

NATIONAL INCOME, 195 4 EDITION
revenues as estimated by the Census Bureau for recent years still derives in
part from detailed breakdowns available only in the 1942 decennial census
and the 1952 survey; but the provision of control totals through sampling of
minor types of governmental units now precludes any likelihood of serious
error in the national income estimates of government receipts (except perhaps for the latest year, before the Census figures are compiled).
While the State and local estimates (and particularly the latter) are much
less certain than the Federal, they are believed to be adequate in general,
both as to level and as to movement.

145

be purchased and applied before sale); the recent provision for quarterly
filing makes it necessary to estimate the monthly pattern of the collections.
Customs duties, as reported in the Daily Treasury Statement are similarly
shifted, while collections of the capital stock tax (as reported by the Internal
Revenue Service) were moved back by 6 months during the period when
it was effective. Federal indirect business nontaxes are based upon the same
detailed analysis of Treasury miscellaneous receipts and minor trust fund
receipts from which the personal nontax estimates are drawn. The classification here may be somewhat inexact, since exhaustive investigation of the
dozens of petty items involved is not feasible; and the timing is somewhat
arbitrary, since basic data are readily available only for fiscal years. NeverPersonal tax and nontax payments
theless, the general order of magnitude of the estimates is not believed to be
By far the preponderant element of personal taxes for the last decade has
seriously in doubt.
been the Federal individual income tax. The monthly collections reports of
Refunds of indirect business taxes are netted out of the latter at the estithe Internal Revenue Service provide a direct record of these levies with the
mated time of initial overpayment, in accordance with the net accrual concept
desired timing, except that the withholding tax component must be shifted
underlying the series. These refunds are derived as part of the more general
back one quarter in order to reflect it as paid by individuals rather than as
refund analysis described above in connection with personal taxes.
deposited by employers with the Treasury. Beginning with January 1951
The basic Census reports, supplemented primarily by Tax Tields statistics
the Internal Revenue Service series combines collections of individual income
for the years 1933—36, provide substantially full coverage of State indirect
taxes with employment taxes collected under the Federal old-age and surbusiness taxes.
vivors insurance program. To derive personal taxes these employment taxes
The major sales taxes which account for the bulk of State revenues are
are eliminated on the basis of the data sources discussed in section 2.
readily distinguishable, and involve no serious classification problems. In
Federal estate and gift taxes are recorded directly as reported by the Inprinciple, these taxes should be recorded on an accrual basis for present
ternal Revenue Service in its monthly collections statistics, as were the divipurposes. Prior to 1942, however, the distinction between accruals and coldends tax and a proportion of the automobile use tax (representing the estilections is ignored as inconsequential, and calendar year estimates represent
mated share paid by individuals in a nonbusiness capacity) when operative.
simply two-year moving averages of fiscal year collections. For later years,
Personal nontax payments to the Federal Government, which include fines,
partial cognizance is taken of the accrual principle through interpolation of
penalties, forfeitures, and a variety of incidental charges, are based upon
calendar year estimates from fiscal-year collections totals by reference to
detailed analyses of miscellaneous receipts of the Treasury and of minor
trust fund receipts, as reported in the annual Budget of the United States Govern-independent series indicating the movement of the respective tax bases. The
retail sales estimates of the Office of Business Economics (or appropriate
ment; fiscal year data on these items are converted to calendar year estimates
components thereof) are used for this purpose with respect to general, gasoby interpolations yielding smooth progressions.
line, and liquor sales taxes, as well as for extrapolating them beyond the
Personal tax refunds—netted out of receipts in the national income aclatest period reported by Census. Monthly data from the Internal Revenue
counts at the time of refund—are based essentially on the Daily Treasury Service on tax-paid withdrawals of tobacco products from registered factories
Statement. The latter reports them only in combination with other types of
or bonded warehouses are similarly utilized in connection with State sales
refunds (mostly of corporate profits taxes), but the availability of detailed
taxes on tobacco.
fiscal year breakdowns in Annual Reports of the Commissioner of Internal
Estimates of other State taxes and nontaxes are somewhat less satisfactorily
Revenue, in conjunction with the distinctive timing pattern for the preponfounded. Some of them involve more or less dubious allocations as between
derant individual income tax component, permits reasonably accurate
persons and businesses, and most of them are arbitrarily timed (within the
estimates for all calendar years. For recent years, quarterly administrative
fixed fiscal-year totals) to yield smooth progressions. These circumstances,
records of the Internal Revenue Service have virtually eliminated all unhowever, are not believed to preclude a generally satisfactory degree of
certainty from these estimates.
reliability in the published estimates, since errors in the detailed calculations
State and local personal tax and nontax receipts are based primarily upon
are likely to be at least partially offsetting.
detailed analysis of available Census and other data on governmental
The local indirect business tax estimates are still less solidly based. They
finances. Difficulties in allocating given types of revenue as between persons
are subject to the hazards arising from fragmentary reporting by the Census
and businesses, however, are frequently solved by reference to available
Bureau prior to 1945 (except in decennial census years) and from possible
corollary information; for example, Bureau of Public Roads statistics
sampling error thereafter with respect to all local units except cities over
on registrations by type of vehicle are employed in allocating motor vehicle
25,000. Particularly to be noted is the somewhat dubious nature of estimates
license taxes. Such corollary data are also employed in some cases as
for intercensal years prior to 1942, when they hinge in large measure upon
extrapolators in estimating yields for recent periods in advance of Census
the local revenue data compiled by the National Industrial Conference
tabulations.
Board, which are not sufficiently detailed for this usage.
With respect to local governments, the necessity for sweeping interpolaThe classification of local revenues as between business and persons detions—based upon National Industrial Conference Board data—of the prepends to a considerab'e extent upon the use of ratios derivable only from the
1942 revenue estimates has already been mentioned. The respective personal
detailed decennial census breakdowns and the 1952 survey, or upon assumpand business shares of several broad revenue categories so interpolated are
tions about changes in such ratios. These classification problems, however,
based throughout the period upon allocations derived from decennial census
are minimized by the predominance in the local revenue structure of real
breakdowns. Such allocations are also applied, although in somewhat
property taxes, all of which are allocable to the indirect business category
greater detail, to local revenue estimates for years after 1942.
because of the treatment of home ownership as a business.
This predominance of property taxes has a special bearing upon the
Corporate profits tax accruals
reliability of the local indirect business tax estimates for the most recent year
These estimates are described in the section on Corporate profits.
(published before the Census reports become available). Since no current
economic series closely correlated with property tax yields is known, the
Indirect business tax and nontax accruals
latest estimate usually represents merely a judgmental extension of the
previous trend, with rough allowance for the volume of new construction and
For the Federal Government, these consist primarily of excise taxes, colthe prevalence of rate revisions.
lections of which are reported by the Internal Revenue Service on a monthly
basis prior to June 30, 1953, when quarterly reporting for all but alcoholic
beverages, tobacco and a few other miscellaneous excise taxes was instituted.
Contributions for soci al insurance
An approximate conversion of Internal Revenue Service figures to an accrual
These estimates ar e discussed in the section on Contributions for social inbasis is accomplished by shifting back by one month all excise tax collections
surance and other labor income.
except those on alcoholic beverages and tobacco (where revenue stamps must

146

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS

Federal grants-in-aid
These do not appear in the consolidated Government account, but become
an element of Federal expenditures and of State and local receipts if the
accounts are segregated. The series is described in general terms below, in
connection with the derivation of estimates of Federal purchases, and its
components are listed in a footnote to table 8 in Part V.

Government Expenditures
The derivation of government expenditure data for the national income
accounts centers upon the estimation of government purchases of goods and
services. The method, in general, is to start with budgetary totals drawn from
broad fiscal reports, then to make various additions to and deductions from
these totals so as to achieve as residuals the desired purchases series. The
alternative method of building up such a series item by item would be much
more informative; but it is not statistically feasible, owing to the absence
of satisfactory comprehensive sources of basic data classified by object of
expenditure.
With purchases of goods and services established, other outlays within the
national income framework—transfer payments, interest, grants-in-aid (for
the separate Federal account), and subsidies (less the current surplus of
government enterprises)—are added to complete the government expenditure account. In the main, these additions represent restoration (not necessarily with the same timing) of many of the budgetary items deducted in
estimating purchases. They also include, however, certain outlays from
nonbudgetary funds consolidated with the budgetary accounts for national
income purposes.
The general approach sketched above is employed in deriving Federal expenditures throughout the period of the estimates, and is applied to State
expenditures in all years except 1933—36, and except also in the most recent
year (when Census tabulations are not yet available). These gaps are filled
mainly by interpolations (discussed more fully below) based upon independent statistics covering major types of outlay.
With respect to local governments, the general method is fully applicable
only to decennial census years and 1952. Estimates for all other years before
1942 represent interpolations or extrapolations similar to those utilized for
State expenditures from 1933 through 1936. The City Finances data available
for those years are discarded, since they cannot readily be integrated with
estimates based on interpolating series covering all local units (although not
all types of expenditure). Subsequent to 1942, available Census data on local
expenditures are utilized, but for local units other than cities with populations
of 25,000 or over (and also counties, prior to 1947) the estimates represent
interpolations and extrapolations benchmarked on the 1942 census and the
1952 survey.

Purchases of goods and services—Federal

expenditures, are given a different timing for national income purposes
(see note to line 13, below).
3. Tax refunds, which are netted out of tax receipts in the national income
accounts, must be eliminated from budgetary expenditures in those years
when they were so classified by the Treasury. The Daily Statement provides a
record of the amounts refunded.
4. General government loans, investments, and capital transfers are compiled
partly from the Daily Statement itself (where separately identifiable in that
document) and partly from the Budget document and from reports of individual lending agencies. In the two latter cases, the estimates doubtless diverge to some extent from the amounts implicit in the initial budgetary expenditure totals, but close approximation can usually be assured. Loans and
investments of government enterprises are not included under the present
heading, being treated separately in line 11.
5. Purchases of land and existing capital assets are estimated for some years on
the basis of title clearance records of the Department of Justice, and for other
years on the basis of obligations (not expenditure) data provided by the
annual Budget document. In neither case do the estimates represent more
than a rough order of magnitude (relatively small) for government acquisitions of goods neither currently produced nor coming out of business inventories or imports.
6. Budgetary transfer payments, except for certain veterans' benefits, are not
distinguishable in the Daily Statement from other outlays of the agencies involved. From administrative records of these agencies, however, most items
under this heading can be ascertained with only minor timing discrepancies;
in a few instances of reliance upon the Budget document, proportionately
larger timing errors are probably present.
Exhibit 1.—Summary Derivation of Federal Government Purchases of Goods
and Services, Selected Calendar Years

[Millions of dollars]
Item
1. Total budgetary expenditures, as reported In Daily
Treasury Statement
Less:
2.
Transfers to trust accounts
3.
Tax refunds.
4.
General government loans, investments, and capital transfers
5.
Purchases of land and existing capital assets
-.
6.
Budgetary transfer payments
._.
7.
Grants-in-aid to State and local governments
8.
Interest payments (other than by government enterprises)
9.
Subsidies (other than those paid by government
enterprises)
10.
Overpayments established by renegotiation of war
contracts
_-.
H.
Budgetary expenditures relating to government
enterprises.
Plus:
12.
Capital formation of government enterprises
13.
Government contributions for social insurance
14.
Change in net payables to private business
15.
Miscellaneous other adjustments
16. Equals: Federal government purchases of goods and
services (gross)
17. Less: Government sales
18. Equals: Federal government purchases of goods and
services (net)
_

1943

1945

88,084

90,552

38,255

474
74

1,787
2,133

950

31
87
590
942

-5
74
2,674
870

4,640
2,339

2,194

4,107

5,700

667

338

357

3,853

771

1,149

759

1,504

2,987
128
800
-74

-686
1,434
-1,100
262

-635
312
95
214

1950

308
60

Exhibit 1 summarizes the derivation of estimates of Federal purchases for
selected years. Attention may be called to the fact that the magnitude of the
81,864
22,393
76,954
items entering the derivation varies widely from year to year, depending to a
641
255
2,158
considerable extent upon the changing content of the initial budgetary expenditures. A brief descriplion of sources and methods may conveniently be
22,138
81, 223
74,796
given in the form of annotations to this exhibit.
1. Total budgetary expenditures.—At least three major Federal fiscal reports—
the annual Budget document, the Treasury's Combined Statement of Receipts,
7. Grants-in-aid to State and local governments are firmly founded, for fiscal
Expenditures, and Balances, and the Daily Statement of the United States Treasury—
years, upon special tabulations appearing in Annual Reports of the Secretary
might be considered in choosing a point of departure for the estimates of
of the Treasury or in the Budget. The calendar year timing of some of the
Federal purchases. These three documents represent essentially the same
largest grants (e. g., for Social Security and for highways) is specified either
accounting record (varying, from an overall standpoint, only because of
precisely or within very narrow limits (where reported in combination with
slightly divergent closing dates), but differ widely with regard to the type
and arrangement of details reported. Although the Daily Treasury Statement relatively small associated administrative expenses) by the Daily Statement.
Arbitrary interpolation is employed, however, in connection with a number
is the least informative of the three in many respects, it is the only one availof minor grant programs for which relevant monthly or quarterly data are
able on other than a fiscal year basis, and has accordingly been adopted as
not readily available.
the basic source of initial summary totals.
8. Interest payments, except for trivial amounts not associated with the
2. Transfers to trust accounts are reported directly in the Daily Statement, and
public debt, are precisely reported in the Daily Statement.
do not have to be estimated. Some of them are purely bookkeeping transfers,
9. Subsidies paid by general government agencies consist chiefly of soil conto be eliminated from budgetary expenditures in the process of consolidating
servation and other similar payments to farmers, which are reported monthly
the various Treasury accounts, while others, although viewed as substantive

NATIONAL INCOME, 195 4 EDITION
by the Agricultural Economics Division of the Agricultural Marketing
Service on a basis not likely to diverge significantly from corresponding
charges implicit in the Daily Statement. With respect to several small nonfarm
subsidy programs, estimates are derived through interpolation of obligations
data given in the Budget. It should be noted that all of the major wartime
subsidies were paid by government enterprises, and hence are treated in
line 11, rather than here.
10. Overpayments established by renegotiation of war contracts are deducted from
budgetary expenditures in order to bring government purchases into line
with related data on corporate profits and business sales, which are computed, for purposes of national income measurement, with retroactive allowance for renegotiation of war contracts. The estimates of gross recoveries
from renegotiation, timed as of the dates of initial overpayments, are based
upon data compiled by the War Contracts Price Adjustment Board.
11. Budgetary expenditures relating to government enterprises represent a combination of contributions by the general government to the capital of the
enterprises and expenditures by the enterprises themselves (to the extent included in the budgetary totals). Most components of this series are reported
directly in the Daily Statement, but several important segments are drawn,
with varying degrees of precision, either from annual financial reports of
individual government enterprises or from the Budget document.
With the present adjustment designed to eliminate all budgetary charges
relating to government enterprises, there is then substituted (in line 12,
below) an estimate of such of their transactions as are relevant to the measurement of government purchases of goods and services.

147

diverse sources, including the Daily Statement, the Budget document, the
United States balance-of-payments statistics, and individual agency records.
17. Government sales, which include all sales by general government agencies
except those of fixed assets to domestic business, are estimated in two groups.
Domestic sales are derived from the detailed breakdowns of miscellaneous
receipts given in the Budget document, except for the peak years of World
War II surplus property disposal, when data compiled by the War Assets
Administration are the primary source. Because of classification difficulties,
the reliability of these estimates is relatively low. Foreign sales, which include
cash unilateral receipts from abroad, are taken directly from the official
balance-of-payments statistics, thus assuring proper integration of the
accounts regardless of accuracy in an absolute sense (although this, too, is
probably much higher than in the case of domestic sales).

Purchases of goods and services—State and local

The method of estimating State and local government purchases parallels,
in years of full coverage by the Census Bureau, that employed for the Federal
Government. Again, budgetary statistics constitute the foundation of the
estimates and numerous adjustments in the direction of national income
classification are required.
While these adjustments are less complex with respect to types of transactions covered, the derivation is in other ways more difficult because of the
several types of governmental units to be dealt with and because of the
necessity for rather tenuous statistical improvisations to fill in the gaps for
intercensal periods.
12. Capital formation of government enterprises consists of the gross acquisition
For segments of the estimates depending directly upon the basic Census
of newly produced fixed assets by these agencies, plus the net change in their
data (involving all non-Federal governmental units in decennial census
inventories. Both components are based largely upon the business-type finanyears and 1952, States in most other years, cities of 25,000 or more since 1942,
cial statements maintained by most government enterprises. In cases where
and counties from 1943 through 1946), the principal items to be excluded
such statements are lacking, the gap is filled somewhat less satisfactorily,
from total governmental expenditures as reported by the Census Bureau are
through resort to relevant budgetary or administrative data.
debt service charges, intergovernmental transfers of various types, and transIn combination, the two adjustments listed in lines 11 and 12 have these
fer payments. The adjustment for government enterprises (to effect the
principal effects: (1) To exclude from government purchases, in accordance
inclusion of only their capital outlays in government purchases) has varied
with national income concepts, the lending and subsidy activities of governdepending on the treatment of government enterprise transactions in the
ment enterprises, as well as their net current operating expenses; and (2) to
basic Census reports. This is also true of a few other outlays from nonbudgconvert the record of their purchases of fixed assets and inventories (net) to
etary funds. Data for most of the necessary adjustments are obtained from
an accrual basis.
the same Census tabulations (or from unpublished details thereof) from which
13. Govcnment contributions for social insurance, which are viewed as supple- the control totals are drawn.
mentary compensation of government employees, are equivalent to the
In interpolating or extrapolating from benchmark totals (as well as in
shares of Federal civilian employee retirement funds and veterans' life insurestablishing, since 1942, the calendar year timing of series reported only by
ance funds in transfers to trust accounts (line 2, above), except that the
fiscal years), chief reliance has been placed upon the government payroll
timing is modified and a deduction is made for a portion of the retirement
estimates of the National Income Division and upon the public construction
fund contribution ascribable to covered government enterprise employees.
estimates of the Building Materials and Construction Division of the Depart(See section on Supplements to wages and salaries.) The latter item is alloment of Commerce. Such outlays account in most years for about 75 percent
cated as an operating expense of the enterprises in the calculation of their
of all State and local purchases.
current surplus.
Interpolations (or extrapolations) geared chiefly to these series (or com14. Change in net payables to private business, an adjustment aimed at articuponents of them) are employed in estimating purchases for the following
lating the record of government purchases with that of corresponding busitypes of governmental units: States for the years 1933-36 (and for the most
ness sales, represents the net increase in Federal Government accounts payrecent year, before compilation of the Census data); all local units during
able to business, less the net increase in outstanding advances and prepaythe interval between the 1932 and 1942 Censuses and prior to the former
ments by the Federal Government. Both sets of data are taken from Securities
(as well as for the most recent year); counties for years after 1946 (except
and Exchange Commission surveys of working capital of United States cor1952); and cities with populations under 25,000, townships, towns, school
porations, and are available only for the years 1940 through 1946 and from
districts, and special districts for years after 1942 (except 1952).
the end of 1950 to date. The adjustment is ignored for other years, as is the
In the pre-1942 interpolations, it is assumed that, except for new construcfailure of the data to cover noncorporate businesses.
tion and a few other items, all purchases followed trends between the bench15. Miscellaneous other adjustments embrace a wide variety of items. In mark years (and back to 1929 in the case of local governments) corresponding
to those of the respective State and local payroll series. With the estimates of
general, they relate either to special characteristics of Treasury accounting
payrolls and of purchases related to them, there are then combined the
practices or to the maintenance of consistency with other segments of the
estimates of construction and other expenditures not assumed to have been
national income accounts. For example, certain sizable payments to United
so related. Among the latter, by far the most important were various types
States personnel in Germany and Japan after World War II were made in
of purchases under programs supervised by the Federal Emergency Relief
the form of "military payments certificates." These were expensed by the
Administration. Estimates of these purchases are based upon the Final StaTreasury on the basis of the issuance of the certificates to disbursing officers,
tistical Report of the Federal Emergency Relief Administration: 1942, with due
but it is the timing (substantially different) of payments by the latter to emallowance for nonpurchase items there included.
ployees which is relevant for present purposes. Or again, acquisitions of
silver are debited by the Treasury directly to the general fund, rather than
Interpolations of local purchases for 1943—51 are undertaken separately for
charged to budgetary expenditures; accordingly, an explicit addition to the
several groups of unreported governmental units, utilizing in each case the
latter is required to include silver in government purchases.
most nearly appropriate detailed components of the available payroll and
construction series.
The requisite data for items under the present heading are drawn from

148

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS

Breakdowns of government purchases

Subsidies less current surplus of government enterprises

In table 9 of Part V, government purchases are subdivided into compensation of employees, new construction, and other purchases from business (with
a further distinction, for the Federal Government only, between net purchases
from abroad and those from domestic business). The data used in effecting
these breakdowns are to a considerable degree independent of those from
which the estimates of total purchases of goods and services are derived.
The employee compensationfigures—whichcover only general government
employees, since government enterprise payrolls are treated not as government purchases, but as operating expenses of the enterprises—are described
in the section on Wages and salaries. The estimates of new public construction
are those published by the Building Materials and Construction Division,
except for the exclusion of work relief construction. (See section on New construction.) Net purchases from abroad, which include cash gifts of the Government to (and from) foreign countries, are taken from the official United
States balance-of-payments statistics, as described in the section on Net
foreign investment.
Deduction of the three series discussed in the foregoing paragraph from
estimated total government purchases gives other purchases from business
as a residual. Although clearly defined in principle, this item is peculiarly
subject to statistical imperfections, owing to its absorption of whatever errors
or inconsistencies may be present in the other series. In particular it should
be noted that inasmuch as force-account construction payrolls are included
both in compensation of employees and in new construction, "other purchases from business" are understated by the amount of these payrolls.
Fragmentary data available indicate that the understatement for State and
local governments is less than 10 percent.
In table 2 of Part V, a different breakdown of Federal Government purchases—between national security and other activities—is given for the years
1939—53. For the 1939—46 period, the national security purchases series conforms in general to the Daily Treasury Statement classification of general and
special account expenditures between war and nonwar activities. It includes
also that part of the capital formation of government enterprises attributable
to their war activities and Government contributions to the National Service
Life Insurance Fund. For 1947—53, national security purchases are based on
the "major national security programs" classification in the Budget of the

This item consists of the Federal general government subsidies described
in the discussion of Exhibit 1 above, plus the operating deficit or minus
the operating surplus of both Federal and State and local government
enterprises.
For the Federal Government, the enterprise surplus is based primarily
upon the business-type profit and loss statements of Federal corporations,
modified to exclude capital gains or losses, interest income or expense (which
is consolidated with general government interest), and depreciation charges
(which are not recognized for national income purposes in connection with
government-owned assets), and to include as an expense an allocated share
of the government contribution to employee retirement funds. For a few
Federal enterprises not actually organized as corporations, it is necessary to
construct business-type financial statements from available budgetary data.
It may be noted that direct subsidies paid by government corporations are
included as operating expenses in their profit and loss statements. The combination of operating deficits of enterprises with direct subsidies thus has the
merit of statistical expediency, in addition to its more basic purpose of achieving parallel treatment for all subsidy programs, whether accomplished
through direct payments or through the deliberate incurrence of losses on
purchase and sale operations.
The State and local enterprise surplus is calculated (with similar modifications) from the summary operating statements of public service enterprises
compiled by the Census Bureau as a supplementary feature of its Government
Finances series. Since the census tabulations cover some types of enterprises
only in decennial census years (and in 1952), the estimates for other periods
represent interpolations or extrapolations based upon the most relevant data
available.
For a list of Federal Government enterprises and major types of State and
local enterprises, see footnotes to the table on industrial classification in the
Introduction to this Part.

Federal grants-in-aid to State and local governments
See discussion of "Government receipts" above.

United States Government for the Fiscal Tear Ending June 30, 7954, p. 1090. Gov-

ernment contributions to the National Service Life Insurance Fund are added
(in the national defense component of national security expenditures).
The series for 1939-46 and 1947 to date are broadly comparable. In the
latter period, inventory goods initially purchased by government enterprises are reflected in national security purchases when transferred for use in
connection with the national security program, rather than when acquired
by the government enterprise, as in the 1939—46 series. Since government
enterprise capital formation related to national security has been confined
to inventory goods (as distinct from fixed capital formation) since 1947, the
difference in the treatment of government enterprise capital formation is
merely a matter of timing.
The national defense part of the national security total is based on the
following Budget components of major national security programs: military
services, the military assistance portion of international security and foreign
relations, civil defense, development and control of atomic energy, promotion
of defense production and economic stabilization, and promotion of merchant
marine (before 1950). The "other national security" part is based on the
Budget components: international security and foreign relations (other than
military assistance), and promotion of merchant marine (after 1949).

Transfer payments
The derivation of these figures, for all levels of government, is described
in the section on Transfer payments. It should be noted that the totals carried
under this heading substantially exceed the amounts of transfer payments
deducted from budgetary expenditures in estimating purchases, since transfer
payments charged against nonbudgetary trust funds (and in two cases against
the Federal public debt accounts) are included.

Net interest paid by government
This series is explained in the section on Interest.

Characteristics of Revisions
Federal Government
Nearly a'l of the basic data underlying the Federal Government estimates
become available within a few weeks or months after the close of any calendar
year. The only important exception is in the case of corporate profits tax
accruals, which for the two most recent years are extrapolated from the
latest Statistics of Income year, as explained in the section on Corporate profits.
For a number of minor items, such as nontax revenues and numerous detailed elements in the derivation of Federal purchases, reliance upon the
Budget document and other fiscal year reports has the effect of leaving the
figures for the latter half of the latest calendar year on a tentative basis at
the time full annual estimates are first prepared. By and large, however, the
revisions eventually arising from substitution of more definitive data in these
areas tend to be trivial.

State governments
The Census reports from which State government receipts and expenditures are chiefly derived are ordinarily available for a fiscal year ending (for
most States) on June 30 of the latest calendar year covered by the national
income estimates. Only for the latter half of that year, therefore, are the estimates completely dependent upon extrapolating procedures. Moreover, the
proportions of expenditures covered by currently available payroll and construction series, and of receipts fairly closely correlated with current retail
sales data, are such as to insure against errors of large magnitude.

Local governments
It is at the local level that divergences between preliminary and final results are potentially widest, since comprehensive information is available

149

NATIONAL INCOME, 195 4 EDITION
only for the decennial census years and for 1952. In this connection it should
be noted, however, that the results of the 1952 survey confirmed the preliminary estimates for 1952 so closely that no significant revisions were required
in them. This experience enhances confidence in the estimates for the years
1943-51, as well as in the extrapolation procedures used to move forward
from the 1952 benchmark. Because of delays in reporting, the latest year's
figures must be prepared without benefit of any of the basic Census compilations. This is perhaps more hazardous in the case of receipts than in that of
expenditures, since current payroll and construction data provide a guide
for the latter, while no current economic indicator closely correlated with
the preponderant property tax component of local revenues is known to
exist.

14. TRANSFER PAYMENTS
Accurate information on nearly all types of government transfer payments
has been available for years since 1933 from the fiscal records of agencies
administering the payments or from such summary sources as the Daily

veterans of World War II are secured directly from the individual States
making such disbursements.
State and local direct relief for the years 1929-32 was estimated by the
National Income Division from the available partial data contained in the
following publications: Summary of Relief and Federal Work Program Statistics,
1933-40, by T. E. Whiting and T. J. Woofter; and Trends in Different Types of
Public and Private Relief in Urban Areas, 1929-35, by E. A. Winslow. The

estimates, at best, are approximate orders of magnitude.
The remaining types of State and local government transfers—pensions,
veterans' aid, payments for the care offosterchildren in private family homes,
and payments to nonprofit institutions—have required estimation for the
entire period since 1929.
Estimates of State and local government pension payments for years subsequent to 1935 have been prepared by the Department of Health, Education,
and Welfare by procedures described in section 2 in connection with employer contributions to State and local employee retirement systems. The
total for 1936 from this source was extended back to 1929 by an extrapolating
series utilizing available data (converted to a calendar year basis) on State
and local pension payments. Data for States were reported for the fiscal years
1929—31 and 1937 in the Census Bureau's Financial Statistics of States and
obtained for intervening years by straight-line interpolation. Data for local
units were derived by extrapolating the 1941 value given in tbe Census Bureau's publication on Retirement Systems for State and Local Government Employees:

Treasury Statement and Budget of the United States Government. For years prior to

1941 by pension payments in cities of 100,000 and over, as provided in the

1933, the State and local series are not so precise and the government totals
for this period are accordingly less accurate.
Business transfer payments, on the other hand, are comprised largely of
items for which statistical sources are weak. Considerable estimation is
necessary to derive approximate orders of magnitude. Business transfers constituted only 6 percent of total transfers in 1950, but as much as 40 percent
in 1929. Transfer payments in 1929, however, comprised only 2 percent of
total personal income, as compared with 5-7 percent in recent years.

annual Census reports on Financial Statistics of Cities.

Government Transfer Payments
Federal Government
Except for several components of the "Other" category, as shown in table
36 in Part V of this report, requisite data on Federal transfer payments
have been available from government sources. The data have required but
little adjustment for use by the National Income Division. In some instances,
data were reported for fiscal years and had to be converted to a calendar year
basis; in others, payments to nonresidents of the continental United States
had to be eliminated from available totals. In several component series, minor
adjustments for timing discrepancies were required.
Reported, direct data have not been available for several items included in
the "Other" grouping. This is true of the series on profits of ships' service
stores for years prior to 1948. Magnitudes for these years were obtained by
extrapolating the 1948 figure by strength of the naval forces. The series on
Federal payments to nonprofit institutions may not, because of unavailability
of data, be quite complete. Also, a few types of such payments must be derived
by indirect methods. An example is furnished by payments to nonprofit educational institutions under veterans' training programs. Such payments are
estimated by making an allocation of data on total expenditures, as reported
by the Veterans Administration, to nonprofit schools, State and local government schools, and commercial schools. This is based on two types of periodic
data for the several types of schools: Enrollment of veterans (from the Veterans Administration) and average tuition costs (from the Office of Education and the President's Committee on Higher Education).

State and local government
For components forming in recent years over four-fifths of State and local
transfer payments, data based on the fiscal records of disbursing agencies are
available for years since 1933. The amounts of direct relief (special types of
public assistance and general assistance) and of cash sickness compensation
are provided by the Department of Health, Education, and Welfare from
reports made to it by State government agencies. The figures on bonuses to

State and local government aid to veterans (not including State bonuses to
World War II veterans) has been estimated largely from data reported by
the Census Bureau in its Government financial statistics series. Consisting in
large part of pensions paid in the Southern States to veterans of the Confederacy, the item amounted to $24 million in 1929 and $11 million in 1950.
The small amount of payments by State and local governments for the
care of foster children in private homes has been estimated from periodic data
of the Bureau of the Census, the Children's Bureau of the Department of
Health, Education, and Welfare, and a few State welfare departments on
the number of children cared for, and from data of the Children's Bureau
on the average cost of foster home boarding in 10 urban areas in 1938,
extrapolated to other years by the Bureau of Labor Statistics Consumer
Price Index.
Estimates of State and local government contributions to nonprofit institutions are derived by multiplying total contributions to such institutions
(by individuals, corporations, and governments, as estimated from scattered,
piecemeal data) by the estimated proportion of total receipts of nonprofit
institutions obtained from State and local governments. This proportion is
based on studies for a group of urban areas for 1938, 1940, and 1942 made by
the Children's Bureau.

Business Transfer Payments
The only component of business transfer payments for which direct information is available is corporate gifts to nonprofit institutions. The estimates
of the other components—consumer bad debts, personal injury payments by
business other than to employees, unrecovered thefts from business of cash
and capital assets, and cash prizes—must be derived from indirect and partial
data.
Data on corporate gifts to nonprofit institutions (forming 30 percent of
total business transfers in 1950) have been reported by the Internal Revenue
Service, beginning with 1936, in its Statistics of Income tabulations of corporate
income tax returns. Pending the availability of reported data, the latest
Internal Revenue figure is held constant for the two most recent years of the
published series. To obtain estimates for 1929-35, the 1936 figure was extrapolated by corporate gifts to social and welfare agencies, derived from rather
fragmentary sample information.
Consumer bad debts (39 percent of business transfer payments in 1950) are
estimated through an allocation of total bad debts (consumer and intrabusiness) by industry, as reported in Internal Revenue tabulations of corporate
and noncorporate income tax statistics. This allocation is a twofold one: (1)
elimination, by assumption, of those industries in which consumer bad debts
do not arise (or are very small), and (2) apportionment of the remaining total

150

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS

of bad debts, by industry, between consumers and business on the basis of
sales, with sales to consumers being approximated from groupings of the
personal consumption expenditure estimates, and business sales being derived
as the difference between reported total sales and estimated consumer sales.
As in the case of corporate gifts to nonprofit institutions, the most recent
estimate is held constant pending receipt of data from the Internal Revenue
Service. For the numerous years for which noncorporate bad debt data were
not available from Internal Revenue tabulations, estimates were made by
industry by extrapolating the noncorporate ratio of bad debts to sales by the
similar corporate ratio, and then applying the resulting ratios to estimated
noncorporate sales.
Personal injury payments by business to persons other than employees
($227 million in 1950) are estimated as the sum of automobile liability payments for personal injury, payments by railroads, and miscellaneous liability
payments.
The procedure of deriving automobile liability payments is to allocate total
losses paid on automobile policies (reported by the Spectator Company)
between business and individuals, and then to allocate estimated business
losses between personal injury and property damage. The first allocation (30
percent to business in all years except 1942—45, when it was 50 percent) is
the same as the one used in the apportionment of consumer and business
expenditures for gasoline and oil. As described in the consumer expenditure
notes, it is "thinly based". The basis for the second allocation was provided
by the American Management Association's Insurance Series, Compulsory
Automobile Insurance (No. 24). The 80 percent allocation of business losses to
personal injury payments derived for 1935 has been held constant over the
whole period of the estimates.
Railroad personal injury payments to persons other than employees represent total payments to all persons, as reported by the Interstate Commerce
Commission, minus the estimated amount of employees' benefit compensation
(see section 2 of this Part). Miscellaneous liability payments—with virtually
no data as a basis—are entered at $10 million each year.
Unrecovered thefts from business of cash and capital assets are estimated
from data on the value of currency and goods stolen and recovered contained
in the annual publication Uniform Crime Reports of the United States of the Fed-

eral Bureau of Investigation. The business allocation is made on the basis of
data on thefts by place of commission.
The figures on cash prizes included in the published data represent a token
estimate of $25 million annually.

series which is to a very large extent statistically independent of the two
residual estimates of personal saving provides a useful check.
The three estimates of personal saving are shown and compared in the
concluding section of table 6.

16. CAPITAL CONSUMPTION ALLOWANCES
The bulk of capital consumption allowances in the national income and
product tables represents charges for the depreciation, including obsolescence,
of business fixed capital and for accidental damage to such capital, deducted
in arriving at business net income. An insignificant amount represents the
depreciation of fixed assets held by nonprofit institutions. Depletion is not
included.
In general, the valuation of these charges reflects the type of accounting
practices pursued under Internal Revenue Service regulations. Estimates of
farm depreciation are an exception to this rule. The Agricultural Economics
Division of the Agricultural Marketing Service, Department of Agriculture, the source of the farm income estimates, measures depreciation on the
basis of replacement cost rather than original cost.
Exhibit 1.—Capital Consumption Allowances, 1950
Item

Personal saving (as shown in table 3) is obtained by subtracting personal
consumption expenditures from disposable personal income. As the difference
of these much larger totals, it is subject to large percentage errors in level as
well as in movement, and it is necessary, therefore, to check the series for
reasonableness against other estimates. There are two other regularly available series that can be used for comparison.
One of these also is a residual estimate, which can be derived within the
framework of the national income accounts, by deducting from investment
the various types of nonpersonal saving and the government surplus. This
alternative estimate equals "personal saving" (obtained as the difference
between disposable income and consumption) plus the "statistical discrepancy", as can be seen from table 5, Part V. It is not possible to say which of
the two residual estimates is likely to be more reliable. However, they are
to a considerable extent statistically independent, and close correspondence
between them—in other words, a small statistical discrepancy—constitutes
strong, although by no means conclusive, evidence of their validity.
Another estimate of personal saving is provided by the Securities and Exchange Commission through direct estimates of changes of the assets and
liabilities of persons. This estimate is published in table 6, Part V of this
report. It may be noted that data deficiencies make the direct estimate of
personal saving a hazardous procedure also. However, the availability of a

Percent

Depreciation:
Depreciation charges..

18,042

Corporate business
Noncorporate business:
Nonfarm, except real estate industry.
Farms
Real estate industry
Institutional
Capital outlays charged to current expense.
Oil and gas well drilling
Producers' durable equipment.
Accidental damage to fixed capital.

87.9

7,904

38.5

3,210
3,797
2,852
279
1,858

15.6
18.5
13.9
1.4
9.1

920
933

4.5
4.6

616

3.0

20,516

Total

15. PERSONAL SAVING

Millions
of dollars

100.0

About two-fifths of total capital consumption allowances are taken directly
from corporate accounting records for all but the two most recent years.
With the improvement in coverage of income tax return data for partnerships and sole proprietorships, and with more frequent tabulation of such
data, it has become possible to derive noncorporate components making up
an additional one-sixth of the total from these materials. The remainder
of the allowances is estimated on the basis of a variety of sources and
methods, and some of them are subject to a wide margin of error.
Exhibit 1 gives a breakdown of capital consumption allowances in which
segments based on distinct types of estimating methods are listed separately.

Depreciation Charges
Estimates under this heading comprise almost 90 percent of all capita)
consumption allowances in 1950.

Corporate business
More than two-fifths of ail depreciation is on corporate property and is
reported annually by the corporations. Federal income tax returns are the
chief source of data. The totals compiled from the tax returns are increased
by the addition of depreciation charged by Federal Reserve Banks, which is
reported to the Federal Reserve Board.
A variation in the use of the tax return data was necessary in wartime,
because of legislation affecting the length of useful life to be assumed in
calculating depreciation of certain capital assets for tax purposes. The assets

NATIONAL INCOME, 195 4 EDITION

151

only the portion chargeable to farm property owned by persons living on
involved were facilities acquired after 1939 which had been certified to be
farms, which accounts for about two-fifths of all noncorporate depreciation.
necessary in the interest of national defense. Taxpayers were allowed, until
The portion chargeable to farm property owned by landlords living off
the end of the war, to amortize their investments in such facilities over an
farms is classified for national income purposes in the real estate industry.
assumed useful life of 60 months. Such emergency amortization allowances
The farm estimates, unlike the other depreciation figures, represent deprewere reported in the tax return tabulations, and were included with depreciation of estimated stocks of capital valued at current prices rather than at
ciation for national income purposes.
original cost.
However, subsequent legislation modified the assumption as to useful life,
by permitting the taxpayers to recompute their amortization charges on
such facilities retroactively in such a way that the cost of the facilities would
Noncorporate real estate industry
a)J be charged off by September 30, 1945. Estimates of additional amortization charges are based upon Internal Revenue Service tabulations of tax
In addition to the farm property component mentioned above, the item
refunds resulting from the retroactive recomputation of amortization charges.
of noncorporate real estate depreciation shown in Exhibit 1 covers nonfarm
Pending the availability of tax return data for the latest two years, prereal estate owned by persons and nonfarm property of unincorporated real
liminary estimates of corporate depreciation are prepared by using data
estate firms. The first of these estimates is described in the section on Rental
from various other sources as extrapolators. The main sources are the Federal
income of persons. The second is benchmarked on depreciation reported to
Trade Commission—Securities and Exchange Commission figures for deprethe Internal Revenue Service for 1945 by partnerships and sole proprietorciation and depletion combined reported in the Quarterly Financial Report for
ships classified in the real estate industry. This benchmark is extrapolated by
manufacturing corporations; combined depreciation and depletion totals
depreciation on personal holdings of tenant occupied property.
for large corporations in selected industries, compiled by the Federal Reserve
Board from financial returns and used generally for nonmanufacturing other
than public utilities and banks; Interstate Commerce Commission figures
Institutional depreciation
on depreciation charges for class I railroads, interstate motor carriers, and
oil pipeline companies; and similar compilations by the Federal CommunicaThe minor item of institutional depreciation charges relates to nonprofit
tions Commission, the Federal Power Commission, the Civil Aeronautics
organizations furnishing services primarily to individuals—nonprofit hosBoard, and the Federal Deposit Insurance Corporation for the industries
pitals, nonprofit schools, religious organizations, and a variety of other orreporting to these agencies.
ganizations such as social and welfare agencies, fraternal societies, charitable
organizations, labor unions, foundations and funds, civic leagues, and social
and athletic clubs. The total is derived by summing component estimates,
Noncorporate nonfarm business, except real estate
and is included in the amounts shown in Part V of this report under the
heading of depreciation allowances by private business.
industry
The largest components are for nonprofit hospitals, nonprofit schools, and
Estimates of noncorporate depreciation in industries other than farming
religious organizations. In each of these cases, depreciation rates are applied
and real estate are prepared separately for forestry and fisheries, mining,
to estimates of the value of depreciable property. The depreciation rates for
contract construction, manufacturing, wholesale trade, retail trade, finance
hospital buildings and equipment were estimates for the Committee on the
and insurance, transportation, communications and public utilities, and
Costs of Medical Care. (C. R. Rorem, The Public Investment in Hospitals, Uniservices. Depreciation reported in Internal Revenue Service tabulations of
versity of Chicago Press, 1930). That for buildings was applied also to the
sole proprietorships and partnerships for 1945 was raised to include depreciavalue of educational buildings, and the hospital building and equipment detion charges of firms not reporting to the Internal Revenue Service, on the
preciation rates were modified downward for application to religious buildbasis of the relationship of the gross receipts of reporting firms to total gross
ings and educational institution equipment, respectively. The value estimates
receipts, for industries for which estimates of total gross receipts were availwere based, for hospital buildings and equipment, on data from the Comable. (See the section on the Income of unincorporated enterprise.) Estimates
mittee on the Costs of Medical Care for 1929, the 1935 Census of Hospitals,
for other years were derived by multiplying gross receipts (or income originatand American Hospital Association figures relating to 1944, 1946, 1950—52;
ing) by ratios of depreciation to gross receipts (or income originating). For
for buildings and equipment of educational institutions, on reports compiled
1939 and 1947 these ratios were obtained by extrapolating the 1945 ratio by
in the Biennial Survey of Education; and for religious edifices, on the 1926
corresponding ratios for partnerships, based on Internal Revenue Service
and 1936 Censuses of Religious Bodies, extrapolated by cumulatively adding
tabulations of partnership returns for 1939, 1945, and 1947. For other years
annual estimates of new religious construction and deducting estimated dethey were obtained by interpolating and extrapolating the 1939, 1945, and
preciation charges. Va'ues for each group for the other years were obtained
1947 ratios for sole proprietorships and partnerships by corresponding ratios
by straight-line interpolation and extrapolation.
for corporations.
Estimates for the other types of nonprofit institutions were generally based
In the absence of information on depreciation for nonprofit organizations
on informational returns filed for 1943 with the Internal Revenue Service.
serving business, depreciation was assumed to bear the same relationship to
These returns indicated the nonprofit organizations' gross receipts from
operating receipts for these organizations as for partnerships or corporations
business, which were multiplied by the ratios of depreciation charges to gross
in industries carrying on similar operations. Total operating receipts of nonreceipts reported by partnerships in industries carrying on similar operations.
profit organizations serving business were estimated chiefly from informaIn general, the resulting totals were extrapolated by the combined estimates
tional returns filed by such organizations with the Internal Revenue Service
of depreciation described in the preceding paragraph.
in 1943. The coverage of this source is known to have been incomplete in
some categories; the amounts involved are generally small, however, and
data for expanding them are generally not available. Extrapolation of the
benchmark depreciation estimates have generally been accomplished for
Capital Outlays Charged to Current Expense
each industry or group of industries by use of the noncorporate depreciation
series for that industry or group.
Business purchases of certain types of capital goods, instead of being amortized through depreciation allowances in the purchasers' books, are cusThe estimates for mutual savings banks and savings and loan associations
tomarily charged off as current expense. The estimated amounts of such
represent minor exceptions to the general procedure just outlined. In these
purchases are included in capital consumption in lieu of an allowance for
cases, annual compilations from financial reports to Government regulatory
depreciation on these types of capital equipment. This treatment is
agencies provide asset values and indicate the applicable depreciation ratesconsistent with the inclusion in the gross private domestic investment component of gross national product of producers' durable equipment imspecFarms
tive of the manner of accounting for its purchase.
The estimates of capital outlays charged to current expense are prepared
The estimates of depreciation on all farm property are prepared by the
in two sections: drilling and development costs of oil and gas wells, which
Agricultural Economics Division, by methods outlined in the discussion
are included in the new construction component of gross private domestic
of Income of unincorporated enterprises. Exhibit 1 shows under this heading

152

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS

investment; and purchases of producers' durable goods charged to current
account, of which hand tools are an important example.

0/7 and gas well drilling
It is believed that, except for the cost of casings, expenditures for oil and
gas well drilling are charged to current expense for tax purposes by almost
all companies. These expenditures are described in the section on New
construction.

Producers' durable equipment
Business accounting practice with respect to charges for tools and similar
items of small unit cost varies from item to item and from firm to firm.
Data on the actual distribution of charges between current and capital account are not available. It may be supposed, however, that most firms charge
most such items to current account. The estimates should be considered
merely as rough approximations.
Exhibit 2.—Producers' Durable Equipment Charged to Current Expense, by
Major Commodity Group, at Purchasers' Values, 1950
Major group ol producers' durable equipment

Total
Cutlery and hand tools
Other fabricated metal products
Metalworking machinery
Miscellaneous

Total value Valueofproductscha?-ged
of products
to current expense
Millions
of dollars
2, 430
375
463
875
717

Millions
Percent, of
of dollars group total
938
375
100
151
33
129
15
283
39

In general, the estimating procedure has been to select from the detailed
commodity groups given in the Census of Manufactures those producers'
durable goods which appear likely, from a general knowledge of accepted
accounting practice, to be charged to current expense. The value of manufacturers' shipments of such items was first obtained for all years for which
this information is available. In general, shipments were converted into estimates of the value of producers' purchases by multiplying them by the ratio
of the value of purchases to shipments applicable to the capitalized portion
of producers' durable equipment in the same major product group. (See section on Producers' durable equipment.) Estimates for years for which shipment data were not available were made by interpolating and extrapolating
by the value of the capitalized portion of producers' purchases in the same
major product group. For cutlery and hand tools the detailed commodity
flow procedure was used. Estimates for this group for years prior to World
War II for which shipment data were not available were interpolated by
relevant payroll data; subsequent interpolations were made on the basis of
sales by retail hardware stores.
Exhibit 2 shows the estimates of producers' durable equipment charged
»o current expense for 1950.

Accidental Damage to Fixed Capital
The estimates of accidental damage represent the value of fixed capital of
private business lost annually due to fire, natural events, and other accidents

not provided for by depreciation allowances. The coverage of this series
corresponds generally to that of gross private domestic investment, particularly in its exclusion of public works and government and consumer
durables. Since the investment series is net of loss due to accidental damage
to inventories and also excludes repair work, inventory losses and reparable
damage are excluded from the estimates of accidental damage.
Losses by fire account for about 6o percent of the total. The estimates are
based chiefly on loss reports to insurance companies tabulated by the National Board of Fire Underwriters and the National Fire Protection Associaion, with an addition for losses not covered by insurance. Forest fire losses
are estimated from damage reports filed by State Foresters and local representatives of the United States Forest Service.
The value of business motor vehicles destroyed by accident is estimated
mainly from State and city police reports compiled by the National Safety
Council; the value of ship losses, from mandatory reports by marine carriers
to the United States Coast Guard and the United States Maritime Administration; and losses (excluding crop losses) from tornadoes, windstorms, and
floods, from damage investigation reports by field offices of the Weather
Bureau. Accident investigation reports to the Interstate Commerce Commission and to the Civil Aeronautics Administration and the Civil Aeronautics Board have been used in estimating the value of damage to railway
equipment and the value of business aircraft destroyed.
In most of these cases, the accuracy of the estimates is impaired by the
necessity either of adjusting reported values to exclude reparable or nonbusiness losses or of multiplying reported physical unit losses by value averages
from other sources to obtain the final aggregates.

Characteristics of Revisions
Estimates of corporate depreciation are based on interim data for the two
most recent years, and have been subject to substantial revisions as corporate
income tax tabulations became available. Revisions in some of the nonfarm
business components of noncorporate depreciation have been even larger,
percentagewise, reflecting heavier reliance upon extrapolation procedures
as well as a lack of appropriate extrapolating series. Revisions in farm depreciation were also substantial in some years.
In the present edition of the National Income supplement significant longterm revisions were made in noncorporate depreciation and in capital outlays
charged to current expense. Depreciation on noncorporate nonfarm property
except real estate was raised. This revision reflects mainly an adjustment of
the entire time series to the 1945 Statistics of Income benchmark described
earlier. The allocation of depreciation between farms and real estate was
reviewed and a larger share assigned to farms on the basis of revised estimates
of the ownership of farm equipment on farms owned by landlords classified
in the real estate industry. Depreciation for the real estate industry was reduced, in addition, as a result of the new estimating methods described in
the section on the Rental income of persons. A downward revision was made
in the estimates of producers' durable equipment charged to current expense.
Much of it was due to the reclassification as intermediate products of items
formerly regarded as producers' durable equipment charged to current
expense, on the basis of product detail shown in the 1947 Census of Manufactures. These items were correspondingly excluded from purchases of
producers' durable equipment.

PART IV

Gross National Product in
Constant Dollars, 1929-53
In times of changing prices many uses of national product
statistics require the separation of the price and volume factors
underlying the current dollar estimates. For some purposes, the
current dollar data cease to be relevant, as in studies of real output
and of productivity. For others, they need to be supplemented by
constant dollar data, as in analyses of inflationary and deflationary processes.
This part of the report describes the annual estimates of gross
national product in constant dollars for the period 1929—53,
together with the implicit price deflators obtained by dividing the
current dollar by the constant dollar estimates. (See tables 40 and
41, Part V.) These estimates—apart from the fact that they are
geared to the revisions of the current dollar data—differ from the
previously published ones chiefly because they express gross
national product in terms of prices of the year 1947 instead of
1939. In addition, the estimates incorporate new price data—
mainly information that has become available in connection
with the revisions of the Bureau of Labor Statistics Wholesale and
Consumer Price Indexes. Moreover, the results of the postwar
industrial censuses have been taken into account in determining
weights for combining price indexes, as explained below.
Opportunity was also taken to make other improvements in
methodology.

Characteristics of Constant-Dollar
National Product
The constant dollar data have the same scope as the currentdollar gross national product described in earlier parts of this
report. Moreover, the two magnitudes are closely related in
statistical estimation. In general, the constant dollar series are
derived by dividing the current dollar estimates, in as fine a
product breakdown as possible, by appropriate price indexes
based on 1947 as 100, in order to eliminate from the current dollar
estimates all price change as compared with 1947. The statistical
sources and methods used in this price deflation procedure are
explained below. Certain major features of the deflated dollar
data will be summarized first. In this connection reference will

be made to the general characteristics of volume series based
upon the direct measurement of physical units, with which the
deflated gross national product is likely to be compared.

Comprehensive measure of real output
The constant-dollar gross national product is a comprehensive
measure of the real volume of national production, including not
only the manufacturing industries, but also the extractive industries, construction, distribution, services, and government. Although estimates of production—usually based on direct volume
measurement—are available for a large number of industries,
gaps in our information about others have made it impossible so
far to build up a production measure for the economy as a whole
via such individual industry calculations. The constant-dollar
gross national product fills the demand for such a measure. However, given the present statistical sources, only a very limited
breakdown of the constant-dollar gross national product by sectors of production is possible. In more detailed types of analysis
this series will have to be supplemented by the individual industry
measures now available.

Output measure free of duplication
A significant characteristic of the measurement of production
in the gross product framework is that—in conformity with the
definition of gross national product—the implied measure of
output for each industry of the business sector is the output of
that industry less its purchases of intermediate products. In
most other measurements of production by industries, no such
deduction for intermediate purchases is made. Output totals
obtained by aggregating such industry measures will tend to
overstate increases of output (and understate decreases) to the
extent that the ratio of intermediate products to the total increases, and understate increases of output (and overstate decreases) to the extent that the ratio of intermediate products
declines. The gross product measurement of real output is free
from this imperfection.
153

154

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS

Partial measurement of quality improvements
In common with all other measures of the volume of production, constant-dollar gross national product cannot take full
account of changes in the quality of products (as distinct from
shifts among products of different quality; see below). The
price indexes by the use of which constant-dollar gross national
pnduct is derived from the current dollar figures are sometimes
adjusted to take account of quality and related changes in the
products whose prices they measure. But quality change cannot, in general, be reduced to quantitative terms. In practice,
the price indexes and the constant-dollar gross national product
do not reflect part of the secular quality improvement and of
the emergence of superior products—factors which are characteristic of our economy.

Short-run fluctuations in output overstated
Another point relevant to the interpretation of the measures
here presented is that they overstate somewhat short-run fluctuations in output, because available price information understates
effective short-run fluctuations in prices. The major factors in
this connection are an incomplete accounting of short-run
changes in premiums, discounts, and bargain sales. It may be
noted that direct measurement of volumes is not subject to this
imperfection.
Incomplete reflection of quality change may also be a factor
working in the same direction, for instance, during extreme
sellers' markets associated with short supplies and inflationary
demands. This shortcoming is common to both deflation and
direct volume measurements.

Output valued at constant market prices
In conformity with the definition of current-dollar gross national product, output is expressed at constant market prices.
The alternative of expressing output at constant factor prices
(that is, at market prices less indirect business taxes plus subsidies)
was not used.
In regard to the practical reasons for this choice, the quantitative difference in movement between the two measures of
output, arising only from the difference in weights attached to
the individual products, would be negligible inasmuch as indirect business taxes and subsidies are not of sufficient importance
in the United States price structure to give rise to a significant
difference in the results. The market price concept afforded a
simpler and more accurate basis of statistical measurement,
particularly in view of the degree of detail in which the results
were desired. Available information with respect to individual
goods and services refers to market prices, and the detailed
allocation of indirect taxes and subsidies that would be necessary
to arrive at their factor prices is a complex statistical problem
that cannot be solved accurately.

Quality and industrial shifts reflected in output
The consistent valuation of output at constant prices by deflation procedures yields a series having two important characteristics.

If a shift occurs from a product of lower quality to a product of
higher quality—relative quality being measured by relative
price—the constant-dollar gross national product will register an
increase. This is so because current values will have increased
and there is no change in the prices which are used to deflate them.
An opposite quality shift will have the opposite effect. In ordinary market conditions, this would seem to be a proper way of
measuring real production.
Direct measures of physical volume should behave similarly, in
principle. But in practice they do so only to the extent that separate volume series are maintained for products of different
qualities and that these separate volume series are given differential weights in proportion to their relative values in the base
period. The allowance that can be made for quality differentials
in direct volume measurement is usually quite limited.
Another consequence of the systematic valuation of each
component of gross national product at constant prices is that
shifts of workers from industries in which gross product per unit of
labor input is relatively low (high) to industries in which it is
higher (lower) will lead to an increase (decrease) in the overall
measure of production even if no increase (decrease) in productivity occurs within the individual industries. This characteristic
of constant-dollar gross national product should particularly be
kept in mind in studies of productivity. Some measures of productivity are constructed to exclude the effects of such industry
shifts in order to isolate the effects of technical changes as distinct
from economic factors.

Choice of 1947 market prices
Market prices of the year 1947 were used to value output. The
choice of a particular set of prices as a basis of valuation is a matter
of concern only to the extent that it influences the relative importance of the components of gross national product and the relative
movements of the aggregates. Unless the various physical quantities or their relative prices all change in the same proportion, the
use of prices of different years as the basis of valuation will result
in different percentage movements of the composite series, and no
unique measure of the change in real output is possible.
While theoretical considerations indicate that under these
circumstances comprehensive output comparisons call for calculations in terms of the prices of each year to which the comparisons
refer, the vast additional labor involved in constructing the full
array of output series did not seem warranted. Various tests indicated that choice of market prices prevailing in other years as the
basis of valuation would not, in general, have greatly affected the
relative movements and proportions of gross national product and
its major components. (Government purchases are a significant
exception to this statement, as will be noted later.)
However, these tests also suggested that the choice of recent
year prices tends to reduce somewhat the indicated long-term
growth in gross national product. The reason for this is that the
products whose output expands most tend to be the ones that
decline in relative price. Hence, they receive a smaller weight in
the total if recent year market prices are used to value output.
The reason for adopting a valuation of gross national product
in terms of postwar prices was that they reflect current economic
conditions more closely than prewar prices and that consequently

NATIONAL INCOME, 195 4 EDITION

estimates based on them are more useful for many practical purposes. The particular year 1947 was a convenient choice, because
it is the most recent year for which detailed census information on
expenditures, necessary to construct composite price indexes, was
available.
It should be emphasized, however, that to the very considerable
extent that the relative movements and composition of the constant-dollar gross national product series are unaffected by the
choice of the particular set of constant prices in which they are
expressed, that choice is really a matter of indifference. For it is
only relative magnitudes that matter. The absolute dollar values
have no significance in themselves.

Statistical Sources and Methods
As already stated, the general statistical procedure for obtaining
constant-dollar gross national product is to divide the current
dollar estimates, in as fine a product detail as possible, by appropriate price indexes based on 1947 as 100, in order to eliminate
from the current dollar estimates all price change as compared
with 1947.
In most cases the information on prices is available in greater
detail than the annual current dollar estimates. For instance,
personal consumption expenditures for shoes and other footwear
cannot be further broken down for all years in the current dollar
estimates; but price indexes are available separately for an extensive list of footwear items. In situations such as these, the full
information on prices is utilized by combining the various indexes
into composites and by dividing the current dollar series by them.
The weights given to the various indexes were based upon their
relative importance in terms of expenditures for the products
which they represented, as approximated on the basis of detailed
information contained in industrial censuses. In principle, weights
based on 1939 census information were used for 1939 and earlier
years, and weights based on 1947 and 1948 census information
for 1947 and later years. Weights for intervening years were obtained by straight-line interpolation. Simpler methods (constant
weights for the entire period, for instance) were adopted, however, whenever inspection of the price and expenditure data indicated that such short-cuts would not impair the results.
It will be noted that from the standpoint of deriving data in
terms of 1947 prices neither fixed weights nor weights obtained
by interpolation are strictly appropriate. Ideally, shifting weights,
reflecting the actual expenditure patterns of the years for which
current values are to be expressed in terms of 1947 prices, should
be used. However, as has just been noted, this detail on current
dollar expenditure patterns is lacking. The constant dollar estimates for the various components that were deflated by composite
price indexes will be in error to the extent that price movements
of the items comprising these components are disparate and current quantity expenditure patterns depart from the one used for
weighting the individual price series.
Conclusive tests of the magnitude of the error cannot be made.
They would require exactly the type of information for lack of
which the statistical procedure being judged was adopted. How291692°—54
11

155

ever, the error is likely, in general, to be negligible. This is suggested, in the first place, by the fact that there were relatively
few important instances in which price indexes combined on the
basis of 1939 census information differed significantly in movement from those combined on the basis of 1947-48 census information. A similar conclusion was suggested also by certain additional tests.
These tests were applied to series for which in all years the
product detail of the current dollar estimates matched that of
the price indexes. Deflated estimates derived by the correct
procedure—in which separately deflated components are combined without committing a weighting error—were compared
with estimates obtained by deflating the sum of the components
by composite price indexes based on fixed weights.
Such comparisons showed that differences were small even
when the fixed weighting procedure was applied to fairly broad
segments, and that they tended to become even smaller as the segment was narrowed. If this tendency carries through to the still
narrower segments for which there is actual resort to price indexes
with fixed weights, the resulting error must be unimportant.
In the following sections the major statistical sources and
methods used in deriving the constant dollar components of gross
national product are outlined.

Personal consumption
The general procedure for deriving constant-dollar personal
consumption expenditures for goods and services was to divide
the current dollar estimates, in a detail considerably finer than
that of the published annual estimates, by price series that are
components of the Consumer Price Index of the Bureau of Labor
Statistics and of the series on Prices Paid by Farmers of the Agricultural Marketing Service, U. S. Department of Agriculture.
These two sets of prices were combined to give representation
to prices paid by both urban and rural purchasers. It should be
noted, however, that the prices reflected in the Bureau of Labor
Statistics Consumer Price Index are those paid by moderate income families in large cities. Prices paid by other urban groups—
families living in small cities and in towns, and families in low
and in high income brackets, for instance—are not included.
Any differences in movement between these prices and those
covered by the indexes lead to error in the deflation of the current
dollar estimates of personal consumption by means of the indexes.
To the extent, however, that differences in cost of living changes
for various groups are due merely to different consumption
patterns—while the prices of similar goods and services are the
same—no errors, of course, are introduced.
For the years 1942-47 an adjustment was made to the published
price indexes for the fact that they did not take account of the
full price increase that took place during and immediately after
World War II. The basic study in which the techniques for
making these adjustments were first developed is the "Report of
the Technical Committee Appointed by the Chairman of the
President's Committee on the Cost of Living, June 15, 1944".
For the types of commodities and services for which Bureau of
Labor Statistics and Agricultural Marketing Service retail price
series are not available, a wide variety of sources was used.

156

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS

These included special retail price indexes computed by other
agencies; price indexes constructed by utilizing published price
data, such as mail-order catalogues, or by adjusting information
on costs to a price basis by allowing for changes in profit margins;
Bureau of Labor Statistics wholesale price information; and
physical volume data, in instances in which this direct approach
was superior to the price deflation approach.

Investment
The deflated series on private new construction represents
largely the constant dollar estimates of construction prepared
by the Building Materials and Construction Division of the
Department of Commerce. These estimates—a regularly published series—are obtained by dividing the components of the
current dollar estimates of new construction by a detailed list
of construction cost indexes, prepared by private and other
government agencies. These indexes are derived, in general, by
pricing fixed lists of construction materials and labor.
Since the current dollar estimates of new construction are in
terms of selling prices, their deflation by means of these indexes
is not strictly appropriate. Their movement will vary from that
of selling prices if there are changes in productivity and in
profit margins.
It was not found possible to make an adjustment for productivity changes. However, a rough adjustment for changing
profit margins was introduced. There is strong evidence that
in the construction industry changes in profit margins and in
productivity are inversely correlated during the business cycle.
Hence the errors due to the neglect of profit margins and of
productivity are additive, and adjustment for only one of these
factors will make the indexes a closer approximation of changes
in selling prices.
Bureau of Labor Statistics wholesale price indexes and Interstate Commerce Commission price indexes were the major data
used for deflating producers' purchases of durable equipment, in
a product detail which went somewhat beyond that in which the
current dollar estimates are published for the years 1929-52.
Further breakdowns were estimated, for deflation purposes, in
instances in which there were indications that the alternative
procedure of dividing broader current dollar components by
fixed-weighted composite price indexes might yield significantly
erroneous results.
Whenever composite price indexes were used, the weights for
combining their components were as far as possible based on
product values derived mainly from the Census of Manufactures,
in a manner which has already been explained. For price series
used for products for which values were not enumerated separately
in the censuses, and for composite price indexes that could not
be broken down further, the weights underlying the Bureau of
Labor Statistics and Interstate Commerce Commission composites were accepted. The information from these two agencies was
supplemented by price indexes compiled by other agencies or
constructed from mail-order catalogues and other published
sources of price data.

The deflated estimates of net change in nonfarm business inventories were derived in the process of estimating the inventory
component of the current-dollar gross national product series.
This process consisted of converting year-end book values of
inventories into a series expressed in constant dollars; taking the
difference of these results; and multiplying the increments by the
ratio of current prices to base year prices. The required constant
dollar series was available directly from the second step.
Bureau of Labor Statistics wholesale price indexes were the
principal source of price information used for deflation of the book
value inventory data. In general, the inventories of each industry
listed in the annual industrial breakdown of the national income
were deflated separately. Total inventories for each industry were
deflated by composites of price indexes appropriate to the industry. The indexes were weighted, as far as possible, by the relative
importance of the principal types of inventory goods represented
by the indexes. The inventory data used for weights were derived
mainly from the 1939 and 1947-48 industrial censuses. With a
few exceptions, the composite price indexes based on the two sets
of weights were closely similar, so that no particular problem was
encountered in constructing consistent composite price indexes
covering the entire period. In instances in which relative inventory weights could not be ascertained, weights (based on sales)
used by the Bureau of Labor Statistics in constructing the wholesale price index were employed.
Year-end book values of inventories reflect the prices prevailing
at various points of time. The exact time pattern reflected depends
on the methods of inventory accounting used and on the rate of
turnover of goods. Accordingly, the price indexes had to be appropriately lagged before being used to deflate the year-end book
value of inventories. These lags were estimated on the basis of
available sample information on the methods of inventory
accounting in the various industries and of turnover ratios computed from Census and Internal Revenue Service information for
1939 and 1947-48. (For a more detailed discussion of some of the
aspects of inventory deflation, see Part III, section on Change in
business inventories.)
In estimating the net change in farm inventories, quantity data
furnished by the Agricultural Marketing Service on year-end
stocks of crops and livestock were utilized. (See Part III, notes on
Income of unincorporated enterprises.) The net changes in these
physical stocks were valued at prices prevailing at the end of 1947.
The net foreign investment component of gross national product
was deflated by separately adjusting for price change the receipts
and payments items in the current balance of payments, whose
difference net foreign investment represents. The alternative
procedure of deflating the net balance directly was not used.
The deflators for merchandise exports and imports are the
indexes of unit value prepared by the Bureau of Foreign Commerce of the Department of Commerce. The weighting procedures
used in deriving these indexes are not strictly appropriate for
purposes of expressing merchandise exports and imports in terms
of 1947 dollars, but tests indicated that theoretically superior
weighting procedures would not yield significantly different
overall results.

NATIONAL INCOME, 195 4 EDITION

Statistical information for deflating the remaining items in the
current balance of payments is deficient. Moreover, problems that
do not even admit of a clear-cut theoretical solution are involved.

Government purchases
The deflation of government purchases of goods and services
was particularly difficult because information on the product
breakdown of government purchases, as well as on the prices paid
by government, is deficient. The task of deflating government
purchases for World War II was further complicated by the fact
that munitions of changing types and quality were acquired by
the Federal Government in large amounts.
For purposes of deflation the current dollar breakdown of
Federal Government purchases as published on an annual basis
was supplemented by further detail in each of the categories
listed—compensation of employees, net purchases from business,
and net purchases from abroad. Compensation of employees was
divided into military (officers and enlisted men separately),
civilian except work relief, and work relief compensation. Construction was subdivided in the considerable detail in which the
Building Materials and Construction Division estimates are
available.
Other purchases from business were divided further by segregating net purchases of silver; the net change in the inventories
of government enterprises; munitions expenditures, for years in
which their size was significant; and rough groupings of the
remaining purchases into the object classes used in the Federal
budget. Within each of these object classes a fixed pattern of
expenditures—the one prevailing in 1938—was assumed for
all years for want of better information. Net purchases from
abroad were also broken down further.
In general, the deflated Federal employee compensation items
are an extrapolation of the base year figures by man-hours
wherever possible and by employment when man-hours were
not available or appropriate, as for military service. It may be
noted that this series and the corresponding one for State and
local government measure the gross product originating in government, as shown in table 40.
Deflated estimates of Federal construction represent the
Building Materials and Construction Division data, with the
allowance for changing profit margins noted in the discussion
of private construction. The volume of silver purchases was
based on direct quantity data. The net change in the inventories
of Federal Government enterprises was estimated for the Commodity Credit Corporation from quantity data, which were
valued at 1947 prices, and for other enterprises by less satisfactory
procedures involving the deflation of book values by priceindex composites.
Munitions expenditures were deflated for the war years by a
special index of munitions prices based on series compiled by
the Defense Department. This index was extended backward, and
forward to 1950, on the basis of price series that seemed most
appropriate—selected mainly from those used for the deflation

157

of producers' purchases of durable equipment. For 1951-53,
price series based upon contract prices paid by the Defense
Department were used for munitions items for which such information was available.
This method of deflating munitions expenditures appears to
be the most satisfactory. Its severe limitations must, however,
be noted. The price information relating to munitions is deficient,
largely owing to the fact that there are insurmountable obstacles
to the compilation of adequate time series on prices (or quantities) in this area which is characterized by extreme product
change. Accordingly, the measurement of the phyiscal volume
of munitions must necessarily be less satisfactory than that of
other components of national product.
Moreover, munitions prices appear to have declined substantially relative to other prices, mainly during World War
II. Since munitions production moved very differently from
other output and accounted for a large proportion of total
output, the movement of total deflated gross national product
during World War II is materially affected by the choice of
the constant price base. The fact that relative rates of pay of
military officers and enlisted men have changed substantially
as compared with the prewar period also makes the movement
of deflated gross national product during the war depend significantly on the choice of the constant price base. This situation
with respect to World War II is in contrast to the finding noted
earlier that the choice of the constant price base has, in general,
little effect on the relative movement shown by measures of real
national output.
The remaining types of Federal purchases from business were
deflated by matching them with price series that appeared most
nearly representative—largely selected from Bureau of Labor
Statistics wholesale price data. The deflation of net purchases
from abroad is subject to limitations similar to those noted for
net foreign investment.
The general procedure for defla ting State and local government
purchases of goods and services was similar to that adopted for
Federal Government purchases. Changes in the employee compensation component of deflated purchases reflect the movement
of employment. Deflated construction represents Building Materials and Construction Division data, adjusted for changing profit
margins. An estimate available for 1947 of the distribution of
other purchases from business was applied in all years for lack of
further information; and the current breakdown so obtained was
deflated by price series that seemed most nearly applicable, selected
chiefly from Bureau of Labor Statistics wholesale price data.

Summary tables
Table 40, Part V, summarizes the results of the deflation
procedure which has been described. The "implicit price deflators" presented in table 41 are obtained by dividing the current
dollar expenditure estimates (as shown in table 2) by the corresponding constant dollar series shown in table 40.
In the price indexes so derived, price relatives receive shifting

158

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS

weights in proportion to expenditures incurred each year for the
goods and services which they represent. This is in contrast to the
more usual type of price index in which weights are based on
constant expenditure patterns.
The latter type of price index can be interpreted as tracing the
change in the total value of an identical list of physical goods and
services over the period of time specified. The implicit deflators
cannot be so interpreted. They trace the change in the value of
the physical goods and services of any given year as compared
with their value in the base year 1947. In comparisons not
involving 1947, the movement of the implicit deflators cannot be
taken as a pure measure of the price change because it is affected
by changes in product composition as well. A related point to be
noted is that it is not strictly correct to obtain constant dollar
series in prices of a year other than 1947 by use of deflators obtained by shifting the base of the deflators given in table 41. How-

ever, for many practical purposes both of these qualifications of
the implicit price deflators may be neglected.
The implicit deflators for the change in business inventories, for
total gross private domestic investment, and net foreign investment
are not shown. In the case of inventory change, the current dollar
totals often include components of opposite algebraic sign. In the
case of net foreign investment, such components are always
present, since it is the difference between current receipts and
payments in the balance of payments. Even small movements of
prices, provided that they affect the positive and negative components dissimilarly, may cause large changes in the ratios of the
current dollar to the constant dollar series, and disqualify these
ratios from serving as indicators of price movement. Since in some
years the change in business inventories constitutes a significant
part of total gross private domestic investment, the implicit price
deflator for this aggregate is subject to similar deficiencies.

PART V

Statistical Section:

Tables
NATIONAL INCOME AND PRODUCT ACCOUNTS
PAGE

PAGE

I. National Income and Product Account, 1953
II. Consolidated Business Income and Product Account, 1953
III. Personal Income and Expenditure Account, 1953

160
160
161

IV. Consolidated Government Receipts and Expenditures Account,
1953
V. Rest of the World Account, 1953
VI. Gross Saving and Investment Account, 1953

161
161
161

ANNUAL TABLES
PAGE

1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
13.
14.
15.
16.
17.
18.
19.
20.
21.

National Income by Distributive Shares, 1929-53
Gross National Product or Expenditure, 1929-53
Personal Income and Disposition of Income, 1929—53
Relation of Gross National Product, National Income, and Personal Income, 1929-53
Sources and Uses of Gross Saving, 1929-53
Securities and Exchange Commission Estimates of Personal Saving and Comparison with Department of Commerce Estimates
of Personal Saving, 1933-53
Consolidated Business Income and Product, 1929-53
Government Receipts, 1929-53
Government Expenditures, 1929-53
Social Insurance Funds, 1929-53
Transactions of the Rest of the World with the United States,
1929-53
National Income by Legal Form of Organization, 1929-53
National Income by Industrial Origin, 1929-53
Compensation of Employees, by Industry, 1929-53
Wages and Salaries, by Industry, 1929-53
Supplements to Wages and Salaries, by Industry Division,
1929-53
Income of Unincorporated Enterprises, by Industry Division,
1929-53
Corporate Income Before Federal and State Income and Excess
Profits Taxes, by Industry, 1929-53
Federal and State Corporate Income and Excess Profits Tax Liability, by Industry, 1929-53
Corporate Income After Federal and State Income and Excess
Profits Taxes, by Industry, 1929-53
Net Corporate Dividend Payments, by Industry, 1929-53

PAGE

162
162
164

22.
23.
24.
25.

164
164

26.

166
168
170
172
172
174
174
176
178
180
182
182
184
186
188
190

27.
28.
29.
30.
31.
32.
33.
34.
35.
36.
37.
38.
39.
40.
41.

Undistributed Corporate Income, by Industry, 1929-53
Inventory Valuation Adjustment, by Industry Division, 1929-53.
Net Interest, by Industry Division, 1929-53
Number of Full-Time Equivalent Employees, by Industry,
1929-53
Average Number of Full-Time and Part-Time Employees, by
Industry, 1929-53
Average Annual Earnings per Full-Time Employee, by Industry,
1929-53
Number of Persons Engaged in Production, by Industry, 1929—53.
Corporate Sales, by Industry, 1929-53
Personal Consumption Expenditures, by Type of Product,
1929-53
New Construction Activity, 1929-53
Private Purchases of Producers' Durable Equipment, 1929-52. . .
Net Change in Business Inventories, 1929-53
Supplements to Wages and Salaries, 1929-53
Personal Contributions for Social Insurance, 1929—53
Transfer Payments, 1929-53
Monetary and Imputed Interest, 1929-53
Reconciliation of Department of Commerce Estimates of Corporate Profits with Internal Revenue Service Tabulations,
1929-51
Major Items of Personal Income and Personal Consumption Expenditures in Kind, 1929-53
Gross National Product or Expenditure in Constant Dollars,
1929-53
Implicit Price Deflators for Gross National Product by Major
Segments, 1929-53

192
194
194
196
198
200
202
204
206
208
210
210
210
212
212
212
214
214
216
216

QUARTERLY AND MONTHLY TABLES
PAGE

42. National Income by Distributive Shares, Quarterly, 1939-53. . .
43. National Income by Distributive Shares, Seasonally Adjusted
Quarterly Totals at Annual Rates, 1939-53
44. Gross National Product or Expenditure, Quarterly, 1939-53. . . .
45. Gross National Product or Expenditure, Seasonally Adjusted
Quarterly Totals at Annual Rates, 1939-53
46. Disposition of Personal Income, Quarterly, 1939—53
47. Disposition of Personal Income, Seasonally Adjusted Quarterly
Totals at Annual Rates, 1939-53
48. Relation of Gross National Product, National Income, and Personal Income, Quarterly, 1939-53

218
220
222
224
226
228

PAGB

49. Relation of Gross National Product, National Income, and Personal Income, Seasonally Adjusted Quarterly Totals at Annual
Rates, 1939-53
50. Personal Consumption Expenditures by Major Type, Quarterly,
1939-53
51. Personal Consumption Expenditures by Major Type, Seasonally
Adjusted Quarterly Totals at Annual Rates, 1939-53
52. Personal Income, Seasonally Adjusted Monthly Totals at Annual
Rates, 1929-53
"

230
159

232
234
236
238

National Income and Product Accounts, 1953
Table I.—National Income and Product Account, 19S3

[Millions of dollars]
Compensation of employees:
Wage and salaries
Supplements

197, 980
11,081

Income of unincorporated enterprises and inventory valuation
adjustment
Rental income of persons

Personal consumption expenditures
Gross private domestic investment
Net foreign investment

38, 444

Government purchases of goods and services.

10, 596

230, 080
51, 408
— 1,866
85, 235

21, 144
9,365
8,921
-964

Net interest....

8,435

National income ' .

305, 002

Indirect business tax and nontax liability
Business transfer payments
Statistical discrepancy
Less: Subsidies minus current surplus of government enterprises..

30, 037
1,016
1,047
-529

Charges against net national product 2

337, 631

Capital consumption allowances

27, 226

CHARGES AGAINST GROSS NATIONAL PRODUCT K ...
1. Data for other years in table 1.

2. Data for other years in table 4.

364, 857

GROSS NATIONAL PRODUCT »

364,857

3. Data for other years in table 2.

Table II.—Consolidated Business Income and Product Account, 7953 *

[Millions of dollars]
Compensation of employees:
Wages and salaries:
Disbursements
Excess of accruals over disbursements.
Supplements:
Employer contributions for social insurance.
Other labor income

Consolidated net sales:
160,117
0
3,717
5,890

Income of unincorporated enterprises and inventory valuation
adjustment

consumers
government
business on capital account
abroad

Change in inventories

217, 075
50,311
49, 914
2,231
1, 494

38, 444

Rental income of persons

To
To
To
To

10, 596

Indirect business tax and nontax liability
Business transfer payments
Statistical discrepancy
Less: Subsidies minus current surplus of government enterprises. .
Charges against net product

Capital consumption allowances
CHARGES AGAINST BUSINESS GROSS PRODUCT.
1. Data for other yean in table 7.

160

21, 144
8,959
8, 180
— 964
5,087
261, 170
30, 037
1,016
1,047
-529
293, 799
27, 226
321, 025

BUSINESS GROSS PRODUCT

321, 025

Table Ml.—Personal Income and Expenditure Account, 1953
[Millions of dollars]
Personal consumption expenditures:
Purchases of direct services:
Compensation of employees:
Wages and salaries paid
7, 745
Supplements paid:
Employer contributions for social insurance
64
Other labor income
71
Interest paid
3, 015
Income originating in and net and gross product of households and
institutions '
10, 895
Net purchases from business 2
217, 075
3
Net purchases from abroad
2, 110
Personal tax and nontax payments *
35, 967
Personal saving *
20, 019

Wage and salary disbursements:
Business 2
160, 117
Government '
30, 174
Households and institutions '
7, 745
l
Rest of the world
20
Other labor income:
2
Business
5, 890
Government '
375
1
Households and institutions
71
Income of unincorporated enterprises and inventory valuation ad2
justment
38, 444
Rental income of persons 2
10, 596
4
Dividends
9, 365
Personal interest income 4
13, 475
5
Government transfer payments
12, 785
Business transfer payments 6
1, 016
6
Less: Personal contributions for social insurance
4, 007

PERSONAL OUTLAY AND SAVING *

PERSONAL I N C O M E *

286, 066

3. Data for other years in table 11.
4. Data for other years in table 3.

1. Data for other years in table 12.
2. Data for other years in table 7.

286, 066
5. Data for other years in table 36.
6. Data for other years in table 35.

Table IV.—Consolidated Government Receipts and Expenditures Account, 1953 '
[Millions of dollars]
Purchases of goods and services:
Purchases of direct services:
Compensation of employees:
Wages and salaries:
Disbursements 2
Excess of accruals over disbursements 2
Supplements:
Employer contributions for social insurance
Other labor income 2
Income originating and net and gross product
Net purchases from business
Net purchases from abroad
Transfer payments
Net interest paid
Subsidies minus current surplus of government enterprises

30, 174
— 76
2

GOVERNMENT EXPENDITURES

964
375
31, 437
50, 311
3, 487
12, 785
5, 040
— 529
102, 531

Personal tax and nontax receipts
Corporate profits tax accruals
Indirect business tax and nontax accruals
Contributions for social insurance:
Personal contributions 3
Employer contributions:
Business *
Government 2
Households and institutions 2
Deficit ( + ) or surplus (—) on income and product transactions 5 .

G O V E R N M E N T RECEIPTS AND D E F I C I T

2. Data for other years in table 12.
3. Data for other years in table 35.

1. Data for other years in tables 8 and 9
except where otherwise noted.

35, 967
21, 144
30, 037
4, 007
3, 717
964
64
6, 631

102, 531

4. Data for other years m table 7.
5. Data for other years in table 5.

Table V.—Rest of the World Account, 1953 "
[Millions of dollars]
Net payments of factor income to the United States:
Wages and salaries
Interest
Dividends
Branch profits.
Income originating and net and gross product
Net purchases from the United States:
From business
From government
From persons

2, 231
— 3, 487
— 2, 110

N E T C U R R E N T PAYMENTS T O T H E U N I T E D STATES.

-1,866

Net disinvestment in the United States

— 1, 866

NET DISINVESTMENT IN T H E U N I T E D STATES

—1,866

20
333
406
741
1, 500

1. Data for other years in table 11.

Table VI.—Gross Saving and Investment Account, 1953 1
[Millions of dollars]
Business purchases on capital account 2
Change in business inventories 2
Net disinvestment in the United States by rest of world

GROSS INVESTMENT
}. Data for other years in table 5 except as noted.

49, 914
1, 494
— 1, 866

49, 542
2. Data for other years in table 7.

Excess of wage accruals over disbursements (business)2
0
Excess of wage accruals over disbursements (government) 3
—76
2
Undistributed corporate profits (domestic)
8, 180
Corporate inventory valuation adjustment
—964
2
Capital consumption allowances by private business
27, 226
Government surplus ( + ) or deficit (—) on income and product
transactions
— 6, 631
Foreign branch profits (net) 4
741
Personal saving
20, 019
Statistical discrepancy
1, 047
GROSS SAVING AND STATISTICAL DISCREPANCY
3. Data for other years in table 12.

49, 542

4. Data for other years in table 11.

162

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS

Table 1.—National Income by Distributive Shares, 1929-38
[Millions of dollars]
Line

1929

1932

1933

1934

1935

1936

1937

1938

75,729

59,708

42,547

40,159

48,959

57,057

64,911

73,618

67,581

51,085

46,844

39,740

31,054

29,539

34,295

37,340

42,910

47,934

44,994

80,423
45,485
308
4,630

46,187
41,033
311
4,843

39,119
33,861
304
4,954

30, 477
25,511
292
4,674

28,997
23,855
267
4,875

33, 705
27, 629
268
5,808

46,107
38,614
354
7,139

42,976
34,752
365
7,859

657
106
551

621
111
510

577
126
451

542
133
409

590
147
443

36,690
30,189
303
6,198
650
171
479

41, 920
34,054
334
7,532

662
101
561

BOO
418
572

1,827
1,234
593

2,018
1,423
595

14,759

11,540

8,734

5,316

5,599

7,010

10,387

10,482

12,691

11,128

8,791

Wages and salaries
Private
Military
Government civilian i_.

1931

87,814

National income
Compensation of employees..

1930

7,410
6,655
755

5,581
4,970
611

3,384
3,089
295

3,166
3,691
-525
2,433

4,564
4,618
-54

5,351
5,401
-50

7,073
7,102
-29

6,793
6,572
221

2,446

5,036

6,530
6,680
-120
3,952

5,618

4,335

1,694

1,661

2,081

2,560

2,918
3,145
951
2,194
2,863
-669
-227

6,204

151
521
-370
2,056
- 2 , 425
-2,143

1,091
1,716
744
972
2,587
-1,615
-625

5,740
1,409
4,331
4,648
-217
-738

4,263
3,300
1,029
2,271
3,187
-916
963

5,042

4,869

4,751

4,741

Supplements to wages and salaries
Employer contributions for social insuranceOther labor income.
-_Income of unincorporated enterprises and inventory valuation adjustmentBusiness and professional
Income of unincorporated enterprisesInventory valuation adjustment
Farm

Rental income of persons

5,425

Corporate profits and inventory valuation adjustment.
Corporate profits before tax
Corporate profits tax liability.
Corporate profits after tax
Dividends
Undistributed profits
Inventory valuation adjustment
Net interest...

142
5,968

10,100
9,628
1,369
8, 259
5,813
2,446
472
6,445

4,130

3,183

1, 932

4,778

3,761

2,713

6,582

1,634

-1,970

3,322
842
2,480
5,490
-3,010
3,260
5,985

-780
498
— 1 , 278
4,088
-5,366
2,414
5,839

-3,017
385
-3,402
2, 565
- 5 , 967
1,047
5,434

1,971
-1,992

1,776
5,002

6,235
1,502
4,733
4,685
48
-31
4,708

4,636

1. Includes also the pay of employees of government enterprises and of permanent TJnited States residents employed in the United States by foreign governments and international
organizations.

Table 2.—Gross National Product or Expenditure, 1929-38
[Millions of dollars]
1929

Line
Gross national product
Personal consumption expendituresDurable goods
Nondurable goods..

Services

Gross private domestic investment..

1930

1931

1932

1933

1934

1935

1936

1937

1938

104,436

91,105

76,271

58,466

55,964

64,975

72,502

82,743

90,780

85,227

78,952

70,968

61,333

49,306

46,392

51,894

56,289

62,616

67,259

64,641

9,212
37,677
32,063

7,155
34,010
29,803

5,485
28,946
26,902

3,646
22,758
22,902

3,469
22,251
20, 672

4,213
26, 656
21,025

5, 111
29,319
21,859

6,304
32, 836
23, 476

6,925
35,185
25,149

5,686
33,985
24,970

16,231

10,265

5,523

913

1,391

2,888

6,277

8,404

11,747

6,661

New construction
Residential nonfarm.
Other

8,707
3,625
5,082

6,183
2,075
4,108

3,968
1,565
2,403

1,876
630
1,246

1,431
470
961

1,709
625
1,084

2,299
1,010
1,289

3,281
1,565
1,716

4,403
1,875
2,528

3,960
1,990
1,970

Producers' durable equipment..

5,850

4,465

Change in business inventories-.
Nonfarm
Farm

1,674
1,836
-163

-83
-300

771

690

Net foreign investment
Government purchases of goods and services..

8,482

2,839

1,593

1,589

2,304

3,066

4,169

5,095

3,644

-1,284
-1,608

- 2 , 556
- 2 , 590

- 1 , 629
-1,370

-1,125
195

912
376
536

954
2,066

2,249
1,726

-943
-1,046

324

-259

- 1 , 320

-1,112

523

103

1,311

1,410

1,344

7,171

150

429

-93

8,078

8,031

9,764

11,816

11,712

12,816

1,480
1,484

2,018
2,022

2,991
2,997

4,815
4,818

4,552
4,557

5,280

2,935

6,598

6,013

6,773

7,059

7,001

7,160

State and local.

169

9,218

1,432

197

1,109

1,537

9,182

Federal
National security
National defense
Other national security..
Other
Less: Government sales

7,772

2,931

1,549
12
7,681

1. Breakdown into "National defense" and "Other national security" not available.

-54

7,536

NATIONAL INCOME,

195 4

163

EDITION

Table 1.—National Income by Distributive Shares, 1939-53
[Millions of dollars]
Line

1942

1943

1944

1945

1946

1947

1948

1949

1950

1951

1952

1953

104,710

137,694

170,310

182,639

181,248

179,577

197,168

221,641

216,193

239,956

277,041

290,959

305,002

64,789

85,271

109,587

121,286

123,181

117,697

128,757

140,927

140,858

154,325

180,420

195,423

209,061

49,818
41,395
563
7,860

62,086
51,894
1,866
8,326

82,109
66,123
6,168
9,818

105,828
79,197
14,133
12,498

116,823
83, 843
20,033
12,947

117, 577
82,664
21,819
13,094

111,836
91,241
7,818
12,777

122,858
105,512
4,067
13,279

135,172
116,424
3,970
14,778

134,334
113,873
4,248
16, 213

146,526
124,297
4,999
17,230

170,881
142,050
8,684
20,147

185,039
152,222
10,465
22,352

197, 980
164,503
10,207
23,270

3
4
5
6

2,167
1,540
627

2,311
1,624
687

2,703
1,983
720

3,162
2,302
860

3,759
2,677
1,082

4,463
2,937
1,526

5,604
3,805
1,799

5,861
3,970
1,891

5,899
3,565
2,334

6,755
3,042
2,713

6,524
3,503
3,021

7,799
3,976
3,823

9,539
4,753
4,786

10,384
4,874
5,510

11,081
4,745
6,336

7
8
9

11,610

13,010

17,401

23,907

28,187

29,565

30,835

35,265

34,433

38,389

34,149

36,140

40,809

39,918

38,444

7,293
7,459
-166
4,317

8,442
8,487
-45
4,568

10,897
11,512
-615
6,504

13,899
14,266
-367
10,008

16,823
16,979
-156
11,364

18,040
18,109
-69
11,525

19,011
19,117
-106
11,824

21,321
23,026
- 1 , 705
13, 944

19,948
21,419
- 1 , 471
14,485

21,649
22,061
-412
16,740

21,431
20,963
468
12,718

22,855
23,989
-1,134
13,285

24,791
25,135
-344
16,018

25,727
25, 519
208
14,191

26,215
26,410
-195
12,229

11
12
13
14

1939

1940

72,753

81,634

48,108

52,129

45,941
37,742
388
7,811

1941

2,742

2,885

3,465

4,547

5,097

5,413

5,634

6,208

6,510

7,198

7,874

8,473

9,129

10,021

10,596

5,689

9,120

14,511

19,678

23,781

23,033

18,413

17,288

23,626

30,619

28,141

35,106

39,913

38,155

38,466

6,403
1,441
4,962
3,788
1,174
-714

9,320
2,834
6,486
4,043
2,443
-200

16,982
7,610
9,372
4,458
4,914
-2,471

20,882
11,415
9,467
4,289
5,178
-1,204

24, 554
14,074
10,480
4,484
5,996
-773

23,320
12,949
10,371
4,673
5,698
-287

18,977
10,689
8,288
4,691
3,597
-564

22, 551
9,111
13,440
5,784
7,656
-5,263

29,525
11,283
18,242
6,521
11,721
-5,899

32,769
12,510
20,259
7,248
13,011
-2,150

26,198
10,411
15,787
7,458
8,329
1,943

39,970
17,829
22,141
9,207
12, 934
-4,864

41,173
22,476
18,697
9,090
9,607
-1,260

37,174
19,965
17,209
9,128
8,081
981

39,430
21,144
18,286
9,365
8,921
-964

17
18
19
20

4,604

4,490

4,544

4,291

3,658

3,342

3,185

3,119

3,842

4,508

5,171

5,912

6,770

7,442

8,435

Table 2.—Gross National Product or Expenditure, 1939—53
[Millions of dollars]
1942

1943

1944

1945

1946

1947

1948

1949

1950

1951

1952

1953

125,822

159,133

192,513

211,393

213,558

209,246

232,228

257,325

257,301

285,067

328,232

346,095

364,857

81,875

89,748

100,541

109,833

121,699

146,617

164,973

177,609

180,598

194,026

208,342

218,424

230,080

7,771
37,215
26,895

9,659
43,208
29,008

6,968
51,324
31,456

6,605
59, 259
34,677

6,764
65,368
37,701

8,105
73,222
40,372

15,892
84,501
46,224

20,593
93,077
51,303

22,214
98,741
56,654

23,573
96,879
60,146

28,608
100,386
65,032

27,148
111,054
70,140

26,815
116,012
75, 597

29,749
118,925
81,406

3
4
5

9,309

13,155

18,072

9,875

5,600

7,130

10,430

27,125

29,705

41,176

32,549

51,219

56,864

50,655

51,408

4,757
2,680
2,077

5,452
2,985
2,467

6,629
3,510
3,119

3,721
1,715
2,006

2,326
885
1,441

2,712
815
1,897

3,833
1,100
2,733

10,291
4,015
6,276

14,029
6,310
7,719

17, 904
8,580
9,324

17,453
8,267
9,186

22,733
12,600
10,133

23,332
10,973
12,359

23,723
11,100
12,623

25, 536
11,930
13,606

7
8
9

4,180

5,831

6,942

4,343

4,027

5,438

7,654

10, 733

16,667

19,110

17,833

21.135

23,177

23,307

24,378

372
316
56

2,172
1,902
270

4,501
4,049
452

1,811
652
1,159

-753
-577
-176

-1,020
-575
-445

-1,057
-595
-462

6,101
6,350
-249

-991
1,298
-2,289

4,162
3,026
1,136

-2,737
-1,862
-875

7.351
6,428
923

10,355
8,951
1,404

3,625
2,971
654

1,494
2,169
-675

11
12
13

1939

1940

1941

91,095

100,618

67,578

71,881

6,670
35,131
25,777

Line
1

888

1,509

1,124

-207

-2,245

-2,099

-1,438

4,586

8,942

1,956

534

-2,201

227

-164

-1,866

13,320

14,073

24,751

59,717

88,617

96,529

82,867

30,918

28,608

36,584

43,620

42,023

62,799

77,180

85,235

5,157
'1,258

6,170
i 2,223

16,923
U3.794

52,027
l 49,567

81,223
80,384

89,006
188,615

74,796
•75,923

20, 934
•21,188

3,908
9

3,956
9

3,173
44

2,664
204

1,480
641

1,652
1,161

1,031
2,158

2,469
2,723

15, 776
13,349
12,254
1,095
3,751
1,324

21,019
15,984
11,578
4 406
5,570
535

25,445
19,288
13, 570
5,718
6,570
413

22,138
18,511
14,257
4,254
S, 882
255

40,995
37,260
33,864
3,396
4,154
419

53,951
48, 501
46,086
2,415
5,805
355

60,105
52,022
49,993
2 029
8,485
402

16
17
18
19
20
21

8,163

7,903

7,828

7,690

7,394

7,523

8,071

9,984

12,832

15,566

18,175

19,885

21,804

23,229

25,130

164

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS
Table 3.—Personal Income and Disposition of Income,

1929-38

[Millions of dollars]
1929

Less: Personal contributions for social insurance

1933

76,881

65,698

50,115

46,187
551
16,318

39,119
510
12,495

30, 477
451
8,029

5,813
7,428
1,496

Dividends
Personal interest income
Transfer payments

1932

60,423
561
20,184

Wage and salary disbursements
Other labor income
Proprietors' and rental income

1931

85,763

Personal income

1930

1934

1935

1936

1937

47,208

53,575

60,210

68,480

73,921

28,997
409
7,570

33, 705
443
8,704

479
12,048

41,920
572
12, 258

46,107
593
14,772

5,490
6,949
1,533

4,088
6,923
2,714

2,565
6,575
2,170

2,056
6,212
2,116

2,587
6,099
2,194

2,863
5,892
2,400

4,548
5,842
3,520

4,685
5,912
2,418

142

Less: Personal consumption expenditures

151

157

162

180

566

2,507
1,134
1,373

1,858
607
1,251

1,455
331
1,124

1,464
474
990

1,595
595
1,000

1,888
827

2,258
1,130
1,128

2,921
1,723
1,198

83,120

Equals: Disposable personal income

147

2,643
1,263
1,380

Less: Personal tax and nontax payments
Federal
_
State and local-.

74,374

63,840

48,660

45,744

51,980

66,222

71,000

62,616

67,259

3,606

3,741

78,952

61,333

49,306

46,392

51,894

4,168

Equals: Personal saving.__

70,968
3,406

2,507

-646

-648

1,061
58,322
56,289
2,033

Table 4.—Relation of Gross National Product, National Income, and Personal Income, 1929-38
[Millions of dollars]
1930

1931

1932

1933

1934

1935

1936

1937

104,436

91,105

76,271

58,466

55,964

64,975

72,502

82,743

90,780

8,617
7,698
413
506

8,541
7,737
389

8,166
7,552
351

7,615
7,038
329
248

7,161
6,661
275
225

7,112
6,598
237
277

7,235
6,665
236
334

7,496
6,700
381

7,746
6,910
304
532

68,105

50,851

48,803

57,863

65,267

-49

-45

283

403

7,155
534

6,859
649
840

6,768
737
754

7,055
659
948

7,815
641
731

8,190
594
-171

-977

59,708

42,547

40,159

48,959

57,057

1929
Gross national product

Less: Capital consumption allowances
*
.
Depreciation charges
Accidental damage to fixed capital
Capital outlays charged to current expense.

95,819

Equals: N e t national product

Plus: Subsidies minus current surplus of government enterprises

-147

Less: Indirect business tax and nontax liability
Business transfer payments

7,003
587

Statistical discrepancy

87,814

Equals: National income

2,446
1,369
472
243
0

Less: Undistributed corporate profits
Corporate profits tax liability
Corporate inventory valuation adjustment
Contributions for social insurance
Excess of wage accruals over disbursements
Plus: Net interest paid by government
Government transfer payments.
Business transfer payments

909
587
85,763

Equals: Personal income

415
82,564
-123

75,729
-3,010
842
3,260
253
0
964
999
534
76,881

39
8,663
594
1,118
64,911

83,034
60
9,157
567
-248
73,618

951
-227

-217
1,409
-738

1,230
1,553
641

1,141
1,806
594

1,101
2,926
594

48
1,502
-31
1,800
0
1,204
1,851
567

53,575

60,210

68,480

73,921

1934

1935

-5,366
498
2,414
262
0

-5,967
385
1,047
278
0

- 2 , 426
521
-2,143
285
0

-1,615
744
-625
304
0

1,084
2,065
649

1,141
1,433
737

1,170
1,457
659

65,698

50,115

47,208

Table 5.—Sources and Uses of Gross Saving, 1929-38

415
75,247

[Millions of dollars]
1929

1930

15,703

12,197

7,721

2,049

4,168
2,446
472
7,698

3,406
-3,010
3,260
7,737

2,507
-5,366
2,414
7,552

-646
-5,967
1,047
7,038

413
506
0

389
415
0

351
263
0

Government surplus on income and product transactions.

1,031

-265

Federal..
State and localGross investment..

1,159
-128

281
-546

17,002
16,231
771
268

Gross private saving.

Personal saving
Undistributed corporate profits
Corporate inventory valuation adjustmentBusiness depreciation charges
Accidental damage to fixed business capital .
Capital outlays charged to current expense. _
Excess of wage accruals over disbursements.

Gross private domestic investmentNet foreign investment
Statistical discrepancy.

1931

1932

1933

1937

4,958

8,372

10,147

11,504

-2,426
-2,143
6,661

-1,615
-625
6,598

2,033
-669
-227
6,665

3,606
-217
-738
6,700

3,741
48
-31
6,910

329
248
0

275
225
0

237
277
0

236
334
0

381
415
0

304
532
0

-2,841

-1,721

-1,351

-2,372

-1,978

-2,954

553

-2,136
-705

-1,480
-241

-1,316
-35

-2,853
481

-2,563
585

-3,477
523

-186
739

10,955

5,720

1,082

1,541

3,317

6,223

8,311

11,809

10,265

5,523
197

913
169

1,391
150

2,888
429

6,277
-54

8,404
-93

11,747
62

-977

840

754

948

731

-171

1,118

-248

1,944

1. In principle gross private saving plus government surplus on income and product transactions equals gross Investment. Because of estimating errors, it diflers from it by the amount
of the statistical discrepancy.

165

NATIONAL INCOME, 1 9 5 4 EDITION
Table 3.—Personal Income and Disposition of Income, 1939-53
[Millions of dollars]
1947

1951

1953

255,340

271,242

286,066

170,776
4,786
49,938

185,068
5,510
49,939

198,056
6,336
49,040

C
4

9,128
12,318
13,090

9,365
13,475
13,801

208,743

206,818

227,050

134, 379
3,021
42,023

146,526
3,823
44,613

7,458
9,768
12,403

9,207
10,628
15,147

9,090
11,592
12, 575

1942

1948

72,884

78,680

96,275

123,497

151,392

165,696

171,222

177,990

190,522

45,941
627
14, 352

49,818
687
15,895

62,086
720
20,866

82,109
860
28,454

105,619
1,082
33,284

117,016
1,526
34, 978

117,563
1,799
36,469

111,866
1,891
41,473

122,843
2,334
40,943

3,788
5,809
2,963

4,043
5,781
3,114

4,458
5,833
3,113

4,289
5,808
3,143

4,484
5,798
2,964

4,673
6,151
3,588

4,691
6,868
6,165

5,784
7,576
11,411

6,521
8,212
11,787

7,248
8,950
11,281

Line

1952

135,142
2,713
45,587

1911

1944

1946

1950

1940

1943

1945

1949

1939

•

596

658

801

1,166

1,839

2,236

2,333

2,011

2,118

2,178

2,234

2,894

3,417

3,811

4,007

2,440
1,235
1,205

2,604
1,364
1,240

3,293
2,016
1,277

5,981
4,668
1,313

17,845
16,517
1,328

18,935
17,536
1,399

20,867
19,379
1,488

18,808
17,162
1,646

21,506
19,650
1,856

21,142
18,997
2,145

18,661
16,194
2,467

20,920
18,179
2,741

29,271
26,278
2,993

34,373
31,143
3,230

35,967
32. 484
3,483

1
(
1
1

70,444

76,076

92,982

117,516

133,547

146,761

150,355

159,182

169,016

187,601

188,157

206,130

226,069

236,869

250,099

67,578

71,881

81,875

89,748

100,541

109,833

121,699

146,617

164,973

177,609

180,598

194,026

208,342

218,424

230,080

I
;

3,866

4,195

11,107

27,768

33,006

36,928

28,656

12,565

4,043

9,992

7,559

12,104

17,727

18,445

20,019

Table 4.—Relation of Gross National Product, National Income, and Personal Income, 1939-53
[Millions of dollars]
1939

1940

1941

1942

1943

1944

1945

1946

1947

1948

1949

1950

1951

1952

1953

Lln(

91,095

100,618

125,822

159,133

192,513

211,393

213,558

209,246

232,228

257,325

257,301

285,067

328,232

346,095

364,857

7,838
7,121
222
495

8,148
7,316
246
586

9,041
8,078
273
690

10,155
9,162
484
509

10,866
9,854
399
613

12,007
10,793
360
854

12,549
11,246
381
922

11,666
10,013
407
1,246

14,118
12,150
567
1,401

16,494
14,290
574
1,630

18,431
16,380
518
1,533

20,516
18,042
616
1,858

23,469
20,344
909
2,216

25,304
22,456
677
2,171

27,226
24,170
808
2,248

83,257

92,470

116,781

148,978

181,647

199,386

201,009

197,580

218,110

240,831

238,870

264,551

304,763

320,791

337,631

485

420

102

150

183

652

760

835

-227

-171

-181

204

187

-229

-529

9,365
451
1,173

10,021
431
804

11, 296
502
375

11,769
495
-830

12,735
505
- 1 , 720

14,127
506
2,766

15,522
532
4,467

17,349
557
932

18,658
674
1,383

20,390
739
-2,110

21,644
781
71

23,741
843
215

25,637
985
1,287

28,049
999
555

30,037
1,016
1,047

72,753

81,634

104,710

137,694

170,310

182,639

181,248

179,577

197,168

221,641

216,193

239,956

277,041

290,959

305,002

1,174
1,441
-714
2,136
0

2,443
2,834
-200
2,282
0

4,914
7,610
-2,471
2,784
0

5,178
11,415
-1,204
3,468
0

5,996
14,074
-773
4,516
209

5,698
12, 949
-287
5,173
-193

3,597
10,689
-564
6,138
14

7,656
9,111
- 5 , 263
5,981
-30

11,721
11,283
-5,899
5,683
15

13,011
12, 510
-2,150
5,220
30

8,329
10,411
1,943
5,737
-45

12,934
17,829
-4,864
6,870
0

9,607
22,476
-1,260
8,170
105

8,081
19,965
981
8,685
-29

8,921
21,144
-964
8,752
-76

1
1
1
1
1

1,205
2,512
451

1,291
2,683
431

1,289
2,611
502

1,517
2,648
495

2,140
2,459
505

2,809
3,082
506

3,683
5,633
532

4,457
10,854
557

4,370
11,113
674

4,442
10, 542
739

4,597
11,622
781

4,716
14,304
843

4,822
11,590
985

4,876
12,091
999

5,040
12, 785
1,016

1
1
1

72,884

78,680

96,275

123,497

151,392

165,696

171,222

177,990

190,522

208,743

206,818

227,050

255,340

271,242

286,066

1950

1951

1952

1953

Table 5.—Sources and Uses of Gross Saving, 1939-53

[Millions of dollars]
1939

1940

1941

1942

11,164

14,586

22,591

2,866
1,174
-714
7,121

4,195
2,443
-200
7,316

11,107
4,914
-2,471
8,078

27,768
5,178
-1,204
9,162

222
495
0

246
586
0

273
690
0

-2,140

-726

-2,234
94

-1,448
722

41,897

1943

1944

1945

1946

1947

1948

1949

Line

54,153

44,252

26,594

23,998

37,377

36,217

40,690

49,648

52,782

55,126

33,006
5,996
-773
9,854

36,928
5,698
-287
10,793

28,656
3,597
-564
11,246

12,565
7,656
-5,263
10,013

4,043
11,721
-5,899
12,150

9,992
13,011
-2,150
14,290

7,559
8,329
1,943
16,380

12, 104
12, 934
- 4 , 864
18,042

17,727
9,607
-1,260
20,344

18,445
8,081
981
22,456

20,019
8,921
-964
24,170

2
3
4
5

484
509
0

399
613
209

360
854
-193

381
922
14

407
1,246
-30

567
1,401
15

574
1,630
30

518
1,533
-45

616
1,858
0

909
2,216
105

677
2,171
-29

808
2,248
-76

6
7
8

-3,770

-31,399

-44,229

-51,888

-39,727

4,185

13,266

7,865

-3,205

8,113

6,156

-2,846

-6,631

-5,119
1,349

-33,198
1,799

-46,714
2,485

-54,577
2,689

-42,331
2,604

2,161
2,024

12,222
1,044

7,957
-92

-2,398
-807

9,229
-1,116

6,517
-361

-2,863
17

-6,831
200

10
11

49,304

10,197

14,664

19,196

9,668

3,355

5,031

8,992

31,711

38,647

43,132

33,083

49,018

57,091

50,491

49,542

9,309
888

13,155
1,509

18,072
1,124

9,875
-207

5,600
-2,245

7,130
-2,099

10,430
-1,438

27,125
4,586

29,705
8,942

41,176
1,956

32,549
534

51,219
-2,201

56,864
227

50,655
-164

51,408
-1,866

13
14

1,173

804

375

-830

-1,720

2,766

4,467

932

1,383

-2,110

215

1,287

555

1,047

166

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS

Table 6.—Securities and Exchange Commission Estimates of Personal Saving and Comparison with Department of Commerce Estimates of Personal Saving,
1933-39
[Billions of dollars]
1933

Line

1938

1937

1936

1935

1934

1939

-1.11

2.86

1.33

3.66

2.63

2.36

3.45

-1.28
.16
1.21
—2.65
-.58
.57
.07

1.80
—.10
.24
1.66
-.29
1.33
.42

.63

1.12
-.79
.09

.82

.55

.40
.04
.38
-.01
.00
1.64
—.22
.41
-.57
-.23
.17
—.64

3.00
.45
1.91
.64
.04
1.72
-.53
.66
-.60
-.23
-.36

3.63
.52
2.04
1.07
-.06
1.67
-.32
.28
.61
-.47
—.75
1 27

.43
.20
-.48
.71
—.11
1.76
1.10
.42
.74
-.06
—.01

-.67
.11
— 10

2.46
.23
1.03
1.20
-.20
1.55
—1.67
.13
—.54
-.12
-1.14

-.85

-1.91

-.87

-.20

.10

.13

.77

.09
.08
-.62

.19
.08
.65

.54
.09
-.13

1.27
.14
-.09

1.63
.19
.01

1.83
.22
.16

2.79
.22
.60

1
2
3

4
6
6
7
g
g
10

11
12

16
16
17

Personal saving in forms other than changes in equity in resl property and unincorporated enterprises l 3
Currency

. . __ . _ .

Time and savings deposits

Other U. S. Government *
Corporate and other

. -

-_.

-._

Increase in equity in nonfarm residences and in real property of nonprofit
institutions'

Less: Increase in mortgage debt to corporations and financial intercae-

1.64

1 63

1.63

1.70

1 71

1 76

1 74

-.62

1.64

1.38

1.92

1.04

-1.64

.28

-.50
.70
.31
-.32
.83

.01

.16

.48

.21

—.13
1.36
.12
1.79
.96

1.26
-.30
-.56
.90

1.68
-.27
—.44
.95

2.03
-.19
.42
.97

.07

-.58

.94
-.18
-1.38
.87
—2.18

-.19

—1 40

— 44

1.68
.18
.34
.95
— 46

28
27
28
29

-.26
.18
-.19
-.26

-1.32
.32
-.14
.47

.54
.51
-.08
.06

-1.11
.68
-.08
-.07

.52
.84
.03
-.08

.10
.68
.01
-.09

.06
.73
.00
-.13

-.26
.84

-.30
87

.19
91

-.04
1.00

.10
1 09

.20
1 12

.26
1 12

21
22
23
24

30
31
32

Depreciation 8

Net purchases of farms from corporations and financial institutions
Less: Increase in mortgage debt to corporations and financial intermeIncrease in other debt to corporations and financial intermediaries •'.-

Difference between lines (32) and (33)

- - - --

Statistical discrepancy in the national income and product accounts (from
table 4).

Alternative estimate of personal saving. Commerce (lines (33)+(35)) '•

Difference between lines (32) and (36)

1. SEC liquid saving less changes in government insurance and pension reserves and
Armed Forces leave bonds (both of which are ascribed to the government sector), and less
liquidation of mortgage debt (treated separately below).
Annual amounts, in billions of dollars, of changes in government insurance and pension reserves are as follows: 1933, $0.11; 1934, $0.16; 1935, $0.24; 1936, $0.55; 1937, $1.37; 1938, $1.09;
1939, $1.30; 1940, $1.30; 1941, $1.86; 1942, $2.55; 1943, $3.92; 1944, $4.96; 1945, $5.14; 1946, $3.55;

-3.16

1.65

3.98

4.05

4.04

-.65

Personal saving, SEC (lines (l)+(14)+(19)+(25))

.09

2.03

3.61

3 74

1.05

2.87

—2.51

.32

—.38

.37

.31

—.64

1 17

.95

.73

-.17

1.12

-.25

.46

1.17

.30

.82

1.86

4.73

3.49

1.51

4.04

-3.46

-.41

-.21

-.75

.56

-1.10

.00

1947, $3.49; 1948, $3.57; 1949, $2.34; 1950, $1.09; 1951, $4.21; 1952, $4.38; 1953, $3.20. Annual
amounts, in billions of dollars, of Armed Forces leave bonds are as follows: 1946, $0.60:
1947, $0.16; 1948, -$0.30; 1949, -$0.12; 1950, -$0.10; 1951, -$0.15; 1952, -$0.04: 1953, -$0.02.
2. Includes changes in assets of unincorporated business of the types specified.
3. Excludes government pension and insurance reserves. See footnote 1.
4. Excludes Armed Forces leave bonds. See footnote 1.

NATIONAL INCOME,

1954

167

EDITION

Table 6.—Securities and Exchange Commission Estimates of Personal Saving and Comparison with Department of Commerce Estimates of Personal Saving,
1940-53
[Billions of dollars]
1940

1941

1942

1943

1944

1945

1946

1947

1949

1948

1950

1952

1951

3.79

9.47

26.84

34.41

36.39

32.46

13.19

7.48

4.33

4.50

7.98

2.88

4.80
2.18
2.58

10.95
4.12
6.07

16.18
4.72
7.12
4.34

17.55
4.55
5.89
7.11

10.56

2.01
-.43

-1.84
-.46
-2.20

-1.46
-.79
-1.54

3.62
-.05
3.23

2.14
2.83
2.75

2.49
10.25
7.98
2.39
-.22

3.21
14.96
11.80
3.94
-.05
-.73

19.06
2.96
7.27
8.82
1.06
3.46
9.36
6.85
3.64
-.20
-.92

1.51
3.71
3.14
1.53

1.51
3.92
2.14

.65

.31
.42
.84

.48

2.28

2.73

2.40

1.36
3.22

3.18

.14

1.21
3.75
3.52
2.13
-1.22
1.09
1.52
2.31

.54

-.88

-1.00

-1.52

-.46

1.56

1.81

2.76

1.09

3.73

5.66

7.61

.12
.20

.41

.51

.85

3.60

4.46

4.61

7.04
1.09
3.87

.77

1.46
.65
.20

1.85
-.17

.04
.36

.76
.26

.55

.81

.10

5.16
5.31
1.18
3.42

.24

2.19
1.20
3.64
3.35
1.78

.82

.86

1953

14.26

15.46

16.86

5.95

7.10
1.12
1.73
4.25
3.07
4.91
4.23

-.10
4.23
3.68
5.08
6.21

Una
1

4.72

.59

3.72
3.85

1.06
1.82
3.03
2.83

3
4
6
6
7
8
9
10
11
12
13

1.98

2.13

2.15

11.33
1.29
7.15

10.15
1.38
6.53

10.31
1.27
6.26

10.91
1.38
6.66

.44

.77

3.22
1.96
2.10
4.05
2.70
-.41
-.49

.66

-2.89

2.85
13.83
11.14
3.00
-.12
-.20
-1.01

.72

1.21

-.03

-.44

3.15

3.67

1.90

1.13

.21
.84

.24
.82

.11
.09

.03

.98
.07

-.38

-.06

1.80

1.87

1.95

1.98

1.99

2.01

2.06

2.16

2.30

2.46

2.72

3.02

3.20

3.48

.73

.20

2.10

.17

.41

-.73

-.20

.08

.99

1.02

-1.90

2.39

.36

3.79

19-

.32

.73

.18

-.12

.43

.38

.06

.97

.55

-.35
-.62
1.45

-.12
-.30
1.47

2.05

6.69
2.06
1.24
2.37

7.10

6.79

7.99

1.51

4.19
1.91
1.10
1.76

5.10

1.02

1.16
-.14
-2.00
1.37

.78

1.28
1.16

1.82
2.75

1.60
7.42
4.67
2.61
3.63

.19

2.55

-.23
5.75
2.02
-.84
3.32

.87

2.04

.50
.96

4.11

1.34
4.53

-.76
4.71

20
21
22
23
24

-.11

.25

1.08

-.43

-.78

-1.20

-1.24

-2.68

.94

-1.20

-.16

.12

-.37

-1.61

.27
.83
.10

.45

1.16

-.18

-.45
1.01

-.46
1.00

-.25
1.59

-2.29
3.02

1.14
3.88

-.88
4.00

.!)2
4.23

1.40
4.67

.65

4.57

-.68
4.11

.08

.19

.30

.28

.86

-.35
-.46
-.22

.97

.07
.54

.72

-.28
-.36

.64

.09

.78
.92

.29
.90

-1.04
-.21

.51

.02
.61
.98

.55

-.46

.68

.42

.66
.81

.32

-.67

.86

.75

.30

.80

16
17

-.03

-.06

-.31

-.48

-.36

-.25

-.02

.02
.11

.33

.28

26
27
28
29

.21

.29

.04

.45

.60

.70

.41

.81

.96

.30

1.29

1.71

-.10
1.91

.03

1.13

-.01
1.51

2.04

2.20

2.71

3.30

3.72

4.20

4.71

4.96

-.38
5.15

30
31

5.13

11.13

29.99

33.71

35.14

29.53

10.23

4.42

7.82

6.13

8.(18

18.75

17.59

21.20

4.20

11.11

27.77

33.01

36.93

28.66

12.57

4.04

9.99

7.56

12.10

17.73

18.44

20.02

.93

.02

2.22

.70

-1.79

.87

-2.34

.38

-2.17

-1.43

-3.42

1.02

-.86

1.18

.80

.38

-.83

-1.72

2.77

4.47

.93

1.38

-2.11

.07

.22

1.29

.56

1.05

5.00

11.49

26.94

31.29

39.70

33.13

13.50

5.42

7.88

7.63

12.32

19.01

19.00

21.07

.13

-.36

3.05

2.42

-4.56

-3.60

-3.27

-1.00

-.06

-1.50

-3.63

-.26

-1.41

.13

1.14
.18

.94
.17

.84
.18

.11

.08

5. Includes Increase in redemption value of outstanding bonds.
6. Consists of changes in consumer debts to corporate business.
7. Represents changes in specified assets and liabilities only.
8. Includes accidental damage to fixed property.
9. Includes increase in equity of individuals in nonfarm nonresidential real property.
10. Includes farm dwellings.

.05

11. Excludes consumer debt, which is included in line 13.
12. Equals disposable personal income less personal consumption expenditures.
13. Equals gross investment less government surplus and less gross private saving other
than personal saving as given in table 5.
Source: Securities and Exchange Commission.

"168

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS

Table 7.—Consolidated Business Income and Product,

1929-38

{Millions of dollars]
Line

1929

1933

82,190

68,027

51,135

48,708

56,713

82, 573
66, 440
4,566
10,648
919

69,311
57,575
4,480
6,807
449

53,691
46, 258
3,573
3,469

50,337
43, 703
3,287
3,020

57,838
49,076
4,147
4,013

391

327

602

Change in inventories

- 2 , 556

- 1 , 629

-1,125

-1,284

1,674
82,190

68,027

66,814

51,464

43, 377
43, 377
0
509
12
497

39, 646
39,149
39,149
0
497
13
484

32,803
32, 348
32, 348
0
455
13
442

14, 759

11, 540

8,791
8,649
142
5,968

7,410
6,655
755
4,130

94,801

Income originating in business

78,179

,
.

Income of unincorporated enterprises and inventory valuation ad'
justment.
Business and professional
Income of unincorporated enterprises
Inventory valuation adjustment
Farm
__

1936

1937

1938

63,698

72,397

80,494

74,286

62,786
53,331

71, 443
59,298
4,485
7,450
210

78, 245
63, 555
4,716
9,498
476

75,229
61,185
5,126
7,604
1,314

1934

993

Charges against business gross product
Compensation of employees
Wages and salaries
Disbursements
Excess of wage accruals over disbursements
Supplements to wages and salaries
Employer contributions for social insurance
Other labor income

1932

93,127
73,500
4,077
14,557

Consolidated net sales
To consumers
To government
To business on capital account
To abroad

1931

94,801

Business gross product

1930

51,135
35,216

48,708
32,903

56,713
40,697

5,365
101
912

954

2,249

63,698

72,397

80,494

74,286

48,253

54,565

63,332

56,640

29, 511
29,078
29,078
0
433
24
409

32,843
32,843
0
756
261
495

38, 759
37,203
37,203
0
1,556
1,050
506

35, 215
33,486
33,486
0
1,729
1,226
503

8,734

24, 737
24,342
24, 342
0
395
13
382
5,316

23,166
22,805
22,805
0
361
13
348
5,599

26,914
26,516
26,516
0
398
16
382
7,010

10, 387

10,482

12,691

11,128

5.581
4,970
611
3,153

3,384
3,089
295
1,932

3,166
3,691
-525
2,433

4,564
4,618
-54
2,446

5,351
5,401
-50
5,036

6,530
6,650
-120
3,952

7,073
7,102
-29
5,618

6,793
6,572
221
4,335

Rental income of persons

5,425

4,778

3,761

2,713

1,971

1,694

1,661

1,776

2,081

2,560

Corporate profits and inventory valuation adjustment
Corporate profits before tax
Corporate profits tax liability.._
Corporate profits after tax
Dividends
Undistributed profits
Inventory valuation adjustment

9,868
9,396
1,369
8,027
5,724
2,303
472

6,445
3,185
842
2,343
5,464
-3,121

1,638
-776
498
- 1 , 274
4,125
-5,399
2,414

-1,936
-2,983
385
- 3 , 368
2,609
- 5 , 977
1,047

-1,990
153
521
-368
2,078
- 2 , 446

1,031
1,656
744
912
2,579
- 1 , 667
-625

2,759
2,986
951
2,035
2,803
-768
-227

4,898
5,636
1,409
4,227
4,556
-329
-738

6,082
6,113
1,502
4,611
4,674
-63

4,016
3,053
1,029
2,024
2,970
-946
963

Net interest

4,241

4,528

4,386

4,048

3,935

3,810

8,397

8,304

8,904

8,210

10,336

6,859
649
840
-49

6,768
737
754
-45

7,815
641
731
283

8,190
594
-171
403

8,663
594
1,118

8,166

7,615

7,112

7,235

7,496

Adjustments to business net product
Indirect business tax and nontax liability
Business transfer payments
Statistical discrepancy
_
Less: Subsidies minus current surplus of government enterprises..
36

Capital consumption allowances

8,005
7,003
587
268
-147
8,617

3,260
4,405
6,835
7,155
534
-977
-123
8,541

-2,143
4,157
8,644
7,055
659
948
18
7,161

-31
3,719
9,416
9,157
567
-248
60
7,746

3,721
9,863
9,154
429
456
176
7,783

169

NATIONAL INCOME, 195 4 EDITION

Table 7.—Consolidated Business Income and Product,

1939-53

[Millions of dollars]
1939

1940

1941

1942

1943

1944

1945

80,090

89,132

112,485

139,936

162,767

174,525

173,363

79,718
64,001
5,657
8,937
1,123

86,960
68,148
6,211
10,983
1,618

107,984
77,925
15,006
13, 571
1,482

138,125
85, 597
43,406
8,064
1,058

163,520
96,013
61,644
6,353
-490

175, 545
104, 401
63, 416
8,150
-422

174, 420
115,634
46,768
11,487
531

1948

1949

182,814

208,626

232,051

229,518

254,689

290,334

303,882

321,025

176,713
140,651
11,000
21,024
4,038

209,617
157,994
11,998
30,696
8,929

227,889
169,643
17, 018
37,014
4,214

232,255
171,895
20,429
35,286
4,645

247,338
184,340
17,828
43, 868
1,302

279, 979
197, 712
32,377
46, 509
3,381

300,257
206, 803
43,172
47,030
3,252

319, 531
217,075
50,311
49,914
2,231

2
3
4
5
6

1950

1951

1952

1953

Line

1947

1946

372

2,172

4,501

1,811

-763

-1,020

-1,057

6,101

-991

4,162

-2,737

7,351

10,355

3,625

1,494

80,090

89,132

112,485

139,936

162,767

174,525

173,363

182,814

208,626

232,051

229,518

254,689

290,334

303,882

321,025

61,748

70,148

91,373

118,497

140,564

145,771

141,053

153,145

173,566

196,367

188,410

209,578

239,143

248,746

261,170

38,231
36,376
36,376
0
1,855
1,332
523

41,913
39,932
39,932
0
1,981
1,405
576

52,835
50,431
50,431
0
2,404
1,749
655

67,225
64,401
64,401
0
2,824
2,017
807

80,771
77,416
77,207
209
3,355
2,338
1,017

85,367
81,636
81,829
-193
3,731
2,318
1,413

83,897
80,137
80,123
14
3,760
2,132
1,628

92,537
88,676
88,706
-30
3,861
2,114
1,747

107,008
102,390
102,375
15
4,618
2,482
2,136

118,023
113,180
113,150
30
4,843
2,397
2,446

115,691
110,582
110,627
-45
5,109
2,416
2,693

127,151
120, 565
120, 565
0
6, 586
3,146
3,140

146,235
138,103
138,042
61
8,132
3,727
4,405

157,090
148,274
148,335
-61
8,816
3,707
5,109

169,724
160,117
160,117
0
9,607
3,717
5,890

10
11
12
13
14
15
16

11,610

13,010

17,401

23,907

28,187

29,565

30,835

35,265

34,433

38,389

34,149

36,140

40, 809

39,918

38,444

7,293
7,459
-166
4,317

8,442
8,487
-45
4,568

10,897
11,512
-615
6,504

13,899
14, 266
-367
10,008

16,823
16,979
-156
11,364

18,040
18,109
-69
11,525

19,011
19,117
-106
11,824

21,321
23,026
-1,705
13,944

19,948
21,419
-1,471
14,485

21,649
22,061
-412
16, 740

21,431
20,963
468
12, 718

22,855
23, 989
-1,134
13,285

24, 791
25,135
-344
16,018

25,727
25, 519
208
14,191

26,215
26,410
-195
12,229

18
19
20
21

2,742

2,885

3,465

4,547

5,097

5,413

5,634

6,208

6,510

7,198

7,874

8,473

9,129

10,021

10, 596

5,505
6,219
1,441
4,778
3,651
1,127
-714

8,886
9,086
2,834
6,252
3,894
2,358
-200

14, 280
16,751
7,610
9,141
4,349
4,792
-2,471

19,453
20,657
11,415
9,242
4,182
5,060
-1,204

23, 543
24, 316
14,074
10,242
4,347
5,895
-773

22,740
23,027
12,949
10,078
4,570
5,508
-287

18,185
18,749
10,689
8,060
4,616
3,444
-564

16,863
22,126
9,111
13,015
5,655
7,360
-5,263

22,937
28,836
11,283
17,553
6,300
11, 253
-5,899

29,783
31,933
12, 510
19,423
6,994
12,429
-2,150

27,309
25,366
10,411
14, 955
7,153
7,802
1,943

34,106
38,970
17,829
21,141
8,781
12,360
-4,864

38,698
39,958
22,476
17,482
8,672
8,810
-1,260

37,034
36,053
19,965
16,088
8,826
7,262
981

37, 319
38,283
21,144
17,139
8,959
8,180
-964

23
24
25
26
27
28
29

3,660

3,454

3,392

3,365

2,966

2,686

2,502

2,272

2,678

2,974

3,387

3,708

4,272

4,683

5,087

10,504

10,836

12,071

11,284

11,337

16,747

19,761

18,003

20,942

19,190

22,677

24,595

27,722

29,832

32,629

9,365
451
1,173
485

10,021
431
804
420

11, 296
502
375
102

11,769
495
-830
150

12,735
505
-1,720
183

14,127
506
2,766
652

15, 522
532
4,467
760

17, 349
557
932
835

18,658
674
1,383
-227

20,390
739
-2,110
-171

21,644
781
71
-181

23, 741
843
215
204

25,637
985
1,287
187

28,049
999
555
-229

30,037
1,016
1,047
-529

32
33
34
35

7,838

8,148

9,041

10,155

10,866

12,007

12,549

11,666

14,118

16,494

18,431

20,516

23,469

25,304

27,226

170

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS

Table 8.—Government Receipts, 1929-38 '
(Millions of dollars]
Line

1929
Total receipts _.
Federal
Personal tax and nontax receipts before refunds.
Income t a x e s '
Estate and gift taxes
Other taxes 1
Nontaxes'

1930

11,26$

10,757

9,477

3,804

3,047

2,047

1,708

1,323

1,183
1,093
61
29

643
567
56

366
320

1,134

607

1,238

Less: Tax refunds
Equals: Personal tax and nontax receipts.

1,263

1931

1932

1934

1935

1936

1937

1938

9,325

10,458

11,362

12,928

15,380

15,022

2,670

3,541

3,964

5,024

7,039

6,480

495
375
69
35
16

609
452
129
15
13

842
580
248

1,143
740
386

1,742
1,319
402

1,654
1,244
390
20

474

1933

595

827

17
13

1,130

1,723

1, 635

Corporate profits tax accruals

1,224

744

423

328

462

644

820

1,252

1,337

895

Indirect business tax and nontax accruals before refundsExcise taxes
Liquor
_
Tobacco
Other
Customs duties
Capital stock tax...
Nontaxes'

1,219
564
13
449
102
599

1,067
537
11
446
80
474

912
490
10
425
55
373

937
635
7
387
241
259

2,270
1,833
375
452
1,006
308
92
37

2,235
1,730
459
478
793
371
95
39

2,273
1,693
569
536
588
403
138

2,425
1,775
587
563
625
469
139

2,238
1,709
565
567
577
357
127
45

1,658
1,246
138
409
699
296
80
36

1,193

1,045

924

1,619

2,181

124

123

125

115

121

136

7,571

7,835

7,743

7,312

7,157

8,550

9,104

1,380
139
165
187
148
47
694

1,373
110
182
183
154
49
695

1,251
74
168
171
149
47
642

1,124
64
137
158
144
48
573

990
67
110
152
129
47
485

1,000
87
97
153
126
52
485

1,061
121
109
163
129
60
479

100

131

157

165

134

5,810
439
414

6,110
525
500

(ii)

(i.)

5,965
571
545
7
524
1
13
26

5,844
578
552
10
522
4
16

5,436
669
641
61
526
34
20

5,634
934
904
228
563
89
24
30

6,009
1,156
1,096
300
620
141
35
60

6,412
1,396
1,306
398
690
169
49
90

6,751
1,518
1,417
440
748
174
55
101

1,583
1,463
449
782
175
57
120

148
4,539
475
232

137
4,424
452
253

133
3,962
424

140
3,907
406

153
4,023
417

166
4,058
529

170
4,162
621

178
4,277

248

247

260

263

153

170

183

197

207

227

243

764

778

Less: Tax refunds
Equals: Indirect business tax and nontax accruals...
Contributions for social insurance
State and localPersonal tax and nontax receiptsIncome taxes.
Death and gift taxes.
Motor vehicle licenses'
Property taxes s
Other taxes'_.
Nontaxes ">
Corporate profits tax accruals
Indirect business tax and nontax accruals.
Sales taxes
State"
General
Gasoline
Liquor.
Tobacco
Local
Motor vehicle licenses'..
Property taxes 8
Other taxes'*
Nontaxes '•
Contributions for social insurance-

145

414
(li)
(IS)

25
153
4,543
467
208
119

Federal grants-in-aid "
1. Includes transactions of social insurance funds, which can be separated by use of the data
furnished in table 10. For an explanation of the treatment of government enterprises, see
Part II. For a list of these enterprises, see footnotes to the table on industrial classification in
the Introduction to Part III.
2. Federal grants-in-aid to State and local governments are reflected in Federal expenditures
and hi State and local receipts and expenditures. Total Government receipts and expenditures have been adjusted to eliminate this duplication.
3. Consists of individual income tax and victory tax.
4. Consists of dividends tax and automobile use tax.
6. Consists mainly of charges for government products and services not accounted for under

500
(I!)
(>»)

25
154
4,727
488
216
129
125

139

134

502

1,633

1,706

2,251

2,406

391

1,573

1,128
167
116
176
130
64
475

724

9,105
1,198
204
129
183
134
69
479

2,216
1,734
9,320
1,227
208
!37
181
137
75
489

612

government enterprises; of fines and penalties; and of donations. Includes also the excess
of receipts over expenditures derived from the services of enemy prisoners of war to private
contractors. Receipts from the sale of surplus property are not included.
6. Consists mainly of charges for government products and services not accounted for
under government enterprises, including rents and royalties; and of fines and penalties.
Receipts from the sale of surplus property are not included.
7. State only. State drivers' licenses are included in personal motor vehicle license receipts.
8. Property taxes levied on houses of owner-occupants are classified as indirect business
taxes.
9. Consists of poll taxes and miscellaneous licenses and permits.

NATIONAL INCOME,

195 4

171

EDITION

Table 8.—Government Receipts, 1939-53 '
[Millions of dollars]
1939

1940

1941

15,382

17,741

24,983

32,633

49,170

51,184

53,210

51,249

57,130

59,262

56,453

69,360

85,554

91,072

95,900

6,721

8,641

15,420

22,943

39,258

41,008

42,495

39,200

43,311

43,438

39,095

50,177

64,491

68,204

71,228

1,260
874
371

1,393
1,036
341

2,044
1,622
401

20,710
19,848
663
81
118

18,815
17,987
734
1
93

18, 562
17,751
754

19,888
19,167
659

28,078
27,247
751

33,279
32,357
850

35,084
34,095
922

17,880
17.133
565
74
108

20,783
19,825
900

16, 540
15,923
461
77
79

21,323
20,446
830

4,696
4,062
471
121
42

3
4
5
6
7

344

1,331

1,653

1,673

1,786

2,368

1,709

1,800

2,136

2,600

1,235

1,364

2,016

4,668

16,517

17,536

19,379

17,162

19,650

18, 997

16,194

18,179

26,278

31,143

32,484

1,285

2,635

7,333

11,065

13,616

12,484

10,234

8,649

10,679

11,840

9,806

17,059

21,598

19,144

20,281

2,347
1,826
602
693
631
344
133

2,662
2,122
721
645
756
327
167

3,593
2,817
928
748
1,141
439
282

4,073
3,364
1,215
859
1,290
313
329

4,979
4,076
1,454
990
1,632
410
381

6,226
5,257
2,083
925
2,249
378
372

7,180
6,214
2,370
1,034
2,810
397
353

7,975
7,267
2,691
1,219
3,357
503

7,943
7,297
2,330
1,267
3,700
436

8,173
7,501
2,177
1,312
4,012
4:0

8,230
7,561
2,204
1,320
4,037
381

9,099
8,252
2,419
1,348
4,485
549

9,598
8,677
2,459
1,447
4,771
591

10,534
9,580
2,726
1,663
5,191
582

11,124
10,100
2,820
1,614
6,666
609

11
12
13
14
15
16
17

1942

1944

1943

1945

1946

1948

1947

1949

1951

1950

1952

Line

1953

112

219

216

205

210

262

288

298

330

372

415

2,322

2,627

3,567

4,049

4,944

6,171

7,128

7,896

7,874

8,090

8,158

9,032

9,530

10,466

11,048

1,879

2,016

2,504

3,161

4,181

4,817

5,754

5,493

5,108

4,511

4,937

5,907

7,085

7,451

7,415

9,649

9,957

10,370

10,578

10,854

11,123

11,591

13,157

15,557

17,810

19,586

21,522

23,541

25,503

27,489

1,205
201
122
190
137
78
477

1,240
232
115
210
140
65
478

1,277
258
116
219
142
64
478

1,313
291
111
198
142
67
504

1,328
330
111
183
145
67
492

1,399
366
125
178
147
71
512

1,488
402
141
182
149
72
542

1,646
409
153
199
155
86
644

1,856
488
177
226
171
101
693

2,145
570
183
253
189
115
835

2,467
718
175
288
211
130
945

2,741
776
182
326
227
141
1,089

2,993
910
209
373
245
149
1,107

3,230
1,007
219
400
266
168
1,170

3,483
1,061
234
433
288
185
1,282

23
24
25
26
27
28
29

156

199

277

350

458

465

455

462

604

670

605

770

878

821

863

7,043
1,653
1,542
465
815
184
78
111

7,394
1,835
1,705
533
865
205
102
130

7,729
2,073
1,942
621
958
241
122
131

7,720
2,033
1,900
642
855
266
137
133

7,791
1,965
1,831
700
704
276
151
134

7,956
2,002
1,866
751
681
281
153
136

8,394
2,266
2,110
806
777
359
168
156

9,453
2,899
2,716
1,051
1,020
427
218
183

10,784
3,508
3,202
1,330
1,176
407
289
306

12,300
4,115
3,715
1,684
1,318
439
374
400

13,486
4,333
3,882
1,609
1,451
418
404
451

14, 709
4,801
4,317
1.828
1.625
442
422
484

16,107
5,366
4,815
2,118
1,791
462
444
551

17, 583
5,857
5,230
2,353
1,973
446
458
627

18,989
6,186
5,472
2,463
2,060
493
456
714

31
32
33
34
35
36
37
38

182
4,285
638
285

200
4,407
656
296

213
4,449
691
303

212
4,397
760
318

212
4,494
806
314

215
4,565
847
327

231
4,642
908
347

271
4,836
1,037
410

324
5,346
1,158
448

368
5,938
1,347
532

412
6,642
1,500
599

460
7,143
1,635
670

517
7,696
1,785
743

566
8,385
1,993
782

615
9,126
2,217
845

39
40
41
42

257

267

280

307

335

356

384

488

575

709

800

963

1,085

1,234

1,337

888

942

947

870

1,108

1,738

1,986

2,228

2,339

2,478

2,635

2,817

988

857

807

10. Consists of charges for government products and services not accounted for under
government enterprises (such as tuition fees and public hospital fees); fines and penalties;
donations; and special assessments for outlay paid by unincorporated business, including
homeowners.
11. Minor State sales taxes not specified below are included in "Other taxes."
12. Consists of gross receipts taxes, franchise taxes, licenses, permits, severance taxes,
documentary and stock transfer taxes, and minor State sales taxes.
13. Consists mainly of charges for government products and services not accounted for
under government enterprises, including rents and royalties; of fines and penalties; special
assessments for operation; and donations.

291692"

14. Includes shared receipts as well as grunts-in-aid. The latter consist of highway grants,
education grants (agricultural research and education, vocational education, and rehabilitation, war training and research programs, and veterans' postwar training programs), public
assistance grants (mainly categorical assistance under the Social Security program), grants for
the administration of the Unemployment Compensation program and of the U. S. Employment Service, Public Health grants, grants made by the Bureau of Community Facilities of
the Federal Works Agency to war-congested communities, the Federal contribution to the
District of Columbia, grants made by the Federal Emergency Relief Administration and the
Public Works Administration, and miscellaneous other grants.
15. Small amounts included in "Other taxes."

172

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS
Table 9.—Government Expenditures, 1929-38

[Millions of dollars]
1929

1930

1931

1932

1933

1934

1935

1936

1937

1938

10,227

11,022

12,318

10,607

10,676

12,830

13,340

15,882

14,827

16,589

2,645

2,766

4,183

3,188

3,986

6,394

6,527

8,501

7,225

8,451

1,311
879
362
155
207

1,410
915
424
209
215

1,537
921
636
271
265

1,480
880
540
333
207

2,018
1,164
805
346
459

2,991
1,694
1,258
426
832

2,931
1,768
1,108
473
635

4,815
3,570
1,180
509
671

4,552
3,013
1,445
540
905

5,280
3,505
1,711
489
1,222

70
103
33

71
93
22

80
92
12

60
64
4

Transfer payments

691

735

1,716

931

Grants-in-aid to State and local governments'..
Net interest paid...
Interest paid
Less: Interest received

117
441
733
2S2

125
380
684
304

313
444
679
235

134
479
718
239

116

173

7,699

8,381

8,448

7,553

7,171
3,456
3,715
2,331
1,384

7,772
3,630
4,142
2,649
1,493

7,681
3,737
3,944
2,388
1,556

Line
!

Total expenditures _.
Federal

---

Purchases of goods and services
Compensation of employees
Net purchases from business
New construction 3
Other
Less: Domestic sales of surplus consumption goods..
Net purchases from abroad
Purchases from abroad
Less: Sales to abroad

Subsidies less current surplus of government enterprises *.
State and locul

Purchases of goods and servicesCompensation of employeesPurchases from business
New construction»
Other.
Transfer payments,.

218

264

349

Net interest paid
Interest paid
Less: Interest received..

542
773
231

584
829
245

640
842
202

Less: Current surplus of government enterprises..

232

239

2,064

600
1,633
590
1,016
426

1,706
526
1,025

580

730

7,192

8,069

8,519

6.598
3,565
3,033
1,529
1,504

6,013
3,531
2,482
1,032
1,450

6, 773
3,884
2,889
1,186
1,703

7,059
4,178
2,881
1,122
1,759

502

759

953

856
194

653
844
191

640
833
193

233

297

222

1. See footnote 1 to table 8.
2. See footnote 2 to table 8.
3. For 1933-43, the sum of Federal and State and local new construction is smaller than
New public construction shown in table 31, because work relief construction, as estimated

65
68
3

502
517
845
328

1,196

724
485
1,062

764
616
1,240

778
619
1,158

577

624

539

413

465

578

8,105
7,001
3,696
3,305
1,744
1,561

8,366
7,160
3,889
3,271
1,607
1,664

8,916
7,536
4,121
3,415
1,622
1,793

1,172

862

1,023

1,209

615
806
191

616
806
190

588
779
191

573
762
189

374

405

402

by the National Income Division, has been excluded. The value of work relief construction
is reflected in compensation of employees and "Other purchases from business."
4. See footnote 14 to table 8.

Table 10.—Social Insurance Funds, T929-38 1
[Millions of dollars]
1929

Line

1930

1931

1932

1933

1934

1935

1936

1937

1938

Federal
Contributions for social insurance
Employee contributions
Employer contributions
Government and government enterprises.
Private
Self-employed persons' contributions
Less: Transferred to general government

124
96
28
28

123
96
27
27

125
95

Equals: Retained by social insurance funds
Plus: Investment Income
Equals: Net receipts
Less: Benefit paymentsEquals: Surplus (+) or deficit (—)_

124
21

124
26

123
26

125
19

145
44

150
51

149

101

Contributions for social insurance
Employees
_
_
_
Employer (government and government enterprises) '..
Less: Transferred to general government-.

119
47
72
1

129
51
78
1

Equals: Retained by social insurance funds
Plus: Investment income

118
16

Equals: Net receipts
Less: Benefit payments.
Equals: Surplus (+) or deficit ( - ) .

124
95
29
29

1,734
458
1,276
79
1,197

121
92
29

136
92
44
37
7

391
104
287
47
240
52

133

138

115
25

118
25

129
26

339
37

1,440
154

1,596
94

144
72

140
82

143
94

155
93

376
95

1,594
142

606

281

1,452

1,084

139
55
84
1

153
57

170
63
107
2

197
70
127
2

207
76
131
2

227

243

65
118
2

141
2

147
3

128
19

138
21

152
24

168
28

181
31

195
35

205
39

225

240
48

134
72

147
78

159

176
95

196
110

212
119

230
127

244
137

144

288
151

103

107

124

137

1,573
480
1,093
66
1,027

State and Local

1. For a listing of social insurance funds and for detail on employer and employee
contributions, and benefit payments, see tables 34, 35, and 36.

2. Includes contributions by private employers to State cash sickness compensation funds
as follows, in millions of dollars: 1949, $2; 1950, $7; 1951, $2; 1952, $2; 1953, $3.

173

NATIONAL INCOME, 195 4 EDITION
Table 9.—Government Expenditures, 1939-53 >
[Millions of dollars]
1939

1940

1941

17,522

18,467

28,753

64,032

93,399

103,072

92,943

47,064

43,864

51,397

59,658

61,247

79,398

93,918

102,531

8,955

10,089

20,539

56,141

85,972

95,585

84,826

37,039

31,089

35,481

41,493

40,948

57,974

71,067

78,059

5,157
3,414
1,679
543
1,140
4
64
69
5

6,170
3,489
2,597
965
1,638
6
84
87
3

16, 923
5,027
11,566
3,596
7,977
7
330
367
37

52,027
10, 645
40,189
9,309
30,896
16
1,193
1,381
188

81,223
20,899
58,913
5,608
53, 372
67
1,411
1,985
574

89,006
27,250
60,831
2,505
58,535
209
925
1,877
952

74,796
29,786
44,067
1,737
42, 752
422
943
2,679
1,736

20,934
14,545
7,193
931
6,978
716
-804
1,203
2,007

15,776
9,343
6,486
951
5,828
293
-53
978
1,031

21,019
8,872
9,955
1,187
8,911
143
2,192
2,584
392

25,445
9,926
11,676
1,488
10,271
83
3,843
4,173
330

22,138
10,649
8,067
1,625
6,488
46
3,422
3,631
209

40,995
16,164
21,642
2,982
18, 721
61
3,189
3,547
358

53, 951
18,708
32,208
4,186
28,086
64
3,035
3,326
291

60,105
18,132
38,486
4,153
34,403
70
3,487
3,819
332

3
4
5
6
7
8
9
10
11

1,240

1,421

1,369

1,419

1,239

1,841

4,310

9,214

8,887

7,652

8,754

10,884

8,663

8,940

9,660

988
643
1,189
546

857
726
1,298
572

807
774
1,379
605

888
1,038
1,726
688

942
1,707
2,481
774

947
2,420
3,262
842

870
3,334
4,335
1,001

1,108
4,164
5,217
1,053

1,738
4,117
5,230
1,113

1,986
4,179
5,354
1,175

2,228
4,327
5,611
1,284

2,339
4,431
5,804
1,373

2,478
4,558
5,996
1,438

2,635
4,589
6,290
1,701

2,817
4,732
6,633
1,901

13
14
15
16

861

1,371

1,516

1,619

571

645

739

1,156

1,280

952

745

8,369

8,434

8,987

11,133

14,513

17,902

20,393

22,638

23,902

25,486

27,289

9,984
6,177
3,807
1,431
2,376

12,832
7,320
5,512
2,482
3,030

15,565
8,502
7,063
3,638
3,425

18,175
9,422
8,753
4,917
3,836

19,885
10,124
9,761
5,375
4,386

21,804
11,069
10, 735
6,436
4,299

23,229
12,265
10,964
6,715
4,249

25,130
13,305
11,825
7,226
4,599

19
20
21
22
23

1,640

2,226

2,890

2,868

3,420

2,927

3,151

3,125

264
656
392

287
733
446

308
808
500

25
26
27

1,093

1,181

1,274

1942

1943

1944

1945

1946

927

915

666

769

9,555

9,235

9,021

8,779

8,163
4,185
3,978
2,129
1,849

7,903
4,289
3,614
1,733
1,881

7,828
4,388
3,440
1,424
2,016

7,690
4,473
3,217
1,066
2,151

7,394
4,663
2,731
681
2,050

7,523
4,938
2,585
568
2,017

8,071
5,370
2,701
661
2,040

1,272

1,262

1,242

1,229

1,220

1,241

1,323

1947

1948

1949

1950

562
752
190

565
761
196

515
709
194

479
681
202

433
660
227

389
633
244

349
599
250

293
555
262

253
521
268

263
550
287

270
585
315

285
624
339

442

495

564

619

678

719

756

784

798

816

920

952

5. Subsidies reflected consist of government payments to farmers, payments for the exportation and diversion of surplus agricultural commodities, shipping and housing subsidies,

1951

1952

1953

Line

the wartime subsidy programs administered mainly by the Commodity Credit Corporation and the Beconstruction Finance Corporation, and subsidy payments to air carriers.

Table 10.—Social Insurance Funds, 1939-53

[Millions of dollars]
1939

1940

1941

1942

1943

1944

1945

1946

1947

1948

1949

1950

1951

1952

1953

Line

160

147

186

172

212

182

196

244

114

175

226

338

388

7,451
3,032
4,212
547
3,665
207
305

1,719
122

1,868
152

2,318
183

2,989
224

3,969
279

4,635
365

5,558
492

5,249
608

4,994
667

4,336
756

4,711
853

5,569
884

6,697
887

7,146
1,008

7,098
1,118

8
9

1,841
696

2,020
835

2,501
707

4,248
538

5,000
655

6,050
1,322

5,857
2,348

5,661
2,123

5,092
2,226

5,564
3,492

6,453
6,100

7,584
4,352

8,154
4,791

8,216
5,607

10
U

1,145

1,185

1,794

3,213
747
2,466

3,710

4,345

4,728

3,509

3,538

2,866

2,072

353

3,232

3,363

2,609

257
105
152
3

267
112
155
3

280
115
165
3

307
122
185
4

335
133
202
4

356
144
212
4

384
159
225
5

488
238
250
6

575
285
290
7

709
349
360
11

800
378
422
16

963
446
517
17

1,085
513
572
17

1,234
572
662
18

1,337
634
703
19

13
14
15
16

254
53

264
59

277
66

303
69

331
74

352
78

379
82

482
86

568
91

698
101

784
122

946
142

1,068
168

1,216
199

1,318
220

17
18

307
157

323
163

372
194

405
213

430
223

461
240

568
260

659
297

799
326

906
356

1,088
398

1,236
466

1,415
542

1,538
610

19
20

150

160

343
175
168

178

192

207

221

308

362

473

550

690

770

873

928

1,879
491
1,388
86
1,302

2,015
546
1,469
95
1,374

2,504
686
1,818
104
1,714

3,161
1,044
2,117
138
1,979

4,181
1,706
2,475
174
2,301

4,817
2,092
2,725
447
2,278

5,754
2,174
3,580
1,495
2,085

5,493
1,773
3,720
1,654
2,066

5,108
1,833
3,275
840
2,435

4,511
1,829
2,682
342
2,340

4,937
1,856
3,081
732
2,349

5,907
2,448
3,459
396
3,063

7,085
2,904
4,181
486
3,695

7,415
3,153
4,042
334
3,708
220
317

1
2
3
4
5
6

174

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS
Table 11.—Transactions of the Rest of the World With the United States, 1929-38 '
[Millions of dollars]
1929

Net current payments to the United States.

1930

1931

1932

1933

771

Net purchases from United States business..
Purchases from United States business..
Sales to United States business
Net purchases from U. S. Government..
Purchases from U. S. Government..
Sales to U. S. Government
Net purchases from United States persons..
Purchases from United States persons..
Sales to United States persons
Net capital movement to the United States..
Long-term
Short-term
_
Change in gold stock
_
Errors and omissions
_
Adjustment for United States territories and possessions..

169

150

547

393

1
608
26
111

1
550
-37
33

1
426
-44
10

1
324
-22
20

-56

-350

-224

993
5,902
4,909

919
4,408
3,489

449
2,870
2,421

391
1,942
1,551

-70
33
103

-71
22
93

-80
12
92

-962
51
1,013

-904
43
947

-771
-240
-4
-143
-384

1935

323

-39

Net purchases from the United States..

197

746

1
577
89
143

Wages and salaries..
Interest
Dividends
Branch profits

690

810

Net payments of factor income.

1934

1937

1938

-54

-93

1,109

367

300

283

386

1
242
8
52

1
207
60
99

1
195
-8
112

1
160
11
111

1
138
217
30

-173

126

-421

-393

-221

723

327
1,960
1,633

602
2,532
1,930

101
2,740
2,639

210
2,966
2,756

476
3,971
3,495

1,314
3,747
2,433

4
64

-49
4
53

-39
6
45

—55
4
59

-65
3

-94
5
99

-64
6
70

-719

-555
17
572

-451
17
468

-437
19
456

-467
20
487

-538
22
560

-603
28
631

-527
37
664

-690

-197

-169

-150

-429

-62

-1,109

-221
-479
-310
320

215
-637
133
92

257
-446
-53
73

77
-419
131
61

200
222
- 1 , 266
415

436
1,072
-1,822
368

777
431
-1,272
157

521
356
-1,364
425

97
344
-1,799
249

1934

1935

1936

1937

1938

48,959

57,057

40,697
23,380
20,642
20. 305
2,173
18,132
337
1,031
1,656
744
912
—625
1,707
12,515
4,966
4,920
46

48,253
27,017
22,632
22,266
2,345
19,921
366
2,759
2,986
951
2,035
-227
1,626
16,330
5,449
5,401
48

64,911
54,565
32,273
25,818
25,185
2,713
22,472
633
4,898
5,636
1,409
4,227
-738
1,557
17,155
6,233
6,141
92

73,618
63,332
37,587
30,042
28,754
2,809
25,945
1,288
6,082
6,113
1,502
4,611
-31
1,463
20,175
7,062
6,847
215

10,365

10,448

12,649

67,581
56,640
32, 256
26, 758
25,348
2,591
22,757
1,410
4,016
3,053
1,029
2,024
903
1,482
18,359
6,776
6,523
253
11,097

4, 550
4,604
-54
2,446
553
4,109
613
612
1

5,329
5,37fl
-50
5,036
516
4,128
652
651
1

6,496
6,616
-120
3,952
474

7,031
7,060
-29
5,618
464
4,700
785
764
21

14
1,694
1,788
693
693
679
14

22
1,661
1,793
778
778
760
18
5,946
5,946
5,740
206
147

34
1,776
1,779
842
842
818
24
7,266
7,216
7,047
219
155
64

2,491
1,882
1,871
11
0
11

2,780
2,044
2,029
15
2
13

429

1. See Part III, section on Net foreign investment.

Table 12.—National Income by Legal Form of Organization, 1929-38
[Millions of dollars]
1929

National income i_.
Income originating in business, total.__
Corporate business
Compensation of employees
Wages and salaries
Compensation of corporate officers.
Other wages and salaries
Supplements to wages and salaries
Corporate profits and inventory valuation adjustment.
Coiporate profits befnro tax
__
Corporate profits tax liability.
Corporate profits after tax..
Inventory valuation adjustment
Net interest
Sole proprietorships and partnerships
Compensation of employees
Wages and salaries
_
Supplements to wages and salaries
Income of unincorporated enterprises and inventory valuation adjustment.
Business and professional
Income of unincorporated enterprises..
Inventory valuation adjustment
Farm..
Net interest'-.
Other private business *
Compensation of employees
_
Wages and salaries
Supplements to wages and salaries
Income of unincorporated enterprises—business and professional ' .
Rental income of persons
Net interest..
Government enterprises
Compensation of employees
Wages and salaries
Supplements to wages and salaries..
Income originating in general government
Compensation of employees
_
Wages and salaries
Supplements to wages and salaries
Employer contributions for social insurance
Other labor income..
_
Income originating in households and institutions '
Compensation of employees
Wages and salaries
,
Supplements to wages and salaries
Employer contributions for social insurance.
Other labor income...
Net interest'.—
Income originating in the rest of the world
Wages and salaries !
Corporate profits after tax 9
Net interest

1930

87,814
78,179
45,224
33, 739
33,307
3,337
29,970
432
9,868
9,396
1,369
8,027
472
1,617
23,941
8,596
8,533
63
14, 713

75,729
66,814
38,490
30.303
29,886
3,139
26,747
417
6, 445
3,185
842
2,343
3,260
1,742

8,745
8,603
142
5,968
632
8,256
793
792
1
46
5,425
1,992
758
758
745
13
4,335
4,335
4,192
143
89
54
4,490
2,8fi3
2,853
10
0
10
1,627

1932

1933

59,708
51,464
23,328
24,888
24, 508
2,698
21,810
380
1,638
-776
498
- 1 , 274
2,414
1,802
15,912
6,425
6,365
60
8,710

42,547
35,216
18,426
18,603
18,274
2,133
16,141
329
-1,936
-2,983
385
-3,368
1,047
1, 759

6,303

40,159
32,903
17.345
17,620
17,318
1,995
15,323
302
-1,990
153
521
-368
-2,143
1,715
10,564
4,351
4,307
44
5,585

7,369
6,614
755
4,130
759
7,501
778
777
1
41
4,778
1,904
771
771
757
14
4,545
4,545
4,396
149
93
56
3,624
2,652
2,641
11
0
11

5,557
4,946
611
3,153
777
6,456
722
721
1

3,371
3,076
295
1,932
714

3,152
3,677
-525
2,433
628

5,247
608
607
1

24
3,761
1,949
768
768
754
14
4,658
4,658
4,503
155
98
57
3,039
2,278
2,267
11
0
11

13
2,713
1,913
705
705
691
14
4,445
4,445
4,274
171
113
58
2,493
1,871
1,860
11
0
11

972

761

810
1

746
1

S47

622
393

4,363
564
563
1
14
1,971
1,814
631
631
617
14
4,695
4,695
4,524
171
120
51
2,238
1,677
1,667
10
0
10
561

232

137
60S

577

1. The national income is classified by distributive shares hi table 1, and income originating
in business is classified by distributive shares in table 7.
2. Data not available.
3. This series is net only of Imputed interest received, and of cash interest received by firms
engaged in lending as a principal activity; cash interest received by other proprietors is
considered to be received in the proprietors' personal capacity.

1931

20,052
7,794
7,729
65
11,499

-4
550

10, 838
4,821
4,770
51

1
-34
426

323
1
-2
324

5,578
5,578
5,396
182
131
51
2,381
1,802
1,792
10
0
10
579
303
1

367
1

60
242

159
207

4,295
706
699

42
2,081
1,792
870
870
838
32
6,902
6,902
6,654
248
176
72
3,101
2,272
2,249
23
8
15
829

6,762
6,541
221
4,335
486
5,127
783
755
23
31
2,560
1,753
860
38
7,626
7,626
7,363
263
189
74
2,929
2,152
2,126
18

283
1

777
386
1

104
195

122
160

247
138

736
300

4. Includes all mutual financial institutions; producers' and consumers' cooperatives; nonprofit organizations, such as trade associations, furnishing services to business; individually
owned property including owner-occupied homes; and miscellaneous forms of business
organization.
5. Estimated patronage refunds and stock dividends paid by farmers' cooperatives.

NATIONAL

INCOME,

1954

175

EDITION

Table 11.—Transactions of the Rest of the World With the United States, 1939-53

[Millions of dollars]
1939

1941

1940

1943

1942

1944

1945

1946

1947

1948

1949

1950

1951

1952

Line

1953

888

1,509

1,124

-207

-2,245

-2,099

-1,438

4,586

8,942

1,956

534

-2,201

227

-164

-1,866

313

357

363

365

367

423

369

577

874

1,076

1,078

1,266

1,547

1,463

1,500

2
127
137
47

3
120
149
85

6
126
109
122

10
130
107
118

14
115
137
101

12
118
103
190

11
130
75
153

17
135
129
296

17
168
221
468

16
224
254
582

16
230
305
527

18
248
426
574

20
312
418
797

25
317
302
819

20
333
406
741

3
4
5

575

1,152

761

-572

-2,612

- 2 , 522

-1,807

4,009

8,068

880

-544

-3,467

-1,320

-1,627

-3,366

1,123
3,886
2,763

1,618
4,785
3,167

1,482
5,378
3,896

1,058
4,209
3,151

-490
3,433
3,923

-422
3,877
4,299

531
4,944
4,413

4,038
9,682
5,644

8,929
15,640
6,711

4,214
12,575
8,361

4,645
12,366
7,721

1,302
11,383
10,081

3,381
15,773
12,392

3,252
15,429
12,177

2,231
14,473
12,242

8
9
10

-84
3
87

-330
37
367

-1,193
188
1,381

-1,411
574
1,985

-925
952
1,877

-943
1,736
2,679

804
2,007
1,203

53
1,031
978

-2,192
392
2,584

-3,843
330
4,173

- 3 , 422
209
3,631

-3,189
358
3,547

-3,035
291
3,326

-3,487
332
3,819

11
12
13

-484
36
520

-382
59
441

-391
43
434

-437
40
477

-711
45
756

-1,175
45
1,220

-1,395
94
1,489

-833
28
861

-914
55
969

-1,142
51
1,193

-1,346
42
1,388

- 1 , 347
30
1,377

- 1 , 512
30
1,542

-1,844
32
1,876

-2,110
35
2,145

14
15
16

-888

-1,509

-1,124

207

2,245

2,099

1,438

-4,586

-8,942

-1,956

-534

2,201

-227

164

1,866

27
1,470
-3,174
789

-73
1,530
-4,243
1,277

-642
-389
-719
476
150

-159
67
23

-147
1,225
757
34
376

21
356
1,350
-37
409

-1,399
1,915
548
8
366

-3,712
-705
-623
204
250

-7,752
61
-2,162
911

-2,074
49i
- 1 , 530
1,152

-1,100
-32
-164
762

-241
726
1,743
-27

- 1 , 595
949
-53
472

-1,039
1,073
-379
509

—650
1,159
1,163
194

18
19
20
21
22

284

Table 12.—National Income by Legal Form of Organization, 1939—53
[Millions of dollars]
1941

1939

1940

72,753
61,748
36,185
29,290
27,771
2,697
25.074
1,519
5,505
6,219
1,441
4,778
-714
1,390
19, 285
7,203
6,936
267

81,634
70,148
42,436
32,326
30,695
2,950
27,745
1,631
8,886
9,086
2,834
6,252
-200
1,224

11,580
7.263
7,429
-166
4,317
502
5,354
814
785
29
30
2,742
1,768
924
924
884
40
7,599
7,599
7,313
286
199
87
3,093
2,276
2,250
26
9
17
817
313

1942

1943

1944

1945

1946

1947

1948

1949

1950

1951

1952

1953

137,694

181,248
141,053
82,414
63,485
60,316
4,118
56,198
3,169
18,185
18,749
10,689
8,060
-564
744
48,629
17,640
17,136
504
30,713

179,577
153,145
86,302
68,969
65,748
5,143
60,605
3,221
16,863
22,126
9,111
13,015
-5,263
470
55,655
20,303
19,757
546
35,085

197,168
173,566
104,710
81,168
77, 254
6,026
71,228
3,914
22,937
28,836
11,283
17,553
-5,899
605
56,919
22,326
21,718
608
34,244

221,641
196,367
120, 263
89,910
85,810
6,733
79,077
4,100
29,783
31,933
12,510
19,423
-2,150
570
62,789
24,105
23,472
633
38,235

216,193
188,410
115,425
87,421
83,112
6,743
76,369
4,309
27,309
25,366
10,411
14,955
1,943
695

239,956

277,041

239,143
151,362
111,940
104,978
8,122
96,856
6,962
38,698
39,958
22,476
17,482
-1,260
724

290,959
248,746
157,799
120,079
112, 600

305,002

209,578
131,612
96,881
91,301
7,607
83, 694
5,580
34,106
38, 970
17,829
21. 141
-4:864
625

261,170
168, 539
130, 513
122,164
(a)

58,518
23,964
23,287
677
34,040

62.203
25,651
24,797
854
35,980

70,569
29,193
28,188
1,005
40,679

71,913
31,322
30,269
1,053

8,349
37,319
38,233
21,144
17,139
-964
707
72,409
33,245
32,140
1,105

2
3
4
5
6
7
8
9
10
11
12
13
14

39,767

38,293

18,889
18,995
-106
11,824
276
8,402
1,164
1,135
29
122
5,634
1,482
1,608
1,608
1,550
58
35,156
35,156
33,362
1,804
1,663
141
4,670
4,117
4,077
40
10
30
553
369
11

21,141
22,846
-1,705
13,944
267
9,318
1,395
1,363
32
180
6,208
1, 815
1,870
1,870
1,808
62
20,722
20,722
18,770
1,952
1,843
109
5,133
4,421
4,373
48
13
35
712

19,759
21,230
-1,471
14, 485
349
9,981
1,558
1,524
34

21,495
21,907
-412
16,740
449
11,031
1,724
1,685
39
154
7,198
1,955
2,284
2,284
2,213
71
17,374
17,374
16,519
855
632
223
6,824
5,514
5,457
57
13
44
1,310
1,076

21,322
20,854
468
12,718
514
11,936
1,775
1,733
42
109
7,874
2,178
2,531
2,531
2,450
81
19,348
19,348
17,995
1,353
1,072
281
7,357
5,803
5,741
62
15
47
1,554
1,078

22, 695
23,829
-1,134
13,285
572
13,087
1,943
1,887
56

24,661
25,005
-344
16,018
697
14,253
2,143
2,070
73

25, 576
25,368
208
14,191
824

160
8,473
2,511
2,676
2,676
2,580
96
20,773
20,773
19,631
1,142
812
330
8,339
6,383
6,312
71
18
53
3,956

130
9,129
2,851
2,959
2,959
2,867
92
27,233
27,233
10 25,944
1,289
966
323
9,118
6,932
6,814
118
60
58

26,064
26,259
-195
12,229
871
16,791
2,535
2,464
81
151
10,596
3,509
3,431
3,431
3,359
72

2,186
1,547

2,442

1,266

25
1,121

832

20
1,215

836
224

18
1,000

1.147

230

248

312

317

333

51
52

118,497
72,904
52,293
49,965
3,691
46, 274
2,328
19,453
20,657
11,415
9,242
-1,204
1,158
37,005
12,732
12,311
421
23,811

170,310
140,564
88,087
63, 595
60,761
3,745
57,016
2,834
23,543
24,316
14,074
10,242
-773
949
43,045
14,648
14,203
445
28,038

182,639

21,230
7,757
7,477
280
12,973

104,710
91,373
56,437
41,051
39,070
3,472
35,598
1,981
14, 280
16,751
7,610
9,141
-2,471
1,106
27,632
9,783
9,434
349
17,341

8,405
8,450
-45
4, 568
500
5,498
846
817
29
37
2,885
1,730
984
984
943
41
7,778
7,778
7,477
301
210
91
3,351
2,435
2,406
29
9
20

10,837
11,452
-615
6,504
508
6,219
916
887
29
60
3,465
1,778
1,085
1,085
1,040
45
9,415
9,415
9,146
269
225
44
3,559
2,633
2,503
30
9
21

13,803
14,170
-367
10,008
462
7,374
986
958
28
96
4,547
1.745
1,214
1,214
1,167
47
15,118
15,118
14,809
309
277
32
3,714
2,918
2,889
29
8
21

16,674
16,830
-156
11,364
359
7,957
1,053
1,025
28
149
5,097
1,658
1,475
1,475
1,427
48
25,562
25,562
25,190
372
329
43
3,817
3,240
3,208
32
10
22

17,899
17,968
-69
11,525
310
8,195
1,110
1,080
30
141
5,413
1,531
1,528
1,528
1,477
51
32,188
32,188
31,491
697
609
88
4,257
3,719
3,684
35
10
25

916
357

1,026
363

796
365

677
367

538
423

225
130

238
115

118

2
184

234

6
231

127

120

126

145,771
90,110
66,525
63,346
3,759
59,687
3,179
22,740
23,027
12,949
10,078
-287
845
45,938
16,204
15,733
471
29, 424

293

228
130

577

189
6,510
1,724
1,956
1,956
1,894
62
16,663
16,663
15,435
1,228
1,069
159
6,065
5,069
5,016
53
14
39
996
874

17
425

17
689

135

168

6. Includes private households; and religious organizations, social and athletic clubs, labor
organizations, nonprofit schools and hospitals, charitable and welfare organizations, and all
other nonprofit organizations furnishing services to individuals.
7. This series measures gross interest paid; it is termed "net interest" only because it is a
component of that distributive share.
8. Pay of permanent United States residents employed in the United States by foreign gov-

(?)
(?)

7,579
37,034
36,053
19,965
16,088
981
686

15,667
2,322
2,242
80
151
10,021
3,173
3,367
3,367
3,263
104
30,973
30,973
i° 29, 529
1,444
1,105
339
9,777
7,335
7,211
124
62
62
1,463

Line

(?)

31,437
31,437
"30,098
1,339
964
375
10,895
7,880
7,745
135
64
71
3,015
1,500

15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36
37
38
39
40
41
42
43
44
45
46
47
48
49

9. Measures net inflow from abroad of dividends and branch profits; the net inflow from
abroad of undistributed profits and corporate profits tax liability is excluded from this line
and from the national income aggregate.
10. Includes excess of accruals over disbursements, in millions of dollars, as follows: 1951.
$44; 1952, $32; 1953, - $ ? 6 .

176

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS
Table 1 3.—National Income by Industrial Origin, 1929-38

[Millions of dollars]
1929

1930

1931

1932

1933

1934

1935

All industries, total
Agriculture, forestry, and fisheries
Farms
Agricultural services, forestry, and fisheries-.
Mining
Metal mining
Anthracite mining...
Bituminous and other soft-coal mining
Crude petroleum and natural gas
Nonmetallic mining and quarrying
Contract construction..
_
_

87,814
8,278

59,708

42,547

4,895
4,727

2,048
466
284
649
447
202

1,628
275
282
531
348
192

969
106
229
374
150
110

3,808

3,179

21,888
2,135
256
1,796
1,262
1,528

18,232
2,394
299
1,405
1,003
1,122

2,203
12,419
1,860
322
1,148
808
653

48,959
3,723
3,603
120
1,158
123
172
417
376
70
1,066

Manufacturing
Food and kindred products
Tobacco manufactures
Textile-mill products
Apparel and other finished fabric products
--Lumber and furniture products •
Lumber and wood products, except furniture
Furniture and fixtures
Lumber and timber basic products
Furniture and finished lumber products
Paper and allied products
Printing, publishing, and allied industries.
Chemicals and allied products»
Products of petroleum and coal 2
R u b b e r products
Leather and leather products
Stone, clay, and glass products.
Metals, metal products, and miscellaneous'
Primary metal industries
Fabricated metal products, including ordnance
Instruments
f
Miscellaneous manufacturing
Iron and steel and their products, including ordnance.
Nonferrous metals and their products
Miscellaneous manufacturing
Machinery, except electrical !
Electrical machinery '
Transportation equipment, except automobiles
Automobiles and automobile equipment

3,332
3,199
133
673
20
151
241
211
50
1,056
7,207
1,409
312
714
498
329

40,159
3,713
3,590
123
647
38
130
257
181
41

57,057

195

75,729
6,226
6,044
182

852
676
562
1,589
1,129
917
355
602
799
4,323

615
507
504
1,501
1,036
809
274
491
613
3,347

281
372
388
1,220
830
309
232
390
439
1,861

118
211
270
883
561
121
113
305
123
768

123
182
290
793
621
76
102
271
208
1,031

264
283
418
928
726
120
134
413
330
1,781

2,970
757
596
1,890
1,045
315
1,385

2,217
634
496
1,481
824
288
841

1,110
412
339
753
503
142
561

13,358
4,222
9,136

12,229
4,053
8,176

Finance, insurance, and real estate-.
Banking
Security and commodity brokers, dealers and exchanges..
Finance, n. e. c
Insurance carriers.
Insurance agents and combination offices
Real estate

12,693
1,957
655
200
888
421
8,572

10,592
1,480
144
6
808
402
7,752

6,636
4,597
825

5,604
3,766
766

9,743
3,181
6,562
8,646
985
70
-28
718
366
6,535
4,369
2,828
633

153
194
424
276
69
382
5,485
1,781
3,704
5,745
495
260
0
571
289
4,130
3,036
1,866
450

381
314
733
376
119
649

Wholesale and retail trade
Wholesale trade
Retail trade and automobile services

410
196
162
299
245
89
168
6,354
2,158
4,196
6,753
733
98
-63
576
328
5,081
3,210
1,979
512

560
266
-3
129
262
2,864
1,125
28
1,631
80
10,338
599
1,279
3,253
40
561
312
440
381
1,536
689
206
402
640
5,093
879

533
216
-10
105
228
2,790
1,097
9
1,608
76
9,187
543
1,203
2,363
38
559
301
438
337
1,476
683
184
413
649

481
173
4
81
169
2,628
991
16
1,563
58
7,863
442
1,030
1,815
31
445
273
361
269
1,306
701
152
412
626

418
127
10
56
108
2,286
794
21
1,410
61
6,133
305
800
1,362
22
356
224
194
178
1,037
591
102
393
569

5,316
915

5,426
921

581
3,456

584
3,630

177
810

187
746

Transportation
Railroads.
Local and highway passenger transportation
Local railways and buslines
Highway passenger transportation, n. e. c
Highway freight transportation and warehousingWater transportation
_
Air transportation (common carriers)
Pipeline transportation
Services allied to transportation
Communications and public utilities
Telephone, telegraph, and related services.
Radio broadcasting and television
Utilities: electric a n d gas
Local utilities and public services, n . e. c
Services
Hotels and other lodging places
Personal services
Private households
Commercial and trade schools and employment agenciesBusiness services, n. e. c
Miscellaneous repair services and hand trades
Motion pictures
Amusement and recreation, except motion pictures
Medical and other health services
Legal services
Engineering and other professional services, n. e. c
Educational services, n. e. c
Nonprofit membership organizations, n. e. c
Government and government enterprises
Federal—general government
Civilian, except work relief
Military
Work relief
Federal—government enterprises.-.
State and local—general government
Public education.._
Nonschool, except work relief.
—
Work relief
State and local—government enterprises
Rest of the world

1. National income originating in each industry is the sum of factor costs Incurred by the
industry in production. Hence, It is the net value added to production by the industry,
measured at factor costs. In the business sector of the economy, except government enterprises, it is equal to the excess of the market value of the industry's product and the subsidies
it receives over the sum of the following costs: purchases of goods and services from other
enterprises, indirect business tax and nontax liability, business transfer payments, and capital consumption charges. . In the other sectors of the economy (government, personal, and

755
7,562
1,331
142
699
542
305

10,905
1,599
146
1,102
784
547

1937

16,182
2,076
134
1,361
973
891

73,618
7,214
7,029
185
1,912
452
137
600
581
142
2,078
19,305
2,401
196
1,601
992
1,072

328
341
461
1,042
806
208
213
376
409
2,345

449
442
505
1,171
961
317
214
424
576
3,084

564
508
565
1,253
1,167
542
292
461
653
3,806

1,478
461
406
1,014
526
139
930

557
458
1,398
710
232
1,155

6,411
6,268
143
1,211
166
139
446
378
82
1,297
13,265
1,873
203
1,201
850

64,911
5,405
5,266
139
1,520
263
146
535
461
115
1,983

2,597
699
510
1,760
912
332
1,300
12,212
3,926

5,633
541
215
19
650
315
3,893
3,415
2,062
485

9,200
2,919
6,281
5,933
665
183
77
720
330
3,958
3,700
2,250
478

10,590
3,234
7,356
6,580
778
279
140
801
347
4,235
4,277
2,635
535

4,634
2,808
546

416
153
10
47
94
2,000
691
14
1,237
58
5,567
271
695
1,199
20
330
191
210
154
948
561
98
363
527

466
178
8
103
113
2,198
741
32
1,359
66
6,231
341
782
1,336
23
424
203
283
197
1,036
600
113
361
532

526
200
14
106
126
2,280
777
38
1,401
64
6,669
371
857
1,428
29
473
218
329
211
1,115
624
121
365
528

654

5,150

5,326
1,164

6,271
1,694

6,724
1,768

587
243
22
107
148
2,487
842
53
1,528
64
7,479
413
958
1,662
32
574
230
391
253
1,253
647
144
376
546
8,108
3,570

582
3,737

544
3,565

485
3,531

540
3,884

614
4,178

186
547

161
393

146
323

153

164
367

8,056
2,476
5,580

7,237
895
243
151
906
386
4,656

130
177
2,725
925
66
1,668
66
8,246
471
1,110
1,930
39
607
247
437
305
1,323
680
156
394
547
7,772
3,013

675
3,889

180
300

195
283

rest-of-the-world) and also in government enterprises, this value added in production (as
measured in the present series) can be described only as factor costs incurred. " National
income originating" is a more net concept of value-added than that used by the Bureau of the
Census in compliling the Census of Manufactures. "Value added by manufacture" was
obtained in the 1947 Census of Manufactures by deducting from the value of products only
"the cost of materials, supplies, containers, fuel, purchased electric energy, and contract
work." National income by industrial origin is obtained statistically by aggregating the data

177

NATIONAL INCOME, 195 4 EDITION
Table 13.—National Income by Industrial Origin, 1939-53

[Millions of dollars
1942

1943

1944

1945

1946

1947

1948

1949

1950

1951

1952

1953

170,310
14,143
13, 864
279
2,741
498
213
1,133
646
251
5,460

182,639
14,483
14,152
331
2,891
403
239
1,263
757
229
4,135

181,248
14,889
14,526
363
2,717
334
219
1,195
71
4
228

197,168
18,244
17,777
467
4,191
515
300
1,815
1,178
383
8,401

221,641

216,193
16,646
16,117
529
4,355
513
259
1,460
1,670
453

290,959
18,653
17, 955
698
5,320
836
249
1,544
2,081
610
14,518

305,002
16,821
16,102
719
5,507
932
183
1,493
2,250
649
15,199

58,149
4,395
189
3,014
2,418
2,089

60,124
4,951
283
2,965
2,705
2,170

48,479
5,539
326
4,005
3,355
2,811

58,717
5,803
364
4,657
3,383
3,455

66,630
6,646
399
5,163
3,500
'3,831
2,639
1,192

239,956
17,232
16, 673
559
4,998
693
277
1,701
1,816
51
1
11,461
74,235
6, 753
512
4,551
3,424
4,187
2,795
1,392

277,041

4,280
52,008
5,010
236
3,015
2,914
2,133

179,577
17,344
16,927
417
2,970
302
283
1,242
839
304
6,477

33,027
2,737
220
2,067
1,463
1,691

137,694
12,403
12,148
255
2,571
581
192
989
556
253
6,471
45,343
3,693
185
2,852
1,928
1,973

89,831
7,629
572
4,541
3,849
4,368
2,839
1,529

97,323
8,057
615
4,366
3,998
4,353
2,765
1,588

51
9
563
665
1,254
1,488
639
321
41
0
760
4,502

907
784
1,030
1,363
1,940
826
489
617
1,070
7,165

1,090
883
1,124
1,434
2,774
1,152
594
778
1,171
9,593

1,138
91
5
1,257
1,739
3,349
1,459
898
859
1,192
12,589

1,142
1,028
1,348
2,029
3,350
1,326
1,019
884
1,134
12,598

1,080
1,053
1,341
2,234
3,221
1,244
928
925
1,146
10,679

1,448
1,363
1,696
2,697
3,271
1,510
1,082
1,082
1,561
8,851

1,938
1,517
2,208
3,055
3,763
2,209
1,124
1,114
1,852
11,094

3,078
790
634
2,179
1,134
810
1,600

6,895
1,491
1,207
5,395
2,474
6,214
2,009
20,312
6,195
14,117

9,068
1,945
1,576
5,917
3,347
12,105
1,333

9,045
1,934
1,619
5,807
3,708
12,446
1,401

7,389
1,686
1,604
5,084
3,051
7,730
1,117

5,531
1,753
1,567
4,717
2,376
1,691
1,909

7,566
1,912
1,616
6,192
3,398
1,524
3,522

27,997
8,242
19, 755

10,649
1,188
78
364
1,021
468
7,530
8,598
5,568
904

23,831
6,911
16,920
11,569
1,410
173
283
1,101
488
8,114
10,784
6,971
1,218

25,745
7,640
18,105
12,197
1,661
178
273
1,087
529
8,469
11,245
6,899
1,293

12,830
1,829
315
272
1,077
568
8,769
10,536
6,009
1,306

34,417
10,393
24,024
14,479
2,167
283
333
1,183
750
9,763
10,245
5,466
1,412

37,341
11,651
25,690
15,250
2,159
132
403
1,403
852
10,301

4,642
2,737
515

14,337
4,463
9,874
8,208
981
139
192
893
405
5,598
5,040
2,944
526

5,076
1,200
889
3,844
1,893
2,262
2,350
17,254
5,228
12,026
9,172
1,097
109
225
918
444
6,379
6,300
3,778
582

11,498
6,294
1,393

41,522
13,049
28,473
17,355
2,406
184
540
1,869
933
11,423
12,644
7,104
1,378

739
280
44
11
3
196
2,863
1,005
76
1,717
65
8,276
481
1,049
1,866
34
638
21
6
434
288
1,381
692
11
8
415
556
8,523
3,414

815
336
57
11
3
231
3,056
1,025
91
1,872
68
8,854
530
1,150
2,056
34
666
21
6
449
310
1,463
719
13
9
424
599
8,762
3,489

1,021
432
77
145
265
3 324
1,135
106
2,011
72
9,806
584
1,286
2,188
57
779
350
513
368
1,575
763
264
439
640
10,500
5,027

1,183
425
13
1
117
288
3,669
1,367
109
2,121
72
10,981
674
1,548
2,201
112
826
419
652
388
1,806
793
385
461
716
16,332
10, 645

1,308
595
11
5
129
412
3,934
1,547
139
2,169
79
12,295
877
1,893
2,107
159
915
610
830
436
1,988
814
344
603
819
27,037
20,899

1,354
857
175
145
522
4,062
1,652
175
2,152
83
13,618
983
2,012
2,360
134
1,055
701
883
507
2,341
874
320
532
916
33,716
27,250

1,390
989
192
11
3
519
4,244
1,751
186
2,218
89
14,614
1,085
2,121
2,635
72
1,179
703
930
613
2,459
930
335
569
983
36,764
29, 786

1,699
823
217
126
502
4,792
1,973
203
2,523
93
17,205
1,322
2,552
2,766
89
1,471
843
1,133
810
3,024
954
454
660
1,127
22,592
14,545

1,993
814
243
11
5
610
5,114
2,077
226
2,709
102
18,919
1,287
2,634
3,272
114
1,634
938
1,054
794
3,544
1,033
560
813
1,242
18,619
9,343

2,272
810
306
192
582
5,894
2,462
253
3,065
114
20,496
1,328
2,765
3,617
135
1,847
965
921
824
3,910
1,180
665
9S1
1,358
19,658
8,872

719
4,185

746
4,289

808
4,388

918
4,473

1,139
4,663

1,188
4,938

1,248
5,370

1,448
6,177

1,440
7,320

205
313

238
357

277
363

296
365

336
367

340

360
369

422

516
874

1941

1939

1940

72,753
5,933
5,761
172
1,582
343
126
501
482
130
2,323

81,634
6,247
6,073
174
1,868
440
138
621
518
11
5
2,569

104,710
8,470
8,269
201
2,299
504
165
805
620
205
4,195

17,925
2,269
297
1,261
1,028
1,001

22,336
2,462
260
1,509
1,138
1,154

494
507
556
1,213
1,202
434
278
424
663
3,377

2,267
51
9
519
1,490
852
396
1,184
12,453
3,830
8,623
7,920
882
165
168
926
390
5,389

423

577

presented in tables 14 and 18 and the industry detail underlying tables 17, 23, and 24 together
with the rental income of persons (shown in table 12 and classified in the real estate industry.)
Footnotes to these tables are, therefore, relevant also to table 13.
2. For certain manufacturing industries, the 1929-47 values shown are not comparable with
those given for 1948 and subsequent years. The discontinuities stern from changes in the
industrial classification system on which the tabulations of basic data are prepared. See
Introduction to Part I I I and notes to tables 15 and 18. Of the industry series principally

20,815
20,290
525
5,246
640
342
2,087
1,729
448
10,305

10,369
62,757
6,508
512
4,139
3,331
3,349
2,189
1,160

20,285
19,648
637
5,551
815
276
1,809
2,062
589
13,551
87,734
6,999
525
5,176
3,702
4,631
3,118
1,513

2,340
3,286
4, 278
'3,306
1,066
1,249
2,133
313,009
5,896
4,387
1,016
1,710

2,162
3,426
4,308
2,527
954
1,111
2,076
11,965
5,387
3,986
995
1,597

2,685
3,620
5,103
2,889
1,045
1,132
2,631
15,370
7,112
5,085
1,242
1,931

3,355
3,870
6,146
3,620
1,626
1,346
3,004
18,809
8,995
6,178
1,585
2,051

3,144
4,070
6,109
3,217
1,738
1,363
2,827
18,207
7,900
6, 504
1,767
2,036

3,338
4,389
6,481
3,426
1,730
1,385
3,037
21,082
9,404
7,451
1,960
2,267

s 6,889
• 3,628
1,867
4,040

6,198
3,456
1,918
4,817
40,504
12,299
28,205

7,247
4,404
2,051
6,631
43,449
13,694
29, 755
20,671
2,893
355
801
2, 250
1,057
13,315

9,796
5,450
3,349
6,330
47,880
15,922
31,958
22,407
3,310
350
985
2,199
1,147
14,416

10,598
6,985
5,785
7,698
52,350
17,138
35,212

13,266
7,109
1,336

14,884
7,792
1,432

10, 585
6,184
4,945
6,483
50,938
16, 781
34,157
24,434
3,711
259
1,114
2,370
1,226
15, 754
15,618
7,980
1,460

3,128
966
540
281
745
8,256
3,333
388
4,399
136
24,754
1,380
3,012
4,941
166
2,324
1,110
857
848
4,935
1,373
930
1,174.
1,704
30,192
16,164

3,456
998
638
308
778
9,206
3,696
433
4,923
154
26,638
1,491
3,138
5,217
160
2,619
1,261
837
889
5,387
1,417
1,135
1,245
1,842
34,340
18,708

3,851
1,052
690
319
797

6,566
2,672
263
3,512
119
21,180
1,287
2,807
3,885
11
5
1,864
933
898
787
4,147
1,231
662
1,075
1,453
21,879
9,926

2,780
746
432
255
608
7,172
2,958
314
3,779
11
2
22,757
1,309
2,861
4,539
169
2,034
971
844
792
4,496
1,317
727
1,135
1,563
23,449
10,649

10,195
4,118
481
5,430
166
28,847
1,561
3,291
5,981
153
2,923
1,350
835
958
5,802
1,499
1,240
1,299
1,955
34,868
18,132

1,627
8,502

1,806
9,422

1,897
10,124

2,081
11,069

2,357
12,265

2,331
13,305

657
1,076

725
1,078

878

1,266

1,010
1,463

1,100
1,500

18,890
2,568
180
697
2,260
949
12, 236
11,969
6,369
1,351
2,377
750
349
202
51
7

779

1,547

26,384
4,123
235
1,222
2,639
1,329
16,836
16,008
7,789
1,510

Line

1
1
1
1
1
1
1
1
j

2
2
2
2,
2
"
2
2
2
"
2
f
2
1
3
o
3
3
3
3
3
3
3
f
3
4i
4
4
4
4
4
4
4
4!
4

a
5
5
5,
5*
5
5
5
<
6
(
6
1
6
!

K
6
4
6
>
6
(
6
"
6
S
6
<

7
(

71
74
7
»
7
f
7"
7
S
7!
81
8
85
&
$
8.
8f
8'
8
1
8
!
9
C
9
1

Involved here, five have been terminated in 1947, the others are indicated by footnotes.
3. See note 2. Estimates of 1948 national income comparable to thoseshown forl947inthe
specified industries are as follows: Lumber and furniture products, $3,954 million; Chemicals
and allied products, $4,427 million; Products of petroleum and coal, $3,290 million; Metals,
metal products and miscellaneous, $12,546 million; Machinery, except electrical, $7,011; and
Electrical machinery, $3,693 million.

178

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS
Table 14.—Compensation of Employees, by Industry, 1929-38 '
[Millions of dollars]
1929

1931

1932

1933

1934

1935

1936

1937

51,085

46,844

39,740

31,054

29,539

34,295

37,340

42 910

47,934

1,406

AH industries, total..

1930

1,011
907
104

747
663
84

687
612
75

748
675
73

859
773

950
867

1,105
992
113

1,011
104
208
387
228
84

698
54
153
266
172
53

700
53
134
284
182
47

927
69
162
394
245
57

985
89
143
430
262
61

1,162
130
142
515
296
79

1,368
206
141
573
351
97

Agrlcultnre, forestry, and fisheries
Farms
Agricultural services, forestry, and fisheries

1,291
115

1,290
1,180
110

Mining
Metal mining.
Anthracite mining
Bituminous and other soft-coal mining
Crude petroleum and natural gas
Nonmetallic mining and quarrying

1,539
204
265
618
326
126

1,349
169
256
515
298
111

Contract construction

2,540

2,142

1,529

863

639

788

920

1,350

1,463

16,243
1,586
143
1,465
1,055
1,330

13,991
1,540
131
1,207
916
1,038

10,933
1,346
109
1,072
784

7,783
1,115
85
774
561
434

7,921
1,149
74
903
572
456

9,746
1,344
84
1,012
693
533

10,961
1,411
84
1,117
783
632

12,672
1,532
90
1,178
850
783

15,186
1,731
101
1,303
895
923

713
617
435
1,243
671
248
283
494
627
3,141

547
491
417
1,248
629
248
224
420
533
2,643

309
389
355
1,071
536
200
169
366
390
1,880

179
2-55
277
843
420
166
133
293
243
1,164

201
255
283
722
428
156
142
305
231
1,248

255
278
337
813
502
181
178
354
290
1,622

303
329
362
872
532
204
184
369
334
1,939

384
399
403
958
584
219
213
381
410
2,432

459
464
476
1,076
701
265
213
423
506
3,081

2,147
544
450
1,408
868
264

1,820
421
402
1,185
720
256

1,230
326
324
783
491
168
515

736
207
221
497
290
118
370

821
207
220
500
306
94
352

267
266
685
413
134
571

1,314
321
304
832
466
146
694

1,703
383
346
1,050
582
209

2,196
484
401
1,391
778
286
1,007

Wholesale and retail trade
Wholesale trade
Retail trade and automobile services

9,374
3,3fl7
5,977

8,766
3,220
5,546

7,634
2, 757
4,877

5,956
2,1S2
3,804

5,331
1,895
3,436

6,159
2,192
3,967

6,68.1
2,382
4,301

7,341
2, 597
4,744

8,442
2,984
5,458

Finance, insurance, and real estate
Banking
Security and commodity brokers, dealers and exchanges.__
Finance, n. e. c
Insurance carriers
Insurance agente and combination oflices
Real estate
.._

2,989
784
403
257
821
240
479

2,808
739
321
247
828
232
441

2,527
670
267
223
777
210

2,145
582
235
198
648
187
295

1,939
499
245
178
579
166
272

2,031
516
234
184
604
1P0
313

2,111
524
206
201
645
190
345

2,313
542
252
233
6F9
206
391

2,524
574
260
256
7?8
224
452

Transportation.
Railroads..
Local and highway passenger transportation.
Local railways and buslines
Highway passenger transportation, n. e. c
Highway freight transportation and warehousingWater transportation
Air transportation (common carriers)
Pipeline transportation
Services allied to transportation

4,813
3,303
661
482
179
333
215
5

4,332
2,92fi
621
453
168
322
195
9
42
217

3,622
2,407
541
402
139
295
168
13
38
160

2,736
1, 752
435
329
106
263
137
14
29
106

2,537
1,628
373
2S3
90
258
144
14
29
91

2,766
1,782
389
296
93
286
154
14
34
107

2,961
1,894
405
307
98
327
162
17
36
120

3,357
2,154
435
326
109
36fi
198
22
40
142

3,762
2,377
471
349
122
426
238
28
49
173

756
10
751
32

1,572
754
15
771
32

1,437
674
21
712
30

1,217
565
24
602
26

1,090
499
21
547
23

1,170
529
25
591
25

1,231
542
27
636
26

1,346
587
34
697

1,525
668
45
785
27

5,538
427
755
1,718
34
359
108
310
323
398
124
81
296
605
5,093
879

5,277
409
730
1,485
33
371
106
313
299
406
131
75
307
612
5,316
915

4,609
343
646
1,148
27
311
98
307
266
386
132
55
311
589
5,426
921

3,758
258
52«
836
19
262
83
241
191
346
126
36
303
531
5,150
880

3,368
219
459
733
16
243
73
227
161
317
118
34
281
487
5,326
1,164

3,688
272
500
851
18
294
76
253
176
324
116
37
279
492
6,271
1,694

3,904
289
529
912
22
326
81
282
180
349
121
40
284
489
6,724
1,768

4,310
318
584
1,017
26
392
84
317
205
388
126
51
295
507
8,108
3,570

4,786
363
652
1,190
31
414
91
3fiO
239
433
135
57
312
509
7,772
3,013

581
1,456

584
3,630

582
3,737

544
3,565

4S5
3,531

540

614
4,178

662
3,696

675
3,889

177
1
45,991

187
1
41,527

186
1
34,313

161
1
25,903

146
1
24,212

153
1
28,023

164
1
30,615

180
1
34,801

195
1

Manufacturing
_
Food and kindred products
Tobacco manufactures
Textile-mill products
Apparel and other finished fabric products.
Lumber and furniture products !
Lumber and wood products, except furniture
Furniture and fixtures
Lumber and timber basic products
Furniture and finished lumber products
Paper and allied products
Printing, publishing, and allied industries
Chemicals and allied products'
Products of petroleum and coal !
Rubber products
Leather and leather products
Stone, clay, and glass products
_
Metals, metal products, and miscellaneous •
Primary metal industries
Fabricated metal products, including ordnance...
Instruments
Miscellaneous manufacturing
Iron and steel and their products, including ordnance..
Nonferrous metals and their products
Miscellaneous manufacturing
Machinery, except electrical'
Electrical machinery'
Transportation equipment, except automobiles
Automobiles and automobile equipment

Communications and public utilities
Telephone, telegraph, and related servicesRadio broadcasting and television
Utilities: electric and gas...
Local utilities and public services, n. e. c . . .
Services
Hotels and other lodging places
Persona! services
Private households
Commercial and trade schools and employment agencies.
Business services, n. e. c
Miscellaneous repair services and band trades
Motion pictures
Amusement and recreation, except motion pictures
Medical and other health services
Engineering and other professional services, n. e. c.
Educational services, n. e. c
Nonprofit membership organizations, n. e. c
Government and government enterprises
Federal—general government
Civilian, except work relief
Military
Work relief
Federal—government enterprises
State and local—general government
Public education
Nonschool, except work relief
Work relief
State and local—government enterprises
Rest of the world
Addendum: All private industries

1. Compensation of employees is the sum of wages and salaries (table 15) and supplements
to wages and salaries (table 16). Footnotes to tables 15 and 16 are, therefore, relevant also to
table 14.

40,161

parable to those shown for 1947 In the specified Industries are as follows: Lumber and furniture
products, $3,043 million; Chemicals and allied products, $2,602 million; Products of oetroleum
and coal, $1,125 million; Metals, metal products, and miscellaneous, $9,733 million; Machinery,

179

NATIONAL INCOME, 1 9 5 4 EDITION

Table 14.—Compensation of Employees, by Industry, 1939-53 '
[Millions of doHarsl
1939

1940

1941

48,108

52,129

64,789

1,097
992
105

1,141
1,035
106

1,375
1,257
118

1,204
168
130
480
335
91

1,360
203
124
570
357
106

1,621
246
143
712
383
137

1943

1944

1945

1946

1947

1948

1949

1950

1951

1952

1963

85,271

109,587

121,286

123,181

117,697

128,757

140,927

140,858

154 325

180,420

195,423

209,061

1,797
1,645
152

2,206
2,042
164

2,412
2,218
194

2,523
2,315
208

2,801
2,563
238

3,097
2,829
268

3,333
3,040
293

3,157
2,867
290

3,043
2,735
308

3,288
2,943
345

3,393
3,019
374

3,457
3,074
383

1,855
287
165
858
374
171

2,072
324
187
957
425
179

2,285
277
209
1,091
538
170

2,261
240
203
1,056
595
167

2,470
242
248
1,111
651
218

3,070
309
262
1,463
775
261

3,543
353
293
1,652
953
292

3,127
339
238
1,277
975
298

3,440
368
254
1,465
1,023
330

3,910
448
260
1,619
1,195
388

3,966
502
246
1,432
1,368
418

4,074
560
198
1,403
1,461
452

1s
C

1942

Line

1,650

1,821

3,074

4,925

4,120

3,037

3,107

4,621

6,108

7,409

7,257

8,311

10,287

11,173

11,637

14,321
1,707
102
1,224
967
890

16,397
1,790
108
1,261
980
981

22,775
2,018
119
1,673
1,261
1,284

32,248
2,392
125
2,001
1,497
1,496

42,65S
2,764
152
2,137
1,786
1,648

44,960
3,106
165
2,127
1,965
1,710

40,182
3,269
179
2,199
2.078
1,715

38,178
3,750
197
2,803
2,555
2,192

44,537
4,282
207
3,219
2.744
2,767

48,604
4,560
215
3,663
2,993
> 2,950
1,94S
1,002

46,124
4,629
226
3,278
2,891
2,680
1,724
956

52,535
4,908
236
3,744
3,118
3,229
2,060
1,169

62,373
5,423
272
3,881
3,263
3,597
2,364
1,233

67,528
5,699
289
3,756
3,400
3,670
2,362
1,308

75,052
6,048
304
3,788
3,619
3,740
2,352
1,388

1
5
1
C
1
4
1,
1
(

432
458
468
1,037
702
2c0
23S
405
494
2,781

489
492
515
1,044
849
326
258
401
542
3,376

654
630
652
1,119
1 150
'388
351
530
710
4,805

795
701
731
1,134
1,731
477
414
607
808
6,706

882
766
849
1, 225
2.118
576
575
648
875
9,360

910
800
920
1,353
2,172
705
670
674
880
9,682

884
831
976
1,526
2,210
773
662
727
899
8,614

1,090
1,102
1,187
1,981
2,i'72
822
778
905
1,180
7,477

1,395
1,372
1,408
2,344
2,394
991
866
978
1,402
8,923

1,572
2, 607
2 2.5 3
2 1,154
844
1,010
1,593
«10,034
4 393
3,473
828
1,340

1,541
2,752
2,505
1,186
778
971
1,530
9,187
3 931
3,210
794
1,252

2,045
3,143
3,321
1,453
1,089
1,062
2,108
13,459
6,000
4,699
1,193
1,567

2,134
3,371
3,613
1,585
1,189
1,147
2,097
14,469
6,057
5,421
1,366
1,625

2,368
3,644
4,041
1,702
1,292
1,190
2,293
16,734
6,937
6,393
1,546
1,858

1,907
453
421
1,167
673
324
864

2,334
547
495
1,505
8(18
555
1,098

3 347
780
678
2, 435
1,224
I, 518
1,538

4,724
1,066
916
3,712
1,805
4,899
1,713

6,817
1,360
1,183
4,319
2,479
10,146
1,001

1,780
2, 928
2,752
1,214
918
1,047
1, 765
11,055
4,864
3,827
931
1,433

7,089
1.393
1,200
4,356
2,834
10,545
1,096

6,090
1,304
1,220
4,069
2,544
6,797
945

4,704
1,412
1,361
4,142
2.352
1,846
1,939

5,942
1,491
1,490
5, (141
2,859
1,674
2,438

' 5, 499
! 2, 949
1,771
2,687

4,781
2,678
1,726
2,785

5,379
3,177
1, 753
3, .532

7,262
4,048
2,982
3,965

8,045
4,698
4.283
4,083

8,605
6,519
5,072
5,093

24
2
>
2
(
2"
28
2
S
3C
3;
3!
3
1
3'
3
1
3
1
37
3S
Si
4
C

8,729
3,141
5,588

9,374
3.358
6,016

10,773
3,935
6,838

11,349
4,182
7,167

12,289
4,366
7,923

13,426
4, 755
8,671

15,166
5,307
9,859

20,195
6,901
13,294

23,622
8,248
15,374

26,053
9,159
16,894

26,434
9,131
17,303

28,330
9,869
18, 161

31,123
11,077
20,016

32,947
11,753
21,194

35,055
12,603
22,452

41
42
43

2,522
600
180
232
797
232
481

2,599
622
170
245
820
231
511

2,752
654
158
271
870
245
554

2,864
710
131
270
910
266
577

3,013
765
154
251
942
284
617

3,166
829
167
243
968
298
661

3,436
903
228
247
1,033
324
701

4,307
1,086
286
314
1,296
430
895

4,722
1,227
237
361
1,481
467
949

5,295
1,360
246
413
1,676
535
1,075

5,554
1,432
240
457
1,823
566
1,036

6,159
1,545
312
498
2,003
643
1,158

6,762
1,739
338
576
2,191
700
1,218

7,314
1,914
336
656
2,416
747
1,245

7,955
2,102
346
725
2,676
809
1,297

44
4
J

3,644
2,240
455
327
128
465
224
36
44
180

3,866
2,373
441
301
140
524
240
45
46
197

4,520
2,803
472
300
172
643
274
57
51
220

5,596
3. 632
609
353
256
771
314
80
58
232

6,956
4,264
785
433
352
883
487
118
69
350

7.989
4,713
880
477
403
965
760
135
82
454

8,388
4,758
958
511
447
1,053
902
160
87
470

9,016
5,144
1,125
671
554
1,255
701
246
93
452

9,664
5,446
1,195
605
590
1,459
636
286
111
531

10,218
5,777
1,174
563
621
1,670
665
309
132
521

9,875
5,387
1,166
661
605
1,758
599
325
130
510

10,430
5.596
1.148
548
600
2,083
689
349
124
641

11,978
6,425
1,211
568
643
2,399
712
423
143
665

12,521
6,465
1,249
575
674
2,659
774
520
160
694

13,042
6,442
1,276
685
691
3,006
855
583
164
716

5
1
5
5
5
2
64
5
>
5
£
S
"
6
8
5
S
6
C

1,576
695
55
798
28

1,657
720
62
845
30

1,806
807
71
897
31

2,024
1,006
87
898
33

2,166
1,083
105
942
36

2,410
1,227
122
1,021
40

3,067
1,615
147
1,269
46

3,563
1,816
173
1,622
52

4,119
2,096
206
1,760
57

4,376
2,188
227
1,902
59

4,619
2,239
258
2,060
62

5,111
2,465
302
2,277
67

5,636
2,730
335
2,496
75

6,154
2,985
371
2,716
82

61
6
5
6
C
64
6
f

4,840
376
638
1,132
28
433
97
353
230
478
142
75
337
521
8,523
3,414

5,149
402
712
1,221
28
443
94
353
246
513
144
80
348
565
8,762
3,489

5,587
430
799
1,240
46
491
125
386
270
558
151
123
362
606
10,500
6,027

1,903
890
76
904
33
6,392
459
925
1,480
91
807
148
4?5
281
641
150
214
389
682
16,332
10,645

7,198
541
1,078
1,600
133
554
214
477
291
744
149
199
433
785
27,037
20,899

8,117
631
1,182
1,890
102
652
243
531
337
845
159
197
465
883
33,716
27, 250

8,933
695
1,311
2,145
59
753
245
573
384
932
169
221
464
952
36,764
29, 786

10,433
849
1,632
2,123
69
961
308
702
523
1,134
184
275
578
1,095
22,592
14,545

11,738
912
1,750
2,350
92
1,104
358
718
565
1,410
209
334
727
1,209
18,619
9,343

12,649
955
1,819
2,384
110
1,258
369
681
610
1,610
230
408
890
1,325
19,658
8,872

13,059
960
1,822
2,415
125
1,284
357
684
609
1,753
248
410
977
1,415
21,879
9,926

13,991
980
1,880
2,671
139
1,403
367
681
622
1, 9S0
266
437
1.034
1,521
23,449
10.649

15,376
1,044
1,997
2,846
133
1,599
466
705
648
2,303
297
610
1,068
1,660
30,192
16,164

16,580
1,109
2,093
2,871
126
1,806
531
721
683
2,600
328
790
1,127
1,795
34,340
18, 708

17,747
1,160
2,184
3,065
118
2,011
553
711
731
2,903
362
869
1,174
1,906
34,868
18,132

719
4,185

746
4,289

808
4,388

918
4,473

1,139
4,663

1,188
4,938

1,248
6,370

1,448
6,177

1,440
7,320

1,627
8,502

1,806
9,422

1.897
10,124

2,081
11,069

2,357
12,265

2,331
13,305

205
2
39,583

238
3
43,364

277
6
54,283

296
10
68,929

336
14
82,536

340
12
87,558

360
11
86,406

422
17
95,088

516
17
110,121

657
16
121,253

725
16
118,963

779
18
130,858

878
20
150,208

1,010

1,100
20
174,173

6
«
6
"
68
61
7
C
71
72
7
3
7
4
7
£
7
6
7"
78
7
£
80
81
85
SS
84
85
86
87
88
89
90
91
92

25
161,053

r
i
s

1
!
2
C
2
2
5

2
C

4
e

4"
48

4
£
5
C

180

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS
Table 15.—Wages and Salaries, by Industry, 1929-38
(Millions of dollars]
1929
All industries, total.

Agriculture, forestry, and fisheries
Farms
Agricultural services, forestry, and fisheries
Mining.
Metal mining
Anthracite mining..
Bituminous and other soft-coal mining
Crude petroleum and natural gas
Nonmetallic mining and quarrying..
Contract construction.
Manufacturing
Food and kindred products
Tobacco manufactures.
Textile-mill products
Apparel and other finished fabric products
Lumber and furniture products 1 ...
Lumber and wood products, except furniture
Furniture and fixtures
Lumber and timber basic products.
_
Furniture and finished lumber products
Paper and allied products..
Printing, publishing, and allied industries
Chemicals and allied products'
Products of petroleum and coal'
Rubber products
Leather and leather products
Stone, clay, and glass products
Metals, metal products, and miscellaneous '
Primary metal industries
Fabricated metal products, including ordnance
Instruments
Miscellaneous manufacturing
Iron and steel and their products, including ordnance.
Nonferrous metals and their products
Miscellaneous manufacturing
Machinery, except electrical'
Electrical machinery '
_
_
Transportation equipment, except automobiles
Automobiles and automobile equipment
Wholesale and retail trade
Wholesale trade
Retail trade and automobile services.
Finance, Insurance, and real estate..
Banking
_
Security and commodity brokers, dealers and exchanges..
Finance, n. e. c
Insurance carriers
_
Insurance agents and combination offices
Real estate
Transportation
_
_
_
Railroads...
Local and highway passenger transportation
Local railways and buslines
Highway passenger transportation, n. e. c
Highway freight transportation and warehousingWater transportation
__
Air transportation (common carriers).
Pipeline transportation
Services allied to transportation
_
Communications and public utilities.
Telephone, telegraph, and related services..
Radio broadcasting and television
Utilities: electric and gas
Local utilities and public services, n. e. c . . .
Services.
Hotels and other lodging places..
Personal services
Private households
Commercial and trade schools and employment agencies.
Business services, n. e. c
Miscellaneous repair services and hand trades
Motion pictures
Amusement and recreation, except motion pictures
Medical and other health services
Legal services
Engineering and other professional services, n. e. c
Educational services, n. e. c
_
Nonprofit membership organizations, n. e. c
Government and government enterprises
Federal—general government 8
Civilian, except work relief
Military'..
_
Work relief
Federal—government enterprises
State and local—general government
Public education
Nonschool, except work relief
Work relief
State and local—government enterprises
-.
Rest of the world'
92

Addendum: AH private industries.

1930

1931

1932

1933

1934

1935

50,423
1,401
1,287
114

39,119
1,006
903
103
993
102
205
380
223
83
1,477
10,810
1,326
109
1,065
781

30,477
742
659

2,484
16,092
1,565
142
1,458
1,051
1,319

46,187
1,285
1,176
109
1,327
166
252
506
293
110
2,085
13,850
1,519
131
1,200
913
1,028

683
53
151
259
168
52
823
7,678
1,096
85
768
558
428

28,997
683
609
74
686
52
132
279
177
46
611
7,827
1,131
74
896
569
450

33,705
744
672
72
911
68
159
388
240
56
759
9,643
1,325
84
1,006
690
527

36,690
855
770
85
969
88
140
424
257
60
889
10,829
1,386
84
1,108
780
625

41,920
946
864
82
1,133
127
138
504
287
77
1,300
12,410
1,492
89
1,159
840

46,107
1,099
988
111
1,305
194
136
550
333
92
1,383
14,571
1,652
98
1,255
864
889

708
611
430
1,236
664
236
281
491
618
3,105

542
486
412
1,241
621
238
222
418
526
2,608

306
384
351
1,065
529
190
167
363
384
1,852

177
251
273
837
413
157
131
291
238
1,142

199
251
279
718
421
149
141
304
227
1,228

253
274
332
809
495
174
176
351
285

300
325
357
866
525
192
182
367

378
391
394
943
572
202
209
375
400
2,376

442
447
456
1,040
672
242
235
407
483
2,948

2,117
541
447
1,396
859
262
979

1,791
418
399
1,173
713
254
633

1,069
266
264
679
409
133
569
6,119
2,180

1,290
318
301
822
461
145
691

1,659
377
340
1,029
569
205
787

2,095
467
386
1,339
745
276
970

8,711
3,204
5,507

717
206
219
489
286
117
369
5,911
2,138
3,773
2,092
565
234
186
639
185
283
2,656
1,688
429
328
101
257
135
14
29
104
1,191
550
24
592
25
3,735
256
523
835
18
260
82
239
190
345
126
36
298
527
4,965
821
529
292
0
532
3,453
1,552
1,809
92
159
1
25,511

804
206
218
494
302
93
351

9,319
3,379
5,940
2,918
758
406
242
812
237
463
4,719
3,226
655
482
173
327
213
5
48
245

323
321
774
485
167
512
7,584
2,742
4,842
2,467
649
265
212
768
208
365
3,531
2,334
534
401
133
289
166
13
38
157
1,408
659
21
699
29
4,585
341
643
1,146
28
309
96
305
255
385
132
55
307
585
5,257
865
561
304
0
570
3,638
1,639
1,953
46
184
1
33,861

6,631
2,366
4,265
2,058
507
205
190
635
188
333
2,884
1,831
400
306
94
321
161
17
36
118
1,193
518
27
623
25
3,881
287
526
911
21
324
80
230
179
348
121
40
279
485
6,500
1,704
790
303
611
598
4,036
1,438
1,807
791
162
1
30,189

7,234
2,560
4,674

8,175
2,888
5,287

2,236
522
250
215
671
203
375
3,237
2,058
427
323
104
356
195
22
40
139
1,294
658
34
675
27
4,264
313
576
1,016
25
385
83
311
202
387
126
51
238
501
7,865
3,496
988
334
2,174
641
3,551
1,507
1,970
74
177
1
34,054

2,406

1,515
200
261
609
321
124

1,520
740
10
739
31
5,517
425
752
1,716
33
357
107
308
322
397
124
81
294

601
4,937
824

516
308
0
569
3,368
1,563
1,805
0
176
45,485

1. For certain manufacturing industries, the 1929-47 values shown are not comparable with
those given for 1948 and subsequent years. The discontinuities stem from changes in the industrial classification basis on which the underlying social insurance payroll tabulations are
prepared (see Introduction to Part III). Of the series principally involved here, five have
been terminated in 1947; the others are indicated by footnotes.

2,742
716
319
234
819
229
425
4,237
2,849
614
452
162
316
193
9
42
214
1,543
739
15
758
31
5,253
407
727
1,483
32
369
104
311
298
405
131
75
303
608
5,153
859
548
311
0
572
3,537
1,615
1,918
4
185
1
41,033

5,290
1,883
3,407
1,896

485
244
170
572
164
261
2,455
1,560
368
283
85
252
143
14
29
89
1,059
477
21
539
22
3,348
217
456
732
15
243
72
225
160
316
118
34
277
483
5,141
1,115
492
267
356
473
3,409
1,409
1,659
341
144
1
23,855

1,988
502
233
176
597
178
302
2,660
1,689
385
296
89
280
153
14
34
105
1,139
507
25
583
24
3,666
270
497
850
17
294
75
249
175
323
116
37
275
488
6,075
1,645
613
288
764
528
3,751
1,370
1,701
680
151
1
27,629

1937

547
253
233
728
217
428
3,549
2,219
453
338
115
407
232
26
47
165
1,438
625
42
745
26
4,688
351
633
1,187
29
401
88
349
231
430
133
55
304
497
7,492
2,921
929
354
1,638
646
3,733
1,593
2,092
48
192
1
38,614

2. See note 1. Estimates of 1948 wages and salaries approximately comparable to those
shown for 1947 in the specified industries are as follows: Lumber and furniture products,
$2,942 million; Chemicals and allied products, $2,450 million; Products of petroleum and coal,

NATIONAL INCOME,

195 4

181

EDITION

Table 15.—Wages and Salaries, by Industry, 1939-53
[Millions of dollars]
1943

1944

1945

1946

1947

1948

1949

1950

1951

1952

1953

82,109
1,790
1,642
148
1,769
270
156
823
355
165
4,670
30,922
2,285
119
1,923
1,436
1,435

105,828
2,199
2,039
160
1,983
308
178
918
407
172
3,919
40,883
2,639
146
2,055
1,711
1,580

116,823
2,403
2,213
190
2,197
263
202
1,052
515
165
2,888
42,913
2,946
158
2,046
1,876
1,642

117,577
2,512
2,308
204
2,173
227
196
1,020
569
161
2,951
38,229
3,105
171
2,113
1,984
1,647

111,836
2,787
2,553
234
2,368
232
237
1,065
623
211
4,412
36,476
3,578
185
2,700
2,448
2,111

122,858
3,082
2,819
263
2,920
297
250
1,378
742
253
5,834
42,500
4,083
195
3,103
2,625
2,668

134,334
3,140
2,855
285
2,931
323
223
1,166
929
290
6,939
43,860
4,414
211
3,151
2,759
2,585
1,663
922

146,526
3,024
2,724
300
3,158
346
233
1,291
969
319
7,913
49,393
4,654
219
3,569
2,952
3,100
1,977
1,123

170,881
3,258
2,920
338
3,584
418
237
1,425
1,131
373
9,785
58,232
5,119
252
3,686
3,076
3,445
2,268

185,039
3,363
2,996
367
3,642
468
224
1,255
1,292
403
10,653
62,918
5,373
267
3,569
3,202
3,519
2,269
1,250

197,980
3,428
3,052
376
3,727
522
183
1,209
1,379
434
11,102
69,799
5,701
279
3,595
3,403
3,589
2,261
1,328

1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18

625
600
622
1,076
1,098
355
336
507
673
4,554

763
672
703
1,094
1,662
441
400
583
772
6,384

135,172
3,317
3,029
288
3,340
336
277
1,529
914
284
7,093
46,459
4,359
202
3,530
2,869
' 2,848
1,879
969

846
734
816
1,186
2,026
522
555
622
836
8,939

874
768
879
1,307
2,060
600
645
650
839
9,233

848
799
932
1,466
2,072
641
637
702
857
8,208

1,048
1 063
1,138
1,912
1,949
697
749
876
1,128
7,164

1,346
1,322
1,347
2,263
2,255
823
833
939
1,344
8,564

3,156
748
650
2,331
1,165
1,458
1,469
10,384
3,793
6,591
2,598
611
152
246
831
237
521
4,255
2,609
451
289
162
613
267
55
50
210
1,681
735
67
849
30
5,453
414
772
1,237
44
474
121
371
261
554
148
119
349
5S9
10,186
4,939
1,860
1,866
1,213
766
4,207
1,826
2,375
6
274
6
51,894

4,475
1,028
881
3,585
1,731
4,713
1,656
10,971
4,042
6,929
2,713
660
126
247
875
259
546
5,261
3,291
585
341
244
738
292
77
57
221
1,778
813
72
861
32
6,249
443
897
1,477
87
489
142
410
271
636
147
207
379
664
15,976
10, 536
3,788
6,168
580
875
4,273
1,883
2,388
2
292
10
66,123

6,488
1,311
1,140
4,162
2,367
9,753
968
11,893
4,232
7,661
2,835
700
150
224
903
275
583
6,559
3,966
757
421
336
848
471
113
68
336
1,886
920
82
852
32
7,040
523
1,046
1,598
126
534
206
459
282
738
148
193
423
764
26,617
20,744
6,561
14,133
50
1,095
4,446
1,973
2,473
0
332
14
79,197

6,740
1,340
1,153
4,180
2,673
10,121
1,058
12,971
4,604
8,367
2,988
758
163
219
933
289
626
7,547
4,386
848
464
384
926
743
130
79
435
1,994
989
100
871
34
7,942
611
1,148
1,887
95
628
235
509
326
839
157
191
456
860
32,968
26,779
6,746
20,033

5,784
1,250
1,174
3,900
2,390
6,490
914
14,665
5,138
9,527
3,269
826
222
236
1,006
314
665
7,913
4,414
919
495
424
1,013
885
150
81
451
2,209
1,123
116
932
38
8,743
672
1,275
2,142
54
723
236
552
372
926
167
215
484
925
34,902
28,223
6,404
21,819

4,502
1,353
1,309
3,987
2,215
1,762
1,877
19,560
6,691
12,869
4,097
991
277
302
1,261
418
848
8,509
4,778
1,081
554
527
1,211
683
232
88
436
2,824
1,479
143
1,157
45
10,208
822
1,589
2,120
63
927
296
679
509
1,125
181
269
664
1,064
20,578
12,858
5,040
7,818

5,706
1,431
1,427
4,821
2,672
1,611
2,354
22,871
7,999
14, 872
4,502
1,124
231
348
1,445
453
901
9,022
4,962
1,150
587
563
1,412
611
271
105
511
3,286
1,661
167
1,407
51
11,495
887
1,707
2,348
90
1,061
345
694
551
1,397
205
325
712
1,173
17,329
8,420
4,363
4,067

2
(
2]
22
23
24
26
26
27
28
29
3(
31
3
5
3
c
34
SI

1,141
4,712
2,104
2,608

1,194
5,129
2,303
2,826

1,391
5,912
2,584
3,328

336
12
83,843

356
11
82,664

417
17
91,241

1939

1940

1941

45,941
1,090
988
102
1,137
156
124
456
315
86
1,546
13,585
1,612
98
1,167
926
849

49,818
1,134
1,031
103
1,287
190
118
542
336
101
1,709
15,584
1,694
104
1,206
938
937

62,086
1,369
1,254
115
1,540
232
135
678
363
132
2,900
21,714
1,918
115
1,603
1,209
1,225

412
437
444
991
667
260
226
386
466
2,622

467
470
490
1,002
808
295
247
382
514
3,182

1,789
432
401
1,111
637
310
823
8,386
3,015
5,371
2,379
567
174
206
756
224
452
3,429
2,091
433
313
120
441
218
34
43
169
1,469
643
52
747
27
4,721
361
617
1,129
26
415
93
339
221
474
139
73
327
507
8,197
3,295
1,032
388
1,875
682
4,018
1,717
2,291
10
202
2
37,742

2,187
523
472
1,436
768
631
1,050
9,020
3,228
5,792
2,453
581
165
222
781
223
481
3,639
2,211
421
289
132
498
234
43
45
187
1,543
660
59
795
29
5,026
387
689
1,218
26
425
90
339
238
509
142
78
336
549
8,420
3,358
1,216
663
1,579
708
4,119
1,772
2,337
10
235
3
41,395

1942

$957 million; Metals, metal products, and miscellaneous, $9,343 million; Machinery, except
electrical, $5,359 million; and Electrical machinery, $2,804 million.
3. Includes pay of United States citizens but not of foreigners employed abroad by the
United States Government.

M77

1,502
2,523
'2,352
'985
813
973
1,530
'9,640
4,224
3,341
786
1,289

1,464
2,657
2,332
985
749
933
1,465
8,757
3,744
3,065
747
1,201

1,684
2,816
2,551
1,027
868
1,000
1,678
10,298
4, 444
3,617
872
1,365

1,919
3,010
3,048
1,162
1,012
1,012
1,988
12,493
5,486
4,407
1,113
1,487

1,999
3,228
3,300
1,243
1,102
1,093
1,977
13,411
5,515
5,082
1,273
1,541

2,214
3,492
3,675
1,327
1,197
1,132
2,160
15,497
6,309
5,991
1,437
1,760

'5,291
2, 759
1,693
2,590
25,298
8,907
16,391
5,031
1,237
238
389
1,627
518
1,022
9,684
5,382
1,130
538
592
1,617
637
293
123
602
3,809
1.924
199
1,631
55
12,393
928
1,775
2,382
107
1,213
356
655
594
1,597
226
397
874
1,289
18,732
8,392
4,422
3,970

4,579
2,488
1,660
2,681
25,629
8,870
16,759
5,251
1,304
232
425
1,766
546
978
9,305
5,000
1,117
644
573
1,698
574
306
121
489
4,036
2,000
219
1,759
58
12,782
932
1,775
2,412
120
1,231
343
658
593
1,737
244
401
959
1,377
20,445
9,008
4,760
4,248

5,114
2,945
1,670
3,248
27,322
9,534
17,788
5,806
1,403
300
475
1,923
616
1,089
9,811
5, 202
1,096
530
566
2,001
556
323
116
517
4,214
2,023
249
1,882
60
13,656
946
1,822
2.668
133
1,338
351
653
603
1,972
260
427
1,010
1,473
22,211
10,031
5,032
4,999

6,854
3,721
2,840
3,595
29,982
10,675
19,307
6,358
1,567
325
541
2,112
674
1,139
11,260
5,977
1,149
547
602
2,303
669
391
131
640
4,649
2,227
295
2,063
64
14 942
1,004
1,932
2,833
130
1,524
446
673
628
2,271
291
589
1,032
1,589
28,811
16,461
6,777
8,684

7,578
4,303
4,072
3,682
31,761
11,330
20,431
6,882
1,733
323
619
2,327
718
1,162
11,761
6,000
1,183
552
631
2,555
730
479
145
669
5,121
2,474
328
2,247
72
16,121
1,067
2,031
2,858
123
1,722
508
689
664
2,564
322
761
1,089
1,723
32,792
17,977
7,512
10, 465

8,103
5,042
4,837
4,556
33,822
12,167
21,665
7,492
1,899
331
686
2,587
780
1,209
12,270
5,985
1,209
564
645
2,896
807
535
147
691
5,591
2,712
363
2,439
77
17,272
1,120
2,122
3,051
116
1,918
532
678
711
2,864
355
844
1,134
1,827
33,457
17,548
7,341
10,207

1,384
7,015
3,084
3,931

1,563
8,127
3,599
4,528

1,734
8,987
3,983
5,004

1,812
9,600
4,292
5,308

2,001
10,483
4,740
5,743

2,271
11, 552
5,251
6,301

2,278
12, 550
5,748
6,802

510
17
105,512

650
16
116,424

716
16
113,873

768
18
124,297

866
20
142,050

992
25
152,222

1,081
20
164,503

Line

i
s

37
38
39
40
41
42
43
44
45
46
47
48
49
50
51
52
53
54
55
66
57
58
59
60
61
62
63
64
65
66
67
68
69
70
71
72
73
74
75
76
77
78
79
80
81
82
83
84
85
86
87
88
89
90
91
92

4. The pay of personnel stationed abroad is included, but that of personnel recruited from
the territories is excluded.
5. Pay of permanent United States residents employed in the United States by foreign
governments and international organizations.

182

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS

Table 16.—Supplements toWages and Salaries, by Industry Division, 1929-38

Millions of dollars]
Line

1929
All industries, total

1930

1932

1933

1934

1935

1937

1936

1938
2,018

662

657

621

577

542

590

650

990

1,827

Agriculture, forestry, and fisheries
Mining

1931

Contract construction

151

Manufacturing

141

123

105

103

132

262

616

656
331

Wholesale and retail trade

107

267

Finance, insurance, and real estate

118

137

Transportation

106

120

213

201

Communications and public utilities

106

Services

122

Government and government enterprises..

156

163

169

185

196

224

243

280

301

Addendum: All private industries

506

494

452

392

357

394

426

747

1,547

1,717

1. Data showing supplements to wages and salaries by type are presented in table 34. The "Eest of the world" is omitted from table 16 because supplements are estimated at less than
$500,000 for all years.

Table 17.—Income of Unincorporated Enterprises, by Industry Division, 1929-38 '
[Millions of dollars)
1931

1933

1932

1929

1930

All industries, total *

14,617

10,785

8,123

5,021

6,124

Agriculture, forestry, and fisheries

6,033

4,194

3,212

1,979

2,476

-15

1,127

865

608

237

191

Line

Mining
Contract construction
Manufacturing

1935

1936

1937

1938

7,064

10,437

10,602

12,720

10,907

2,489

5,087

4,002

5,684

4,304

304

376

607

681

611

1934

565

2S2

120

201

240

299

404

367

268

2,867

1,947

1,257

527

1,103

1,658

2,051

2,627

2,904

2,652

Finance, insurance, and real estate

762

450

294

223

313

250

305

356

357

316

Transportation

220

209

184

159

154

172

195

216

231

229

2,980

2,791

2,456

1,867

1,679

1,915

2,084

2,330

2,515

2,382

Wholesale and retail trade

Communications and public utilities-.
10

Services

1. "Income of unincorporated enterprises" measures the net income of sole proprietorships
and partnerships except that the series for trade includes estimated patronage refunds and
stock dividends paid by farmers' cooperatives (shown separately in table 12). "Income of
unincorporated enterprises" excludes the inventory valuation adjustment which is shown by
industry division iB table 23.

2. Exhibit 2, section 3, of Part III, provides a breakdown of the industry division totals for
the years 1929,1939,1945, and 1949.

183

NATIONAL INCOME, 195 4 EDITION

Table 16.—Supplements to Wages and Salaries, by Industry Division, 1939-53 '
[Millions of dollars]
1939

1940

1942

1941

1943

1944

1945

1947

1946

1949

1948

1952

1951

1950

1953

Line

2,167

2,311

2,703

3,162

3,759

4,463

5,604

6,861

5,899

5,755

6,524

7,799

9,539

10,384

11,081

102

150

203

196

282

326

324

347

104

112

174

255

201

149

156

209

274

316

318

398

502

520

535

7S6

813

1,061

1,326

1,775

2,047

1,953

1,702

2,037

2,145

2,264

3,142

4,141

4,610

5,253

343

364

389

378

396

455

501

635

751

755

805

1,008

1,141

1,186

1,233

143

146

154

151

178

167

210

220

264

303

353

404

432

463

215

227

265

335

397

442

475

507

642

564

570

619

718

760

772

107

114

125

138

172

201

243

277

310

340

405

462

515

563

119

123

134

143

158

175

190

225

243

256

277

335

434

459

475

326

342

314

356

420

748

1,862

2,014

1,290

926

1,434

1,238

1,381

1,548

1,411

1,841

1,969

2,389

2,806

3,339

3,715

3,742

3,847

4,609

4,829

5,090

6,661

8,158

8,836

9,670

Table 17.—Income of Unincorporated Enterprises, by Industry Division, 1939-53
[Millions of dollars]
1942

1944

1943

1945

1947

1948

1949

1951

1952

1939

1940

1941

11,776

13,055

18,016

24,274

28,343

29,634

30,941

36,970

35,904

38,801

33,681

37,274

41,153

39,710

38,639

4,378

4,633

«, 578

10,105

11,473

11,656

11, 972

14,115

14,678

16,965

12,953

13, 532

16,305

14,509

12,560

122

160

145

108

143

244

335

243

213

219

197

207

646

689

968

1,241

1,112

986

1,088

1,720

2,119

2,397

2,541

2,739

2,714

2,824

2,984

400

515

985

1,434

1,878

2,195

2,361

2,279

1,626

1,394

1,238

1,728

1,578

1,306

1,172

3,193

3,863

6,675

7,098

8,749

9,201

9,676

12,070

10,437

10.379

9,281

11,156

12,005

12,091

12,391

346

365

401

431

534

598

757

818

720

798

75
7

996

1,021

1,007

1,079

249

285

358

415

476

463

426

486

563

576

602

607

688

741

798

1946

1950

1953

Line
1

2,496

2,639

2,963

3,416

3,946

4,371

4,530

5,315

5,601

5,929

6,019

6,274

6,594

7,005

7,418

184

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS
Table 18.—Corporate Income Before Federal and State Income and Excess Profits Taxes, by Industry, 1929-38

[Millions of dollars]
Line
1
2
3
4
5

1929

All industries, total'

1930

1931

1932

1933

1934

1936

1935

1937

1938

9,628

Farms
_
_ _ _ _ _ _ _
Agricultural services, forestry, a n d

fisheries

__ _ _

3,322

-780

-3,017

151

1,716

3,145

5,740

6,235

3,300

6
2
4

-46
—44
-2

-73
—68
-5

-71
—64
-7

-32
—29
-3

-33
—29
-4

6
8
-2

16
16
0

3
4
-1

-12
—10
-2

—22
15
—7
—29
2
—3

162
0
12
90
8

161
78
— 11
4
74
16

287
134
—4
8
117
32

436
239
—13
12
161
37

205
114
—18
— 17
109
17

—51

—27

818
342
65
157
17

I 349
402
112
33
14

2 128
401
111
76
20

3,554
523
129
190
46

3,651
348
127
103
16

1,557
360
130
— 17
3

Mining
Metal mining
Anthracite mining . __ _
_ _
Bituminous a n d other soft-coal mining
__ _ _ _ _ _ _
Crude petroleum a n d natural gas
Nonmetallic mining a n d quarrying. _ _ _ _ _
_ _

417
251
11
13
87
55

90
40
14
— 12
7
41

-135

6
7
8
9
10

-86
7

—94
—51
—12
—34
12
-9

Contract construction

119

—87

4 848
478
140
150
41

1 636
379
155
—203
-33

—305
204
159
— 161
-60

— 1 296
91
167
— 177
-73

125

-67

-161

-183

-44

-28

86
39

-29
-38

-101
-60

-106
-77

-25
-19

-20

6
7

42
36

67
32

7
11

109
242
418
594
16
48
145

52
151
280
198
-51
— 19
56

—6
70
188
—146
-20
—27
-25

32
39
222
17
6
39
-6

68
74
278
—38
5
25
37

74
113
298
23
21
45
67

106
149
396
162
46
40
150

127
132
389
278
29
22
146

47
79
298
77
19
8
65

1,122

289

-276

-519

-57

184

369

640

780

109

804
210
108

226
46
17

-223
—19
-34

-382
—58
-79

-108
52
-1

28
110
46

145
136
88

349
186
105

482
195
103

12
45
52

494
203
60
463

178
88
22
161

-69
15
-31
41

-209
—40
-30
-192

-36
— 15
-22
62

108
—16
-8
99

191
63
-7
2.50

352
135
23
389

450
170
62
373

196
81
20
64

759
312
447

-14
—35
21

-415
— 175
—240

-724
—242
—482

84
94
-10

409
217
192

533
252
281

922
432
490

821
362
459

398
142
256

1,157
691
142
26
194
29
75

195
408
-140
-167
88
21
-15

—303
127
-110
—219
45
19
-165

-655
—6
-60
-236
22
18
-393

—673
—58
-38
-242
64
13
-412

-578
—3
-8
-292
107
16
-398

-314
145
-68
-212
122
15
-316

23
242
-46
-158
130
16
-161

250
336
-55
-108
160
17
-100

288
289
-48
-103
181
16
-47

1,037
809
55
35

435
298
47
20

-96
-147
6
11

-328
-328
-7
-4

-241
-275
4
4

-164
-256
0
12

-91
-176
-24
12

96
-33
7
16

59
-62
-19
14

-180
-255
-49
29

Pipeline transportation

50
-6
86
8

17
-19
68
4

0
-9
41
2

— 15
-2
30
-2

4
-2
24
0

16
-6
68
2

29
-3
69
2

38
0
66
2

47
-2
80
1

17
-1
72
7

Radio broadcasting and television

908
308
20
554
26

715
266
-5
436
18

586
239
-4
349
2

456
158
-2
299
1

380
131
-6
249
6

556
148
7
385
16

558
174
11
359
14

665
196
18
438
13

788
208
20
544
16

723
204
15
491
13

145
0
22
48

81
-18
10
38

—36
-29
0
12

— 184
-44
-18
-3

-110
-34
-6
-1

-18
-30
0
18

5
-26
4

45
-22
7
26

63
-18
10
29

47
-27
4
28

4
59
3
9

3
51
-8
5

0
2
-19
-2

-1
-83
-29
-6

-1
-40
-23
-5

1
2
-9
0

1
13
-5
0

2
29
2
1

2
33
5
2

1
39
2
0

232

137

-4

-34

-2

159

104

122

247

12
13
14
15
16

Food and kindred productsTobacco manufactures
Textile-mill products
A pparp.l and nt.her finished fahric products

17
18
19
20
21

Lumber and furniture products 3__
Lumber and wood products, except furniture
Furniture and
fixtures
_____ _ _ _ . _
Lumber and timber basic products
Furniture andfinishedlumber products

22
23
24
25
26
27
28

Paper and allied products
_ _
Printing, publishing, and allied industries
Chemicals and allied products3 3
Products of petroleum and coal

29
30
31
32
34
35
36

Metals, metal products, and miscellaneous3
Primary metal industries
Fabricated metal products, including ordnance
_
Instruments
__
Miscellaneous manufacturing. .
_ _
Iron and steel and their products, including ordnance
Nonferrous metals and their products
_____ .
Miscellaneous manufacturing

37
38
39
40

Electrical machinery3
_
Transportation equipment,except automobiles ..
Automobiles and automobile equipment

Leather and leather products
Stone, clay and glass products

_
_

__ __ ____ _

41
42
43

Wholesale and retail trade
Wholesale trade
.
Retail trade and automobile services

44
45
46
47
48
49
50

Finance, insurance, and real estate

51
52
53
54
55
56
57
58
59
60
61
62
63

Security and commodity brokers, dealers and exchanges _
_
Finance, n. e. c_ _
Insurance agents and combination offices

Local and highway passenger transportation
Highway freight transportation and warehousing
Water transportation

64
65
66
67
68
69
70
71
72

Miscellaneous repair services and hand trades

_ ._

Engineering and other professional services, n. e. c.
R e s t of t h e world

_ .

_. _

1. A complete reconciliation of the all-industry totals for these income series with Internal
Revenue Service figures for "Compiled net profit" is presented in table 38. Depletion charges
are not deducted in arriving at corporate income for national income purposes. This has an
important bearing on the data for the mining industries.

-36
8
-28

—56
— 15
99
—6
-34
—35
-84

2. Industries in which there are no corporations organized for profit, or in which corporate
profits before tax are estimated at less than $500,000 in all years, are omitted from this table.
3. For certain manufacturing industries, the 1929-47 values shown are not comparable with
those given for 1948 and subsequent years. The discontinuities stem from changes in the

185

NATIONAL INCOME, 195 4 EDITION
Table 18.—Corporate Income Before Federal and State Income and Excess Profits Taxes, by Industry, 1939-53 '
[Millions of dollars]
1939

1941

1940

1942

1943

1945

1944

1946

1948

1947

1949

1950

1952

1951

1953

Line

6,403

9,320

16,982

20,882

24,554

23,320

18,977

22,551

29,525

32,769

26,198

39,970

41,173

37,174

39,430

3
4

15
18
-3

52
50
2

73
71
2

104
102
2

96
94
2

93
89
4

135
131
4

145
143
2

138
135
3

99
99
0

157
157
0

95
94
1

2
3
4

418
233
7
37
103
38

587
266
15
75
170
61

578
293
18
102
98
67

500
176
17
138
115
64

452
128
23
142
111
48

347
99
12
112
74
50

438
92
33
112
121
80

953
234
34
310
269
106

1,430
309
45
387
555
134

925
167
16
140
477
125

1,374
341
21
208
642
162

1,418
383
12
156
691
176

1,154

1,254

5
6
7
8
9
10

296
177
-12
8
90
33
32

185

306

234

120

211

377

566

514

541

533

485

550

3,637
638
136
171
38

5,508
565
153
216
48

10,820
879
173
610
134

12,410
1,244
188
850
214

14,231
1,512
191
825
255

13,234
1,521
169
781
257

9,933
1,438
142
727
249

11,402
2,033
173
1,406
494

16,529
1,850
194
1,544
451

18,102
1,540
246
1,524
282

14,140
1,494
266
664
156

23,280
1,815
294
1,237
282

24,512
1,599
301
979
159

20,402

21,798

12
13
14
15
16

166

348

352

325

321

246

496

794

< 717
544

410
283
127

900
660
240

736
525
211

17
18
19
20
21

785
< 1, 575
* 2, 260
218
134
533

541
507
1,549
1,231
135
90
502

989
562
2,625
1, 726
399
160
842

1 331
605
2,823
2,183
491
112
870

22
23
24
25
26
27
28

«3,315
1,748
1,046
197
324

2,404
1,317
691
162
234

4, 425
2,437
1,263
293
432

5,267
3,030
1,442
397
398

29
30
31
32
33
34
35
36

1,302
674
194
2,021

1,994
1,387
36 i
3,279

2 617
1 496
436
2 507

37
38
39
40

173

43
50

95
71

200
148

211
141

187
138

163
158

112
134

263
233

518
276

110
126
513
196
61
40
157

196
156
643
277
63
40
204

390
190
1,015
530
153
99
353

365
239
1,067
640
180
139
342

398
464
1,194
870
289
156
290

407
584
1,139
601
293
144
230

340
593
980
437
243
139
214

563
648
1,416
796
306
234
363

927
615
1,708
1,434
204
219
449

566

976

2,229

2,660

2,926

2,533

1,706

1,606

2,702

314
150

642
218

1,624

2,047

2 128

1 815

1,199

1,019

1,912

376

360

482

416

259

365

652

116

229

263

316

302

248

222

238

320

672

1,392

336
267
530

1,596

849

685

1,460

697
761
867

1 463

1 275

183
75
325

691

840

844

1 307

1 905

1 837

328

298

134
—39
88

769
—12

336

517
949
164

1,221

* 1 712
•855
223
1,619

830
355
475

1,124
495
629

2,162
1,018
1,144

2,607
1,102
1,505

3,128
1,257
1,871

3,279
1,290
1,989

3,420
1,304
2,116

5,550
2,438
3,112

6,082
2,694
3,388

5,768
2,383
3,385

3,833
1,480
2,353

6,276
2,860
3,416

5,446
2, 735
2,711

5,199

5,156

41
42
43

331
337
—41
-109
163
17
-36

490
437
-45

676
541
-39

1,151
702
22

1,393
903
—25

1,490
1,032
-34

1,630
1,201
—38

1,593
1,023
—47

-28

105

102

62
34
106

130
29
123

179
24
213

158
26
293

91
23
336

-50
38
411

7
55
453

2,574
1,331
-50
221
533
55
484

2,662
1,499
-38
376
350
66
409

2,800
1,804
— 52
450
106
72
420

3,572

94
25
19

2,224
1,275
—60
166
273
65
505

3,170

-40

878
522
—31

44
45
46
47
48
49
50

157
—14
-30
45

335
82
8
30

907
517
30
51

2,096
1,597
184
67

2,895
2 300
286
64

2,360
1 798
263
59

1,330
890
203
41

526
107
151
90

1,156
724
60
119

1,649
1,173
70
160

1,101
648
43
147

1,996
1,308
56
227

1,989

1,849

51
52
53
54

50
8
86
12

89
12
84
30

154
20
93
42

105
34
58
51

98
34
60
53

88
41
63
58

78
34
45
39

120
-24
39
43

173
-40
50
70

134
0
62
50

134
19
65
45

144
86
125
50

1,961
1 138
86
187
240
119
130
61

861
254
20
572
15

1,021
262
28
713
18

1,173
285
34
834
20

1,372
416
31
906
19

1,530
480
51
975
24

1,533
511
69
929
24

1,472
470
63
917
22

1,507
324
56
1,106
21

1,353
224
53
1,050
26

1,486
284
42
1,133
27

1,674
348
32
1,268
26

2,189
614
61
1,407
27

2,635
745
80
1,774
36

3,015

3,417

59
60
61
62
63

72
-19
9
34

105
—9
14
33

189
2
23
63

337
34
39
52

543
96
50
68

560
96
59
77

575
107
54
84

727
121
65
110

648
112
71
127

570
112
62
143

506
92
61
135

495
89
56
163

558
92
60
192

563

613

1
41

2
52

7
78

6
309

12
232

13
247

6
239

11
155

12
253

9
136
43
30

12
102
41
32

19
94
55
46

64
65
66
67
68
69
70
71

832

1,000

1,215

1,121

1,147

564

13
148
58
34

184

234

231

225

238

293

228

425

689

836

industrial classification basis on which the underlying corporate tax return data are
reported. (See the Introduction to Part III.) Of the series principally involved here, 5 have
been terminated in 1947; the others are indicated by footnotes.
4. See note 3. Estimates for 1948 income before tax approximately comparable to those

55
56
58

shown for 1947 in the specified industries are as follows: Lumber and furniture products, $743
million; Chemicals and allied products, $1,628 million; Products of petroleum and coal,
$2,272 million; Metals, metal products, and miscellaneous, $3,137 million; Machinery, except
electrical, $1,730 million; and Electrical machinery, $875 million.

186

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS
Table 19.—Federal and State Corporate Income and Excess Profits Tax Liability, by Industry, 1929-38
[Millions of dollars]
1929

All industries, total'
Agriculture, forestry, and fisheries
Farms
Agricultural services,forestry,and fisheries.
Mining
Metal mining
Anthracite mining
_.
Bituminous and other soft-coal mining.
Crude petroleum and natural gas
Nonmetallic mining and quarrying
Contract construction.
Manufacturing
Food and kindred products
Tobacco manufactures
Textile-mill products
Apparel and otherfinishedfabric products..
Lumber and furniture products'.
Lumber and wood products, except furnitureFurniture and fixtures
Lumber and timber basic products
Furniture andfinishedlumber products
Paper and allied products
Printing, publishing, and allied industries
Chemicals and allied products •
Products of petroleum and coal *
Rubber products
Leather and leather products
Stone, clay, and glass products
Metals, metal products, and miscellaneous >
Primary metal industries
Fabricated metal products, including ordnance
Instruments
Miscellaneous manufacturing
Iron and steel and their products, including ordnance.
Noiiferrous metals and their products
Miscellaneous manufacturing
Machinery, except electrical'
Electrical machinery»
Transportation equipment, except automobiles..
Automobiles and automobile equipment
Wholesale and retail trade
Wholesale trade
Retal trade and automobile services
Finance, insurance, and real estate
Banking
Security and commodity brokers, dealers and exchanges..
Finance, n. e. c...
Insurance carriers
Insurance agents and combination offices
Real estate
Transportation.
Railroads
Local and highway passenger transportation
Highway freight transportation and warehousing..
Water transportation
Air transportation (common carriers).
Pipeline transportation
Services allied to transportation
Communications and public utilities
Telephone, telegraph, and related servicesRadio broadcasting and television
Utilities: electric and gas.
Local utilities and public services, n. e. c...
Services
Hotels and other lodging places.
Personal services
Business services, n. e. c
Miscellaneous repair services and hand trades
Motion pictures
Amusement and recreation, except motion pictures..
Engineering and other professional services, n. e. c..

1933

842

498

385

6
5
1

3
3
0

1
1
0

47
23
2
5
10
7

1934

20
3
2
3
7
5

521

1936

1935

1
1
0

744

S51

1937

1,409

9
7
1

6
0

62
36
0
4
16

23
9
0
4
7

40
17
1
4
13
5
13

484
121
18
25

720
105
22
44
10

768
82
22

618
61
17
31
8

373
60
21
10
3

206
48
22
7
2

132
32
26
5
2

255
62
12
31
6

329
71
17
20

18
7
10

16
33
53
54
7
10
20
141

10
8

16
76

24
34
77
22
10
9
30
133

31
168

35
23
18

73
36
24

103
42
23

17
25
53

33
76
36

97
25
19

40
11
12

3
5
4

63
29
9
49

36
16
6
29

5
1
1
-1

4
2
21

12
2
48

73
27
7
76

101
34
14
74

124

77
29
48

41
15
26

120
60
60

137
64
73

208
98
110

201
88
113

282
66
41
70

151
34
9
27
28
4
49

68
5
2
9
21
3

97
5
3
31
21
3
34

125

196
19
11
97
22
3
44

192
14
2
100
24
3
49

135
105
6
4

73
52
6
3

49
20

52
21
6
3

72
35

76
36

7
0

5
0
6
2

7
0
10
3

8
0
11
3

10
0
13
3

13
1
14
3

110
37
2

103
35
0
65

101
26
1
71

28
2
65
3

124
37
3
81
3

148
40
4

17
1
1
6

27
1
2
8

31
2
2

0
5
2
2

10
3
2

1
10
4

52
72

1. See table 18, footnote 2.
See table 18, footnote 3.
2. Estimates for 1948-53 not strictly comparable with earlier years.

1932

1931

1930

8
7
47
23
3
37

NATIONAL INCOME,

187

1 9 5 4 EDITION

Table 19.—Federal and State Corporate Income and Excess Profits Tax Liability, by Industry, 1939-53
[Millions of dollars]
1939

1940

1941

1942

1944

1943

1946

1945

1947

1948

1949

1950

1951

1952

1953

Line

1,441

2,834

7,610

11,415

14,074

12,949

10,689

9,111

11,283

12,510

10,411

17,829

22,476

19.965

21 144

7
6
1

10
9
1

23
22
1

39
37
2

62
69
3

56
64
2

61
68
3

62
59
3

67
64
3

69
66
3

59
57
2

89
84
5

84
80
4

2
3
4

43
23
0
3
12
5

74
42
1
8
14
9

150
75
2
21
30
22

199
106
4
36
21
32

159
65
4
51
26
23

128
34
6
49
18
21

108
25
4
38
19
22

117
23
9
31
28
26

269
67
10
93
65
34

399
86
14
120
134
45

252
46
5
46
113
42

413
103
3
74
170
63

498
139
5
58
225
71

356

405

5
6
7
8

g
10

192

155

141

221

212

254

304

275

327

741
112
26
40
10

1,727
147
40
64
14

5,244
329
69
266
54

7,301
647
93
526
122

8,667
888
100
528
153

7,776
901
86
493
152

5,903
841
65
456
141

4,744
819
69
576
192

6,474
756
79
615
173

7,066
660
98
611
126

5,729
630
105
294
86

10,905
838
139
566
132

14,252
899
175
553
108

11,499

12,204

12
13
14
15
16

140

186

179

169

128

195

302

2 280
207

171
113
58

396
282

369
244
125

7
12

22
21

77
63

108
78

166
79

80
89

54
74

102
93

192
110

24
29
102
20
12
9
31
117

59
46
204

183
76
498

141

210
124
603

242
268
702
293
201
93
181
1,838

247
352
683
130
200
82
138
1,505

203
369
584
91
167
80
122
1,032

226
255
571
203
127
94
142
677

365
246
684
390
85
88
178
1,052

16
12
63
318

69
35
170
1,158

214

84
78
209
1,680

114

17
18

19
20
21

313

228
2 637
2 622
91
60
213
21,325
676

226
208
637
293
58
44
201
1,012

468

259
1,302
514

195
72
408
2,133

813
334
1,746
854
314
74
604
3,114

22
23
24

25
26
27
26
29

527
301
71
113

1,178

423
83
143

604
144
207

1,802
836
248
228

30
31
32
33
34
35
36
37
38

76
38

851

29
20

199
108

1,302
222
156

1,351
284
203

1,103
236
166

750
138
144

429
142
106

741
205
106

66
36
20
68

235
116
104
196

744
392
452
468

1,038
450
833
204

972
560
1 274
195

808
526
1 135
169

543
353
607
121

342
118
64
74

600
323
64
474

2 356
100
651

556
286
89
833

948
692
169
1,674

1,604
954
263
1,574

195
81
114

329
142
187

926
451
475

1,446
623
823

1,812
745
1,067

1,888
733
1,155

1,960
733
1,227

2,121
949
1,172

2,302
1,039
1,263

2,244
946
1,298

1,592
639
953

2,698
1 251
1,447

2,882
1,475
1,407

2,725

2,679

41
42
43

149
17
2
62
26
4
38

212
25
4
101
22
7
53

336
57
3
159
27
12
78

401
64
2
118
104
15
98

445
128
9
74
119
12
103

509
220
7
73
80
12
117

674
321
18
88
67
11
169

743
346
13
106
45
13
220

715
316
6
111
34
19
229

988
455
5
141
101
30
266

1,178
526
8
151
209
25
259

1,391
641
12
242
154
34
308

1,702
857
10
315
116
42
362

2,009

2,283

44
45
46

89
39
7
7

151
63
10
9

330
149
22
19

983
705
104
35

1,685
1,348
171
35

1,415
1,106
159
31

812
560
127
25

347
151
69
34

526
313
47
44

686
471
37
62

478
276
28
60

896
568
33
98

1,057
609
48
99

1,063

12
2
16
6

33
4
23
9

80
9
33
18

72
16
26
30

58
16
27
30

50
8
29
32

43
13
20
24

52
6
16
19

74
1
19
28

65
4
26
21

61
10
24
19

75
41
57
24

130
67
72
32

172
64
4
111
3

261
68
8
180
5

800
303
44
442
11

790
290
40
450
10

594
141
24
420
9

531
93
22
406
10

589
127
18
433
11

681
160
15
495
11

945
275
24
635
11

1,367
402
45
901
19

44
4
5
12

669
231
17
413
8
180
22
18
26

781
274
31
465
11

31
3
3
8

432
110
15
300
7
81
8
9
19

308
48
24
34

303
48
26
39

322
55
24
45

258
45
26
49

248
47
23
68

230
40
24
58

1
14
5
3

3
26
10
6

6
77
12
19

8
149
23
22

8
138
28
16

3
139
44
12

4
91
27
16

5
73
27
15

5
63
25
15

238
42
24
75
6
51
24
16

330
52
31
108

1
11
3
2

297
49
23
44
2
128
38
13

204

291692°—54-

-13

10
62
37
30

39
40

47
48
49
50

964

61
52

6S
54
66
56
57
58
1,613

1,821

5S
60

61
62

6a
351

389

64
65

6«
67
68

6<
70
71

188

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS
Table 20.—Corporate Income After Federal and State Income and Excess Profits Taxes, by Industry, 1929-38 '
[Millions of dollars]
1930

1929
AH industries, total

1932

1933

1935

1934

1937

1936

8,259

Agriculture, forestry a n d fisheries

Farms
Agricultural services, forestry, and fisheries..

Mining
_..
Metal mining
Anthracite m i n i n g .
Bituminous a n d other soft-coal mining..
C r u d e petroleum a n d natural gas
Nonmetallic mining a n d quarrying
Contract

1931

construction..

2,480

-1,278

-3,402

-370

972

2,194

4,331

4,733

0
-3
3

-49
-47
-2

-74
-69
-5

-72
-65
-7

-34
-31

-37
-33
-4

0
2
-2

7
7
0

-5
-3
-2

370
228
9
8
77
48

70
37
12
-15
0
36

-141
-37
7
-29
-86
4

-102
-52
-12
-35
8
-11

139
45
-1
8
82
5

138
69
-11
0
67
13

247
117
-5
4
104
27

374
203
-13
8
145
31

1,644

2,834
418
107
146
36

266
105
70
10

-30
-1

100

-8

-91

-55

-32

4,230
417
123
119
33

1,263
319
134
-213
-36

-511
156
137
-168
-62

-1,428
61
141
-182
-75

563
280
53
126
11

1,020
331
95
13
8

108

-72

-163

-184

-48

-33

77
31

-32
-40

-101
-62

-106
-78

-22
-11

35
26

-22

93
209
365
540
9
38
126

42
127
238
170
-53
-24
43

-12
53
157
-149
-22
-31
-31

-59
-26
75
-11
-34
-38
-86

23
26
184
9
4
31
-12

53
53
230
-42
3
18
26

57
88
245
17
16
36
51

82
115
319
140
36
31
120

99
99
313
242
23
16
115

226

-295

-531

-81

135

293

507

612

707
185

186
35
5

-228
-25
-42

-385
-63

-115
42

110
113
70

276
160
81

379
153

431
174
51
414

142
72
16
132

-82
12
-32
21

-214
-41
-31
-193

-17
-23
43

-20
-10
78

153
51
-9
202

279
108
16
313

349
136
48
299

635
260
375

-91
-64
-27

-473
-192
-281

-765
-257
-508

-54

289
157
132

396
188
208

714
334
380

620
274
346

875
625
101
-44
156
24
13

44
374
-149
-194
60
17
-64

-385
116
-112
-229
23
16
-199

-723
-11
-62
-245
1
15
-421

-730
-61
-42
-254
52
11
-436

-675
-8
-11
-323
86
13
-432

-439
137
-75
—259
99
12
-353

-173
223
-57
-255
108
13
-205

58
322
-57
-208
136
14
-149

902
704
49
31

362
246
42
17

-130
-165
2
9

-355
-341
-11
-6

-268
-287
0
2

-213
-276
—6

-143
-197

24
-68
-1
13

-17
-98
-25
11

43
-6
77
4

12
-19
62
2

-3
-9
36
0

—17
-3
27
-4

21
—2

58
-1

28
0
53
-1

34
-3
66
-2

Communications and public utilities
Telephone, telegraph, a n d related services..
Radio broadcasting a n d television
Utilities: electric and g a s . . .
Local utilities a n d public services, n . e. c . . .

798
271
18
486
23

612
231
-5
371
15

495
207
-5
293
0

361
129
-3
236
-1

301
109
-6
194
4

455
122
6
314
13

460
146
9
294
11

541
159
15
357
10

640
168
16
443
13

Services
Hotels a n d other lodging places.
Personal services
Business services, n . e. c

117
-2
20
39

57
-19
8
31

—47
-30
-1

-193
-45
-19

-119
-34
-7
—4

-34
-31
-1
12

-12
-27
3
12

18
-23
5
18

32
-20
8
20

2
42
-10

0
-2
-20
-3

-29
-7

-1
-43
-24
-6

1
-2
-11

1
19
-1
_. 1

1
23
1
-1

137

-4

-34

-2

104

122

Manufacturing
Food and kindred products
Tobacco manufactures
Textile-mill products.
Apparel and otherfinishedfabric products..
Lumber and furniture products >.
Lumber and wood products, except furniture..
Furniture and fixtures
Lumber and timber basic products
Furniture and finished lumber products
Paper and allied products
Printing, publishing and allied industries..
Chemicals and allied products •
Products of petroleum and coal3
Eubber products..
Leather and leather products
Stone, clay, and glass products
Metals, metal products, and miscellaneous *
Primary metal industries
Fabricated metal products, including ordnance
Instruments
Miscellaneous manufacturing
Iron and steel and their products, including ordnance..
Nonferrous metals and their products
Miscellaneous manufacturing
Machinery, except electrical3
Electrical machinery»
Transportation equipment, except automobiles..
Automobiles and automobile equipmentWholesale and retail trade
Wholesale trade..
Retail trade and automobile services
Finance, insurance, and real estate
Banking.
Security and commodity brokers, dealers and exchanges..
Finance, n. e. c
Insurance carriers
Insurance agents and combination offices
Heal estate.
Transportation
Railroads.
Local a n d highway passenger transportation
Highway freight transportation a n d warehousing..
Water transportation
Air transportation (common carriers).
Pipeline transportation
Services allied to transportation

Miscellaneous repair services and hand trades
Motion pictures...
Amusement and recreation, except motion pictures..
Engineering and other professional services, n. e. c_.

232

Rest of the world.
1. See table 18, footnote 1.

49
1
7

2. See tabla 18, footnote 2.

-7
-2

159

3. Estimates for 1948-53 not strictly comparable with earlier years. See table IS, footnote 3.

189

NATIONAL INCOME, 195 4 EDITION
Table 20.—Corporate Income After Federal and State Income and Excess Profits Taxes, by Industry, 1939-53

[Millions of dollarsi
1939

1940

1941

1942

1943

1947

1946

1945

1944

1952

1951

1950

1949

1948

1953

Line

4,962

6,486

9,272

9,467

10,480

10,371

8,288

13,440

18,242

20,259

15,787

22,141

18,697

17,209

18,286

-4
-2
-2

5
9
-4

29
28
1

34
34
0

42
43
-1

40
40
0

32
31
1

73
72
1

78
79
-1

69
69
0

40
42
-2

68
73
-5

11
14
-3

2
3
4

253
154
-12
5
78
28

344
191
6
29
89
29

437
191
13
54
140
39

379
187
14
66
77
35

341
121
13
87
89
31

324
94
17
93
93
27

239
74
8
74
55
28

321
69
24
81
93
54

684
167
24
217
204
72

1,031
223
31
267
421
89

673
121
11
94
364
83

S61
258
18
134
472
99

920
244
7
98
466
105

798

849

5
6
7
8

114

125

236

345

302

287

229

210

223

2,8%
426
110
131
28

3,781
418
113
152
34

5,576
550
104
344
80

8,109
597
95
324
92

5,564
624
91
297
102

5,458
620
83
288
105

4,030
597
77
271
108

6,658
1,214
104
830
302

10,05?
1,094
115
929
278

11,036
880
148
913
156

8,411
864
161
370
70

12,375
977
155
671
150

10,260
700
126
426
51

8,903

9,594

12
13
14

123

208

166

146

152

118

301

492

»4S7
337
100

239
170
69

504
378
126

367
281
86

36
38

73
50

123
85

103
63

87
59

83
69

58
60

161
140

326
166

86
96
411
176
49
31
126

137
110
439
227
47
28
141

207
114
517
389
84
64
183

155
115
464
426
96
61
133

156
196
492
577
88
63
109

160
232
456
471
93
62
92

137
224
396
340
76
59
92

337
393
845
593
179
140
221

562
369
1,024
1,044
119
131
271

472
336
»938
»1,638
127
74
320

315
299
912
938
77
46
301

521
303
1, S.23
1,212
204
88
434

518
271
1,077
1,329
177
38
366

2
i
2
C
2
4
2
f
2
f

439

658

1,071

980

1,088

1,028

674

929

1,650

'1,990
1,072
623
114
181

1,392
790
390
91
121

2,292
1,259
659
149
225

2,153
1,228
606
149
170

246
121
72

438
142
78

773
177
121

745
138
97

777
198
113

712
180
136

449
121
104

590
223
116

1,171
347
132

2!
31
3
3'.
3;
3'
3.
3
t

254
147
55
237

437
220
163
334

648
305
309
399

558
241
474
132

491
280
631
133

467
318
702
129

306
164
342
43

343
16
-103
14

860
446
-76
747

U,017
3 499
123
968

746
388
105
1.188

1,046
695
195
1,605

1,013
542
173
933

3
"
38
3
S
4(

635
274

795
353
442

1,236
567
669

1,161
479
682

1,316
512
804

1,391
557
834

1,460
571
889

3,429
1,489
1,940

3,780
1,655
2,125

3,524
1,437
2,087

2,241
841
1,400

3,578
1,609
1,969

2,564
1,280
1,304

2,474

2,477

41
45
4
C

182
320

278
412
-49
-14!
72
18
-34

340
484
-42
—187
35
22
28

477
458
-33
-13
26
14
25

706
574
-31
-19
60
12
110

884
683
-32
-35
78
14
176

816
711
-52
-46
24
12
167

887
855
-61
-38
-95
25
191

878
707
-53
-9
-27
36
224

1,236
820
-65
25
172
35
249

1,396
805
-58
70
324
30
225

1,271
858
-50
134
196
32
101

1,098
947
-62
135
-10
30
58

1,161

1,289

44
11
4
f
4"
46
49
50

68
-53

577
368
8
32

1,108
892
80
32

1,210
952
115
29

945
692
94
28

518
330
76
16

179
-44
82
56

630
411
13
75

963
702
33
98

623
372
15
87

1,100
740
23
129

904
529
38
88

926

885

-37
£8

184
IS
-2
2!

51
62
63
54

38
6
70
6

56
8
61
£1

74
11
60
24

33
18
32
21

40
18
33
23

38
33
34
26

35
21
25
15

68
-30
23
24

99
-41
31
42

69
-4
36
29

73
9
41
26

69
45
68
26

110
52
58
29

6%
200
16
461
12

700
194
20
533
13

741
175
19
534
13

703
185
14
493
11

749
206
20
510
13

733
208
25
487
13

682
180
23
467
12

913
183
32
686
12

822
131
31
644
16

897
157
24
700
16

993
188
17
773
15

1,244
339
27
862
16

1,268
343
35
873
17

1,402

1,5%

59
60
61
62
63

4!
-22
6
26

61
-13
9
21

108
-6
14
34

157
12
21
26

235
47
26
34

257
48
33
38

253
52
30
39

430
72
42
66

390
67
45
78

322
65
39
85

276
52
37
77

257
47
32
88

228
40
29
84

212

224

64
65
66
67

0
30
1
0

1
38
4
1

4
52
8
2

5
78
6
9

4
104
11
9

5
109
14
10

3
100
27
2

4
181
52
13

8
141
35
16

8
75
31
19

4
73
18
15

6
61
17
16

9
32
18
16

184

234

231

225

238

293

228

425

689

836

832

1,000

1,215

361

-43
-171

137
13
-74

g
10

IS
16
1
8
I
S
2(
21

2
f

6S
66
S7
58

68
69
70
71
1,121

1,147

190

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS
Table 21.—Net Corporate Dividend Payments, by Industry, 1929-38
(Millions of dollars]
1929

All industries,total>
Agriculture, forestry, and fisheries
Farms
Agricultural services, forestry, and fisheries..
Mining
_
Metal mining
Anthracite mining
-Bituminous and other soft-coal mining
Crude petroleum and natural gas
Nonmetallic mining and quarrying
Contract construction..
Manufacturing
Food and kindred products
Tobacco manufactures
Textile-mill products
Apparel and otherfinishedfabric products.
Lumber and furniture products 2
Lumber and wood products, except furnitureFurniture and fixtures
Lumber and timber basic products..
Furniture andfinishedlumber products
Paper and allied products
Printing, publishing, and alliedJ industries
Chemicals and allied products .2
Products of petroleum and coal .-.
Rubber products
Leather and leather products
Stone, clay, and glass products
Metals, metal products, and miscellaneous!
Primary metal industries
Fabricated metal products, including ordnance
Instruments
Miscellaneous manufacturing...
Iron and steel and their products, including ordnance.
Nonferrous metals and their products
Miscellaneous manufacturingMachinery, except electrical2
Electrical machinery2..
Transportation equipment, except automobiles..
Automobiles and automobile equipment
Wholesale and retail trade
Wholesale trade
Retail trade and automobile services.
Finance, insurance, and real estate
Banking
Security and commodity brokers, dealers and exchanges..
Finance, n. e. c
Insurance carriers..
Insurance agents and combination offices
Real estate..
Transportation
Railroads
Local and highway passenger transportation
Highway freight transportation and warehousing..
Water transportation.-.
Air transportation (common carriers).
Pipeline transportationServices allied to transportation
Communications and public utilities
Telephone, telegraph, and related servicesRadio broadcasting and television
Utilities: electric and gas
Local utilities and public services, n. e. c—.
Services
Hotels and other lodging places..
Personal services
Business services, n. e. c
Miscellaneous repair services and hand trades
Motion pictures.
•
Amusement and recreation, except motion pictures..
Engineering and other professional services, n. e. c.._

1930

1932

1933

5,813

5,490

4,088

2,565

14
9
5

8
4
4

15
13
2

7
6
1

338
194
16
27
69
32

230
92
13
24
79
22

120
38
9
16
37
20

72
11
6
7
36
12

1934

1936

1935

1937

2,056

2,587

2,863

4,548

4,685

-1
1

17
16
1

19
17
2

36
34
2

27
2

174
31
3
28
98
14

148
41
3
11
73
20

192
79
3
16
70
24

257
128
1
12
91
25

2,358
296
99
120
22

65
13
1
4
38

2.647
305
83
142
36

2,539
328
95
103
26

1,862

1,102
198
92
46
9

991
190

1,186
242
90
81
11

1,516
247
80
77
15

2,332
337
99
121
27

23
11

35
22

40
23

61
104
249
192
31
28
95

75
93
257
147
27
28
101

101

46
22

56
132
217
254
29
37
83

51
127
269
320
26
38
73

36
95
196
258
20
28
63

541

476

360
106
75

331
79

256
90
40
245

20
13

20
59
169
109
13
20
27

27
35
174
119
6
19
22

39
66
156
7
—1
21
39

46
72
264
38
7
22
50

152

103

200

345

181
58
50

82
42
28

37
40
26

101
67
32

225
60
60

201
124
64

260
122

214
81
39
205

137
65
25
168

70
22
10
70

47
24
3
64

81
22
26
74

105
12
25
77

182
82
23
255

220
111
38
213

537
193
344

474
177
297

376
134
242

210
71
139

173
61
112

328
160

419
194
225

646
270
376

607
260
347

835
410
5
0
64
16
340

625
389
6
-81
56
15
240

610
334
5
-91
56
16
190

310
246
5
-90
24
8
117

145
134
4
-94
18
7
76

-26
166
5
-351
18
8
128

-318
170
6
-689
31
10
154

307
168
21
-81
17
9
173

323
173
1
-74
16
10
197

571
303
115
12

S81
353
79
11

378
219
66

177
26
64

124
20
55
7

78
50

287
119
35

287
125

320
73
66
8

29
0
92
20

0
90
18

20
0
49
16

12
0
53
14

8
0
23
11

24
3
59
12

56
3
112
12

41
2
64
15

634
167
4
449
14

861
201
6
601
53

772
217
5
526
24

677
192
1
471
13

540
190
1
333
16

618
187
3
411
17

644
191
8
428
17

649
174
11
446
18

692
179
12
485
16

79
4
7
24

52
2
5
13

35
1
3
16

21
0
2
11

34
1
2
17

34
1
3
16

71
2
5
25

79
2
5

1
26
4
1

1
10
2
2

0
5
1
2

1
7
3

-87

-44

-22

Rest of the world..
1. See table 18, footnote 2.
2. Estimates for 1948-53 not strictly comparable with earlier years. See table 18, footnote 3.

1931

448

1
26

191

NATIONAL INCOME, 195 4 EDITION
Table 21.—Net Corporate Dividend Payments, by Industry, 1939-53
[Millions of dollars]
1939

1910

1941

1943

1942

1944

1946

1945

1947

1952

1951

1950

1949

1948

1953

Line

3,788

4,043

4,458

4,289

4,484

4,673

4,691

5,784

6,521

7,248

7,458

9,207

9,090

9,128

9,365

15
13
2

19
17
2

22
19
3

22
20
2

27
23
4

24
22
2

14
13
1

28
23
5

52
50
2

54
52
2

53
51
2

60
57
3

70
67
3

2
3
4

175
94
0
9
54
18

238
109
3
15
92
19

265
107
4
16
116
22

237
145
7
21
44
20

175
70
6
23
57
19

157
61
7
23
48
18

138
44
6
26
45
17

177
53
13
28
60
23

260
84
10
37
98
31

361
117
9
60
141
34

338
92
8
51
154
33

455
131
5
53
224
42

503
142
1
46
272
42

544

531

5
6
7
8

1,741
272
89

1,930
268
85

2,271
295
90

2,139
282
67

2,271
304
63

2,397
301
68

2,856
405
69

4,83(i
430
92

4,620

12
13
14

200

237

267

201

232

4,581
445
91

4,568

110

3,939
402
90

111

3,414
439
75

3,736
419
86

106

2,421
313
62

224

4ti

109

121

104

141

129

89
32

74
30

100
41

97
32

18
19
20
21

154
132

130
123
450
521
37
37
124

170
123
576
478
40
37
156

200
112
539
552
35
34
149

22
23
24
2^
26
27
28

616
311
186
57
62

810
455
218
69
68

781
428
220
66
67

29
30
31
32

104

100

24
25

35
26

51
28

43
24

38
24

35
25

38
22

44
36

62
47

48
74
251
79
22
22
80

68
73
254
82
16
21
84

83
70
260
104
25
27
95

65
63
237
245
19
25
62

71
78
262
236
29
27
62

67
93
271
274
33
27
52

70
88
298
255
35
26
58

96
123
360
291
44
34
85

136
123
401
375
35
43
97

>398
»416

243

261

359

372

392

426

425

432

552

»628

29
40
111
314
194
52
68

145
56
42

171
52
38

246
62
51

275
60
37

273
81
38

295
92
39

287
90
48

278
97
57

370
129
53

154
96
32
145

200
132
64
179

238
131
84
204

211
88
172
43

188
120
213
31

189
109
259
30

182
122
269
23

230
125
83
147

299
162
72
210

»348
*177

85
270

332
186
85
458

400
253
94
758

400
265
94
506

425
155

432
149

501
200

447
169

485
174

490
179

949
374

853
324

1,002
401

946
382

907

830

311

323

816
300

867
332

311

499
176

436
218

483
243

522
263

643
327

656
348

825
401
o

815
412
o

859

886

270
301
191

4
-86
43
11
138
228
77

283

301

278

243
209

245
216

426
203

-173

-174

35
13
146

23
14
159

0
69
25
9
120
233
131

259
114

271
83

15
14

19
12

23
13

32
0
69
21

43
1
60
20

51
3
78
20

28
4
17
15

683
174

685
175

675
174

11
483
15

12
483
15

61
5

7
22

22
16

-4
33
49
10
130
257
160

-1
58
30
9
144

292
189

-2
84
30
8
139

292
203

516

535

631
290

570
310

6
103
27
10
195
285
167

49
15

29
12

29
11

23
8
19
16

24
6
17
15

21
6
10
13

24
3
15
12

591
185

592
171

623
189

687
192

14
472
15

9
386
11

12
400
9

624
181

12
421
10

10
414
10

14
470
11

66
5

72
6

62
6

7
25

7
23

7
15

81
9

145
18

1
15
6
5

1
18
6
4

1
24
8
3

137

149

109

29
12

82
9

89
10

8
18

10
19

10
20

0
26
4
4

1
35
5
5

1
33
6
4

1
35
10
3

1
64
18
5

107

137

103

129

13
26

-1
45
11
14
191
246
127

34
36
36

575

529

-1
40
47
17
205

135
57
23
211

312
197

271
154

366
199

393
250

37
4
15
12

34
4
13
12

32
4
18
12

714
180

741
181

831
201

141
16

12
539
9

8
611
11

142
20

150
17

44
4fi

46
47
48
49
50
413

429

61
52

33
23

53
54

37
10
51
13

40
15
21
11

56
57
58

1,032
253

1,151
294

29
27

18
748
13
137
20

14
37

1,282

1,427

152
18

14
37

1
61
16
6

1
55
15
7

1
59
15
7

2
40
16
8

254

305

426

418

61
62
63

138

134

3
57
17
9

221

m
60

10
835
12

13
31

12
29

41
42

187
4
21
194

30
21

14
510
10

564

0
74
23
20
199

33
19

35
16

601

37
38
39
40

11
37

64
61

66
67
68
69
70
71
302

406

192

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS

Table 22.—Undistributed Corporate Income, by Industry, 1929-38
[Millions or dollars]
1929
All industries, t o t a l '

1930

1931

1932

1934

1935

1936

1937

2,446

-3,010

-5,366

-5,967

-2,426

-1,615

-217

Agriculture, forestry, a n d fisheries
Farms
Agricultural services, forestry, and fisheries..

-14
-12
-2

-57
-51
-6

-89
-82
-7

-79
-71

-34
-30

-54
-49
-5

-19
-15
-4

-29
-27
-2

-34
-30
-4

Mining
Metal mining
Anthracite mining.
Bituminous and other soft-coal mining
Crude petroleum and natural gas
Nonmetallic mining and quarrying

32
34
-7
-19

-160
-55
-1

-261
-75

-97
-1
-9
-34
-39
—14

-35
14
-4
-20
-16
-9

-10
28
—14
-11
-6
-7

55
-12
34

117
75
-14
-4
54

-110

-74

-21

-16

502
81
25
9

525
-50
-12

Contract construction..

-39
-79
14

-45
-123
-16

-1,276
-9
39
-316
-62

-2,373
-107
38
-247
-80

-2,530
-137
49
-228
-84

90
-33
76

-140

-196

-200

-78

Manufacturing
Food and kindred products
Tobacco manufactures.
Textile-mill products. _
Apparel and other finished fabric products.
L u m b e r a n d furniture p r o d u c t s 2
Lumber and wood products, except furniture.
Furniture and fixtures
Lumber and timber basic products
Furniture and finished lumber products

-174
-63
-18
-42
-28
-23

1,583
112
40
-23
-3

-47

-68
-3

128
33
13
-26
-1

-62

-65

-28

-114

-35
-27

-46
-19

-20

0
4

17
1

-79
-85
-94
-120
-47
-58
-113

—4
-9
10
-110
-2
12
-34

14
-13
74
-49
4
-3
-13

11
16
-19
-21
9
14
1

21
11
70
-52
5
3
25

24
6
56
95
-4
-12
14

-166
89
5

37
77
148
286
-20
1
42

0
-31
-150
-79
-62
-30

-121
-75
-48
-42
-39
-407
-42
-59
-84

Metals, metal products, and miscellaneous >
Primary metal industries
Fabricated metal products, including ordnance
Instruments
Miscellaneous manufacturing
Iron and steel and their products, including ordnance.
Nonferrous metals and their products
Miscellaneous manufacturing

440

-250

-584

-683

-184

-65

-52

118

164

347
79
14

-145
-44
-61

-409
-83
-92

-467
-105
-111

-152
2
-34

-91
24
2

-115
53
10

75
26
17

119
31
14

Machinery, except electrical«_
Electrical machinery»
Transportation equipment, except automobiles,.
Automobiles and automobile equipment

175
84
11
169

-72
-9
-23
-73

-219
-53
-57
-147

-284
-63
-41
-263

-93
-41
-26
-21

1
-42
-36
4

-34
125

97
26
-7
58

129
25
10
86

98
67
31

-565
-241
-324

-849
-326
-523

-975
—328
-647

-39
-3
-36

-23
-6
-17

68
64
4

13
14
-1

40
215
96
-44
92
8
-327

-581
-15
-155
-113
4
3
-305

-895
-218
-117
-138
-33
0

-1,033
-257
-67
-155
-23

-167
—1
-166
-875
-195
-46
—160
34
4
-512

-649
-174
-16
28
68
5
-560

-121
-33
-81
430
68
2
-507

-480
55
-78
-174

91
4
-378

-265
149
-58
-134
120
4
-346

331
401
-66
19

-219
-107
-37

-508
-384
-64
1

-532
-367
-75
-14

-392
—307
-55
-5

-446
-354
-56
2

-463
-270
-86
1

-263
-187
-36
4

-304
-223
-56
2

14
-6
—15
-16

-18
-19
-28
-16

-23
-9
-13
-16

-29
-3

-26
-18

-2
-13

-15
-9
—1
-13

-35
-6
-54
-13

-12
-3
-13
-16

-7
-5
2
-17

164
104
14
37

-249
30
-11
-230

-277
-10
-10
-233
-24

-316
-63
-4
-235
-14

-239

-163
-65
3
-97
-4

-184
-45
1
-134
-6

-108

-15
4
-89

-52
-11
4
-42
-3

-22
-23
1
7

-99
-32

-228
-46
-22
-22

-140
-34
-9
-15

-68
-32
-3

-5

-46
-28
0
-4

-53
-25
0
-7

-47
-22
3
-9

0
32
-10
4

0
9
-18
2

-1
-28
-24
-4

-2
-96
-31

-1
-48
-25

0
-9
-14
-5

0
2
-11
-5

0
-7
-9
-6

0
-5
-8

143

111

112

111

Paper and allied products
Printing, publishing, and allied industries
Chemicals and allied products •
Products of petroleum and coal»
Eubber products
Leather and leather products
Stone, clay, and glass products

Wholesale and retail trade
Wholesale trade
Retail trade and automobile services..
Finance, insurance, and real estate
Banking
Security and commodity brokers, dealers and exchanges..
Finance, n. e. c
Insurance carriers
Insurance agents and combination offices
Real estate.
Transportation
Railroads
Local and highway passenger transportation
Highway freight transportation and warehousing..
Water transportation
Air transportation (common carriers).
Pipeline transportation
Services allied to transportation
Communications and public utilities
Telephone, telegraph, and related servicesRadio broadcasting and television
Utilities: electric and gas..
Local utilities and public services, n. e. c
Services
Hotels and other lodging places..
Personal services
Business services, n . e. c
Miscellaneous repair services a n d h a n d trades
Motion pictures
Amusement and recreation, except motion pictures..
Engineering and other professional services, n . e. c...
Rest of the world
1. See table 18, footnote 2.

-1

2. Estimates for 1948-53 not strictly comparable with earlier years. See table 18, footnote 3.

-81
-139
-12

NATIONAL INCOME,

193

195 4 EDITION

Table 22.—Undistributed Corporate Income,feyIndustry, 1939-53
[Millions of dollarsl
1939

1940

1941

1943

1942

1,174

2,443

-19
-15
-4

-M
-8
-6

7
9
-2

12
U

78
60
-12
-4
24
10

106
82
3
14
-3
10

172
84
9
38
24
17

142
42
7
45
33
15

4,914

5,178

1944

1945

1947

1946

1948

1949

1952

1951

1950

1953

Line

5,996

5,698

3,597

7,656

11,721

13,011

12,934

9,607

8,081

8,921

15
20
-5

16
18
—2

18
18
0

45
49
-4

26
29
-3

15
17
-2

-13
-9
-4

8
16
-8

-59
-53
-6

-49

-28

2
3
4

166
51
7
64
32
12

167
33
10
70
45
9

101
30
2
48
10
11

144
26
11
53
33
31

424
83
14
180
106
41

670
106
22
207
280
55

335
29
3
43
210
50

506
107
13
81
248
57

417
102
6
52
194
63

254

8,329

318

5
6
7
8
9
10

-4

200

289

240

219

168

146

151

1,155
154
21
64
10

1,851
150
28
79
15

3,305
255
14
240
57

2,970
315
28
224
71

3,293
320
28
191
75

3,061
319
15
177
78

1,609
284
15
161
83

3,802
809
35
630
250

6,641
655
40
692
229

7,300
461
62
646
101

4,472
462
71
169
27

7,539
547
63
439
104

5,679
255
35
202
16

4,335

4,974

12
13
14
15
16

229

221

383

1316
248
68

135
96
39

363
278
85

238
184
54

12
13

38
24

72
57

60
39

49
35

48
44

20
38

264
119

38
22
160
97
27
9
46

79
37
185
145
31
7
57

124
44
257
285
59
3
7
88

90
52
227
181
77
36
71

85
118
230
341
59
36
47

93
139
185
197
60
35
40

67
136
98
91
41
33
34

117
104
241
270
485
302
135
106
136

17
18
19
20
21

426
246
623
669
84
88
174

318
204
540
11,222
98
34
209

185
176
462
417
40
9
177

351
180
747
734
164
51
278

318
159
538
777
142
4
217

22
23
24
25
26
27
28

196

397

712

608

696

602

249

497

1,098

«1,362
758
429
62
113

776
479
204
34
59

1,482
804
441
80
167

1,372
800
386
83
103

101
65
30

267
90
40

527
115
70

470
78
60

504
117
75

•417
88
97

162
31
56

312
126
59

801
218
79

29
30
31
32
33
34
35
36

100
51
23
112

237
88
99
155

410
174
225
195

347
153
302
89

303
160
418
102

278
209
443
99

124
42
73
20

113
-109
-186
-133

561
284
-148
537

»669
'322
38
698

414
202
20
730

646
442
101
847

613
287
79
427

37
38
39
40

210
119
91

363
204
159

735
367
368

714
310
404

831
338
493

901
378
523

961
395
566

2,613
1,189
1,424

2,913
1,323
1,590

2,575
1,063
1,512

1,388
517
871

2,576
1,208
1,368

1,618
878
740

1,567

1,647

41
42
43

-119
129
-47
—85
94
2
-212

35
203
-62
32
37
5
-ISO

95
268
-49
-13
12
8
-131

51
255
-33
-82
1
5
-95

270
366
-27
-52
11
2
-20

401
440
-31
-93
48
6
32

294
448
-50
-130
-6
4
28

256
565
-57
-141
-122
15
—4

308
397
-52
—54
-38
22
33

593
493
-65
-49
149
15
10

740
467
-57
30
277
13
20

446
457
-48
-1
139
9
-110

283
535
-59
-52
-14
9
-136

302

403

44
45
46
47
48
49
50

-160
-130
-52
24

-75
—95
-21
9

306
285
-15
19

875
761
58
16

953
802
86
17

653
603
65
16

226
127
47
6

-106
-211
33
41

384
284
-22
59

651
505
0
79

352
218
-15
66

734
541
-6
102

511
279
5
65

513

456

51
52
53
54

6
6
1
-15

13
7
11
1

23
8
-18
4

5
14
15
6

17
10
14
7

14
27
17
11

14
16
15
2

44
-33
8
12

62
-45
16
30

35
23
17

41
5
23
14

32
35
17
13

70
37
37
18

6
26
5
-22
-3

75
19
8
50
-2

66
1
5
62
-2

112
0
5
107
0

157
35
8
110
4

109
27
13
66
3

59
-9
13
53
2

226
Q
18
216
1

108
-49
17
134
6

156
-24
12
161
7

162
—13
9
162
4

212
86
9
114
3

117
49
25
38
5

120

169

69
60
61
62
63

-20
-27
1
4

-5
-18
2
-4

36
-22
7
11

95
6
14
11

154
38
18
16

175
39
23
19

164
42
20
19

285
54
29
40

249
51
33
49

180
45
26
54

126
35
23
40

120
27
18
51

76
22
18
47

64
65
6i
67

-1
15
-5
-5

0
20
-2
-3

3
28
0
-1

5
52
2
5

3
69
6
4

4
76
8
6

2
65
17
-1

3
127
34
8

7
80
19
10

7
20
16
12

3
14
3
8

4
11
1
8

6
-25
1
7

122

118

101

190

153

296

468

582

527

574

797

55
56
57
58

68
69
70
71
819

741

194

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS

Table 23.—Inventory Valuation Adjustment, by Industry Division, 1929-38

[Millions of dollars]
Line

1929

1930

1931

1932

1933

1934

1935

1937

1936

1938

All industries, total
A. Corporations, total
Mining
Contract construction
Manufacturing
Wholesale and retail trade
Transportation..
Communications and public utilities..

614

4,015

3,025

1,342

-2,668

-679

-277

-858

-60

1,184

472

3,260

2,414

1,047

-2,143

-625

-227

-738

-31

963

5
3
301
152
7
4

122
30

64
23

-67
-22

-4
0

-9
-1

-16
-3

2,215

1,585

663
46
33

-1,340
-627

-457
-143

-161

804
53
36

23
11
655
318
24
16

-478
-226

-52
-35

-12
-9

11
4
619
309
11
9

B. Unincorporated enterprises, total.
Mining
Contract construction
Manufacturing
Wholesale and retail trade.

142

755

611

295

-525

1
3
12
126

14
22
85
634

6
18
60
527

2
9
36
248

-4
-17
-66
-438

-3

-9
-6

0
-7
-11
34
-28
-19

-54

-50

-120

-29

221

-1
0
-5
-48

-1
-1
-7
-41

-1
-3
-13

0
-6
15
-39

1
3
18
199

-48
—5

-103

1. The inventory valuation adjustment has been estimated only in those industrial divisions in which inventories are an important income-determining factor.

Table 24.—Net Interest, by Industry Division, 1929-38
[Millions of dollars]
Line

1929

All industries, total..
Agriculture, forestry, and fisheries....
Mining
Contract construction...
Manufacturing
Wholesale and retail trade
Finance, insurance, and real estate...
Transportation
...
Communications and public utilities
Services
Best of the world

1930

1931

1932

1933

1934

1935

1937

1936

1938

6,445

5,985

5,839

5,434

5,042

4,869

4,751

4,741

4,708

4,636

833

788

745

677

582

519

459

437

422

442

41
1

-81

2,360

2,361

2,367

2,327

2,195

2,236

2,170

2,112

2,025

2,052

559

575

613

619

638

653

640

617

610

612

394

458

565

594

564

478

491

478

424

429

1,675

1,038

834

692

630

646

676

794

882

832

577

608

560

426

324

242

207

195

160

138

195

NATIONAL INCOME, 1 9 5 4 EDITION

Table 23.—Inventory Valuation Adjustment, by Industry Division, 1939-531
[Millions of dollars]
1941

1940

1939

1943

1942

1944

1945

1946

1947

1949

1948

1950

1952

1951

1953

Line

-880

-245

-3,086

-1,571

-929

-356

-670

-6,968

-7,370

-2,562

2,411

-5,998

-1,604

1,189

-1,159

-714

-200

-2,471

-1,204

-773

-287

-564

-5,263

-5,899

-2,150

1,943

-4,864

-1,260

981

-964

-12
-4
-471
-219
-8

-17
-14
-1,511
-879
-30
-20

-3
-726
-455
-10

„ O

1
-6
—135
-37
-14
-9

-3
-4
-552
-190
-14
-10

-3
-5
-206
-55
-12
-6

-4
-3
-413
-111
-22
-11

-75
-39
-3,041
-1,881
-144
-83

-70
-109
-3,737
-1,628
-213
-142

-61
-42
-1,440
-366
-151
-90

31
24
1,194
667
59
68

-49
-72
-3,082
-1,450
-100
-111

-9
-12
-662
-470
-78
-29

-10
-3
643
370
2
-21

-35
-8
-620
-235
-46
-20

3
4
5
6
7
8

-166

-45

-615

-367

-156

-69

-106

-1,705

-1,471

-412

468

-1,134

-344

208

-195

0
-4
-45
-318

-1
-4
-27
-124

0
-3
-15
-51

-1
-3
-22
-80

-13
-40
-221
-1,431

-14
-109
-225
-1,123

-13
-41
-36
-322

7
24
56
381

-12
-72
-149
-901

-2
-12
-4
-326

—3
-3
22
192

—9
-8
-5
-173

10
11
12
13

—1
-3
-28
-134

0
rj

-4
-34

-2
-12
-73
-528

Table 24.—Net Interest, by Industry Division, 1939-53
[Millions of dollars]
1939

1941

1940

1942

1944

1943

1945

1946

1947

1948

1949

1951

1950

1952

1953

Line

4,604

4,490

4,544

4,291

3,658

3,342

3,185

3,119

3,842

4,508

5,171

5,912

6,770

7,442

8,435

455

458

465

428

360

319

301

293

324

379

437

600

597

675

730

3
4

-39

-44

-33

-118

-13

-77

-63

-70

-74

-21

-55

-74

-86

-49

102

139

156

1,979

1,869

1,878

1,929

1,774

1,627

1,513

1,516

1,705

1,840

2,113

2,381

2,695

2,922

3,182

597

568

545

501

471

445

414

361

338

322

332

333

335

365

422

380

355

389

375

350

277

314

351

419

446

510

546

614

868

961

1,067

836

608

570

576

730

1,032

1,348

1,596

1,997

2,226

2,490

3,069

127

120

126

130

115

118

130

135

168

224

230

248

312

317

333

196

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS
Table 25.—Number of Full-Time Equivalent Employees, by Industry 1929-38
[Data in thousands]

1929
All industries, total
Agriculture, forestry, and fisheries
Farms
Agricultural services, forestry, and fisheries...
Mining....
Metal mining
Anthracite mining
Bituminous and other soft coal mining.
Crude petroleum and natural gas
Nonmetallic mining and quarrying
Contract construction..
Manufacturing
Food and kindred products
Tobacco manufactures
Textile-mill products..
Apparel and other finished fabric products..
Lumber and furniture products J
Lumber and wood products, except furniture
Furniture and fixtures
Lumber and timber basic products
Furniture and finished lumber products
Paper and allied products
Printing, publishing, and allied1 industries.
_
Chemicals and allied products !
_
Products of petroleum and coal
Rubber products
Leather and leather products
Stone, clay, and glass products
Metals, metal products, and miscellaneous *
Primary metal industries
_
_
Fabricated metal products, including ordnance
_.
Instruments
Miscellaneous manufacturing
Iron and steel and their products, including ordnance.
Nonferrous metals and their products-.
Miscellaneous manufacturing...
Machinery, except electrical 2
Electrical machinery !
Transportation equipment, except automobiles
Automobiles and automobile equipment
Wholesale and retail trade
Wholesale trade
Retail trade and automobile services
_
_.
Finance, insurance, and real estate.
Banking
Security and commodity brokers, dealers and exchanges..
Finance, n. e. c
Insurance carriers
Insurance agents and combination offices
Real estate
Transportation
Railroads
Local and highway passenger transportation
Local railways and buslines
Highway passenger transportation, n . e. c
Highway freight transportation and warehousing..
Water transportation
Air transportation (common carriers)..
Pipeline transportation
Services allied to transportation
Communications and public utilities
Telephone, telegraph, and related services..
Radio broadcasting and television.
Utilities: electric and g a s . . .
Local utilities and public services, n. e. c . . .
Services
Hotels and other lodging places
Personal services
Private households
Commercial and trade schools and employment agencies..
Business services, n . e. c
Miscellaneous repair services and hand trades
Motion pictures
Amusement and recreation, except motion pictures..
Medical and other health services.
Legal services
Engineering and other professional services, n. e. c .
Educational services, n. e. c.<
Nonprofit membership organizations, n . e. c
Government and government enterprises
Federal—general government
Civilian, except work relief'.
Military «
Work relief
Federal—government enterprises
State and local—general government
Public education <
Nonschool, except work relief
Work relief.
State and local—government enterprisesBest of the world •
Addendum: All private industries

1930

1931

1932

1933

1934

1935

1936

1937

35,886
3,530
3,403
127
993
124
151
471
159

33,769
3,312
3,190
122

30,690
3,225
3,103
122
813
79
128
418
118
70

27,215
3,004
2,894
110
672
50
104
358
105
55
907
6,678
841
108
907
593

27,681

30,905
2,968
2,862
106
822
SO
106
431
163
62
806
8,364
1,085
112
1,139

32,263
2,990
2,878
112

35,413

36,662

3,085
2,981
104
897
92
98
457
180
70

3,054
2,924
130
955
119
98
470
192
76

1,484
10,428

1,041
145
1,262
772
1,041

107
144
452
148
81
1,366
9,309
1,020
133
1,095
722
840

1,198

7,8"5
914
120
1,025
672
624

604
437
284
615
397
128
176
370
397

469
371

303
321

277
617
377
125
142
344
345

1,827

1,217
325
285
764
519
150
540

5,846
1,631
4,215
1,415
385
128
130
358
120
294
2,873
1,845
410
280
130
252
167
2
25
172
1,031
534
4
465
28
5,112
387
617
2,348
20
157
59
142
253
429
90
35
224
351
3,184
528
267
261
0
299
2,247
1,082
1,165
0
110
0
32,712

1. Full-time equivalent employment measures man-years of full-time employment of wage
and salary earners and its equivalent in work performed by part-time workers. Full-time
employment is defined simply in terms of the number of hours which is customary at a particular time and place. For a full explanation of the concept, see Survey of Current Business,

932

2,973
2, 865
108
693
50
92
373
124
54
703

7,204
939
102
1,081
632
549

250
548
329
105
120
315
277

225
261
226
481
291
97
110
300
204

244
449
321
99
124
320
212

1,621

1,298

1,040

1,118

1,092
269
260
671
430
147
403
5,551
1,571
3,980
1,390
375
103
128
368
122
294

857
222
219
509
332
105
352

687
175
178

5,074
1,418
3,656
1,328
345
88
120
361
119
295

4,496
1,279
3,217
1,266
311
80
114
355
117
289

749
182
187
392
251
71
300
4,472
1,275
3,197
1,219
281
89
108
341
112
288

2,632
1,659
387
263
124

2,280
1,405
356
239
117

1,934
1,155
323
214
109

249
159
4
24
150
1,031
524
6
473
28
4,928
371
606
2,193
18
153
58
143
235
434
94
37
228
358
3,318
571
310
261
0
300
2,331
1,110
1,217
4
116

235
144
5
21
114

218
130
6
17
85
828
412
9

30,451

930
459
8
437
26
4,547
331
566
1,962
16
137
57
140
205
419
99
29
232
354

373
242
80
299

384
23

4,068
282
525
1,680
12
141
56
122
156
399

3,399
553
296
257
0
298

100
21
233
341
3,361
541
290
251
0
297

2,431
1,120
1,267
44
117
1

2,419
1,109
1,223
87
104
1

27,290

23,853

840
71
99
443
165
62
866

1,104

1,082

8,904
1,106
108
1.196
768

9,645
1,157
109
1,218

79
7

10,511
1,223
111
1,2S3
843
857
459
398
325
604
431
132
154
375
356

609
320
289
280
492
369
115
141
345
262
1,358

360
329
289
510
379
121
134
352
281
1,487

415
364
300
554
393
124
142
359
317

917
220
221
505
319
101
433

996
249
242
577
338
105
464

1,147
277
262

1,317
313
284

664
385
137
492

791
461
171
580

4,982
1,406
3,576
1,242
284
83
106
348
113
308

5,186
1,443
3,743

5,584
1,550
4,034
1,305
276
85
114
368
114
348

6,046
1,706
4,340
1,346
285
83
116
383
115
364

1,841
1,084
302
199
103

1,910
1,122
294
201
93

2,046
1,194
298
204
94

215
135
6
20
79
784
383
8
371
22
3,919
266
513
1,592
11

232
145
6
22
89
799
379
11
386
23
4,280
313
549
1,797
12
172
56
135
147
403

1,933
1,113
294
202
92
254
148
8
23
93
803
376
13
392
22
4,448
327
575
1,878
15
172
56
148
150
420
104
25
240
338
5,031
1,440
449
263
728
336
3,145
1,112
1,268
765
110
1

2,159
1,251
301
207
94
289
151
12
26
129
898
422
18
437
21
5,000
373
647
2,128
19
204
67
177
182
491

27,231

29,264

270
279

147
56
119
135
390
101
21
233
335
3,872
916
294
249
373
300

2,557
1,084
1,174
1
23,808

100
23
234
339
4,731
1,394
357
250
787
323
2,909
1,083
1,223
603
105
26,173

1,261
277
74
108
364
112
326

1,914

268
142
10
25
109
850
393
15
418
24
4,748
349
613
2,008
17
201
57
164
164
455
105
29
244
342
6,148
3,145
521
290
2,334
343
2,541
1,134
1,352
55
119
1

108
31
251
332
5,530
2,457
517
313
1,627
349
2,599
1,165
1,401
33
125
1
31,131

parable with those given for 1948 and subsequent years. The discontinuities stem from
changes in the industrial classification basis on which the underlying social insurance employment tabulations are prepared. (See the Introduction to Part III.) Of the series principally involved here,fivehave been terminated in 1947; the others are indicated by footnotes.

NATIONAL

INCOME,

1954

197

EDITION

Table 25.—Number of Full-Time Equivalent Employees, by Industry, 1939-53

[Data in thousands]
1939

1940

1941

36,339
2,831
2,727
104
832
103
88
381
187
73
1,219
9,967
1,175
107
1,215
903
815

38,336
2,781
2,679
102
927
118
91
439
196
83
1,285
10,882
1,223
104
1,223
918
906

43,022
2,751
2,652
99
975
131
92
452
204
96
1,774
13,137
1,303
103
1,383
1,043
1,069

48,045
2,660
2,555
105
985
132
89
480
183
101
2,131
15,284
1,385
96
1,388
1,079
1,077

54,239
2,535
2,436
99
917
132
84
434
177
90
1,566
17,402
1,405
102
1,321
1,073
1,006

55,421
2,340
2,231
109
879
107
80
415
198
79
1,110
17,050
1,441
100
1,217
1,049
965

53,713
2,229
2,119
110
829
89
73
388
206
73
1,135
15,186
1,431
102
1,163
1,021
926

47,466
2,309
2,189
120
871
88
82
391
221
89
1,739
14,493
1,500
104
1,313
1,117
1,064

47,453
2,392
2,267
125
938
99
80
429
235
95
2,062
15,215
1,530
100
1,327
1,128
1,210

431
384
314
577
414
135
146
372
343
1,739

500
406
336
568
469
151
156
367
369
2,001

609
460
378
581
580
168
189
410
433
2,473

633
444
380
555
780
183
189
403
436
2,889

585
421
393
550
849
186
224
375
413
3,492

559
406
390
550
790
197
239
355
386
3,413

524
402
394
569
776
207
234
356
381
3,018

578
486
449
668
705
219
265
411
474
2,704

658
552
464
705
723
228
270
406
503
2,882

1,155
284
300
661
398
186
467
6,165
1,776
4,389
1,376
288
62
98
414
119
395
1,990
1,114
276
184
92
290
140
15
22
133
868
402
21
423
22
4,957
377
597
2,075
17
220
58
172
173
522
116
37
265
828
6,133
2,898
560
342
1 996
375
2,732
1,224
1,497
11
128
1
30,205

1,331
328
342
792
455
301
543
6,526
1,840
4,686
1,422
296
58
105
425
118
420
2,072
1,160
270
170
100
321
142
19
23
137
898
410
23
443
22
5,274
388
661
2,200
16
225
67
174
186
549
116
41
271
390
6,267
2,980
642
549
1,789
389
2,752
1,235
1,506
11
146
2
32,067

1,641
410
422
1,087
607
675
655
7,027
1,952
5,075
1,462
309
50
113
435
120
435
2,257
1,285
271
161
110
376
144
24
24
133
952
450
26
454
22
5,347
404
718
2,057
24
241
64
184
202
580
117
53
276
427
7,337
3,984
944
1,676
1,364
431
2,764
1.249
1,509
6
158
3
35,682

1,960
461
468
1,363
757
1,749
575
6,823
1,857
4,966
1,439
319
41
105
428
121
425
2,410
1,429
294
169
125
397
107
34
25
124
944
474
27
422
21
5,518
404
750
2,092
40
236
66
193
204
614
111
78
282
448
9,846
6,457
1,702
4,154
601
622
2,714
1,245
1,467
2
153
5
38,194

2,460
508
524
1,457
960
3,271
325
6,678
1,752
4,926
1,389
328
38
86
406
118
413
2,631
1,534
332
184
148
395
139
46
25
160
909
490
28
373
18
5,226
412
756
1,739
50
229
78
204
193
655
104
63
288
455
14,979
11, 573
2,497
9,029
47
616
2,635
1,227
1,408

2,424
492
497
1,405
1,037
3,175
341
6,667
1,771
4,896
1,364
336
39
78
392
115
404
2,817
1,616
345
188
157
390
205
47
26
188
887
486
30
353
18
5,165
420
731
1,655
35
243
81
214
196
665
95
59
292
479
17,137
13,885
2,520
11,365

2,072
457
489
1,331
925
2,044
308
6,938
1,868
6,070
1,393
343
42
81
404
118
405
2,894
1,628
354
189
165
398
247
53
25
189
911
500
33
3S9
19
5,181
417
746
1,632
21
264
84
215
197
661
90
66
295
493
17,012
13, 722
2,420
11,302

1,670
498
536
1,393
847
593
667
8,226
2,215
6,011
1,594
374
53
94
475
143
455
2,886
1,564
402
203
199
440
200
82
27
171
1,100
613
36
429
22
5,452
462
857
1,503
25
324
107
228
233
701
103
82
313
514
8,791
5,276
1,842
3,434

481
2,622
1,216
1,406

495
2,647
1,224
1,423

155
7
39,253

149
5
38,279

1942

1943

1944

1945

148
5
36,696

1946

1948

1949

1950

1951

1952

1953

48,401
2,466
2,337
129
986
101
81
452
255
97
2,274
15,285
1,528
99
1,366
1,175
3 1,187
838
349

47,134
2,381
2,252
129
914
95
77
398
248
96
2,148
14,183
1,509
101
1,229
1,157
1,057
732
325

48,705
2,220
2,090
130
91li
97
75
395
251
98
2,359
14,969
1,517
97
1,292
1,183
1,171
798
373

52,623
2,124
1,988
136
921
102
70
372
273
104
2,620
16,122
1,548
103
1,272
1,190
1,209
846
363

53,971
2,064
1,921
143
895
103
64
332
289
107
2,649
16,411
1,545
103
1,195
1,207
1,153
789
364

55,151
2,074
1,935
139
854
107
64
288
297
108
2,616
17,230
1,551
103
1,188
1,239
1,132
760
372

470
721
5 692
'243
254
403
523
s 2,971
1,231
1,029
249
462

453
727
659
236
232
388
487
2,664
1,090
922
227
425

484
741
677
238
245
393
518
2,920
1,192
1,024
247
457

510
752
748
251
265
379
553
3,200
1 318
1,134
286
462

503
765
768
251
267
382
534
3,244
1 253
1,227
307
457

531
790
806
255
279
385
546
3,541
1,339
1,373
330
499

1,863
482
537
1,549
929
512
749
8,688
2,408
6,280
1,643
393
49
102
514
146
439
2,869
1,543
406
198
208
461
163
83
28
185
1,177
643
41
470
23
5,732
461
863
1,605
31
351
116
229
235
767
104
93
337
640
6,732
3,015
1,416
1,599

3 1,541
'875
471
766
8,934
2,498
6,436
1,707
407
48
106
651
154
441
2,815
1,503
385
171
214
482
159
80
30
176
1,269
693
47
606
23
5,867
457
847
1,590
34
376
113
225
242
818
108
106
400
551
6,793
2,864
1,396
1,468

1,317
765
459
743
8,840
2,451
6,389
1,724
411
46
112
573
157
425
2,617
1,349
374
166
208
479
139
79
29
168
1,280
688
49
520
23
5,900
445
824
1,606
37
372
106
226
238
850
110
102
431
553
7,142
3,020
1,416
1,604

1,362
874
447
810
9,005
2,487
6,518
1,790
420
49
122
594
166
439
2,652
1,373
354
157
197
525
126
79
27
168
1,269
667
53
527
22
6,152
440
815
1,768
39
387
102
224
235
923
113
104
441
661
7,368
3,130
1,436
1,694

1,621
1,002
668
851
9,296
2,580
6,716
1,856
447
53
129
615
173
439
2,792
1,433
350
151
199
566
140
90
28
185
1,308
692
57
536
23
6,327
447
823
1,785
38
412
116
220
231
1,005
119
130
435
566
9,252
4,918
1,794
3,124

1,697
1,087
911
799
9,514
2,645
6,869
1,916
474
53
141
638
177
433
2,765
1,382
345
144
201
584
140
103
29
182
1,347
719
59
545
24
6,375
453
821
1,695
35
444
124
216
229
1,071
123
157
432
575
10,029
5,528
1,890
3,638

1,727
1,220
1,016
921
9,729
2,723
7,006
1,992
600
54
151
671
183
433
2,763
1,358
340
141
199
615
134
110
28
178
1,386
744
62
656
24
6,517
460
821
1,717
31
474
123
209
233
1,144
128
167
432
578
9,985
5,334
1,789
3,545

526
2,828
1,276
1,552

483
3,053
1,364
1,689

505
3,209
1,418
1,791

528
3,369
1,491
1,878

516
3.484
1,536
1,948

527
3,557
1,581
1,976

555
3,677
1,657
2,020

543
3,830
1,734
2,096

161
5
38,670

181
5
40,716

215
5
41,603

225
5
39,987

238
5
41,332

250
5
43,366

269
6
43,936

278
5
45,161

Chemicals and allied products, 723; Products of petroleum and coal, 235; Metals, metal products, and miscellaneous, 2,873; Machinery, except electrical, 1,562; and Electrical machinery, 889.
4. School teachers are considered to be employed during vacation periods.
5. Includes United States citizens, but not foreigners, enmloved abroad bv the TJ. S. Gov-

1947

Line

1
2
3
4
5
6

7
S

9
10
11
12
13
14
15
16
17
18
1
6
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36
37
38
39
40
41
42
43

44
45
46
47
48
49
50
51
62
53
54
55
56
57
58
59
60
61
62
63
64
66
66
67
68
69
70
71
72
73
74
76
76
77
78
79
80
81
82
83
84
85
86
87
88
89

90
91
92

7. Because of the exceptional character of work relief employment, full-time equivalent
employment has been computed for all years by use of a 40-hour week as a measure of fulltime employment.
8. Represents the estimated number of permanent United States residents employed in the

198

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS
Table 26.—Average Number of Full-Time and Part-Time Employees, by Industry 1929-38

[Data in thousands]
1929
All industries, total..
Agriculture, forestry, and fisheries
Farms
_
_
Agricultural services, forestry, and fisheries.
Mining
_
Metal mining
Anthracite mining
Bituminous and other soft-coal mining
Crude petroleum and natural gas
Nonmetallic mining and quarrying
Contract construction
Manufacturing
Pood and kindred products
_
Tobacco manufactures
Textile-mill products
__
Apparel and other finished fabric products
Lumber and furniture products *
Lumber and wood products, except furniture
Furniture and fixtures
Lumber and timber basic products,.
Furniture and finished lumber products
Paper and allied products
Printing, publishing, and allied industries
Chemicals and allied products *
Products of petroleum and coal !
Rubber products
Leather and leather products
Stone, clay, and glass products
Metals, metal products, and miscellaneous 2
Primary metal industries
Fabricated metal products, including ordnance...
Instruments
Miscellaneous manufacturing
Iron and steel and their products, including ordnance..
Nonferrous metals and their products
Miscellaneous manufacturing
Machinery, except electrical s
Electrical machinery >
Transportation equipment, except automobiles
Automobiles and automobile equipment
Wholesale and retail trade
Wholesale trade
—
Retail trade and automobile services
Finance, insurance, and real estate
Banking
Security and commodity brokers, dealers and exchanges..
Finance, n. e. c
Insurance carriers..
Insurance agents and combination offices
Real estate...
Transportation
Railroads
Local and highway passenger transportation
Local railways and buslines
Highway passenger transportation, n. e. c
Highway freight transportation and warehousingWater transportation
Air transportation (common carriers)
Pipeline transportation
Services allied to transportation
Communications and public utilities
Telephone, telegraph, and related servicesRadio broadcasting and television
Utilities: electric and gas..
Local utilities and public services, n. e. c...
Services
_
Hotels and other lodging places.
Personal services
Private households >..
Commercial and trade schools and employment agencies.
Business services, n. e. c
Miscellaneous repair services and hand trades
Motion pictures...
Amusement and recreation, except motion pictures
Medical and other health services'.
Legal services
Engineering and other professional services, n. e. c
—
Educational services, n. e. c.> •
Nonprofit membership organizations, n. e. c
Government and government enterprises
Federal—general government
Civilian, except work relief
Military'
Work relief
Federal—government enterprises
State and local—general government.
Public education •
Nonschool, except work relief..
Work relief...
State and local—government enterprises
Rest of the world «.
Addendum: All private industries

1930

1931

1932

1933

1934

1935

37,636
3,556
3,403
153
993
124
151
471
159

32,649
3,252
3,103
149
813
79
128
418
118
70
1,198
7,895
914
120
1,025
672
624

29,368
3,028
2,894
134
672
50
104
358
105
55
907
6,678
841
108
907
593
486

30,872
2,995
2,865
130
693
50
92
373
124
54
703
7,204
939
102
1,081
632
549

34,170
2,986
2,862
124
822
60
106
431
163
62
806
8,364
1,085
112
1,139
699

35,499
3,013
2,878
135
840
71
99
443
165
62

1,484
10,428
1,041
145
1,262
772
1,041

35,521
3,337
3,190
147
932
107
144
452
148
81
1,366
9,309
1,020
133
1,095
722
840

604
437
284
615
397
128
176
370
397
1,827

469
371
277
617
377
125
142
344
345
1,621

303
321
250
548
329
105
120
315
277
1,298

225
261
226
481
291
97
110
300
204
1,040

270
279
244
449
321
99
124
320
212
1,118

320
289
280
492
369
115
141
345
262
1,358

360
329
289
510
379
121
134
352
281
1,487

1,217
325
285
764
519
150
640
6,441
1,757
4,684
1,520
387
156
153
367
145
312
2,958
1,845
413
280
133
303
176
2
25
194
1,031
534
4
465
28
5,677
398
661
2,619
24
189
76
158
313
429
98
35
224
453
3,548
528
267
261
0
337
2,562
1,120
1,442

1,092
269
2fiO
671
430
147
403
6,162
1,693
4,469
1,491
377
126
151
376
148
313
2,711
1,659
389
263
126
299
167
4
24
169
1,031
524
6
473
28
5,472
384
649
2,446
22
185
74
160
290
434
103
37
228
460
3,710
571
310
261
0
339
2,673
1,150
1,503
20
127
0
31,811

857
222
219
509
332
105
352
5,678
1,530
4,148
1,423
347
107
143
369
144
313
2,352
1,405
359
239
120
282
152
5
21
128
930
459
8
437
26
5,049
344
607
2,188
18
164
73
156
261
419

687
175
178
373
242
80
299
5,068
1,380
3,688
1,358
313
97
135
363
142
308
1,998
1,155
326
214
112
263
137
6
17
94
828
412
9
384
23
4,534
296
564
1,874
15
169
72
135
205
399
109
21
233
442
4,296
541
290
251
0
333
3,304
1,148
1,564
692
118
1
25,071

749
182
187
392
251
71
300
5,076
1,377
3,699
1,309
281
109
128
348
136
307
1,899
1,084
303
199
104
258
141
6
20
87
785
383
9
371
22
4,374
281
553
1,776
14
176
72
133
183
390
110
21
233
432
5,833
1,014
294
249
471
335
4,370
1,122
1,524
1,724
114
1
25,038

917
220
221
505
319
101
433
5,567
1,492
4,075
1,332
286
101
126
355
137
327
1,974
1,122
295
201
94
278
152
6
22
99
800
379
12

121
0
34,088

1. This series measures the average number of full-time and part-time jobs filled during the
year by wage ana salary earners. The difference between the data shown in table 25 and
table 26 is explained in the Survey of Current Bwmesi, June 1945, pp. 17-18.

232
450
4,058
553
296
257
0
336
3,039
1,160
1,580
299
130
1
28,590

4,766
331
590
2,004
15
207
72
147
193
403
109
23
234
438
6,752
1,747
357
250
1,140
359
4,526
1,122
1,570
1,834
120
1
27,417

8,904
1,106
108
1,196
768

249
242
577
338
105
464
5,707
1.507
4,200
1,352
279
89
129
372
136
347
2,004
1,113
296
202
94
305
155
8
23
104
804
376
14
392
22
4,936
346
618
2,095
17
207
72
159
190
420
113
25
240
434
7,072
1,702
449
263
990
374
4,870
1,152
1,621
2,097
126

1937
38,507
3,106
2,981
125
897
92
98
457
180
70
1,104
9,645
1,157
109
1,218
829
779

39,597

415
364
300
554
393
124
142
359
317

459
398
325
604
431
132
154
375
356
1,914

1,147
277
262
664
385
137
492
6,155
1,612
4,543
1,401
278
103
135
376
138
371
2,121
1,194
300
204
96
322
149
10
25
121
852
393
17
418
24
5,267
370
658
2,240
20
241
72
178
205
455
114
29
244
441
7,958
4,464
521
290
3,653
381
2,978
1,174
1,713
91
135
1
30,548

1,317
313
284
791
461
171
580
6,674
1,770
4.904
1,445
287
101
138
392
139
388
2,240
1,251
303
207
96
346
158
12
26
144
900
422
20
437
21
5,538
397
694
2; 374
22
246
73
193
224
491
118
31
251
424
7,088
3,537
517
313
2,707
387
3,024
1,206
1,762
66
140

2,924
159
955
119
98
470
192
76
1,082
10,591
1,223
111
1,263
843
857

32,508

2. See notes 2 and 3, table 25.
3. Data represent the number of persons employed; the number of full-time and part-time
jobs is much larger.

NATIONAL INCOME,

195 4

199

EDITION

Table 26.—Average Number of Full-Time and Part-Time Employees, by Industry 1939-53 '
[Data in thousands]
1940

1941

39,469
2,859
2,727
132
832
103
88
381
187
73
1,219
9,967
1,175
107
1,215
903
815

41,253
2,809
2,679
130
927
118
91
439
196
83
1,285
10,882
1,223
104
1,223
918
906

45,831
2,779
2,652
127
975
131
92
452
204
96
1,774
13,137
1,303
103
1,383
1,043
1.069

50,282
2,692
2,555
137
985
1S2
89
480
183
101
2,131
15,284
1,385
96
1,388
1,079
1,077

56,086
2,563
2,436
127
917
132
84
434
177
90
1,566
17,402
1,405
102
1,321
1,073
1,006

57,344
2,372
2,231
141
879
107
80
415
198
79
1,110
17,050
1,441
100
1,217
1,049
965

55,683
2,259
2,119
140
829
89
73
388
206
73
1,135
15,186
1,431
102
1,163
1,021
926

49,642
2,343
2,189
154
871
88
82
391
221
89
1,739
14,493
1,500
104
1,313
1,117
1,064

49,713
2,427
2,267
160
938
99
80
429
235
95
2,062
15,215
1,530
100
1,327
1,128
1,210

431
384
314
577
414
135
146
372
343
1,739

500
406
336
668
469
151
156
367
369
2,001

609
460
378
581
580
168
189
410
433
2,473

633
444
380
555
780
183
189
403
436
2,889

585
421
393
550
849
186
224
375
413
3,492

559
406
390
550
790
197
239
355
386
3,413

524
402
394
569
776
207
234
356
381
3,018

578
486
449
668
705
219
265
411
474
2,704

658
552
464
705
723
228
270
406
503
2,882

1.155
284
300

1,331
328
342
792
455
301
543
7,220
1,899
5,321
1,518
298
71
124
435
143
447
2,164
1,160
272
170
102
385
150
19
23
155
900
410
25
443
22
5,813
416
709
2,454
19
265
72
192
230
549
126
41
271
469
7,733
3,983
642
549
2,792
425
3,164
1,254
1,872
38
161
2
33,518

1,641
410
422
1,087
607
675
655
7,768
2,014
5,754
1,559
311
61
135
445
144
463
2,357
1,285
273
161
112
451
151
24
24
149
954
450
28
454
22
5,907
433
769
2,312
28
281
79
204
250
580
128
53
276
514
8,618
4,812
944
1,676
2,192
452
3,182
1,319
1,846
17
172
3
37,210

1,960
461
468
1,363
757
1,749
575
7,539
1,916
5,623
1,531
321
50
125
437
145
453
2,512
1,429
296
169
127
477
112
34
25
139
946
474
29
422
21
6,108
433
802
2,369
48
272
82
215
253
614
122
78
282
538
10,549
6,765
1,702
4,154
909
487
3,126
1,327
1,794
5
171
5
39,728

2,460
508
524
1,457
960
3,271
32£
7,378
1,808
5,570
1,475
330
47
101
415
142
440
2,741
1,534
335
184
151
474
146
46
25
181
911
490
30
373
18
5,770
440
808
1,984
60
260
95
226
238
655
114
63
288
539
15,356
11,611
2,497
9,029
85
544
3,028
1,319
1,709

2,424
492
497
1,405
1,037
3,175
341
7,357
1,828
5,529
1,447
338
47
92
401
138
431
2,932
1,616
348
188
160
469
216
47
26
210
890
486
33
353
18
5,712
448
779
1,904
43
273
100
237
242
665
105
59
292
565
17,590
13,885
2,520
11,365

2,072
457
489
1,331
925
2,044
308
7,644
1,927
5,717
1,477
345
52
95
413
142
430
3,012
1,628
357
189
168
477
260
53
25
212
914
500
36
359
19
5,727
445
795
1,892
25
292
102
238
244
661
100
66
296
571
17,495
13, 722
2,420
11,302

1,670
498
536
1,393
847
593
667
9,055
2,286
6,769
1,692
376
64
112
484
172
484
3,009
1, 5(14
406
203

520
3,019
1,319
1,700

173
7
40,723

166
5
39,749

398
186
467
6,825
1,833
4,992
1,470
290
76
117
423
144
420
2,073
1,114
277
184
93
347
148
IS
22
150
870
402
23
423
22
5,497
405
642
2,315
21
265
74
191
215
522
126
37
265
419
7,856
4,118
560
342
3,216
412
3,183
1,267
1,877
39
143
1
31,612

1942

1943

1944

1945

1947

1939

1946

1949

1950

1951

1952

1953

49,443
2,417
2,252
165
914
95
77
398
248
96
2,148
14,184
1,509
101
1,229
1,157
1,057
732
325

51,110
2,256
2,090
166
916
97
75
395
251
98
2,359
14,969
1,517
97
1,292
1,183
1,171
798
373

55,024
2,164
1,988
176
921
102
70
372
273
104
2,620
16,122
1,548
103
1,272
1,190
1,209
846
363

56,397
2,107
1,921
186
895
103
64
332
289
107
2,649
16,411
1,545
103
1,195
1,207
1,153
789
364

57,593
2,118
1,935
183
854
107
54
288
297
108
2,616
17,230
1,551
103
1,188
1,239
1,132
760
372

470
721
2 692
2 243
254
403
5?3
' 2, 971
1.231
1,029
249
462

453
727
659
236
232
388
487
2,664
1,090
922
227
425

484
741
677
238
245
393
518
2,920
1,192
1,024
247
457

510
752
748
251
265
379
553
3,200
1,318
1,134
286
462

503
765
768
251
267
382
534
3,244
1 253
1,227
307
457

531
790
806
255
279
385
546
3,541
1,339
1,373
330
499

210
82
27
192
1,104
613
40
429
22
6,007
491
912
1,756
30
354
130
253
289
701
114
82
313
582
9,324
5,276
1,842
3,434

1,8B3
482
537
1,549
929
512
749
9,546
2,485
7,061
1,746
395
61
121
525
177
467
2,996
1,543
410
198
212
553
171
83
28
208
1,181
643
45
470
23
6,307
489
915
1,891
37
380
139
253
291
767
116
93
337
599
7,290
3,015
1,416
1,599

»1, 541
2 875
471
766
9,804
2,578
7,226
1,813
410
58
127
564
185
469
2,943
1,503
388
171
217
578
167
80
30
197
1,273
693
51
506
23
6,441
484
899
1,888
41
401
134
249
298
818
11
2
106
400
602
7,379
2,864
1,396
1,468

1,317
765
460
743
9,703
2,529
7,174
1,831
414
56
133
586
190
452
2,744
1,349
377
166
211
575
146
79
29
189
1,285
688
54
520
23
6,480
471
873
1,923
44
397
126
250
295
850
123
102
431
595
7,732
3,020
1,416
1,604

1,362
874
447
810
9,884
2,565
7,319
1,903
423
60
146
607
199
468
2,787
1,373
357
157
200
629
133
79
27
189
1,274
667
58
527
22
6,781
467
863
2,134
47
412
128
248
291
923
127
104
441
596
7,976
3,130
1,436
1,694

1,621
1,002
668
851
10,203
2,662
7,541
1,973
450
64
154
629
208
468
2,937
1,433
353
151
202
678
147
90
28
208
1,313
692
62
536
23
6,960
474
872
2,155
46
440
138
245
285
1,005
133
130
435
602
9,806
4,918
1,794
3,124

1,697
1,087
911
799
10,442
2,729
7,713
2,037
477
65
169
652
214
460
2,915
1,382
348
144
204
701
147
103
29
205
1,353
719
65
545
24
6,992
480
871
2,046
42
473
147
239
284
1,071
138
157
432
612
10,590
5,528
1,890
3,638

1,727
1,220
1,016
921
10,666
2,800
7,866
2,116
503
65
180
686
221
461
2,917
1,358
343
141
202
737
141
110
28
200
1,393
744
69
556
24
7,142
488
870
2,073
38
506
146
232
287
1,144
144
167
432
615
10,536
5,334
1,789
3,545

636
3,071
1,337
1,734

572
3,297
1,414
1,883

528
3,547
1,517
2,030

553
3,726
1,579
2,147

579
3,888
1,660
2,228

565
4,023
1,718
2,305

577
4,045
1,768
2,277

606
4,171
1,853
2,318

594
4,315
1,947
2,368

166
5
38,183

179
5
40,313

200
5
42,418

236
5
43,323

245
5
41,706

258
5
43,129

266
5
45,213

285
6
45,801

293
5
47,052

2o;s
628

4. Series measures full-time equivalent employment; full-time and part-time employment
not available.
5. See note 4, table 25.

1948
50,707
2,504
2,337
167
986
101
81
452
255
97
2,274
15,285
1,528
99
1,366
1,175
! 1.187
838
349

6. See note 5, table 25.
7. See note 6, table 26.
8. See note 8, table 25.

Line
1
2
:
4
6
6

8
9
10
11
12
13
14
16
16
17
18
19
20
21
22
23
24
2£
2
f
2"
2
S
2
S
3
C
31
3
5
3
C
34
3.
3
f
3'
3!
3
<
4
(
41
42
41
44
4.
4
f
4"
4S
4S
5
C
61
5i

5
C
54
5!
5
6
5!
6
J
5S
60
61
62
63
64
6
«

67
68
68
70
71
72
7
i
7'
75
7
t
77
78
79
80
81
82
83
8
4
8!
86
87
88
gc
90
91
92

200

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS
Table 27.—Average Annual Earnings per Full-Time Employee, by Industry, 1929-38 '
[Dollars]
1929
AH industries, t o t a l . .
Agriculture, forestry, a n d fisheries

Farms
Agricultural services, forestry, and fisheries..
Mining
Metal mining
Anthracite mining
Bituminous and other soft-coal mining
Crude petroleum and natural gas...
Nonmetallie mining and quarrying
Contract construction.
Manufacturing
Food and kindred products
Tobacco manufactures
Textile-mill products
Apparel and otherfinishedfabric products.
Lumber and furniture products2
Lumber and wood products, except furniture
Furniture and fixtures _
Lumber and timber basic products
Furniture andfinishedlumber products
Paper and allied products
_
Printing, publishing, and allied industries..
Chemicals and allied products»
Products of petroleum and coal *
Rubber products
Leather and leather products
Stone, clay, and glass products
Metals, metal products, and miscellaneous2
Primary metal industries
Fabricated metal products, including ordnance.._
Instruments
Miscellaneous manufacturing
Iron and steel and their products, including ordnance.
Nonferrous metals and their products
Miscellaneous manufacturingMachinery, except electrical 2
...
Electrical machinery •
Transportation equipment, except automobiles
Automobiles and automobile equipment...
Wholesale and retail trade
Wholesale trade
Retail trade and automobile services
Finance, insurance, and real estate
Banking
Security and commodity brokers, dealers, and exchanges..
Finance, n. e. e
Insurance carriers
Insurance agents and combination offices
Keal estate
Transportation
Railroads
Local and highway passenger transportation
Local railways and buslines.
Highway passenger transportation, n. e. c
Highway freight transportation and warehousing.
Water transportation
Air transportation (common carriers)
Pipeline transportation
Services allied to transportation
Communications and public utilities
_
Telephone, telegraph, and related services..
Badio broadcasting and television
Utilities: electric and gas
Local utilities and public services, n. e. c.-.
Services
Hotels and other lodging places
Personal services
Private households
Commercial and trade schools and employment agencies.
Business services, n. e. c
Miscellaneous repair services and hand trades
Motion pictures
Amusement and recreation, except motion pictures
Medical and other health services.
Legal services
Engineering and other professional services, n. e. c
Educational services, n. e. c.
Nonprofit membership organizations, n. e. c
Government and government enterprises
Federal—general government
Civilian, except work relief.
Military..
Work relief
Federal—government enterprises
State and local—general government...
Public education
Nonschool, except work relief.
Work relief
State and local—government enterprises
Rest of the world
A d d e n d u m : All private i n d u s t r i e s .

1,405
397

1,368
388
369
893
1,424

1931

1932

1933

1934

1,275

1,120

312
291
844

1,048
230
213
685
990
1,040
1,435
748
1,427
852

1,091
251
235
679
1,108
1,133
1,500
900
1,472
903

1935
1,137

1936

1,258
360
338
854
1,366

911
1,074
1,313
1,702
1,455
1,629
1,472
1,045
1,262
1,409

963
1,123
1,403
1,722
1,559
1,833
1,526
1,085
1,357
1,540

1,446
1,361
1,298
1,550
1,478
1,496
1,600

1,591
1,492
1,359
1,693
1,616
1,614
1,672

1,298
1,652
1,159

1,352
1,693
1,218
1,788
1,919
3,048
2.009
1,901
1,887
1,176

1,551
1,750
1,119
1,980
1,358

1,221
1,291
1,602
909
1,890
1,186

1,674
1,543
1,503
979
1,155
1,361
1,267

1,526
1,488
1,489
985
1,096
1,265
1,224

1,233
1,369
1,451
908
1,039
1,162
1,106

907
1,150
1,303
787
847
941
881

1,086
1,204
725
829
900
820

942
1,153
1,221
750
883
987
865

286
268
759
1,154
1,239
1,414
957
1,558
968
1,027
1,216
1,253
778
926
1,016
907

1,172
1,398
1,514
2,010
1,673
1,844
1,597
1,327
1,557
1,700

1,156
1,310
1,487
2,011
1,647
1,904
1,563
1,215
1,525
1,609

1,010
1.196
1,404
1,943
1,608
1,810
1,392
1,152
1,386
1,427

787
962
1,208
1,740
1,419
1,619
1,191
970
1,167
1,098

737
900
1,143
1,599
1,312
1,505
1,137
950
1.071
1,098

791
948
1,186
1,644
1,341
1,513
1,248
1,017
1,088
1,177

1,235
1,698
1,385
1,587
1,358
1,043
1,171
1,284

1,740
1,665
1,568
1,827
1,655
1,747
1,813
1,594
2,072
1,409

1,640
1,554
1,535
1,748
1,658
1,728
1,571
1,569
2,039
1,384

1,410
1,455
1,466
1,521
1,461
1,590
1,455

1,044
1,177
1,230
1,311
1,182
1,463
1,234

1,073
1,132
1,166
1,260
1,203
1,310
1,170

1,166
1,209
1,195
1,345
1,282
1,317
1,314

1,973
1,909
3,097
1,828
2,226
1,877
1,446

1,315
1,672
1,173
1,652

1,183
1,477
1,066
1,555

1,228
1,550
1,102

2,062
1,9«9
3,172
1,862
2,268
1,975
1,575

1,495
1,934
1,324
1,858
1.881
3.011
1,767
2,127
1,748
1,237

1,295
1,277
1,244
1,425
1,364
1,381
1,489
1,279
1,640
1,139

1,726
2,742
1,574
1,677
1,464
906

1,601
1,768
2,807
1,660
1,716
1,575
981

1,632
1,830
2,770
1,759
1,745
1,679
1,021

1,713
1,891
2,941
1,886
1,823
1,781
1,078

1,643
1,749
1,598
1,721
1,331
1,298
1,275
2,624
1,927
1,424
1,474
1.386
2, 513
1,589
1,116
1,079
1.1"""
1,219
731
1,650
2,274
1,814
2,169
1,273
925
1,378
2,314
1,312
1,712
1,551
1,561
1,933
1,180
0
1,903
1,499
1,445
1,549
0
1,600
2,000
1,390

1,610
1,717
1,587
1,719
1,306
1,269
1,214
2,424
1,802
1,427
1,497
1,410
2,624
1,603
1,124

1,817
2,925
1,632
1,800
1,581
979
1,373
1,461
1,328
1,533
927
1,179
1,038
2,346
1,691
1,224

1,334
1,439
1,219
1,422
825
1,172
1,059
2,227
1,443
1,127

1,393
1, 505
1,310
1,473
957
1,207
1, 055
2,201
1,521
1,180

1,492
1,645
1,361
1,515
1,022
1,264
1,088
2,195
1,575
1,269

1,438
1,335
2,740
1,542
1,081
918
908
996
497
1,500
1,844
1,464

1,351
1,245
2, 510
1,453
1,021
854
816
889
460
1,364
1,653
1,286
1,891
1,185
810
1,
1,619
1,189
1,442
1,328
1,217
1,673
1,072
954
1,577
1,333
1,300
1,413
1,140
1,455

1,426
1,338
2,198
1,510
1,061

1,700

1,800

1,002

1,056

1,486
1,378
2,089
1,589
1,116
873
878
915
485
1,400
1,884
1,429
1.892
1,193
829
1,163
1,600
1,162
1,435
1,292
1,183
1,759
1,152
839
1,780
1,
1,293
1,425
1,035
1,473
1,800
1,109

1,582
1,724
1,433
1,583
1,106
1,328
1,373
2,243
l,f09
1,275
1,522
1,420
2.223
1,615
1,135

378
1,526
1,613
1,728
1,293
2,019
1,409

1,066
1,097
1,200
676
1,778
2,412
1,793
2,175
1,268
933
1,394
2,027
1,329
1,
1,553
1,504
1,768
1,192
0
1,907
1,517
1,455
1,576
1,000
1,595
1,900
1,348

1,549
1,661
1,500
1,678
1,137
1,230
1,153
2,381
1,794
1,377
1,514
1,436
2,732
1,600
1,122
1,
1,030
1,136
584
1,625
2,255
1,684
2,179
1,244
919
1,333
1,"""
1,323
1,653
1,547
1,564
1,895
1,183
0
1,
1,497
1,463
1,541
1,045
1,573
1,900
1,241

l , 218
'
865
1,260
1,714
1,279
1,545
1,477
1,518
1,824
1,163
0

1, 791
1,427
1,399
1,479
1,057
1,529
1,800
1,070

857
863
905
473
1,417
1,709
1,339
1,844
1,190
801
1,160
1,609
1,175
1,440
1,284
1,180
1,717
1,072
971
1,635
1,289
1,265
1,391
1,128

1937

1,184
307
290
788
1,263
1,380
1,408
1,103
1,594
1,100
1,178
1,287
1,290
817
952
1,013
987

247
228
755
1,016
1,060
1,452
723
1,600
945

1. Average annual earnings per full-time employee are obtained by dividing wages and
salaries, as given in table 15, by the number of full-time equivalent employees, as given in
table 25. Footnotes to tables 15 and 25 are, therefore, relevant also to tabie 27. For a full

1930

898
897
940
506
1,471
1,915
1.456
i, r""
1,232
851
1,200
1,759
1,180
1,465
1,279
1,112

1,630
1,388
1,170
1,734
1,211
1,278
1,376
1,351
883
994
1,025
1,037

1,644
1,774
1,505
1,633
1,223
1,408
1,536
2, 257
1,822
1,279
1,601
1,481
2,3«1
1, 705
1,197
938
941
978
558
1,526
1^544
1,972
1,269
876
1,231
1,774
1,211
1,497

1.457
1,345
1,487

1,355
1,189
1,797
1,131
1,007
1,851
1,436
1,367
1,493
1,454
1,536

1,900
1,164

1,240

1^152
931
1,:
1,397
1,329

1,900

explanation of the concept of "average annual earnings per full-time employee", see Survey o)
Current Biutiness, June 1945, pp. 17-18.

201

NATIONAL INCOME, 195 4 EDITION
Table 27.—Average Annual Earnings per Full-Time Employee, by Industry,

1939-531

[Dollars]
1939

1940

1941

1942

1943

1,264

1,300

1,443

1,709

1,951

385
362
981

408
3S5

498
473

673
643

867
837

1,367
1,515
1,409
1,197
1,684
1,178
1,268
1,363
1,372

1,010
1,388
1,610
1,297
1,235
1,714
1,217
1,330
1,432
1,385
1,000

1,025
1,042

1,022
1,034

1,162
1,579
1,771
1,467
1,500
1,779
1,375
1,635
1,653
1,472
1,117
1,159
1,159
1,146

1,410
1,796
2,045
1,753
1,715
1,940
1,634
2,191
2,023
1,650
1,240
1,385
1,331
1,332

1,616
2,162
2,333
2,119
2,115
2,299
1,911
2,503
2,349
1,878
1,431
1,556
1,595
1,571

1,026
1,304
1,646
1,852
1,893
2,113
1,778
1,236
1,554
1,841

1,205
1,514
1,850
1,971
2,131
2,410
2,116
1,447
1,771
2,210

916
960

956

986

934

1 138
1,414
1,718
1,611
1,852
1,548
1,038
1,359
1,508

1,158
1,458
1,764
1,723
1,954
1,583
1,041
1,393
1,590

1, 549
1, 521
1 337
l|681
1,601
1,667
1,762
1.360
1,698
1,224
1,729
1,969
2,806
2,102
1,826
1,882
1,144
1,723
1,877
1,569
1,701
1.304
1,521
1, 557
2,328
1,930
1,271
1,692
1,600
2,427
1,766
1,240

1,643
1, 594
1,380
1,813
1,688
1,764
1,934
1,382
1,754
1,236
1,725
1,963
2,845
2,114
1,838
1,890
1,145
1,756
1,906
1,559
1,700
1,320
1,551
1,648
2,239
1,928
1,305
1,718
1,610
2, 554
1,795
1,286

952
958

953
997

1,034

1,042

1,923
1,824
1,540
2,144
1,919
2,160
2,243
1,478
1,943
1,299
1,777
1,977
3,040
2,177
1,910
1,975
1,198
1,885
2,030
1,664
1,795
1.473
1, 630
1,854
2, 258
2,099
1,579
1,766
1,633
2,581
1,870
1,344
1,020
1,025
1,075

1,629
1,886
1,603
1,971
1,277

1,625
1,889
1,579
1,948
1,280

1,833
1,967
1,891
2,016
1,292

1,198
1,973
1,234
1,546
1,337
1,137
1,843
1,135
939
1,819
1,471
1,403
1,530
909
1,578
2,000
1,250

1,224
1,902
1,240
1,408
1,344
1,127
1,894
1,026
883
1,820
1,497
1,435
1,552
909
1,610
2,000
1,291

1,265
2,245
1,264
1,379
1,388
1,240
1,970
1,113
889
1,777

544

908

554

927

601

955

1,522
1,462
1,574
1,000
1,734
2,000
1,454

1944

1945

1946

1951

1952

1953

3,247
1,534
1,469
2,485
3,891
4,098
3,386
3,831
4,143
3,587
3,735
3,612
3,307
2,447
2,898
2,585
2,849
2,681
3,242

3,428
1,629
1,560
2,566
4,069
4,544
3,500
3,780
4,471
3,766
4,022
3,834
3,478
2,592
2,987
2,653
3,052
2,876
3,434

3,590
1,653
1,577
2,705
4,364
4,879
3,389
4,198
4,643
4,019
4,244
4,051
3,676
2,709
3,026
2,747
3,170
2,975
3,570

3,196
3,499
2 3,399
2 4,054
3,200
2,414
2,025
2 3,245
3 431
3,247
3,157
2,790

3, 232
3,655
3,539
4,174
3,228
2,405
3,008
3,287
3,435
3,324
3,291
2,826

3,479
3,800
3,768
4,315
3,543
2,545
3,239
3,527
3,728
3,632
3,530
2,987

3,763
4,003
4,075
4,629
3,819
2,670
3,595
3,904
4,162
3,886
3,892
3,219

3,974
4,220
4,297
4,952
4,127
2,861
3,702
4,134
4,401
4,142
4,147
3,372

4,169
4,420
4,560
5,204
4,290
2,940
3,956
4,376
4,712
4,363
4,355
3,527

1, 4«5
2,903
3,023
2,974
3,031
2,345
1,821
1,971
3,495
2,113
2,172
2,574
2,793
3,074
2,543

2 3,433
"3,153
3,594
3,381
2,832
3,566
2, 547
2,947
3,039
4,958
3,670
2,953
3,364
2,317
3,440
3, 581
2,935
3,146
2,766
3,355
4,006
3,662
4,100
2,852
3,002
2,776
4,2.34
3,223
2,380
2,H2
2,031
2,096
1,498
3,147
3,226
3,150
2,911
2,455
1,952
2,093
3,745
2,185
2,339
2,758
2,930
3,168
2,704

3,477
3,2!.
3,59^
3,608
2,899
3,619
2,623
3,046
3,173
5,043
3,795
3,082
3,478
2,301
3,556
3,706
2,987
3,277
2,755
3,545
4,129
3,873
4,172
2,911
3,153
2,907
4,469
3,383
2,519
2,166
2,094
2.154
1,502
3, 243
3,309
3, 236
2,912
2.492
2,044
2,218
3,931
2,225
2,490
2,863
2,983
3,362
2,648

3,755
3.370
3:736
4,010
3,034
3.834
2,729
3,244
3,340
6,122
3,893
3,237
3,711
2.481
3,699
3,789
3,096
3,376
2,873
3,811
4,413
4,089
4,296
3,077
3,321
3,033
4,698
3,571
2,606
2,220
2, 150
2,236
1,509
3, 410
3,457
», 441
2,915
2, 566
2,137
2,301
4,106
2,290
2,626
3,015
3,205
3,504
2,951

4,228
3,714
4,251
4,224
3,225
4,138
2,875
3,426
3,506
6,132
4,194
3,434
S.896
2, 595
4,033
4,171
3,233
3,623
3,025
4,069
4,779
4,344
4,679
3,459
3,554
3,218
5,175
3,849
2,776
2,362
2,246
2,348
1,587
3,421
3,699
3,845
3,059
2,719
2,260
2,445
4,531
2,372
2,807
3,114
3,144
3,778
2,780

4,466
3,959
4,470
4,608
3,338
4,284
2,974
3,592
3,656
6,094
4,390
3,647
4,056
2,684
4,254
4,342
3,429
3,833
3,139
4,375
5,214
4,650
5,000
3,676
3,802
3,441
6,559
4,123
2,988
2,529
2,355
2,474
1,686
3,514
3,878
4,097
3,190
2,900
2,394
2,618
4,847
2,521
2,997
3,270
3,262
3,975
2,877

4,692
4,133
4,761
4,947
3,476
4,465
3,092
3,761
3,798
6,130
4,543
3,855
4,262
2,792
4,441
4,407
3,556
4,000
3,241
4,709
6,022
4,864
5,250
3,882
4,034
3,645
5,855
4,387
3,191
2,650
2,435
2,585
1,777
3,742
4,046
4,325
3,244
3,052
2,503
2,773
6,054
2,625
3,161
3,351
3,290
4,103
2,879

2,644
2,091
2,025
2,144

2,865
2,298
2,261
2,327

3,095
2,533
2,538
2,528

3,284
2,668
2,671
2,665

3,512
2,755
2,794
2,725

3,797
2,947
2,998
2,906

4,092
3,142
3,169
3,119

4,195
3,277
3,315
3,245

2,590
3,400
2,359

2.818
3,400
2,591

3,023
3,200
2,798

3,182
3,200
2,848

3,227
3,600
3,007

3,464
4,000
3,276

3,688
4,167
3,465

3,888
4,000
3,643

1,743
2,499
2,458
2,525
2,535
2,601
2,089
2,602
2,517
2,044
1,580
1,681
1,788
1,702

1,446
1,743
2,076
2,156
2.386
2,806
2,478
1,659
2,024
2,560

1,564
1,892
2,254
2,376
2,608
3,046
2,699
1,831
2,174
2,705

1,618
1,988
2,365
2,576
2.670
3,097
2,722
1,972
2,249
2,720

1,813
2,187
2,535
2,862
2,765
3,183
2,826
2,131
2,380
2,649

2,046
2,395
2.903
3,210
3,119
3,610
3,085
2,313
2,672
2,972

2,283
2,230
1,882
2,630
2,287
2,695
2,880
1,608
2,177
1,395
1,885
2,069
3,073
2,352
2,044
2,140
1,285
2,183
2,303
1,990
2.018
1.952
1,859
2,729
2,265
2,280
1,782
1,883
1,715
2,667
2,040
1,544
1,132
1,097
1,196

2,637
2,581
2,176
2,857
2,466
2,982
2,978
1,781
2,416
1,555
2,041
2,134
3,947
2,605
2,224
2,331
1,412
2,493
2,585
2,280
2,288
2.270
2,147
3,388
2,457
2,720
2,100
2,075
1,878
2,929
2.284
1,715
1,347
1,269
1,384
2,520
2,332
2,641
2,250
1,461
1,127
1,423
3,063
1,469
1,679
1,777
1,792
2,628
1,565
1,064
1,778
1,687
1,608
1,756

2,792
2,735
2,401
2,930
2,584
3,175
2,968
2,114
2,751
1,879
2,347
2,408
5,286
2.914
2,490
2,6M
1,642
2,734
2.711
2,596
2,619
2.570
2,545
3, 583
2,830
3,240
2,386
2,425
2,246
3,515
2,596
1,951
1,688
1,612
1,709
1,312
2,571
2.739
2,810
2,567
1,888
1,401
1, 856
3, 258
1,641
1,876
2,052
2,057
2,646
1,931

2,696
2,717
2,442
2,862
2,615
2,971
2.814
2,378
3,021
2,141
2,570
2,650
5,226
3,213
2,655
2,923
1,864
2,948
3,055
2,689
2,729
2,648
2,752
3,415
2,829
3,259
2, 550
2,567
2,413
3,972
2,697
2,040
1,872
1,779
1,854
1,411
2,520
2,861
2,766
2,978
2,] 85
1,605
1, 757
3,280
1,802
2,070
2,341
2,437
2,736
2,277

3,063
2,969
2,657
3,112
2,876
3,146
3,143
2,632
3,322
2,368
2,740
2,860
4,714
3,412
2,811
3,103
2.052
3,145
3,216
2,833
2,965
2,707
3,063
3,748
3,265
3,750
2,762
2,792
2,583
4,073
2,994
2,230
2,005
1,924

2,175
2,072
2,152
2,124
1,328
1,036
1,324
2,654
1,344
1,482
1,623
1,632
2,226
1,485
965
1,676
1,574
1,512
1,628
1,000
1,908
2,100
1,731

2,781
2,724
2,320
2,975
2,578
3,188
3,103
1,946
2,600
1,709
2,191
2,256
4,179
2.808
2,380
2,513
1,550
2,679
2,714
2,458
2,468
2.446
2,374
3.624
2,766
3,038
2,314
2,248
2,035
3,333
2,467
1,855
1,538
1,455
1,570
1,140
2,714
2,584
2,901
2,379
1,663
1,262
1,653
3,237
1,562
1,795
1,924
1,929
2,677
1,763
2,372
1,797
1,730
1,855

2,412
1,938
1,822
1,986

2,142
2,100
2,018

2,255
2,200
2,190

2,405
2,400
2,253

919

1950
3,008
1,362
1,303
2,308
3,448
3, 567
3,107
3,268
3,861
3,255
3,354
3,300
3,068
2,258
2,762
2,495
2,647
2,477
3,011

2,589
1,288
1,243
2,104
3,113
3,000
3,125
3,212
3,157
2.663
2,829
2,793
2,669
1,950
2,338
2,327
2,205

706

1949
2,850
1,319
1,268
2,209
3,207
3,400
2,896
2,930
3,746
3,021
3,230
3,092
2,925
2,089
2,564
2,385
2,446
2,272
2,837

2,356
1,207
1,166
1,950
2,719
2,636
2,890
2,724
2,819
2,371
2,537
2,517
2,385
1,779
2,056
2,192
1,984

992

1948
2,793
1,345
1,296
2,233
3,387
3,327
3,420
3,383
3,684
2,928
3,119
3,040
2,853
2,040
2,584
2,442
2 2, 399
2,242
. 2,777

2,189
1,127
1,089
1,855
2,621
2,551
2,685
2,629
2,762
2,205
2,600
2,517
2,170
1,676
1,817
1,943
1,779

2,108
1,027

2. See note 1, table 15 and note 2, table 25. Estimates of 1948 average annual earnings
approximately comparable to those shown for 1947 in the specified industries are as follows:
Lumber and furniture products, $2,411; Chemicals and allied products, $3,389; Products of

1947

1,978

Line
1
2

3
4
5
6
7

8
9
10
11

12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
35
3f
37
38
39
40
41
42
43
44
45
46
47
48
40
50
51
52
53
54
55
56
57
58
59

60
61
62
63

64
65
66
67
68
69

70
71
72
73
74
75
76
77
78
79
80
81
82

83
84
85
86
87

88
89
90
91
92

petroleum and coal, $4,072; Metals, metal products and miscellaneous, $3,252; Machinery,
except electrical, $3,431; and Electrical machinery, $3,154.

202

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS
Table 28.—Number of Persons Engaged in Production, by Industry, 1929-381
[Data in thousands]
1929

46,216
All industries, total.
Agriculture, forestry, and fisheries
9,205
Farms
8,969
Agricultural services,forestry,and fisheries..
236
Mining
1,017
Metal mining
130
Anthracite mining.
151
Bituminous and other softcoal mining
476
Crude petroleum and natural gas
168
Nonmetallic mining and quarrying
92
Contract construction
2,306
Manufacturing
10,556
Food and kindred products
1,078
Tobacco manufactures
147
Textile-mill products.._
1,264
Apparel and otherfinishedfabric products
793
Lumber and furniture products*
1,062
Lumber and wood products, except furniture
Furniture and fixtures
Lumber and timber basic products
620
Furniture andfinishedlumber products
442
Paper and allied products..
285
Printing, publishing, and allied industries
630
Chemicals and allied products'
401
Products of petroleum and coal'
128
Rubber products
176
Leather and leather products...
372
402
Stone, clay, and glass products
Metals, metal products, and miscellaneous*
Primary metal industries.....
Fabricated metal products, including ordnance
Instruments
Miscellaneous manufacturing
Iron and steel and their products, including ordnance.
1,219
Nonferrous metals and their products
_
330
Miscellaneous manufacturing
290
769
Machinery, except electrical J._
519
Electrical machinery 2
150
Transportation equipment, except automobiles
541
Automobiles and automobile equipment
Wholesale and retail trade
7,821
Wholesale trade
_
1,744
Retail trade and automobile services
6,077
1,575
Finance, insurance, and real estate
Banking
386
Security and commodity brokers, dealers and exchanges143
Finance, n. e. c
137
Insurance carriers
358
Insurance agents and combination offices
183
Real estate
368
Transportation
3,034
Railroads..
1,845
Local and highway passenger transportation
438
Local railways and buslines
280
Highway passenger transportation, n. e. c
158
Highway freight transportation and warehousing381
Water transportation
168
Air transportation (common carriers)
2
Pipeline transportation
25
Services allied to transportation
175
Communications and public utilities
1,034
535
Telephone, telegraph, and related servioes..
4
Radio broadcasting and television
Utilities: electric and gas.
465
30
Local utilities and public services, n. e. c...
6,484
Services
Hotels and other lodging places
518
Personal services.
1,008
Private households
2,348
Commercial and trade schools and employment agencies.
24
209
Business services, n. e. c
Miscellaneous repair services and hand trades
264
153
Motion pictures
295
Amusement and recreation, except motion pictures
Medical and other health services
750
194
Legal services
Engineering and other professional services, n. e. c
83
287
Educational services, n. e. c
Nonprofit membership organizations, n. e. c
351
3,184
Government and government enterprises
Federal—general government
528
Civilian, except work relief
267
Military
261
Work relief
0
Federal—government enterprises
299
2,247
State and local—general government
1,082
Public education
1,165
Nonschool, except work relief.
0
Work relief
State and local—government enterprises
110
Rest of the world
43,032
92 Addendum: All private industries.
1. This series measures man-years of full-time employment by persons working for wages or
salaries (as shown in table 25) and by active proprietors of unincorporated enterprises devoting the major portion of their time to the business. "Persons engaged" falls snort of total
man-years of full-time employment because of the exclusion from the data of unpaid family
workers. This exclusion is due to unresolved difficulties in their definition and measurement.

1930

1931

1932

1933

1934

1935

44,080
8,983
8,756
227
956
113
144
457
157
85
2,183
9,418
1,053
134
1,097
740
855

41,042
8,998
8,766
232
839
86
128
424
127
74
1,983
7,983
941
121
1,027
687
633

37,565
8,862
8,654
208
701
59
105
364
114
59
1,644
6,746
863
109
908
604
493

38,052
8,925
8,722
203
724
60
94
379
133
68
1,383
7,273
961
103
1,083
642
656

41,398
9,009
8,816
193
857
72
108
438
173
66
1,460
8,441
1,108
113
1,141
710
618

42,908
9,140
8,929
211
876
84
101
450
175
66
1,514
8,983
1,127
109
1,198
779
700

45,960
9,050
8,852
198
934
105
100
464
190
75
1,763
9,732
1,182
110
1,220
841
791

47,157
8,864
8,615
249
993
132
100
478
202
81
1,738
10,686
1,254
112
1,265
855

480
375
278
632
380
125
142
346
349
1,631

309
324
251
561
332
105
120
317
280
1,306

229
264
227
492
293
97
110
301
206
1,046

274
282
245
460
323
99
124
321
214
1,124

326
292
281
504
372
115
141
346
264

367
333
290
523
382
121
134
353
283
1,496

423
368
301
668
396
124
142
360
320

467
402
326
619
434
132
154
377
359
1,923

1,094
273
264
676
430
147
403
7,524
1,685
5,839
1,551
376
118
135
368
186
368
2,795
1,659
414
263
151
381
160
4
24
153
1,034
525
6
473
30
6,318
504
996
2,193
22
207
281
153
277
749
202
85
291
358
3,318
571
310
261
0
300
2,331
1,110
1,217
4
116

859
225
222
613
332
105
352
7,040
1,533
5,507
1,488
346
103
127
361
182
369
2,444
1,405
382
239
143
369
145
5
21
117
933
460
8
437
28
5,934
465
941
1,962
20
192
299
147
248
725
212
77
292
354
3,399
553
296
257
0
298
2,431
1,120
1,267
44
117

750
184
190
396
251
71
300
6,431
1,393
5,038
1,373
282
104
115
341
171
360
2,008
1,084
326
199
127
354
136
6
20
82
787
384
8
371
24
5,275
403
860
1,592
14
204
312
124
180
679
217

919
223
224
509
319
101
433
6,961
1,530
5,431
1,401
285
98
113
348
172
385
2,077
1,122
316
201
115
373
146
6
22
92
802
380
11
386
25
5,658
463
910
1,797
15
231
309
141
193
695
216
72
287
339
4,731
1,394
357
250
787
323
2,909
1,083
1,223
603
105

40,762

37,642

252
246
581
338
105
464
7,180
1,572
5,608
1,425
278
89
115
364
171
408
2,102
1,113
315
202
113
397
150
8
23
96
806
377
13
392
24
5,850
469
950
1,878
18
233
311
155
197
711
223
74
293
338
5,031
1,440
449
263
728
336
3,145
1,112
1,268
765
110
1
37,876

1,149
280
266
668
385
137
492
7,639
1,690
5,949
1,475
277
100
121
368
174
435
2,218
1,194
319
204
115
414
144
10
25
112
853
394
15
418
26
6,167
494
994
2,008
20
265
311
171
212
750
225
78
297
342
6,148
3,145
521
290
2,334
343
2,541
1,134
1,352
55
119
1
39,831

1,319
316
288
795
461
171
580
8,162
1,857
6,305
1,520
286
98
123
383
175
455
2,33-3
1,251
322
207
115
437
153
12
26
132
901
423
18
437
23
6,429
520
1,034
2,128
22
269
311
184
230
785
230
80
304
332
5,530
2,457
517
313
1,627
349
2,599
1,165
1,401
33
125
.1
41,626

177
181
376
242
80
299
6,453
1,395
5,058
1,423
312
95
121
355
179
361
2,100
1,155
348
214
134
355
131
6
17
88
831
413
25
5,443
417
15
198
315
128
200
691
214
69
289
341
3,361
541
290
251
0
297
2,419
1,109
1,223
87
104
34,203

3,872
916
294
249
373
300
2,557
1,084
1,174
299
99
1
34,179

36,666

1937

2. For certain manufacturing industries, the 1929-47 data shown are not comparable with
those given for 1948 and subsequent years. The discontinuities stem from changes in the
industrial classification system in the source data underlying the estimates. (See the Introduction to Part III.) Of the series principally involved here, 5 have been terminated in
1947, the others are indicated by footnotes.

NATIONAL INCOME,

1954

203

EDITION

Table 28.—Number of Persons Engaged in Production, by Industry,

1939-531

[Data in thousands]
1939

1940

1941

46,605
8,273
8,058
215
870
116
90
389
197
78
1,864
10,086
1,211
108
1,217
920
830

48,486
8,044
7,832
212
965
131
93
447
206
88
1,941
11,009
1,258
105
1,226
936
923

53,112
7,937
7,730
207
1,015
144
94
461
216
100
2,449
13,274
1,341
103
1,386
1,062
1,088

57,992
7,775
7,558
217
1,021
141
91
487
197
105
2,859
15,430
1,424
97
1,392
1,099
1,095

63,670
7,568
7,364
204
949
138
85
439
193
94
2,172
17,556
1,442
103
1,325
1.097
1,026

64,694
7,310
7,084
226
905
111
81
419
213
81
1,646
17,218
1,479
101
1,222
1,078
986

63,062
7,126
6,899
227
855
93
74
392
220
76
1,700
15,360
1,458
103
1,169
1,054
948

57,379
7,085
6,838
247
901
93
83
397
235
93
2,551
14,681
1,534
105
1,318
1,149
1,092

57,652
7,042
6,785
257
973
104
82
437
260
100
3,007
15,406
1,562
101
1,331
1,157
1,246

441
389
315
595
417
135
146
374
347
1,752

511
412
337
586
473
151
156
369
373
2,016

620
468
379
599
584
168
189
412
437
2,490

644
451
381
573
785
183
189
405
441
2,907

597
429
395
567
854
186
225
378
418
3,511

571
415
392
568
795
197
241
358
391
3,435

537
411
396
588
781
207
236
360
387
3,045

596
496
450
689
710
219
266
415
483
2,732

684
562
465
728
727
228
271
410
513
2,910

1 159
288
305
666
399
186
468
8,382
1,942
6,440
1,560
289
77
105
414
181
494
2,169
1,114
296
184
112
444
142
15
22
136
871
403
21
423
24
6,396
626
996
2,075
20
290
300
179
223
813
242
86
318
328
6.133
2,898
560
342
1 996
'375
2,732
1,224
1,497

1,335
333
348
798
456
302
544
8,783
2,015
6,768
1,611
297
73
113
425
180
523
2,256
1,160
293
170
123
477
144
19
23
140
901
411
23
443
24
6,707
538
1,050
2,200
19
296
293
181
240
841
244
91
324
390
6,267
2,980
642
549
1 789
'389
2,752
1,235
1,506
11
146
2
42,217

1,646
415
429
1,096
608
676
656
9,262
2,136
7,126
1,647
310
64
122
435
182
534
2,447
1,285
293
161
132
539
146
24
24
136
957
461
27
454
25
6,784
557
1,095
2,057
29
314
320
191
256
861
245
103
329
427
7,337
3,984
944
1,676
1 364
'431
2,764
1,249
1,509
6
158
3
45,772

1,965
467
475
1,375
758
1,750
576
8,957
2.041
6,916
1,636
320
54
114
428
181
539
2,586
1,429
314
169
145
549
109
34
25
126
951
476
28
422
25
6,926
561
1,115
2,092
47
310
328
200
255
878
228
129
335
448
9,846
6,457
1,702
4,154
601
522
2,714
1,245
1,467
2
153
5
48,141

2,465
515
531
1,469
961
3,273
326
8,560
1,912
6,648
1,575
329
50
93
406
172
525
2,789
1,534
355
184
171
525
141
46
25
163
917
492
29
373
23
6,598
573
1,090
1,739
58
305
378
211
234
894
211
110
340
455
14,979
11, 573
2,497
9,029
47
616
2,635
1,227
1,408

2 430
500
505
1,418
1,038
3,177
342
8,534
1,936
6,598
1,561
337
50
85
392
166
531
2,960
1,616
372
188
184
498
208
47
26
193
896
488
31
353
24
6,522
584
1,053
1,655
41
320
394
221
232
895
200
104
344
479
17,137
13,885
2,520
11,365

2 079
466
500
1,346
927
2,046
309
8,914
2,052
6,862
1,602
344
52
88
404
11
7
543
3,018
1,628
381
189
192
487
250
53
25
194
921
502
34
359
26
6,549
584
1,073
1,632
26
343
399
222
232
892
195
112
346
493
17,012
13,722
2,420
11,302

1,678
507
547
1,407
849
595
668
10,392
2.419
7,973
1,813
375
66
102
475
204
591
3,039
1,564
435
203
232
552
203
82
27
176
1,111
616
36
429
30
7,010
632
1,210
1,503
30
418
504
236
275
983
210
131
364
514
8,791
6,276
1,842
3,434

481
2,622
1,216
1,406

495
2,647
1,224
1,423

526
2,828
1,276
1,552

128
1
40,471

1942

1943

155
7
48,684

1944

149
5
47,552

1945

148
5
46,045

1946

161
5
48,583

3. See note 2. Estimates for 1948 of persons engaged in production comparable to those
shown in the specified industries are as follows (in thousands): Lumber and furniture products, 1,256; Chemicals and allied products, 727; Products of petroleum and coal, 235; Metals,

291692°—54

1947

1948

1949

1950

1951

1952

1953

58,586
6,988
6 724
264
1,024
107
84
462
269
102
3,258
15,468
1,559
100
1,370
1,203
> 1,222
867
355

57,165
6,769
6,608
261
949
100
79
408
261
101
3,112
14,369
1,542
102
1,233
1.185
1,091
760
331

58,685
6,477
6,214
2(8
952
101
78
406
264
103
3,370
15,154
1,550
98
1,296
1,211
1,205
826
379

62,270
6,080
5,804
276
958
106
73
382
287
110
3,667
16,310
1,581
104
1,276
1,217
1,246
877
369

63,485
5,946
5,656
290
931
107
66
342
303
113
3,697
16,598
1,578
104
1,199
1,233
1,190
820
370

64,512
5,826
5,540
286
889
110
56
297
312
114
3,632
17,414
1,583
104
1,192
1,264
1,167
789
378

471
744
3 696
»243
254
406
533
» 2, 997
1, 234
1,040
251
472

454
750
663
236
232
391
497
2,692
1,093
934
229
436

485
764
681
238
245
396
528
2,947
1,194
1, 036
248
469

511
776
752
251
265
382
563
3,226
1,320
1,146
287
473

604
789
772
252
267
385
543
3,270
1,255
1,239
308
468

532
814
810
256
279
388
555
3,568
1,341
1,385
331
511

1 871
491
648
1,563
931
513
750
11,001
2,625
8,376
1,866
394
61
111
514
210
576
3,045
1,543
442
198
244
592
166
83
28
11
9
1,190
646
42
470
32
7,385
636
1,243
1,605
36
455
635
237
284
1,071
212
144
387
540
6,732
3,015
1,416
1,599

»1,554
3 877
472
767
11,310
2,712
8,598
1,927
408
61
116
551
220
571
3,000
1,503
421
171
250
622
162
80
30
182
1,281
695
48
506
32
7,532
637
1, 235
1,590
39
487
512
235
293
1,127
216
160
450
551
6,793
2,864
1,396
1,468

1,330
767
460
744
11,244
2,669
8,575
1,934
412
59
122
573
224
544
2,803
1,349
409
166
243
621
142
79
29
174
1,293
690
51
620
32
7,545
629
1,211
1,606
43
484
477
236
289
1,163
219
155
480
553
7,142
3,020
1,416
1,604

1,375
876
448
811
11,428
2,709
8,719
1,999
421
62
133
594
236
553
2,842
1,373
386
157
229
672
130
79
27
175
1,282
660
55
527
31
7,808
629
1,203
1,768
45
497
474
235
289
1,238
222
157
490
561
7,368
3,130
1,436
1,694

1, 635
1,004
669
852
11,658
2,802
8,856
2,069
448
66
141
615
242
557
2,985
1,433
332
151
231
716
144
90
28
192
1,321
694
59
536
32
7,965
632
1,188
1,785
44
522
498
231
235
1,319
228
183
484
566
9,252
4,918
1,794
3,124

1,711
1,089
912
800
11,816
2,867
8,949
2,134
475
67
154
638
247
553
2,960
1,382
378
144
234
735
144
103
29
189
1,360
721
61
545
33
8,008
634
1,171
1,695
41
556
516
227
284
1,386
232
210
481
575
10,029
5,528
1,890
3,638

1,741
1,222
1,017
922
12,051
2,945
9,106
2,213
501
68
165
671
257
551
2,958
1,358
373
141
232
766
138
110
28
185
1,399
746
64
556
33
8,140
636
1,161
1,717
37
586
513
220
288
1,465
238
220
481
578
9,985
5,334
1,789
3,545

483
3,053
1,364
1,689

505
3,209
1,418
1,791

528
3.369
1,491
1,878

516
3,484
1,536
1,948

527
3,557
1,581
1,976

555
3,677
1,657
2,020

543
3,830
1,734
2,096

250
5
53,013

269
6
53,450

278
5
54,522

181
5
50,915

215
5
51,788

225
5
50,018

238
5
51,312

Line

1
1
1
1
1
1
1
1
1
1
2
(
2
22,
2
<
2.
2
<
2'
2
f
2
<
3
(
3
3!
3;
3'
3
>
3
f
3"
3!
35
4
C
41
4:
43
44
45
46
47
48
4S
60
61
52
53
54
55
56
57
58
59
60
61
62
63
64
65
66
67
68
69
70
71
72
73
74
75
76
77
78
79
80
81
82
83
84
85
86
87
88
89

90
91
92

metal products, and miscellaneous, 2,898; Machinery, except electrical, 1,575; and Electrical
machinery, 891.

204

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS
Table 29.—Corporate Sales, by Industry, 1929-38 »
[Millions of dollars]

Line

1929

All industries, total '..
Agriculture, forestry, and fisheries
Farms
_
_
Agricultural services, forestry, and fisheries..
Mining
Metal mining
Anthracite mining
Bituminous and other soft-coal mining
Crude petroleum and natural gas
Nonmetallic mining and quarrying
Contract constructionManufacturing
Food and kindred products
Tobacco manufactures
Textile-mill products..
Apparel and otherfinishedfabric products
Lumber and furniture products»
Lumber and wood products, except furniture..
Furniture and fixtures
Lumber and timber basic products
Furniture andfinishedlumber products
Paper and allied products..
Printing, publishing, and allied industries..
Chemicals and allied products'..
Products of petroleum and coal'
Kubber products
Leather and leather products
Stone, clay, and glass products
Metals, metal products, and miscellaneous3
Primary metal industries
Fabricated metal products, including ordnance
Instruments
Miscellaneous manufacturingIron and steel and their products, including ordnance..
Nonferrous metals and their products
Miscellaneous manufacturing
Machinery, except electrical!
Electrical machinery s
Transportation equipment, except automobiles..
Automobiles and automobile equipment
Wholesale and retail trade
Wholesale trade
Eetail trade and automobile services.
Transportation
Railroads
Local and highway passenger transportation
Highway freight transportation and warehousing..
Water transportation
Air transportation (common carriers).
Pipeline transportation
Services allied to transportation
Communications and public utilities
Telephone, telegraph, and related services..
Radio broadcasting and television
Utilities: electric and gas..
Local utilities and public services, n. e. c...
Services
Hotels and other lodging placesPersonal services
Business services, n. e. c
Miscellaneous repair services and hand trades
Motion pictures
Amusement and recreation, except motion pictures..
Engineering and other professional services, n. e. c..

1931

1932

1933

1934

1935

1936

1937

1938

138,640

118,294

92,365

69,185

73,027

89,553

101,953

119,462

128,884

108,551

731
657
74

522
468
54

413
380
33

319
302
17

338
314
24

469
444
25

509
477
32

628
585
43

677
628
49

571
522
49

3,700
1,157
300
937
871
435

2,707
728
293
828
470

2,052
448
327
591
408
278

1,511
238
2F2
442
397
182

1,817
375
251
491
515
185

2,293
375
258
684
759
217

2,413
504
225
729
730
225

2,836
671
241
845
806
273

3,295
939
209

2,594
598
197
685
895
219

2,802

2,789

2,035

1,290

962

1,110

1,334

1,793

2,208

1,926

70,305
13, 279
1,254
5,5(55
2, 553
2,793

58,484
11,822
1,151
4,179
2,144
1,984

42,759
9,212
1,167
3,383
1,836
1,334

30,995
7,142
1, 025
2, 456
1,3B6
835

34,303
7,744
927
3,074
1,516

40,131
9,266
1,046
3,402
1,784
1,094

46,782
10,491
1,089
3,915
1,926
1,325

55,959
11, 895
1,200
4,445
2,266
1,761

61,459
12,542
1,283
4,471
2,234
1,945

50,031
11, 615
1,291
3,210
2,114
1,769

1,485
1,308

1,052
832

622
712

380
455

456
527

504
590

637

830
931

9<58
977

740
1,029

1, 732
2,777
4,025
5,665
1, 355
1,715
1,619

1,515
2, 562
4,878
5,708
1,042
1.3P8
1,380

1,221
2,213
2,770
4,131
771
1,092
1,013

1,727
2,170
3,951
595
828
651

1,126
1, 594
2,251
3,794
665
974
701

1,285
1,804
2,726
3,620
(582
1,022
819

1,459
1,963
3,119
3,952
730
1,153

1,687
2,165
3,783
4,419
903
1,270
1,345

1,84R
2,3(13
4,088
5,086
1,039
1,319
1,502

1,512
2,163
3,657
4,956
852
1,130
1,206

12,951

9,452

6,358

3,803

4,658

5,762

6,951

8,941

10, 580

6,416

8, 2*4
2,664
2,033

5, 856
1,984
1,612

3,716
1,378
1,264

940
877

2, 574
1,1(59
915

3,170
1,585
1,007

3,952
1,797
1,202

5,4(52
2, 230
1,249

6,518
2,693
1,369

4,282
1,240

4,531
1,689
711
6,091

3,498
1,327
60i
3,869

2,205
913
319
2,731

1,342
532
IBS
1,411

1,45R
536
168
2,134

1,898
764
295
2,862

2,419
923
3"32
4, 05fi

3, 358
1, 2B3
555
4,703

4,144
1, 554
824
4,639

3,006
1, 565
624
2,945

43,108
20, 747
22,361

36,897
17,62!
19,276

30,242
13,787
16,455

22,903
10.398
12,505

23,978
11,166
12,812

32,813
17,731
15,082

37,417
20,479

43,145
23,771
19,374

45,383
24,391
20,992

38,575
19,577
18,998

9,688
6,933
1,112
613

8,453
5,840
1,041

6,985
4,737
8811
559

5,525
S,584
787
461

5,470
3,520
731
497

6,139
3,702
930
548

6,453
3,853
948
619

7,319
4,511
1,001
692

7,683
4,630
1,009
786

6,682
4,138
802
653

476
34
350
170

408
44
318
174

339
67
248
155

308
61
196
128

350
59
175
138

559
32
216
152

44
219
171

627
52
244
192

703
63
275
217

65
257
181

4,994
1,856
172
2,851
115

5,232
1,851
125
3,136
120

5,067
1,66(1
130
3,129
148

4,485
1,376
96
2,873
140

4,222
1,229
92
2,770
131

4,251
1,112
79
2,947
113

4,491
1,172
95
3,111
113

4,782
1,266
116
3,283
117

5,037
1,337
123
3,458
119

4,937
1,336
123
3,360
118

3,312
679
672

3,210
601
643
641

2,812
489
557
520

2,157
367
449
414

1,937
321
394
387

2,347
390
442
504

2,554
455
491
550

3,000
521
549
657

3,142
573
614
676

3,235
544
606

63
749
255
228

61
824
221
219

50
836
182
178

39
611
135
142

36
546
120
133

48
642
148
173

52
654
164

62
797
189
225

64
765
218
232

61
887
196
253

1. The general sources used in making these estimates are discussed in Part III, section on
Corporate profits.
2. Industries in which there are no corporations organized for profit, or in which corporate
sales are estimated at less than $500,000 in all years, are omitted from this table. The indus-

1930

289

trial division of Finance, insurance, and real estate is excluded from the table because the
presentation of sales data for these industries would be misleading in view of the large part of
their receipts which is in the form of property income.
3. For certain manufacturing industries, the 1929-47 values shown are not comparable witb

NATIONAL INCOME,

195 4

205

EDITION

Table 29.—Corporafe Sales, by Industry, 1939-53 '
[Millions of dollars]
1942

1943

1944

1945

1946

1947

1948

1949

1950

1951

1952

1953

176,181

202,777

233,435

246,737

239,512

270,898

347,801

388,744

370,079

431,858

488,445

498,694

523,496

712
663
49

768
727
41

826
787
39

879
841
38

931
885
46

1,208
1,150
58

1,595
1,527
68

1,784
1,715
69

1,825
1,769
56

1,986
1,910
76

2,323
2,234
89

2,464

2,664

3,114
973
222
920
727
272

3,723
1,095
256
1,167
851
354

3,865
1,260
303
1,271
636
395

3,579
818
323
1,417
648
373

3,875
744
378
1,573
821
359

3,789
712
354
1,509
857
357

4,123
641
440
1,580
995
467

5,809
968
498
2,245
1,498
600

7,595
1,216
559
2,641
2,436
743

6,565
927
409
1,875
2,602
752

8,258
1,250
476
2,356
3,314
862

9,316
1,503
485
2,484
3,838
1,006

9,232

9,507

2
3
4
5
6
7
S
9

2,208

2,473

3,452

4,643

4,219

3,101

2,869

4,220

6,929

9,228

9,740

11,358

14,010

14,200

15,500

67,159
11,877
1,319
3,869
2,342
2,129

65,755
12,372
1,415
4,207
2,509
2,460

92,023
15, 767
1,581
6,068
3,379
3,302

116,278
20,602
1,800
7,616
3,961
3,591

141,930
22,373
2,101
8,011
4,115
3,595

150,960
23,806
2,148
7,718
3,957
3,606

138,725
23, 951
2,243
7,690
4,001
3,428

136,906
28.321
2,640
10, 257
6,737
4,804

177,777
35, 705
2,869
11,631
7,779
6,540

197,122
36, 635
3,029
12,304
8,353
» 6,841
4,413
2,428

184,476
35,087
3,114
10, 691
7,749
6,164
3,893
2,271

216,817
37.359
3.208
13, 030
8.296
8,245
5,233
3,012

251,227
42,657
3,395
14,264
8,874
8,760
5,535
3,225

256,662

272,782

12
13
14
15
16
17

905
1,224

1,07)
1,389

1,505
1,797

1,710
1,881

1,659
1,936

1,608
1,998

1,423
2,005

2 033
2,771

3,114
3,426

1,747
2,220
4, 251
5,254
1,069
1, 236
1,486

2,023
2,369
4.764
5,5?3
1,153
1,287
1,682

2,791
2,577
6,437
6,659
1,689
1,780
2,283

2,877
2,663
7,205
7,478
1,883
2,112
2,298

3,268
3,096
8,612
8,500
2,906
2,1P5
2,352

3.473
3,449
9,822
9,853
3,33?
2,150
2,290

3,565
3,804
9,834
10,007
3,366
2,201
2,322

4,353
4,792
10, 737
10, 374
3,127
2,845
2,938

5,690
5,672
13, 487
14, 792
3,420
3,298
3,633

5,920
6,152
1
13,972
«19,411
3,323
3,137
4,079

5,372
6,315
13,050
17,560
3,022
2,901
3,927

6,863
6,670
16,104
19,281
3,980
3,174
4,981

8,293
7,333
18,055
23,481
4,861
3,448
5,689

22
23
24
25
26
27
28

8,619

10, 692

16,262

21,472

27,409

27, 995

25,209

20,926

27,420

»33,165
16, 835
9,577
1 909
4,844

29,398
14,473
8 635
1 829
4,461

37,030
18,654
11 059
2 300
5 017

44,082
22,604
12 907
3 041
5 530

30
31

37
38
39
40

1940

1941

120,789

135,248

577
528
49

608
566
42

2,731
798
194
784
704
251

1939

18
19
20

29
32
33
34
35
36

5,974
1,617
1,028

7,549
1,988
1,155

11, 756
2,882
1,624

16, 333
3,157
1,982

20,534
4,286
2,5S9

20,837
4,379
2,779

18, 495
3.969
2,745

13,717
4,315
2,894

18, 778
5,337
3,305

3,463
1,844
857
3,577

4.668
2.462
1,568
4.701

7,222
3,747
3,924
6,555

9,437
5,022
12, 271
3,990

10,732
6,585
22,322
3,788

11,012
8,012
24, 622
3.715

9,801
7,070
17,141
3,092

9,117
5,488
2,855
6,595

13,145
8,214
2.998
11,483

» 14,858
' 8.703
3,722
13, 518

13,451
8.095
3,804
14, 776

15, 653
10, 457
3,996
18,500

20,452
12,223
5,944
19,426

42,262
21,314
20,948

46,638
23, 532
23,106

57,081
29,707
27,374

55,184
29,026
26,158

57,616
30,306
27,310

61,023
32,311
28,712

65,905
34, 746
31,169

95,736
51,408
44,328

122,185
65, 237
56, 948

136,199
72, 776
63,423

130,983
67,197
63,786

153,587
81,608
71,979

166,751
90,869
75,882

168,783

172,905

7,364
4,632
791
728

7,769
4,722
772
793

0,526
5,840
857
1,006

11,527
7,887
1,132
1,061

13,661
9,610
1,406
1,160

14,307
10,045
1,454
1,188

14,052
9,699
1,485
1,232

13,786
8,612
1, 556
1,542

16,717
9,567
1.579
1,999

18,371
10,626
1,685
2,450

17,164
9,342
1,596
2,677

18,805
10,200
1,503
3,408

21,326
11,240
1,612
3,855

22,041

22,885

664
88
269
201

832
293
226

1,047
187
318
271

729
191
236
291

680
223
243
339

726
263
252
379

670
327
219
420

921
516
190
449

2,073
662
260
577

2,018
781
335
576

1,830
835
339
645

1,677
957
474
586

2,165
1,199
538
717

5,161
1,401
136
3,505
119

5,352
1,364
161
3,708
119

5,806
1,495
181
4,007
123

6,259
1,841
182
4,132
104

6,775
2,064
234
4,368
109

7,310
2,210
307
4,687
106

7,658
2,400
327
4,818
113

8,118
2,583
343
5.058
134

8,985
2,772
383
5,676
154

10,157
3,204
412
6,371
170

10,859
3,496
442
6,735
186

12,282
3, 915
545
7,631
191

13,787
4,366
692
8.507
222

15,139

3,327
565
622
728

3,539
603
653
789

3,858
665
724
849

4,253
715
803
812

4,829
896
858
911

5,282
966
903
1,045

5,583
1,035
950
1,169

6,801
1,23?
1,151
1,461

7,804
1,341
1,366
1,751

8,288
1,409
1,472
1,961

8,467
1,383
1,491
2,136

8,765
1,373
1,528
2,395

9,705
1,461
1,689
2,798

10,173

62
883
212
255

61
949
232
252

98
1,004
267
251

128
1,149
266
380

148
1,327
264
425

157
1,483
308
420

122
1,574
378
355

130
1,823
574
429

213
1,942
609
582

246
1,913
644
643

266
1,857
652
682

297
1,826
627
719

408
1,804
663
882

those given for 1948 and subsequent years. The discontinuities stem from changes in the
industrial classification basis on which the underlying corporate tax return data are reported.
(See the Imroduction to P a n HI.) Of the series principally involved here, five have been
terminated in 1947. For the others, 1948 values approximately comparable to those shown

Line

41
42

43
44
45

46
47
48
49
50
51
16,626

52
53

54
55
56
10,627

57
58

59
60
61
62
63
64

for 1947 are as follows: Lumber and furniture products, $7,228 million; Chemicals and allied
products, $14,413 mUT.on; Products of petroleum and coal, $19,495 million; Metals, metal
products, and miscellaneous, $30,998 million; Machinery, except electrical, $14,994 million;
Electrical machinery, $8,918 million.

206

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS
Table 30.—Personal Consumption Expenditures, by Type of Product, 1929-38*
[Millions of dollars]
1931

1929

1932

1933

1934

1935

1936

1937

1938

I. Food ' and tobacco
1. Food purchased for off-premise consumption (n. d. c.)
2. Purchased meals and beverages' (n. d. c.)
..
3. Food furnished government (including military) and commercial employees (n. d. a ) .
4. Food produced and consumed on farms (n. d. c.)
5. Tobacco products (n. d. c.)

21,230
14, 777
2,911
257

19,414
13,500
2,788
245

16,220
10,833
2,541
198

12,704
8,203
2,102
160

12,757
8,626
1,816
155

15,549
10, 757
2,248
185

17,621
12,150
2,610
214

19,955
13,929
2,985
236

21,552
14, 792
3,528
271

29,585
14,082
3,392
247

1,590
1,695

1,431
1,450

1,159
1,489

917
1,322

927
1,233

992
1,367

1,213
1,434

1,270
1,635

1,288
1,673

1,167
1,697

H . Clothing, accessories, a n d jewelry
1. Shoes and other footwear (n. d. c.)
2. Shoe cleaning and repair (s.)
3. Clothing and accessories except footwear s
a. Women's and children's (n. d. c.)
b . Men's and boys' (n. d. c.)
_
4. Standard clothing issued to military personnel (n. d. c.)
5. Cleaning, dyeing, pressing, alteration, storage, and repair of garments including furs (in shops) not elsewhere classified (s).
6. Laundering in establishments (s.)
7. Jewelry and watches (d. c.)
..
8. Other « (s.)

11,193
1,675
164
7,682
4,662
3,020
12
473

9,713
1,375
141
6,659
4,100
2,559
11
420

8,217
1,207
114
5,713
3,528
2,185
9
352

6,042
1,022
100
4,022
2,446
1,576
10
252

5,438
887
98
3,731
2,254
1,477
11
230

6,562
1,072
102
4,585
2,801
1,784

7,010
1,031
106
4,982
3,080
1,902
9

265

302

7,661
1,145
113
5,403
3,226
2,177
12
339

8,092
1,279
122
5,546
3,277
2,269
13
383

7,991
1, 257
118
5,495
3,337
2,158
14
391

475
560
152

458
513
136

392
328
102

310
252
74

252
172
57

262
198
71

272
233
75

304
265
80

323

HI. Personal care
1. Toilet articles and preparations (n. d. c.)
2. Barbershops, beauty parlors, and baths (s.)
IV. Housing
1. Owner-occupied nonfarm dwellings—space-rental value • (s.)
2. Tenant-occupied nonfarm dwellings (including lodging houses)—
space r e n t ' (s.).
3. Rental value of farm houses (s.)
4. O t h e r ' (s.)
V. Household operation
1. Furniture (d. c.)
2. Kitchen and other household appliances' (d. c.)
3. China, glassware, tableware, and utensils (d. c.)
4. Other durable house furnishings' (d. c.)
5. Semidurable house furnishings • (n. d. c.)6. Cleaning and polishing preparations, and miscellaneous household supplies and paper products (n. d. c.)
7. Stationery and writing supplies (n. d. c.)
8. Household utilities
a. Electricity (s.)
.
b. Gas (s.)
c. Water (s.)
d. Other fuel and ice (n. d. c.)
9. Telephone, telegraph, cable, and wireless (s.)
10. Domestic service (s.)
11. Other'«(s.)
_
VI. Medical care and death expenses
1. Drug preparations and sundries (n. d. c.)
2. Ophthalmic products and orthopedic appliances (d. c.)
3. Physicians (s.)_
4. Dentists (s.)._
5. Other professional services « (s.)
_
6. Privately controlled hospitals and sanitariums " (s.)
7. Medical care and hospitalization insurance '• (s.)
8. Funeral and burial expenses (s.)
VII. Personal business
_
1. Brokerage charges and interest, and investment counseling ( s . ) . .
2. Bank service charges, trust services, and safe-deposit box rental

1,116
591
625

979
504
475

817
420
397
9,002
4,416
3,753

660
320
340
7,880
3,844
3,296

760
377
383
7,577
3,643
3,158

802
374
428
7,640
3,646
3,199

864
395
469

961
428
533
8,436
3,950
3,639

8,813
4,104
3,870

587
153

615
161
7,209
514
518
404
573
449

621
174

211

622
217

9,525
923
845
515
885
639
488

8,865
827
711
472
800
568
485

131
3,042
766
528
331
1,417
642
1,187
323
3,180
558
165
854
350
168
454
123
608
3,663
281
126

129
2,971
810
523
327
1,311
542
1,023
337
3,172
578
157
833
356
163
467
134
484
3,472
195
130

3. Services furnished without payment b y financial intermediaries except insurance companies (s.).
4. Expense of handling life insurance « (s.)
5. Legal services (s.)
_
6. Interest on personal debt (s.)
7. Other » (s.)
VIII. Transportation..
_._
1. User-operated transportation
a. New cars and net purchases of used cars (d. c.)
b . Tires, tubes, accessories, and parts (d. c.)
c. Automobile repair, greasing, washing, parking, storage, and
rental (s.).
d. Gasoline and oil (n. d. a ) .
e. Bridge, tunnel, ferry, and road tolls (s.)
f. Automobile insurance premiums less claims paid (s,)
2. Purchased local transportation
__
a. Street and electric railway and local bus (s.)
b . Taxicab (s.)
c. Railway (commutation) (s.)
3. Purchased intercity transportation..
a. Railway (excluding commutation) and sleeping and parlor
ear (s.).
b . Intercity bus (s.)
c. Airline (s.)_
d. Other » (s.)
IX. Recreation
1. Books and maps (d. c.)
2. Magazines, newspapers, and sheet music (n. d. c.)
3. Nondurable toys and sport supplies " (n. d. c.)
4. Wheel goods, durable toys, sport equipment, boats, and pleasure
aircraft " (d. c ) .
5. Radio and television receivers, records, and musical instruments
(d. c ) .
6. Radio and television repair(s.)
7. Flowers, seeds, and potted plants (n. d. c.)
8. Admissions to specified spectator amusements
a. Motion picture theaters (s.)
b. Legitimate theaters and opera, and entertainments of
nonprofit institutions (except athletics) (s.)
c. Spectator sports " (s.)
9. Clubs and fraternal organizations except insurance '• (s.)
10. Commercial participant amusements ! 0 (s.)
11. Pari-mutuel net receipts (s.)

515
524
11,015
5,552
4,397

10,270
5,101
4,200

236
9,585
937
671
442
937
570
471

754
215
8,425
796
565
429
783
497
419

655
178
6,779
509
344
406
562
374

103
2,844
674
556
296
1,318
654
1,146
289
3,029
517
117
819
408
201
395
92
480

71
2,615
662
537
278
1,138
482
835
253

5,086
1,707
76

133
3,058
660
560
296
1,542
577
1,483
306
3,382
568
133
924
463
233
404
110
547
4,035
759
79

1,278
874
402
584
165
7,612
5,960
2,588
648
776

11,446
5,868
4,500
829
249
10,735
1,201
1,148
717
485
143
3,044
616
542
278
1,608
569
1,716
316

6,466
462
408
364
472
391
332

7,938
3,759
3,365

7,737
666
614
407
617
478
403

620
194
8,821
848
733
456
827
591
449

2,581
468
124
678
295
145
369
85
417

101
2,792
697
503
311
1,281
472
911
276
2,728
474
131
731
302
151
406
93
440

112
2,979
726
516
326
1,411
511
1,016
299
2,978
509
140
820
331
165
422
106
485

2,927
227
92

3,119
228
104

3,391
296
116

87
2,729
671
494
301
1,263
443
850
256

323
85
951
442
509

2,542
449
93
661
312
154
386
72
415

2,561
645
- 495
269
1,152
436
732
239
2,370
427
92
617
276
138
363
70
387

3,497
418
80

269
78

2,912
372
79

1,141

1,017

872

767

793

792

843

876

818

901
397
614
144

884
410
566
122

846
334
435
89

875
359
452
129

974
371
601
149

981
383
612
160

6,147
4,662
1,642
523
624

5,003
3,747
1,144
433
509

853
348
481
85
3,981
2,935
635
314
385

3,987
3,035
779
280
392

4,596
3,584
1,024
346
445

5,281
4,217
1,508
368
457

6,131
4,956
1,921
402
520

1,025
402
703
250
6,517
5,288
1,988
433
543

1,001
392
669
267
5,633
4,453
1,228
398
517

1,814
40
94
1,117
820
220
77
535
413

1,749
43
81
1,053
772
208
73
432
333

1,540
45
76
921
705
152
64
335
247

1,476
43
82
786
624
109
53
260
170

1,466
42
76
720
578
96
46
232
154

1,640
43
86
761
605
111
45
251

1,743
42
99
790
626
119
45
274
173

1,945
44
124
845
674
127
44
330
210

2,143
44
137
871
684
145
42
358
232

2,145
41
124
842
660
141
41
338
209

52
3
67
4,331
309
538
338
219

53
2
44
3,990
264
512
281
172

50
2

46
3
29

44
4
34
2,441
165
441
200
118

62
6
33
2,630
183
456
216
136

3,302
253
479
266
159

48
3
39
2,442
153
428
207
110

3,020
208
490
242
171

1,381
243
518
269
210

32
3,241
221
514
268
210

1,012

921

478

248

333

386

339

221
913
720
127

27
190
892
732
95

24
134
854
719
78

19
89
631
527
57

14
90
573
482
41

17
116
625
518
42

21
130
672
656
44

21
159
759
626
60

23
186
818
676
53

25
176
816
663
68

65
294

57
277
175

47
242
132
4

50
208
121

65
199
135
19

72
197
141
26

83
198
165
29

203
194

95
200
164
44

3,544
604
131
959
482
250
403
108
607

302
207

2,202
152
419
181
195

207

NATIONAL INCOME, 195 4 EDITION
Table 30.—Personal Consumption Expenditures, by Type of Product, 7939-53*
[Millions of dollars]
1939

1940

1941

20,931
14,163
3,633

22,223
14,954
3,974

25,741
17,089
4,738

1942

1944

1945

1946

1947

1948

1949

1950

1951

1952

1953

Line

40,133
24,503
8,472
2,398

44,573

26, 689
10,063
2,753

52,264
33,332
11,709
1,349

58,040
38,677
11,939
1,023

61,441
41,671
12,036
1,082

60,737
41,513
11,830
1,070

63,250
43, 760
12,019
1,175

71,236
49, 376
13,246
1,772

75,065
52,175

77,154
53,915

13,811
1,940

14,161
1,831

1
2
3
4

264

278

470

933

36,353
22,586
7,392
1,677

1,114
1,767

1,134
1,883

1,336
2,108

1,661
2,381

2,021
2,677

2,043
2,717

2,096
2,972

2,396
3,478

2,532
3,869

2,505
4,147

2,072
4,252

1,895
4,401

2,141
4,701

2,047
5,092

1,937
5,310

5
6

8,406
1,226

8,857
1,265

10,521
1,446

13,082
1,793

16,026
1,872

17,512
1,958

142

153

223

218

7,132
4,348
2,784

8,537
5,341
3,196

219
492

657
571

716

809

22,705
3,052
201
15,151
9,655
5,499
274
1,466

24,240
3,274
211
16,086
10,275
5,811
418
1,565

16,269
10,603
5,666

32
423

11,647
7,838
3,809
1,041

22,676
2,928
205
15,371
9,929
5,442
213
1,444

16,588

16
397

10.4S6
6,940
3.546
1,031

23,878
2,988
216
16,450
10, 736
5,714
191
1,434

204

6,153
3,766
2,387

22,952
2,955
227
15,610
9,963
5,647
229
1,349

207

5,893
3,607
2,286

22,215
2,781
241
15,097
9,728
5,369
364
1,198

24,604
3,362

124

19,706
2,263
210
13,109
8,786
4,313
1,087
936

24,803
3,285

114

7
8
9
10
11
12
13
14

312
355
93

340
414
106

397
562
131

466
743
162

523
968
207

1,050

600
1,243
258

715
1,506
313

796
1, 463
323

837
1.435
327

842
1,360
313

854
1,385
319

870
1,477
339

902
1,561
362

1,004

1,036

1,162

1,354

1,616

1,834

486
518

507
629

607
555

728
626

874
742

992
842

9,018
4,179
3.994

9,327
4,310
4,154

10,046
4,706
4,438

10,820
5,192
4,692

11,333
5,588
4,737

11,885
6,060
4,729

1,982
1,087
895
12,407
6,492
4,596

2,086
1,109
977
13,609
7,343
4,759

2,253
1,245
1,008
15,436
8,471
5,113

2,286
1,256
1,030
17,548
9,776
5,745

2,259
1,233
1,026
19,439
10,962
6,422

2,355
1,306
1,049
21,356
12,195
7,062

2,488
1,393
1,095
23,367
13,430
7,595

2,573
1,434
1,139
25,631
14,818
8,311

620
225

625
238

646
256

684
252

727
281

791
305

9,624

10,479
1,060

11,951
1.320
1,158

12,727
1,285

13,110
1,242

14,032
1,314

809
658

291
612

171
643

1,266
1,119

1,369
1,330

1,398
1,481

704

756

776

980
339
15,530
1,559
362
800
1,519
1,545
722

1,103
404
20,023
2,248
1,811
1,263
2,194
2,039
924

1,316
536
23,878
2,552
3,179
1,348
2,453
2,135
1,523

1,421
606
25,617
2,758
3,344
1,405
2,548
2,267
1,556

1,445
610
24,642
2,664
2,928
1,324
2,315
2,178
1,478

1,448
651
27,414
3,040
3,590
1,395
2,533
2,402
1,555

1,616
726
28,592
3,122
3,406
1,439
2,623
2,472
1,659

1,715
787
28,877
3,229
3,354
1,380
2,433
2,406
1,560

410
4.507
1,194
705
419
2,189
1,189
2,142
775
5,756
1,138
349
1,370
620
266
925
374
714
4,431
317
207

426
4,872
1,270
754
433
2,415
1,312
2,120
814
6,893
1,271
396
1,720
772
338
1,163
444
789
4,993
320
234

440
5,611
1,406
862
464
2,879
1,383
2,348
906
7,685
1,313
400
2,020
784
390
1,397
513
868
5,707
244
260

445
6,299
1,564
958
491
3,286
1,617
2,382
996
8,307
1,358
427
2,203
833
423
1,591
550
922
6,574
291
293

450
6.124
1,746
1,031
612
2,835
1.761
2,412
1,008
8,660
1,350
448
2,312
857
448
1,730
557
958
7,113
256
314

450
6,741
1,955
1,177
554
3,055
1,966
2,668
1,074
9,257
1,406
479
2,435
869
476
1,975
636
981
8,181
459
341

469
7,209
2,192
1,335
593
3,089
2,182
2,833
1,178
9,843
1,516
532
2,528
888
498
2,167
651
1,063
8,726
446
367

503
7,500
2,426
1,457
651
2,966
2,410
2,858
1,254
10,486
1,569
561
2,676
906
532
2,398
740
1,104
9,403
375
387

949
774
475
908
681
608

881
610
991
749
544

623
1,214

913
607

31,168
20,328
5,865

1943

561
228

149

162

191

230

287

353

3,128

3,391

3,582

849
538
343

910
573
359

965
575
368

3,875
1,017

4,079
1,045

4,242
1,125

623
384

648
391

667
407

1,398

1,549

1,674

1,851

1,995

576

615

695

825

973

1,129

1,218

1,237

1,477

1,598

2,043
1,077
1,887

347

358

411

479

573

690

3,347

3,533

3,852

4,312

612
172
866
386
167
492
153
499

635
186
913
419
173
527
165
515

725
227
957
459
179
555
196
554

4,832
1,014

5,383
1,072

3,548

3,646

183
135

151
142

848
258

307

333

1,048

1,092

1,321

505
196
649
231
577

539
206
752
279
643

573
245
846
315
678

3,894

3,743

3,831

4,141

131
151

105
159

207
176

215
196

10, 675
5,913
259
1,639

197
1,703

939
1.E60

370
2,641
1,466
1,175
27,710
16,194
8,898
1,751

867
30,070
3,294
3,488
1,398
2,420
2,461
1,613

538
7,830
2,692
1,550

715
2,873
2,640
3,051
1,337
11,169
1,618

577
2,815

943
562
2,602

887
1,168
10,620

403
413

15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36
37
38
39
40
41
42
43
44
45
46
47
48
49
50
51
52
53

817

792

852

904

948

1,186

1,325

1,499

1,532

1,710

1,880

2,028

2,198

2,524

2,839

1,014

1,029

1,040

1,025

1,074

1,106

407
709
283

423
815
294

450
930
340

475
706
369

493
486
447

541
445
452

7,143
5,872
2,217

8,438
7,031
2,706

5,529
3,581

5,539
2,859

5,848
3,045

484
596

530
647

673
772

415
303
594

410
366
558

322
449
695

1,549
668
904
550
15,390
12,316
4,587
1,674
1,975

1,684
799
1,210
587
17,525
14,313
5,646
1,671
2,152

1,779
857
1,444
583
20,053
16,939
7,768
1,707
2,108

2,035
889
1,820
609
23,225
20,182
10,078
2,275
2,138

2,058
935
2,030
692
22,828
19,586
8,693
2,166
2,418

2,210
962
2,274
671
23,392
20,054
8,315
2,263
2,563

55
56
57
58
59
60
61
62
63

2,181

2,273

2,649

2,090

1,339

1,384

46
142
878
684
153
41
359
216

60
155
907
714
163
40
364
214

58
173
978
760
177
41
429
234

43
136

31
155

35
160

1,294

1,646
1,237

1,726
1,299

353
56

370
57

1,034

1,077

664

677

1,809
42
175
1,746
1,316
372
58
1,107
676

1,292
609
618
421
12,066
9,004
2,436
1,492
1,717
3,034
65
260
1,951
1,334
564
63
1,111
627

2,428
1,004
2,817

6,365
6,128
1,679

1,090
590
457
445
6,845
3,992
357
652
957

3,630
69
381
2,007
1,326
614
67
1,067
589

4,294
74
476
2,115
1,418
621
76
1,097
603

4,741
80
535
2,086
1,421
586
79
1,028
517

5,042
87
562
2,075
1,388
608
79
968
446

5,542
97
670
2,128
1,413
632
83
1,114
500

6,006
119
788
2,170
1,440
641
89
1,168
513

98
12
33

101
18
31

137
23
35

241
23
26

315
24
31

336
33
31

3,452

3,761

4,239

4,677

4,961

5,422

234
589
306
254

255
636
362
314

291
703
404
306

366
838
393
271

450
880
459
323

341
106
37
8,621
594
1,099
843
809

321
120
37
9,352
636
1,243
910
972

324
134
36
9,603
513
1,360
948
1,010

325
152
34
9,801
490
1,434
924
906

315
177
30
10,768
476
1,470
999
978

343
243
28
10,961
495
1,528
1,080
1,040

342
287
26
11,368
604
1,616
1,164
1,115

11,892

226
654
285
228

339
55
37
6,139
520
965
563
400

420

494

607

634

403

311

344

1,143

1,429

1,457

1,663

2,379

2,155

2,100

2,176

28
191
821
659
64

32
201
904
735
71

36
229
995
809
79

46
241

60
274

72
327

1,455
1,275

1,563
1,341

118

142

115
447
2,066
1,692
174

140
475
2,004
1,594
188

174
484
1,920
1,506
182

213
506
1,885
1,468
179

324
527
1,792
1,394
177

420
587
1,739
1,338
183

476
641
1,687
1,284
181

533
684

1,204
1,022

88
378
1,714
1,450
148

185

82
83
84
85
86

98
199
183
41
276

98
203
197
55
292

107
203
210
65
327

90
205
213
69
361

62
217
215
79
390

80
236
241
131
429

116
281
284
153
459

200
359
379
241
526

222
399
415
255
574

232
439
437
257
604

238
460
457
247
616

221
470
467
239
647

218
487
482
263
685

222
511
512
327
715

223
530
539
377
752

87
88
89
90
91

980
261
53
654
364

716
26,821
23,461
10,696
2,416
2,727
6,619

129
874
2,171
1,423

655
93
1,189

500
331
330
28
531
1,708
1,209
1,193

1,660
1,252

64
65
66
67
68
69
70
71
72
73
71
75
76
77
78
79
80

208

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS
Table 30.—Personal Consumption Expenditures, by Type of Product, 1929-38*—Continued
[Millions of dollarsj

Line

1929

X. Private education and research..
1. Higher education » (s.)
2. Elementary and secondary schools » (s.).
3. Others (s.)97
98
99
100
101
102

XI. Religious and welfare activities" (s.)
_.
XII. Foreign travel and remittances—net
1. Foreign travel by United States residents (s.)
2. Expenditures abroad by United States Government personnel
(military and civilian) (n. d. a).
3. Personal cash remittances toforeigncountries less personal cash
remittances to the United States by foreigners (s.).
4. Less: expenditures in the United States by foreigners (s.)_
Total personal consumption expenditures.

1930

1931

1932

664
219
162
283

242
170
271

665
251
185
229

1,196

1,209

1933

1934

1935

1936

1937

1938

481
205
121
155

483
213
121
149

507
228
122
157

546
242
140
1C4

600
249
174
177

1,125

973

872

870

862

899

900

923

756
611
20

601
445
20

467
334
20

367
258
18

339
276
16

352
303
20

412
368
18

452
433
18

376
379
18

257

799
632
21

871
227
158
186

234

182

161

132

135

18
4

141

114

106

122

140

135

61,333

49,306

46,392

51,894

56,289

62,616

67,259

64,641

142

132

78,952

70,968

619
256
192
171

103

Durable commodities (d. c.)

9,212

7,155

5,485

3,646

3,469

4,213

5,111

6,304

6,925

5,686

104

Nondurable commodities (n. d. c ) .

37,677

34,010

28,946

22,758

22,251

26,656

29,319

32,836

35,185

33,985

105

Services (s.)

32,063

29,803

26,902

22,902

20,672

21,025

21,859

23,476

25,149

24,970

•Consumer durable commodities are designated (d. a ) , nondurablo commodities (n. d. c ) ,
and services (s.) following group titles.
1. Expenditures for food (items 1-4) include consumer expenditures for alcoholic beverages
of the following amounts in millions of dollars: 1933, $665; 1934, $2,000; 1935, $2,555; 1936, $3,175;
1937, $3,465; 1938, $3,270; 1939, $3,420; 1940, $3,600; 1941, $4,185; 1942, $5,080; 1943, $5,840; 1944,
$6,775; 1945, $7,485; 1946, $8,360; 1947, $8,620; 1948, $7,930; 1949, $7,730; 1950, $7,880; 1951, $8,200;
1952, $8,725; and 1953, $8,865. Expenditures for food (items 1-4) excluding alcoholic beverages
are as follows in millions of dollars: 1929, $19,535; 1930, $17,864; 1931, $14,731; 1932, $11,382; 1933
$10,859; 1934, $12,182; 1935, $13,632; 1936, $15,245; 1937, $16,414; 1938, $15,618; 1939, $15,744;
1940, $16,740; 1941, $19,448; 1942, $23,707; 1943, $27,836; 1944, $30,641; 1945, $34,116; 1946, $40,426;
1947. $45,551; 1948, $49,364; 1949, $48,755; 1950, $50,969; 1951, $58,335; 1952, $61,248; and 1953,
$62,979.
2. Comprises purchases of meals and beverages from retail, service, and amusement
establishments, hotels, dining and buffet cars, schools, school fraternities, institutions, clubs,
and industrial lunchrooms, and also tips.
3. Includes luggage.
4. Comprises watch, clock, and jewelry repairs, dressmakers and seamstresses not in shops,
costume and dress suit rental, and miscellaneous personal services related to clothing.
5. Space rent covers heating and plumbing facilities, water heaters, lighting fixtures, kitchen
cabinets, linoleum, storm windows and doors, window screens, screen doors, and window

blinds or shades, but excludes other furnishings, equipment, and related services
furniture,
stoves and ranges, refrigerators, repairs of furniture and appliances, fuel, electricity, etc.
6. Comprises transient hotels, tourist cabins, clubs, schools, and institutions.
7. Includes refrigerators, cooking ranges, dish washers, laundry equipment, heating stoves,
air conditioners, sewing machines, vacuum cleaners, and other small electric appliances.
8. The principal house furnishings included arefloorcoverings, bedding, picture frames,
mirrors, art products, portable lamps, and clocks. Also includes writing equipment, technical equipment such as microscopes, drafting, and surveying instruments, and hand, power,
and garden tools.
9. Consists mainly of textile house furnishings (except those specified in group V-4) including piece goods allocated to house furnishings use. Among other products covered are lamp
shades, brooms, and brushes.
10. Comprises maintenance services for appliances and house furnishings, moving and warehouse expenses, postage and express charges, premiums for fire and theft insurance on personal
property less claims paid, and miscellaneous household operation services.
11. Comprises services of osteopathic physicians, chiropractors, chiropodists and podiatrists, private duty trained nurses, and miscellaneous curative and healing professions.
12. Comprises current expenditures (including depreciation) of nonprofit hospitals and
sanitariums and payments by patients to proprietary hospitals and sanitariums.

Table 31.—New Construction Activity, by Type, 1929-38 '
[Millions of dollars]
1929

Line
Total new construction activity.

New private construction activity.
Eesidential building (excluding farm).
New dwelling units
Additions and alterations
Nonhousekeeping units
Nonresidential building 3(excluding farm) •
Industrial buildings
Warehouses, office and loft buildings»..
Stores, restaurants, and garages *
Other nonresidential buildings
Religious
Educational
Hospital and institutional
Social and recreational
Miscellaneous
Public utility...
_.
Railroads
Telephone and telegraphOther public utility«
Farm construction.
Residential
Nonresidential.
All other private '..
New public construction activity.
Residential building...
Nonresidential building
Industrial
Educational.
Hospital and institutional
Other nonresidential building •_.
Military facilities
Highway
Sewer and water...
Miscellaneous public service enterprises.
Conservation and development
All other public'

1932

1934

1933

1935

1937

1936

1938

10,793

8,741

6,427

3,538

2,879

3,720

4,232

6,497

6,999

6,980

8,307

5,883

3,768

1,676

1,231

1,509

1,999

2,981

3,903

3,560

3,625
3,040
340
245

2,075
1,570
305
200

1,565
1,320
175
70

630
485
105
40

470
290
145
35

625
380
200
45

1,010
710
250
50

1,565
1,210
295
60

1,875
1,475
320

1,990
1,620
295
75

2,694
949
619
516
610
147
120
104
173

2,003
532
596
297
578
135
118
109
148

1,099
221
276
178
424
87
100
71
123
43

502
74
117
106
205
45
53
34
60
13

406
176
44
86
100
22
15
10
34
19

456
191
66
107
92
21
14
9
33
15

472
158
75
136
103
28
17
10
34
14

713
266
111
179
157
34
40
17
54
12

1,085
492
137
250
206
44
42
31
73
16

764
232
95
190
247
51
40
35
97
24

1,578
510
354
714

1,527
521
333
673

946
292
166
488

467
139
87
241

261
94
45
122

128
47
151

363
116
52
195

518
149
67
302

705
199
102
404

605
119
92
394

307
147
160

193
107
86

97
59
38

37
24
13

49
29
20

66
36
30

126
61
65

161
76
85

207
100
107

171
79
92

2,233

3,516

3,096

3,420

93
550
2
253
73
222

35
672
12
311
97
252

37
1,226
311
134
605
140

1,421
355
137
551
187

103

2,486

2,858

2,659

1,862

1,648

2,211

659

660

612

415

1
363
11
148
51
153

2
153
38
135

61
701
4
366
74
257

47
1,000
173
55
518
54

37
845
175
71
700
68

29
1,362
342
167
658
196

101

364
118
178

285
110
217

130
83
202

230
2
52
49
127

19
1,266
253
151
115
23

29
1,516
343
157
137
16

40
1,355
270
209
156
17

34
958
156
135
150
14

36
847
95
65
359
16

Petroleum and natural gas well drilling.
1. These construction data are published by the Building Materials and Construction
Division of the Department of Commerce. For an explanation of the differences between
the series shown in this table and the new construction series in the other tables of this report,
see the first paragraph of section 9 on New construction in Part III.

1931

1930

3. Public industrial and commercial building not segregable from private construction,
1929-32; amount believed negligible.
4. Consists of local transit, petroleum pipeline, electric light and power (including construction with Rural Electrification Administration funds), and manufactured and natural gas.

NATIONAL INCOME,

1954

209

EDITION

Table 30.—Personal Consumption Expenditures, by Type of Product, 1939-53*—Continued
[Millions of dollars]
1939

1940

1941

1942

1943

628
267
195
166

641
280
198
163

702
288
208
206

813
312
221
280

972
404
266
302

957
366
239
352

1946

1945

1944

1948

1947

1949

1950

1952

1951

1953

Line

974
415
299
260

1,162
601
350
311

1,411
649
420
342

1,589
715
495
379

1,789
787
584
418

1,959
822
681
456

2,139
876
758
605

2,319
935
812
572

2,476
999
853
624

92
93
94
95

938

1,012

1,060

1,207

1,428

1,667

1,735

1,915

2,032

2,256

2,294

2,463

2,607

2,855

2,964

317
333
20

223
172
27

269
189
77

316
128
251

555
143
417

1,004
175
822

1,621
267
1,394

770
450
388

837
597
450

985
696
417

1,135
828
501

1,093
893
444

1,315
889
705

1,652
1,044
960

1,959
1,144
1,157

97
98
99

108

129

135

176

163

234

169

216

195

187

197

208

229

100

144

105

122

140

169

203

302

379

344

38S

431

476

560

571

101

67,878

71,881

81,875

89,748

100,541

109,833

121,699

146,617

164,973

177,609

180,598

194,026

208,342

218,424

230,080

102

6,670

7,771

9,659

6,968

6,605

6,764

8,105

15,892

20,593

22,214

23,573

28,608

27,148

26,815

29,749

103

35,131

37,215

43,208

51,324

59,259

65,368

73,222

84,501

93,077

98,741

96,879

100,386

111,054

116,012

118,925

104

25,777

26,895

29,008

31,456

34,677

37,701

40,372

46,224

51,303

56 654

60,146

65,032

70,140

75,597

81,406

105

20. Comprises billiard parlors, bowling alleys, dancing, riding, shooting, skating, and
swimming places, amusement devices and parks, daily fee golf course greens fees, golf instruction, club rental, and caddy fees, sightseeing buses and guides, and private flying operations.
21. Comprises photo developing and printing, photographic studies, collectors' net acquisitions of stamps and coins, hunting dog purchase and training, sports guide service, veterinary service, purchase of pets, camp fees, nonvending coin machine receipts minus payoff,
and other commercial amusements.
22. The estimates represent current expenditures (including depreciation) net of receipts
accounted for separately in consumer expenditures, such as receipts from meals, rooms, and
entertainments.
23. Comprises fees paid to commercial, business, trade, and correspondence schools; fees
for musical, dancing, and other instruction except athletics; and current expenditures (including depreciation; of foundations for education and research.
24. Comprises religious bodies, social welfare and foreign relief agencies, political organizations, museums and libraries, and foundations (except foundation expenditures for education
and research). The estimates represent current expenditures (including depreciation but
excluding relief payments within the United States), and are net of receipts accounted for
separately in consumer expenditures, such as receipts from meals, rooms, and entertainments.

13. Premiums less claims: accident and health insurance, mutual accident and sick benefit
associations, and group hospitalization associations. Also covers administrative and medical
expenses of group health associations and student fees for medical care.
14. Comprises total operating expenses of life insurance companies and fraternal and assessment associations, excluding payments to policyholders and expenses allocated to accident
and health insurance.
15. Comprises total payments to labor unions minus cash benefits, employment agency
fees, employees' payments to professional associations, miners' expenditures (for explosives,
lamps, and smithing), money order fees, classified advertisements, net purchases from pawnbrokers and miscellaneous second-hand stores, and other personal business services.
16. Comprises baggage charges and coastal and inland waterway and ferry foot passenger
fares.
17. Groups IX-3 and IX-4 include games, toys, sporting, athletic, and photographic goods,
and related products. These commodities are divided roughly between the two groups on the
basis of durability.
18. Comprises professional baseball, football, and hockey, horse and dog race tracks, college
football, and other amateur spectator sports.
19. Comprises gross receipts less cash benefits of fraternal, patriotic, and women's organizations except insurance; and dues and fees of athletic, social, and luncheon clubs, and school
fraternities.

Table 31 .—New Construction Activity, by Type, 1939-53

[Millions of dollars]
1940

1939

1941

1942

1943

1946

1945

1944

1948

1947

1949

1950

1951

1952

1953

Line

8,198

8,682

11,957

14,075

8,301

5,259

5,633

12,000

16,689

21,678

22,789

28,454

31,182

33,008

35,256

4,389

5,054

6,206

3,415

1,979

2,186

3,235

9,638

13,256

16,853

16,384

21,454

21,764

22,107

23,877

2,680
2,270
320
90

2,985
2,560
335
90

3,510
3,040
375
95

1,715
1,440
225
50

885
710
160
15

815
570
220
25

1,100
720
340
40

4,015
3,300
570
145

6,310
5,460
735
125

8,580
7,500
925
155

8,267
7,257
825
185

12,600
11,525
900
175

10,973
9,849
934
190

11,100
9,870
1,0(5
185

11,930
10, 555
1,108
267

3
4
6
6

786
254
81
211
240
48
39
31
100
22

1,025
442
91
257
235
59
50
33
67
26

1,482
801
123
286
272
62
58
46
72
34

635
346
62
93
134
31
24
29
30
20

233
156
14
19
44
6
6
11
7
14

351
208
17
39
87
11
11
26
17
22

1,020
642
56
147
175
26
31
37
27
54

3,341
1,689
331
801
520
76
123
85
125
111

3,142
1,702
237
619
584
126
174
110
99
75

3,621
1,397
352
901
971
251
253
126
224
117

3,228
972
321
706
1,229
360
269
202
262
136

3,777
1,062
402
886
1,427
409
294
344
247
133

5,152
2,117
544
827
1,664
452
345
419
164
284

5,014
2,320
515
622
1,557
399
351
394
125
288

5,680
2,229
739
1,052
1,660
472
426
317
163
282

7
8
9
10
11
12
13
14
15
16

683
137
93
453

771
167
122
482

872
187
179
506

786
197
155
434

570
211
61
298

725
247
83
395

827
264
117
446

1,374
258
305
811

2,338
318
510
1,510

3,043
379
713
1,951

3,323
352
533
2,438

3,330
315
440
2,575

3,729
399
487
2,843

4,003
438
570
2,995

4,416
442
615
3,359

17
18
19
20

212
106
106

240
145
95

310
182
128

260
135
125

284
121
163

283
108
175

267
100
167

856
409
447

1,397
683
714

1,544
738
806

1,488
695
793

1,635
763
872

1,846
863
983

1,905
890
1,015

1,731
809
922

21
22
23

112

120

3,809

3,628

5,751

10,660

6,322

3,073

2,398

2,362

3,433

4,825

6,405

7,000

9,418

10,901

11,379

65
970
23
468
127
352

200
615
164
156
54
241

430
1,646
1,280
158
42
166

545
3,685
3,437
128
35
85

739
2,010
1,870
63
44
33

211
1,361
1,230
41
58
32

80
937
755
59
85
38

374
354
113
101
85
65

200
699
96
287
85
131

156
1,301
196
618
223
264

359
2,068
177
934
477
480

345
2,384
224
1,133
496
431

595
3,497
974
1,513
528
482

654
4,136
1,684
1,619
473
360

656
4,352
1,771
1,728
353
500

26
27
28
29
30
31

125
1,381
371
136
570
191

385
1,302
338
131
528
129

1,620
1,066
252
141
500
96

5,016
734
169
85
357
69

2,550
446
107
49
285
136

837
362
79
46
163
14

690
398
97
55
130
11

188
895
194
99
240
18

204
1,451
351
164
394
70

158
1,774
535
185
629
87

137
2,131
619
203
793
95

177
2,272
659
185
881
97

887
2,518
775
213
853
80

1,388
2,820
790
193
854
66

1,307
3,165
861
201
830
107

32
33
34
35
36
37

368

398

423

306

347

526

598

653

773

1,051

1,069

1,279

1,568

1,616

1,659

5. Consists of sewer and water, roads, bridges, and miscellaneous nonstructural items such
as parks and playgrounds.
6. Consists of public administration, social and recreational, commercial, and miscellaneous
nonresidential.
7

TnnlnHoc ™iV»liVlv nwnpH nnrVs and nlflvcrrrtnnHs

Tnpmnrijk

pio

TnplnrlAG npfrrtlpnTn

8. Estimates for this item by the Building Materials and Construction Division for the
years 1929-38 are not available. Rough approximations, in billions of dollars, are as follows:
1929, $0.4; 1930, $0.3; 1931, $0.2; 1932, $0.2; 1933, $0.2; 1934, $0.2; 1935, $0.3; 1936, $0.3; 1937, $0.5;
1938, $0.4.

210

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS
Table 32.—Private Purchases of Producers' Durable Equipment,

1929-38

[Millions of dollars]
1929
Total producers' durable equipment

1930

1931

1932

1934

1933

1935

1936

1937

1938

5,850

4,465

2,839

1,593

1,589

2,304

3,066

4,169

5,095

3,644

Furniture and fixtures
Cutlery and hand tools
Fabricated metal products (except cutlery and hand tools)

361
94
190

292
73
160

193
49
114

113
32
81

98
35
76

141
46
101

154
54
106

181
63
122

236
77
153

197
60
120

Engines and turbines
Tractors
Agricultural machinery (except tractors)
Construction machinery
Mining and oilfield machinery

54
186
265
90
143

45
174
252
71
87

26
112
114
41
41

12
56
62
7
30

10
30
49
7
33

17
69
71
17
51

25
131
136
31
77

43
208
176
54
117

64
270
229
72
119

44
204
229
62
79

270
407
440
201
186
443

171
288
314
144
147
339

101
210
225
104
117
230

41
133
134
73
65
108

45
151
130
72
61
80

86
186
173
88
74
132

147
227
240
115
92
193

220
309
335
140
134
246

301
368
400
172
168
396

172
276
292
143
127
263

590
1,105
41
75
374

423
701
17
109
374

291
438
9
83
82

155
271
1
18
45

186
331
8
12
22

307
436
15
21
101

388
643
8
9
97

508
822
7
57
196

623
849
19
65
356

360
524
15
122
142

81
254

69
215

51
158

34
122

29
124

32
140

41
152

51
180

75
183

57
156

. __

Metalworking machinery. _
Special-industry machinery, n . e. c
General industrial machinery
Office and store machines
Service-industry and household machines.
Electrical machinery

__
..

Trucks, buses, and trailers
Passenger cars
Aircraft...
Ships and boats
KaUroad equipment
Instruments
Miscellaneous equipment

Table 33.—Net Change in Business Inventories,

1929-38

[Millions of dollars]
1929

1930

1931

1932

1933

1934

1935

1936

1937

1938

Net change in business inventories, total
Farm...
Nonfarm

1,674
-162
1,836

-383
-300

-83

-1,284
324
-1,608

-2,556
34
-2,590

-1,629
—259
-1,370

-1,125
-1,320
195

912
536
376

954
-1,112
2,066

2,249
523
1,726

-943
103
-1,046

Net change in nonfarm inventories...
Corporate
Noncorporate

1,836
1,558
278

191
-274

-1,698
-1,149
-459

-2,590
-1,816
-774

-1,370
-871
-499

195
182
13

376
217
159

2,066
1,589
477

1,726
1,520
206

-1,046
-920
-126

Change in book value.
Corporate
Noncorporate

1,222
1,086
136

-4,098
-3,069
-1,029

-4,633
-3,583
-1,070

-3,932
-2,863
-1,069

1,298
1,272
26

874
807
67

653
444
209

2,924
2,327
597

1,786
1,551
235

-2,230
-1,883
-347

614
472
142

4,015
3,260
755

3,025
2,414
611

1,342
1,047
295

-679
-625
-54

-277
-227
-50

-858
-738
-120

1,836
911
598
313

-83
747
- 1 , 553
2,300

-1,608
-594
-2,239
1,645

-2,590
-1,155
-1,846
691

195
136
598
-462

376
213
381
-168

2,066
1,095
1,586
-491

-1,046
-631
-1,268
637

Wholesale trade
Change in book value
Inventory valuation adjustment

31
-74
105

54
-527
581

-413

-175
-358
183

-357

66
226
-160

1
9
-8

286
487
-201

210
70
140

-403
205

Retail trade
Change in book value
Inventory valuation adjustment

250
77
173

-457
-1,314
857

-1,087
771

220
-708

-48
-17
-31

297
378
-81

796
-128

53
198
-145

-164
-467
303

Allother..
Change in book value
Inventory valuation adjustment

644
621
23

-427
-704
277

-285
-475
190

-215
-18
-197

41
67
-26

-135
-115
-20

119
178
-59

-53
-92
39

Inventory valuation adjustment
Corporate
Noncorporate
Net change in nonfarm inventories by industrial group.
Manufacturing
Change in book value..
Inventory valuation adjustment

-832
419
-316

-2,143
—525
-1,370
-578
828
-1,406

-695
-1,078
-565
-650
85

-31
-29
1,726
1,344
1,340

1,184
963
221

Table 34.—Supplements to Wages and Salaries, 1929-38
[Millions of dollars]
1929

Line

1930

1931

1932

1933

1935

1934

1936

1937

1988

662

657

621

577

542

590

650

990

1,827

2,018

101

106

111

126

133

147

171

418

1,234

1,423

288
588
89

261
780
102

3
4
5
6
7
8
9
10
11

Old-age and survivors insurance

Railroad unemployment insurance

159
81

State and local employee retirement systems.
Cash sickness compensation funds 1. -

107

118

127

131

141

147

Employer contributions to private pension and welfare funds
Pay of military reservists.Othon

1 nnnsist<! nf rHreotr»r<!'fi»As.inrv tmr\

561

12
13
14
15
16

551

510

451

409

443

479

572

593

595

278
169
34
80

278
160
36
77

246
158
37
69

207
148
37
59

180
140
31
58

188
166
31
58

201
180
38
60

228
238
42
64

263
218
45
67

253
228
48
66

fops. nnmnftTisfttinn nf nrisoTi inmates, finvpmment nftvmpmt.s tn finftmv nrisnners of wsu\ Tnarriftffft fans tn i

fi nf thin nation anH

211

NATIONAL INCOME, 195 4 EDITION
Table 32.—Private Purchases of Producers' Durable Equipment,

1939-52

[Millions of dollars]
1940

1939

1942

1941

1943

1944

1945

1946

1947

1948

1949

1950

1951

1952

Line

4,180

5,531

6,942

4,343

4,027

5,438

7,654

10,733

16,667

19, H O

17,833

21,135

23,177

23,307

210
70
144

252
99
151

332
147
166

248
97
144

200
128
191

213
181
238

287
161
298

500
353
317

690
348
506

639
373
510

551
341
414

704
375
463

878
433
533

855
381
505

2
3
4

54
195
183
57
90

62
240
209
80
119

56
341
309
88
215

26
189
280
74
117

47
84
180
66
112

91
303
349
38
164

193
324
414
273
293

52
298
351
323
301

148
544
676
408
352

215
757
985
503
567

198
854

255
913

1,075

1,077

343
485

511
544

280
1,096
1,210
576
735

268
976
1,161
640
792

5
6
7
8
9

240
297
322
149
143
328

531
335
344
173
162
493

744
356
367
215
179
549

701
297
249
167
150
359

699
232
290
119
174
325

606
360
504
174
245
672

704
529
738
229
345
776

779
837
863
443
456
1,129

834
1,340
1,170
588
873
2,061

776

610

1,453
1,300

1,189
1,069

875
1,403
1,162
634
941
2,104

1,107
1,667
1,531
663
83 <
2, £97

1,393
1,574
1,585
750
926
2,865

10
11
12
13
14
15

489
715
23
57
170

562
948
39
133
313

737
1,158
35
185
408

126
251
6
197
394

140
253
0
232
268

343
167
0
130
346

901
172
12
195
331

1,376
995
156
174
359

2,825
3,613
86
168
1,075

2,629
3,399
167
192
935

16
17
18
19
20

71
173

61
225

59
296

32
239

67
220

69
245

179
300

226
445

517
753

588
726

21
22

648

565
891

1,276
1,968

1,730

2,283
1,889
145
236
631

2,613
2,316

2,138
3,269

75
123

103
108

1,004

1,030

2,861
4,237
63
111
796

335
610

355
654

315
555

389
717

Table 33.—Net Change in Business Inventories,

1939-53

[Millions of dollars]
1939

1941

1940

1942

1943

1944

1945

1946

1947

1948

1949

1950

1951

1952

1953

Line

372
56
316

2,172
270
1,902

4,501
462
4,049

1,811
1,159
652

-753
-176
-577

-1,020
-445
-575

-1,057
-462
-595

6,101
-249
6,350

-991
-2,289
1,298

4,162
1,136
3,026

-2,737
-875
-1,862

7,351
923
6,428

10,355
1,404
8,951

3,625
654
2,971

1,494
-675
2,169

1
2
3

316
251
65

1,902
1,686
316

4,049
3,318
731

652
470
182

-577
-458
-119

-575
-1,070
495

-595
-1,027
432

6,350
5,967
383

1,298
1,240
58

3,026
2,055
971

-1,862
-1,635
-227

6,428
4,924
1,604

8,951
8,080
871

2,971
2,781
190

2,169
1,621
548

4
6
6

1,196
965
231

2,147
1,786
361

7,135
5,789
1,346

2,223
1,674
549

352
315
37

-219
-783
564

75
-463
638

13,318
11,230
2,088

8,668
7,139
1,529

5,688
4,205
1,383

- 4 , 273
-3,578
-695

12,426
9,788
2,638

10, 555
9,340
1,215

1,782
1,800
-18

3,328
2,585
743

7
S
9

-880
-714
-166

-245
-200
-45

-3,086
- 2 , 471
-615

-1,571
-1,204
-367

-929
-773
-156

-356
-287
-69

-670
-564
-106

-6,968
-5,263
-1,705

-7,370
-5,899
-1,471

-2,562
-2,150
-412

2,411
1,943
468

-5,998
-4,864
-1,134

-1,604
-1,260
-344

1,189
981
208

-1,159
-964
-195

10
11
12

316
214
713
-499

1,902
1,218
1,357
-139

4,049
2,567
4,151
- 1 , 584

652
1,553
2,324
-771

-577
244
823
-579

-575
-814
-593
-221

-595
-1,556
-1,121
-435

6,350
2,901
6,163
-3,262

1,298
450
4,412
-3,962

3,026
1,274
2,750
- 1 , 476

-1,862
-1,494
- 2 , 744
1,250

6,428
2,265
5,496
-3,231

8,951
7,400
8,066
-666

2,971
2,024
1,359
665

2,169
1,699
2,324
-625

13
14
15
16

77
236
-159

183
173
10

221
846
-625

-554
-279
-275

-234
-66
-168

202
233
-31

560
665
-105

815
2,081
-1,266

-21
1,084
-1,105

566
706
-140

4
-401
405

1,356
2,458
-1,102

308
604
-296

721
391
330

451
594
-143

17
18
19

97
291
-194

482
563
-81

851
1,633
-782

-411
87
-498

-462
-316
-146

-58
17
-75

272
358
-86

2,048
4,094
-2,046

603
2,249
-1,646

1,229
1,777
-548

-147
-690
543

2,404
3,653
-1,249

336
836
-500

187
-45
232

-1
264
-265

20
21
22

-72
-44
-28

19
54
-35

410
505
-95

64
91
-27

-125
-89
-36

95
124
-29

129
173
-44

586
980
-394

266
923
-657

-43
355
-3S8

-225
-438
213

403
819
-416

907
1,049
-142

39
77
-38

20
146
-126

23
24
25

Table 34.—Supplements to Wages and Salaries, 1939-53
[Millions of dollars]
1939

1942

1941

1940

1943

1944

1945

1946

1947

1948

1949

1950

1951

1952

1953

Line

2,167

2,311

2,703

3,162

3,759

4,463

5,604

5,861

5,899

5,755

6,524

7,799

9,539

10,384

11,081

1,540

1,624

1,983

2,302

2,677

2,937

3,805

3,970

3,565

3,042

3,503

3,976

4,753

4,874

4,745

291
815
105

329
813
98

419
1,011
124

532
1,089
161

625
1,246
183

648
1,177
184

630
1,011
174

687
893
184

780
1,029
212

839
965
228

816
1,010
223

1,308
1,217
232

1,660
1,465
263

1,785
1,350
265

1,890
1,288
275

3
4
5

58
33
84

67
67
93

80
80
102

98
99
109

129
118
147

140
129
192

140
130
227

163
139
241

271
143
241

283
25
244

277
23
273

282
24
316

307
26
316

319
25
330

313
25
184

152

155

165

185

202

212

225

250

290

255

1,268

1,413

599

360
0
98

420
2
459

510
7
80

570
2
144

660
2
138

700
3
67

e
9
10

627

687

720

860

1,082

1,526

1,799

1,891

2,334

2,713

3,021

3,823

4,786

5,610

6,336

255
248
58
66

278
282
61
66

318
314
14
74

367
401
3
89

403
586
2
91

443
948
1
134

478
1,132
5
184

495
1,231
27
138

560
1,555
125
94

614
1,810
188
101

643
2,024
244
110

676
2,743
284
120

804
3,582
273
127

895
4,195
283
137

944
4,927
315
150

13
14
16
16

212

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS

Table 35.—Personal Contributions for Social Insurance, 1929-38
[Millions of dollars]
Line

1929

1930

1931

1933

1932

1936

1935

1934

1937

1938

142

147

151

152

157

162

180

566

554

142

147

151

152

157

162

180

566

554

288
32
62
37
86

261
44
54
39
96

3
4
5
6
7
8
9

Old-age and survivors insurance

Federal civilian employee retirement systems

. . .

29
47

...

30
51

Cash sickness compensation funds

31
55
65

32
57

30
63

30
65
62

32
70
60

34
76
61

10
11

Table 36.—Transfer Payments, 7929-38
[Millions of dollars]
1929

Line

1930

1931

1932

1933

1934

1935

1936

1937

1938

1,496

1,533

2,714

2,170

2,116

2,194

2,400

3,520

2,418

2,834

691

735

1,716

931

698

600

634

2,064

828

1,196

3
4
5
6
7
8
9

95
1

142
1
2
40

606
10
393
98

18
26

22
29

27
33

32
40

42
40

52
42

57
36

60
34

63
36

65
40

443
93

468
106

548
996

571
170

456
58

382
28

2
418
29

20
433
1,430

36
434
134

23
446
59

10
11
12
13
14
16

Old-age and survivors insurance benefits.
Railroad retirement insurance benefits
Government life insurance benefits .

_.
_

. -

Direct relief'
Military pension, disability, and2retirement payments
Adjusted compensation benefits
_
_
Mustering-out payments to discharged servicemen and terminal-leave
benefits.
Readjustment, self-employment, and subsistence allowances to veterans.
Other'

111

17
18
19

}

24
25
26
27

Corporate gifts to nonprofit institutions.
Other •

, _

— -

- - - —

759

953

1,172

862

1,023

1,209

78
78

86
86

95
95

110
110

119
119

127
127

137
137

144
144

151
151

Other *

. _

102

502

105
105

176
176

558
72

745
80
665

954
115
839

635
218
417

787
397
390

965
509
456

587

Direct relief
Special types of public assistance-

118

349

20
21
22

112

264

72
72

Cash sickness compensation

110

218

534

649

737

32
452
103

35
390
109

40
497
112

31
598
108

1. Consists of Farm Security Administration grants and the value of free stamps issued
under the surplus food and cotton stamp programs.
2. Covers benefits under the World War Veterans Adjusted Compensation Act of May 19,
1924, as amenaed, and under the Adjusted Compensation Payment Act of Jan. 27, 1936.
For the period 1929 through May 1936 this series represents very largely net loans to veterans
on the security of their adjusted service certificates from the U. S. Government Life Insur-

317
317 r
\
90

486
91
659
27
530
102

641

594

567

429

27
508
106

28
458
108

30
461
103

33
428
106

27
296
106

ance Fund and the Adjusted Service Certificate Fund; for the period since June 1936 it consists almost entirely of cash redemptions by veterans of their adjusted service bonds. Additionally, the series includes (1) payments to beneficiaries on certificates matured by death of
veterans; (2) "adjusted service dependent pay", which comprises cash payments (negligible
in amount) to veterans and their beneficiaries where, under certain circumstances, no certificates were issued; (3) payments to veterans in settlement of adjusted service certificates not

Table 37.—Monetary and Imputed Interest, 1929-38
[Millions of dollars]
1929

Line
Net interest (component of national income)

1932

1933

1934

1935

1936

1937

1938

_
_

Originating in rest of the world
Monetary interest received from abroad
Less: Monetary interest paid to abroad
Personal interest income (component of personal income)

5,985

5,839

5,434

5,042

4,869

4,751

4,741

4,708

4,241

Originating in households and institutions
Monetary interest paid

4,405

4,528

4,386

4,157

4,048

3,935

3,810

3,719

3,721

9,720
3,311
7,709
1,081

8,909
3,053
6,658

8,346
2,810
5,898
730

7,635
2,594
5,179
664

6,743
2,361
4,377
570

6,450
2,399
4,262
539

6,161
2,374
4,079
521

5,909
2,497
4,055
541

5,833
2,583
4,143
554

5,633
2,560
3,918
554

1,627
1,627

972
972

761
761

561
561

579
579

609
609

736
736

829

622

777
777

577
711
134

701
93

426
458
32

324
349
25

242
265
23

207
231
24

195
221

160
191
31

138
170
32

7,428

6,949

6,575

6,212

6,099

5,892

5,912

5,828

Net interest (component of national income)

6,445

5,985

Net interest paid by government
Monetary interest paid
Less: Monetary interest received

983
1,506

964
1,513
549

1931

6,445

Originating in private business
Monetary interest p a i d . . .
Imputed interest paid
Less: Monetary interest received
Less: Imputed interest received

1930

550
612
62
6,923
5,839
1,084
1,521
437

26
5,842
5,434
1,141
1,574
433

1,170
1,689
519

4,751

5,042

4,708
4,741

1,230
1,849
619

1,141
1,831

1,101
1,868
767

1,204
2,019
815

1,192
1,920
728

213

NATIONAL INCOME, 1 9 5 4 EDITION
Table 35.—Personal Contributions for Social Insurance, 1939—53
[Millions of dollars]
1939

1940

1941

1942

1944

1943

1945

1946

1947

1948

1949

1950

1951

1952

1953

Line

596

658

801

1,166

1,839

2,236

2,333

2,011

2,118

2,178

2,234

2,894

3,417

3,811

4,007

653

801

1,166

1,839

2,236

2,333

2,011

2,118

2,178

2,234

2,894

3,417

3,604

3,787

291
41
68
42
105

329
44
67
60
112

419
56
80
66
115

625
88
129
257
128
5
607

648
90
140
282
139
5
932

630
79
140
295
155
4
1,030

687
44
163
232
190
48
617

780
33
271
246
230
55
503

839
18
283
275
280
69
414

816
11
277
350
330
48
402

1,308
13
282
371
395
51
474

1,660
13
307
391
465
48
633

1,785
14
319
425
520
52
489

1,890
14
313
427
580
54
509

3
4
5
6
7
8

532
74
98
159
120
2
181

207

220

207

220

Table 36.—Transfer Payments, 1939-53
[Millions of dollars]
1939

1940

1941

1942

1944

1943

1946

1945

1947

1948

1949

1950

1951

1952

1953

Line

2,963

3,114

3,113

3,143

2,954

3,588

6,165

11,411

11,787

11,281

12,403

15,147

12,575

13,090

13,801

1,240

1,421

1,369

1,419

1,239

1,841

4,310

9,2i4

8,887

7,652

8,754

10,884

8,663

8,940

9,660

696
14
429
110
6
68
69

835
35
518
118
16
73
75

707
88
344
124
14
78
59

747
130
344
128
6
83
56

538
165
80
132
1
93
67

655
209
62
137
1
130
116

1,322
273
446
146
2
183
272

2,348
378
1,094
159
40
349
328

2,123
463
775
212
39
282
352

2,226
552
790
283
28
220
353

3,492
664
1,730
320
103
242
433

6,100
954
1,367
337
60
273
3,109

4,352
1,872
837
345
20
288
990

4,791
2,178
992
476
42
328
775

5,607
2,979
954
515
46
395
718

3
4
5
6
7
8
9

22
462
36

63
476
28

137
474
19

108
476
10

9
491
6

649
7
230

1,013
189
1,404

1,693
18
2,131

2,181
6
1,577

2,297
3
431

2,402
2
167

2, 478
2
116

2,431
1
153

2,553
0
455

2,720
1
352

11
12
13

142

2,780

2,605

2,284

2,280

1,708

1,222

652

499

195

295

240

244

395

411

480

504

489

481

1,272

1,262

1,242

1,229

1,220

1,241

1,323

1,640

2,226

2,890

2,868

3,420

2,927

3,151

3,125

157
157

163
163

175
175

194
194

213
210
3

223
218
5

240
235
6

260
255
5

297
275
22

326
300
26

356
325
31

398
360
38

466
430
36

542
500
42

610
560
50

17
18
19

1,024
566
458

1,013
630
383

985
718
267

956
778
178

929
818
111

939
850
89

986
900
86

1,177
1,057
120

1,478
1,314
164

1,727
1,529
198

2,169
1,889
280

2,345
2,055
290

2,267
2,075
192

2,297
2,129
168

2,357
2,207
150

20
21
22

203

451

837

343

677

194

312

158

45)

431

502

495

505

506

532

557

674

739

781

843

985

999

1,016

31
316
104

38
287
106

58
332
112

98
283
114

159
246
100

234
165
107

266
150
116

214
193
150

241
258
175

239
298
202

223
353
205

253
328
262

343
328
314

343
328
328

343
328
345

25
26
27

covered by issuance of bonds; and (4) payments to veterans holding certificates to maturity.
3. Consists of military and naval insurance payments, payments to nonprofit institutions,
profits of military pest exchanges and navy exchanges and ships' stores, payments under the
Panama Canal Construction Annuity Act, enemy alien and civilian war assistance, payments
to United States military and civilian prisoners of war, and Atomic Energy Commission
fellowships.

4. Consists of veterans' aid and bonuses, payments for the care of foster children in private
family homes, and payments to nonprofit institutions.
5. Consists of cash prizes, unrecovered thefts from business of cash and capital assets, and
personal-injury payments from business other than to employees.

Table 37.—Monetary and Imputed Interest, 1939-53
[Millions of dollars]
1939

1940

1941

1942

1943

1944

1945

1946

1947

1948

1949

1950

1951

1952

1953

Line

4,604

4,490

4,544

4,291

3,658

3,342

3,185

3,119

3,842

4,508

5,171

5,912

6,770

7,442

8,435

3,660

3,454

3,392

3,365

2,966

2,686

2,502

2,272

2,678

2,974

3,387

3,708

4,272

4,683

5,087

5,691
2,606
3,979
558

6,426
2,694
4,052
614

5,430
2,821
4,199
660

5,264
2,996
4,213
682

4,946
3,178
4,387
771

4,774
3,450
4,788
750

4,803
3,757
5,266
792

4,920
4,181
5,848
981

5,573
4,502
6,233
1,164

6,267
4,970
6,987
1,276

6,924
5,397
7,568
1,366

7,622
5,870
8,299
1,485

8,753
6,520
9,298
1,703

9,823
7,217
10,478
1,87a

10,874
8,026
11,717
2,096

817
817

916
916

1,026
1,026

796
796

577
577

538
538

553
553

712
712

996
996

1,310
1,310

1,554
1,554

1,956
1,956

2,186
2,186

2,442
2,442

3,015
3,015

127
158
31

120
152
32

126
162
26

130
155
25

115
145
30

118
149
31

130
168
38

135
179
44

168
224
56

224
269
45

230
277
47

248
301
53

312
384
72

317
406
89

333
447
114

3
4
5
6
7
8
9
10
1
1
12

5,809

5,781

5,833

5,808

5,798

6,151

6,868

7,576

8,212

8,950

9,768

10,628

11,592

12,318

13,475

4,604

4,490

4,544

4,291

3,658

3,342

3,185

3,119

3,842

4,508

5,171

5,912

6,770

7,442

8,435

1,205
1,941
736

1,291
2,059
768

1,289
2,088
799

1,617
2,407
890

2,140
3,141
1,001

2,809
3,895
1,086

3,683
4,934
1,251

4,457
5,772
1,315

4,370
5,751
1,381

4,442
5,904
1,462

4,597
6,196
1,599

4,716
6,428
1,712

4,822
6,662
1,830

4,876
7,023
2,147

5,040
7,441
2,401

14
1
5
16

214

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS

Table 38.—Reconciliation of Department of Commerce Estimates of Corporate Profits with Infernal Revenue Service Tabulations, 1929-38l
[Millions of dollars]
Line
1
2
3
4
5
6
7
8

1929
Compiled net profits, I R S *
Plus depletion, I R S

1930

11,870
559
500

Plus net loss, sales of property other than capital assets, I R S
Less net capital gain, I R S
.
.. . .. . _
Less net gain, sales of property other than capital assets, I R S .
Less domestic dividends received, I R S
__ _ . _
Less foreign dividends received, I R S

4,649
463
935

1931
-777
268
1,702

1932

1933

-3,829
246
1,705

-930
246
1,686

1934
2,970
312
298

1935
5,423
349
239

1936
7,771
437
142

1937

1938

7,830
524
164

4,131
437
75
152
207
95
1,791
312

1,316

299

142

262

243

470

581

305

2,571
189

1,969
92

1,260
43

3,014
163

2,676
193

2,682
209

-56
408

-56
341

-2
553

44
531

-32
640

96
-62
6

104
-49
2

1,026
54
-32
421
17
-59
6

2,217
101

65
664

646

2,593
237

33
-81
10

7
-88
12

12
-96
14

-13
667
-19
—79
13

-30
-79
5

9
10

Plus "rest of the world" adjustment, Commerce . . . —

11
12
13

Less profits of mutual life insurance companies, based on3 I R S
Less profits of mutual nonlife insurance companies, I R S
Less foreign income tax on branch profits, Commerce.

123
-69
13

3
609
110
-86
11

14
15

Plus profits of Federal Reserve banks, Federal Reserve Board

145
38

98
6

75
0

57
21

59
7

100
8

131
6

157
5

165
9

134
1

16
17

Less gross renegotiation refunds, I R S - . . .
Less emergency amortization acceleration, Commerce

18
19
20
21

Less Federal income taxes, I R S

9,628
1,193
145
62

3,322
712
98
61

-780
399
75
43

-3,017
286
57
47

151
423
59
58

1,716
596
100
76

3,145
«779
131
73

5,740
1,192
157
96

6,235
1,276
165
100

3,300
860
134
77

Less taxes resulting from audit, Commerce

22
23

Plus tax refunds resulting from renegotiation, I R S
Plus tax refunds resulting from emergency amortization acceleration,
Commerce.

Less income taxes, Federal Reserve banks, Federal Reserve Board

195
476

25
26

Plus taxes paid by mutual nonlife insurance companies, I R S

Plus foreign income tax on dividend income, Commerce
Plus foreign income tax on branch profits, Commerce

Less excess profits tax, Vinson Act, Commerce

28
29
30

1
18
11

13
6

5
2

13
6

18
10

20
12

22
14

26
13

38
5

8,259

22
13

2,480

-1,278

-3,402

-370

972

2,194

4,331

4,733

2,271

3. Adjusted to include the same audit results included for this industry in the audit adjustment above.

1. For a discussion of this table see Part III, section on corporate profits.
2. IRS—Internal Revenue Service.

Table 39.—Major Items of Personal Income and Personal Consumption Expenditures in Kind, 1929-38
[Millions of dollars]
1929

Line
Personal income and consumption expenditures in kind..
Food furnished government (including military) and commercial employees.
Standard clothing issued to military personnelMeals furnished domestic servants and nurses
Net rent of owner-occupied farm and nonfarm dwellings
Services furnished without payment b y financial intermediaries except
insurance companies.
Employees' lodging
-..
Personal income and consumption expenditures partially in k i n d l
Food produced and consumed on farms..
Fuel produced and consumed on farms..
Personal consumption expenditures in kind not included in personal income.
Depreciation of owner-occupied farm and nonfarm dwellings.
Taxes on owner-occupied farm and nonfarm dwellings
Institutional depreciation
-

1931

1932

1933

1934

1935

1936

1937

1938

4,645

4,167

3,534

2,773

2,208

2,099

2,152

2,334

2,601

2,695

257

245

198

160

155

185

214

236

271

247

12
278
2,722
1,278

11
247
2,426
1,141

9
182

10
130

11
119

7
150

9
168

12
181

13
199

14
169

2,040
1,017

1,523
872

1,095
757
71

893
793

895
792

984
843

1,157
876

1,360
818

1,317

1,373

1,394

1,266

1,704

1,540

1,255

1,010

1,024

1,090

1,590
114

1,431
109

1,159
96

917
93

927
97

992
98

1,213
104

1,270
103

1,288
106

1,167
99

2,095

2,136

2,106

2,033

1,925

1,954

1,976

1,971

1,997

2,012

892
1,024
179

899
1,059
178

883
1,047
176

869
990
174

874
876
175

892
887
175

896
904
176

906
887
178

919
898
180

920
909
183

' These items are presented a t their gross value because data on costs are not available
separately from costs of farm output sold on the market. Only the net income derived from

1930

production of these items represents income in kind; only the net income derived from, and
the depreciation a n d taxes incurred in, their production represent personal consumption

NATIONAL INCOME,

1954

215

EDITION

Table 38.—Reconciliation of Department of Commerce Estimates of Corporate Profits with Internal Revenue Service Tabulations, 1939-51
[Millions of dollars]
1939

1941

1940

1949

1948

1947

1946

1945

1944

1943

1942

1950

223

1
2
3
4

1,129
539
2,460
644

1,423
467
2,377
630

5
6
7
8

231
487

376
556

381
600

9
10

1,411
24
162

1,551
32
145

1,654
38
226

1,862
44
345

11
12
13

670
232

605
239

770
195

878
299

14
15

31,615
1,210

34,588
1,711

28,387
1,476

464

240

325

239

227

923
183
1,418
134

1,211
298
1,713
254

925
323
1,882
341

849
364
2,194
382

723
389
2,162
452

96
453

17
359

122
243

198
410

213
502

1,118
16
43

1,205
18
48

1,229
19
83

1,309
21
129

458
26

465
55

455
94

462
93

604
93

1,783
173

2,893
311

1,478
715

622

16,982
7,168
277
284

120,882
12,256
350
426

24,554
15,926
458
527

23,320
14,884
465
287

18,977
10,795
455
291

1,316
124

2,141
221

1,106
495

395

9,348
475
703
336

16,675
544
1,006
297

23,389
578

28,126
644

26,547
712

21,346
693

486

584

504

212
115
1,906
250

188
178
2,021
245

163
185
2,235
183

179
131
1,344
156

294
130
1,334
134

428
140
1,429
145

114
609

137
566

99
676

98
724

-41
-98
8

-57
-131
14

-59
-156
23

1,030
12
26

130
776
1,056
14
24

156
9

199
14

277
8

350
14

26
9,320
2,549
199
145

Line

43,800
2,079
284

25,399
799

7,178
438
65
186

6,403
1,232
156
97

1951

42,831
1,709

16
17
29,525
10,982
604
126

22,551
8,875
462
65

32,769
11,920
670
170

26,198
9,817
605
161

39,970
17,317
770
207

41,173
22,082
878
308

18
19
20
21
22
23

167

193

197

255

59
16

100
28

25
26

4,962

6,486

40
23
39

46
14

42
26
103

56
24
389

50
43
987

48
48
353

79
83
120

101
129
264

116
162
127

125
145
48

241
226
120

274
345
300

28
29
30

•9,467

10,480

10,371

8,288

13,440

18,242

20,259

15,787

22,141

18,697

38
8

9,372

34
13

4. Includes Department of Commerce estimate of $44 million for unjust enrichment tax.

6. Includes Department of Commerce estimates of $77 million for war losses.

Table 39.—Major Items of Personal Income and Personal Consumption Expenditures in Kind, 1939-53
[Millions of dollars]
1939

1940

1941

1942

1943

1944

1945

1946

1947

1948

1949

1950

1951

1952

1953

Line

2,788

2,856

3,519

4,879

6,351

7,621

8,376

6,231

5,707

6,258

6,991

7,737

9,054

9,889

10,426

254

278

470

933

1,677

2,398

2,753

1,349

1,023

1,082

1,070

1,175

1,772

1,940

1,831

16
178
1,433
817

32
188

219
192

657
229

1,031
213

1,041
200

1,087
201

364
214

274
323

418
361

259
350

197
349

1,692
852

2,057
904

2,375
948

2,679
1,186

2,884
1,325

2,685
1,499

191
298
2,843
1,710

213
289

1,475
792

229
277
2,521
1,532

3,400
1,880

3,789
2,028

4,143
2,198

4,643
2,524

5,025
2,839

3
4
5
6

107

117

126

120

125

134

139

148

162

173

185

1,224

1,239

1,442

1,772

2,140

2,169

2,218

2,528

2,666

2,635

2,189

2,007

2,243

2,145

2,037

1,114
110

1,134
105

1,336
106

1,661
111

2,021
119

2,043
126

2,096
122

2,396
132

2,532
134

2,505
130

2,072
117

1,895
112

2,141
102

2,047
98

1,937
100

9
10

1,999

2,055

2,132

2,244

2,388

2,543

2,709

2,947

3,356

3,784

4,273

4,754

5,389

5,991

6,634

933
882
184

960
909
186

1,015
926
191

1,088
960
196

1,169
1,019
200

1,256
1,084
203

1,345
1,158
206

1,463
1,275
209

1,646
1,493
217

1,804
1,754
226

1,923
2,100
250

2,105
2,370
279

2,335
2,750
304

2,535
3,123
333

2,757
3,519
358

12
13
14

expenditure in kind. On a cash income basis the current expenses incurred in their production, other than depreciation and taxes, would become personal consumption expenditures

instead of business expenses, the taxes would become personal taxes instead of business taxes,
and the depreciation would not appear.

216

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS

Table 40.—Gross National Product or Expenditure in Constant Dollars, 1929-38 "
[Billions of 1947 dollars]
Line

1929

Gross national product

1930

1931

1932

1934

1933

1935

1936

1937

1938

149.3

135.2

126.6

107.6

103.7

113.4

127.8

142.5

153.5

145.9

107.3

100.9

98.0

88.9

86.6

91.5

97.3

107.6

111.5

109.8

13.0
58.1
36.2

10.5
55.2
35.2

9.1
55.0

6.9
50.7
31.4

6.7
49.2
30.8

7.6
52.5
31.4

9.4
55.4
32.5

11.6
61.8
34.3

12.2
63.8
35.6

10.0
64.9
34.9

Gross private domestic investment..

26.8

17.9

12.0

3.3

2.1

4.3

13.6

15.2

22.5

12.1

New construction.._
Residential nonfarm
Other
Producers' durable equipment..
Change in business inventories..
Nonfarm
Farm

16.1
6.9
9.3
8.5
2.1
2.6
-.4

11.8
4.0
7.8
6.8
-.7
-.2
-.6

8.3
3.4
5.0
4.6
— 9
-&0
2.1

4.6
1.7
2.9
2.7
-4.1
-5.1

3.5
1.3
2.3
2.9
-4.2
-3.0

-2.8

8.7
3.9
4.8
8.1
5.7
3.0
2.8

7.8
4.0
3.8

-1.3

5.2
2.5
2.7
5.2
3.2
.7
2.6

7.3
3.6
3.7
7.1

1.1

3.9
1.5
2.4
3.9
-3.5
.3
-3.9

1.6

1.2

-.5

-.2

1.9

13.6

15.1

15.9

17.2

17.4

20.3

19.7

22.1

2.3
11.2

2.7
12.5

2.9
13.0

5.7
11.6

5.4
11.9

8.3
12.0

7.8
11.8

9.6
12.5

Personal consumption expenditures.
Durable goods
Nondurable goods.
Services

Net foreign investment
Government purchases of goods and services..
Federal
State and local.
Gross government products-

.3
15.1
3.0
12.1

.1
14.9
4.3
10.8

.9
3.7

5.6
-1.2
-1.8

7.0

7.4

7.5

7.4

8.1

9.5

10.2

12.2

11.3

12.3

142.3

Other gross product»

127.8

119.1

100.3

95.6

103.9

117.6

130.3

142.1

133.6

1. Detail will not necessarily add to totals because of rounding.
2. Compensation of general government employees.

3. Gross national product less compensation of general government employees; i. e., gross
product accruing from domestic business, households, and institutions, and from the rest
of the world.

Table 41.—Implicit Price Deflators for Gross National Product by Major Segments, 1929-38
[Index numbers, 1947=100]
1929

Line

1930

1932

1931

1933

1934

1935

1936

1937

1938

70.0

67.4

60.3

54.3

54.0

57.3

56.7

58.1

59.2

73.6

70.3

62.6

55.4

53.6

56.7

57.8

58.2

60.3

58.9

3
4
5

70.7
64.8
88.6

67.9
61.6
84.8

60.6
52.6
79.3

53.0
44.9
73.0

52.0
45.3
67.2

55.4
50.8
66.9

54.5
52.9
67.2

54.5
63.2
68.4

56.9
55.1
70.8

57.0
52.3
71.6

53.9
52.6
54.9
68.6

52.2
61.3
52.6
65.8

47.7
46.7
48.4
62.3

40.8
37.7
42.5
58.8

40.6
37.5
42.4
55.7

43.4
41.7
44.4
59.3

44.2
41.1
47.0
59.1

45.0
43.2
46.8
59.0

50.4
47.6
62.8
63.3

60.7
49.2
52.3
65.4

62.4

60.7

57.9

53.4

54.0

56.7

57.5

58.3

59.6

57.9

56.0
63.8

52.8
62.4

53.2
58.9

48.9
64.5

47.3
66.7

62.9
58.6

53.8
69.2

58.3
58.4

58.0
60.6

65.1
60.1

61.5

61.3

62.0

60.5

58.3

58.7

58.3

59.7

61.0

61.8

70.4

67.7

60.2

53.9

53.6

57.2

56.6

57.9

59.0

58.1

58.4

6
7

g
9
10

New construction

Other

11
12
13
14
15

Federal

_ _.

1. Compensation of general government employees.
2. Gross national product less compensation of general government employees;!, e., gross

product accruing from domestic business,households, and institutions, and from the rest of
the world.

217

NATIONAL INCOME, 195 4 EDITION

Table 40.—Gross National Product or Expenditure in Constant Dollars, 1939-53

[Billions of 1947 dollars]
1939

1940

1941

1942

1943

1944

1945

1946

1947

1948

1949

1950

1951

1952

1963

Line

157.5

171.6

198.2

223.6

248.9

268.2

263.1

233.8

232.2

243.9

241.5

264.7

282.9

294.2

306.6

116.3

122.5

130.9

128.1

131.4

135.9

145.2

162.4

165.0

168.0

172.3

182.8

183.6

189.2

196.7

11.8
68.5
36.0

13.5
71.6
37.4

15.6
76.4
38.9

10.1
78.0
40.1

8.7
80.8
42.0

7.9
84.3
43.7

8.9
90.6
45.6

17.2
95.4
49.8

20.6
93.1
51.3

21.3
93.3
53.5

22.4
94.7
55.2

27.2
97.2
58.4

24.2
99.0
60.4

23.8
102.4
63.0

26.5
105.2
65.0

3
4
5

16.8

22.8

28.9

14.7

7.4

9.2

13.0

32.4

29.7

38.8

28.1

45.3

45.2

39.9

39.3

9.4
5.4
4.0
6.5
.8
.5
.3

10.6
5.8
4.8
8.4
3.9
3.1
.8

11.8
6.2
5.6
9.8
7.3
6.0
1.2

6.0
2.9
3.2
5.7
3.0
.6
2.4

3.4
1.4
2.0
5.2
-1.2
-.8
-.3

3.6
1.1
2.5
6.9
—1.3
-.8
-.6

5.0
1.4
3.6
9.7
-1.6
-.7
-.9

12.3
4.8
7.5
12.3
7.8
7.7
.0

14.0
6.3
7.7
16.7
-1.0
1.3
-2.3

16.1
7.7
8.4
17.7
5.1
2.8
2.3

15.8
7.6
8.2
15.7
-3.5
-1.7
-1.8

20.0
11.1
8.9
18,3
7.0
6.0
1.0

19.0
9.0
10.0
18.4
7.8
7.1
.6

18.9
8.9
10.0
18.3
2.8
2.4
.4

19.9
9.4
10.5
18.8
.6
1.7
-1.1

7
8
9
10
11
12
13

1.6

2.2

1.1

-1.1

-4.1

-4.0

-2.9

5.0

8.9

2.1

-1.1

2.3

1.6

-.3

22.8

24.1

37.3

81.8

114.2

127.1

107.8

34.0

28.6

349

40.3

37. 7

51.8

63.5

70.8

9.0
13.8

11.0
13.0

25.1
12.2

70.8
11.0

104.3
9.9

117.4
9.7

97.9
9.9

22.7
11.2

15.8
12.8

20.8
14.0

24.3
16.0

20.5
17.3

34.2
17.5

45.7
17.8

62.1
13.7

16
17

12.4

13.0

16.5

24.8

39.9

46.2

45.1

22.6

16.7

16.6

17.4

18.1

23.0

24.9

24.7

145.0

158.6

181.7

198.7

209.0

222.0

218.0

211.2

215.6

227.3

224.0

246.6

259.9

269.3

281.9

Table 41.—Implicit Price Deflators for Gross National Product by Major Segments, 1939-53
[Index numbers, 1947=-100]
1939

1940

1941

1942

1943

1944

1945

1946

1947

1948

1949

1950

1951

1952

1953

Line

57.9

58.6

63.5

71.2

77.3

78.8

81.2

89.5

100.0

105.5

106.6

107.7

116.0

117.6

119.0

58.1

S8.7

62.6

70.0

76.5

80.8

83.8

90.3

100.0

105.7

104.8

106.2

113.5

115.5

117.0

56.5
51.3
71.6

57.4
52.0
72.0

61.9
56.6
74.5

69.2
65.8
78.5

76.2
73.4
82.7

85.6
77.6
86.3

90.6
80.8
88.5

92.2
88.6
92.9

100.0
100.0
100.0

104.3
105.9
105.9

105.1
102.3
108.9

105.1
103.3
111.4

112.0
112.2
116.1

112.6
113.3
120.0

112.2
113.1
125.2

3
4
5

50.6
49.9
61.5
64.0

51.7
51.5
51.9
66.0

66.0
56.3
55.6
70.6

61.6
59.9
63.1
76.4

69.2
65.2
71.9
77.2

74.7
71.6
76.1
78.3

76.8
77.0
76.8
79.3

83.3
83.4
83.3
87.4

100.0
100.0
100.0
100.0

111.4
112.0
110.9
108.1

110.7
109.2
112.0
113.3

113.9
113.8
113.9
115.7

122.8
121.6
123.9
125.7

125.5
124.6
126.4
127.5

128.3
126.8
129.7
130.0

7
8
9
10
11

58.3

58.5

66.3

73.0

77.6

76.0

76.9

91.0

100.0

104.9

108.2

111.3

121.3

121.6

120.3

57.3
59.0

55.9
60.7

67.3
64.3

73.4
70.0

77.9
74.8

75.8
77.8

76.4
81.8

100.0
100.0

100.8
110.8

104.6
113.6

108.0
115.3

119.9
124.3

118.0
130.7

115.4
134.2

14
15

61.2

59.9

57.2

60.9

64.1

69.7

77.9

92.2
88.8
91.9

100.0

104.5

111.0

115.0

118.3

124.4

127.5

57.6

58.5

64.1

72.5

79.9

80.7

81.8

89.2

100.0

105.6

106.2

107.2

115.8

117.0

118.3

218

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS
Table 42.—National Income by Distributive Shares, Quarterly, 1939-40
[Billions of dollars]
1939

1940

Line
I
National income..

III

Year

III

Year

17.4

17.7

18.1

19.5

72.8

18.9

19.9

20.2

22.6

81.6

11.6
11.1
8.9
.1
2.1
.5

Compensation of employees
Wages and salaries
Private
Military
Government civilian
Supplements to wages and salaries..

11.9
11.4
9.2
.1
2.1
.5

11.9
11.4
9.6
.1
1.7
.6

12.7
12.1
10.1
.1
2.0
.6

48.1
45.9
37.7
.4
7.8
2.2

12.3
11.8
9.7
.1
2.0
.6

12.8
12.2
10.0
.1
2.0
.6

12.9
12.4
10.5
.1
1.7
.6

14.1
13.5
11.2
.2
2.1
.6

52.1
49.8
41.4
.6
7.9
2.3

10
11

Proprietors' and rental income •
Business and professional.
Farm....
Rental income of persons

3.6
1.8
1.1
.7

3.5
1.8
1.0
.7

3.8
1.9
1.2
.7

14.4
7.3
4.3
2.7

3.8
2.0
1.1
.7

3.8
2.1
1.1
.7

3.9
2.1
1.1
.7

4.3
2.3
1.3
.8

15.9
8.4
4.6
2.9

12
13
14
15
16

Corporate profits and inventory valuation adjustment..
Corporate profits before tax
Corporate profits tax liability
Corporate profits after tax
Inventory valuation adjustment.

1.0
.9
.2
.7
.1

1.2
1.3
.3
1.0
-.1

1.5
1.6
.4
1.2
-.1

1.9
2.6
.6
2.0
-.7

5.7
6.4
1.4
5.0
-.7

1.6
1.7
.5
1.2
—.1

2.2
2.1
.6
1.5
.1

2.2
2.2
.7
1.5
.0

3.0
3.3
1.0
2.3
-.2

9.1
9.3
2.8
6.5
-.2

Net interest..

1.2

1.1

4.6

1.1

4.5

Addendum: Compensation of general government employees.

2.0

1.7

1.9

7.6

2.0

1.7

2.1

7.8

1. Includes noncorporate inventory valuation adjustment.

Table 42.—National Income by Distributive Shares, Quarterly, 1944-45
[Billions of dollars]
1944

1945

Line
II

I
National income

Year

III

Year

44.8

45.8

45.6

46.5

182.6

47.0

47.4

44.2

42.7

181.2

29.3
28.2
20.4
4.5
3.3
1.1

30.1
28.9
20.7
19
3.3
1.1

30.6
29.4
21.2
5.2
3.0
1.1

31.4
30.2
21.5
5.4
3.4
1.1

121.3
116.8
83.8
20.0
12.9
4.5

31.5
30.1
21.2
5.6
3.3
1.3

31.8
30.4
21.3
5.7
3.3
1.4

30.7
29.3
20.4
5.8
3.1
1.4

29.2
27.8
19.7
4.8
3.3
1.4

123.2
117.6
82.7
21.8
13.1
5.6

8.8
4.4
3.0
1.3

Compensation of employees
Wages and salaries
Private
Military
Government civilian
Supplements to wages and salaries

8.9
4.5
3.1
1.4

8.6
4.6
2.6
1.3

8.7
4.6
2.8
1.4

35.0
18.0
11.5
5.4

9.2
4.7
3.1
1.4

9.1
4.S
3.0
1.4

9.0
4.7
2.8
1.4

9.2
4.8
3.0
1.4

36.5
19.0
11.8
5.6

5.9
5.9
3.3
2.6
-.1

6.0
6.1
3.4
2.7
-.1

5.6
5.7
3.1
2.5
.0

5.6
5.6
3.1
2.5
-.1

23.0
23.3
12.9
10.4
-.3

5.5
5.6
3.2
2.5
-.1

5.6
5.8
3.3
2.5
-.1

3.7
3.9
2.2
1.7
-.1

3.5
3.7
2.1
1.6
-.2

18.4
19.0
10.7
8.3
-.6

Proprietors* and rental income '
Business and professional
Farm
Rental income of persons
Corporate profits and inventory valuation adjustment
Corporate profits before tax
Corporate profits tax liability
Corporate profits after tax
Inventory valuation adjustment

Addendum: Compensation of general government employees.

3.3

3.2

7.5

Net interest

8.0

8.1

8.6

32.2

8.9

9.1

9.0

8.2

35.2

1. Includes noncorporate inventory valuation adjustment.

Table 42.—National Income by Distributive Shares, Quarterly, 1949-50
[Billions of dollars]
1949

1950

Line
I

III

Year

III

Year

53.7

54.2

541

54.2

216.2

53.3

58.1

62.7

65.9

240.0

Compensation of employees
Wages and salaries
Private
Military
_
Government civilian
Supplements to wages and salaries

34.9
33.3
28.2
1.0
4.1
1.6

35.1
33.4
28.3
1.0
4.1
1.7

35.2
33.6
28.7
1.1
3.8
1.7

35.7
34.1
28.7
1.1
4.3
1.6

140.9
134.3
113.9
4.2
16.2
6.S

35.2
33.3
27.9
1.1
4.3
1.9

37.3
35.3
30.0
1.1
4.3
2.0

39.7
37.7
32.5
1.2
4.0
2.0

42.1
40.2
33.9
1.6
4.7
1.9

154.3
146.5
124.3
5.0
17.2
7.8

Proprietors' and rental income 1
Business and professional
Farm
Rental income of persons

11.0
5.4
3.7
1.9

10.6
5.4
3.3
2.0

10.3
5.3
3.0
2.0

10.0
5.3
2.7
2.0

42.0
21.4
12.7
7.9

10.6
5.4
3.1
2.1

10.9
5.6
3.2
2.1

11.4
5.9
3.3
2.1

11.7
5.9
3.6
2.2

44.6
22.9
13.3
8.5

Corporate profits and inventory valuation adjustment
Corporate profits before tax
Corporate profits tax liability.
Corporate profits after tax
Inventory valuation adjustment

6.6
6.4
2.5
3.8
.3

7.3
6.2
2.5
3.8
1.0

7.2
6.6
2.6
4.0
.5

7.1
7.0
2.8
4.2
.1

28.1
26.2
10.4
15.8
1.9

6.1
6.4
2.9
3.5
-.3

8.4
8.8
3.9
4.9
-.5

10.2
11.9
5.3
6.6
-1.8

10.5
12.8
5.7
7.1
—2.3

35.1
40.0
17.8
22.1
-4.9

Net interest....

1.2

1.3

1.4

5.2

1.4

1.5

5.9

4.8

4.6

5.1

19.3

5.1

5.0

4.9

5.8

20.8

National income

Addendum: Compensation of general government employees.
1. Includes noncorporate inventory valuation adjustment.

4.8

219

NATIONAL INCOME, 195 4 EDITION

Table 42.—National Income by Distributive Shares, Quarterly, 1941-1943
[Billions of dollars]
1943

1912

1941

Line
I

III

Year

III

Year

III

22.9

25.6

27.2

29.1

104.7

29.5

32.9

36.1

39.2

137.7

40.4

42.5

43.1

44.3

170.3

14.4
13.8
11.4
.3
2.1
.6

15.8
15.1
12.5
.4
2.1
.7

16.7
16.0
13.6
.5
1.9
.7

17.9
17.2
14.4
.6
2.2
.7

64.8
62.1
51.9
1.9
8.3
2.7

18.4
17.7
14.6
.8
2.3
.7

20.3
19.6
15.9
1.2
2.5
.8

22.2
21.4
17.3
1.8
2.3
.8

24.3
23.5
18.3
2.4
2.8
.8

85.3
82.1
66.1
6.2
9.8
3.2

25.6
24.7
18.5
3.1
3.1
.9

27.1
26.2
19.6
3.3
3.2
.9

27.8
26.8
20.3
3.7
2.9
1.0

29.1
28.1
20.8
4.1
3.3
1.0

109.6
105.8
79.2
14.1
12.5
3.8

2
3
4
5
C
?

4.7
2.5
1.4
.8

5.0
2.6
1.6
.8

5.5
2.9
1.7
.9

5.7
2.9
1.8
.9

20.9
10.9
6.5
3.5

6.2
3.1
2.0
1.0

6.8
3.3
2.4
1.1

7.5
3.6
2.7
1.2

8.0
3.9
2.9
1.2

28.5
13.9
10.0
4.5

8.2
4.1
2.9
1.2

8.3
4.1
2.9
1.3

8.3
4.3
2.8
1.3

8.4
4.3
2.8
1.3

33.3
16.8
11.4
5.1

8
9
10
11

2.7
3.0
1.3
1.7
-.3

3.7
4.2
1.9
2.3
-.5

3.8
4.8
2.1
2.6
-.9

4.3
5.0
2.2
2.8
-.7

14.5
17.0
7.6
9.4
-2.5

3.8
4.5
2.4
2.0
-.7

4.6
5.0
2.8
2.3
—. 4

5.4
5.4
3.0
2.5
—. 1

5.9
6.0
3.3
2.7
-.1

19.7
20.9
11.4
9.5
-1.2

5.6
5.9
3.4
2.5
-.3

6.1
6.4
3.6

6.1
6.2
3. 6
2.7
-.1

5.9
6.1
3.5
2.6
o

23.8
24.6
14.1
10.5
-.8

12
13
14
15
l(i

1.1

I.I

1.1

4.5

1.1

1.0

4.3

1.0

2.2

2.6

9.4

2.9

3.4

3.8

4.9

15.1

5.9

6.3

2.2

2.4

-.2

3.7

6.3

7.1

25.6

: 18

Table 42.—National Income by Distributive Shares, Quarterly, 1946-48
[Billiors of dollars]
1946

1947

19-18

Line
I

Year

III

Year

III

Year

41.3

43.8

45.9

48.8

179.6

46.9

48.1

49.5

52.7

197.2

51.9

55.1

56.6

58.1

221.6

27.8
26.3
20.1
3.1
3.1
1.5

28.8
27. 3
'22.2
1.9
3.2
1.5

30.0
28. 5
24.1
1.6
3.0
1.4

31.1
29.7
24.0
1.3
3.4
1.4

117.7
111.8
91.2
7.8
12.8
5.9

30.9
29.3
24.8
1.2
3.3
1.6

31.6
30.0
25.7
1.0
3.4
1.6

32.4
31.0
27.1
.9
3.0
1.4

33.9
32.5
28.0
1.0
3.0
1.3

138.8
122.9
105. 5
4.1
13.3
5. S

33.4
32.0
27.5
1.0
3.0
1.4

34.6
33.1
28.5
1.0
3.6
1.5

30.2
34.7
30.2
1.0
3 5
1.5

36.7
35.3
30.2
1.0
4.1
1.4

149.9
135.2
116.4
4.0
14.8
5.8

2
3
4
5
6
7

9.8
5.2
3.1
1.5

10.2
5.4
3.2
1.5

10.7
5.5
3.7
1.6

10.8
5.2
3.9
1.6

41.5
21.3
13.9
6.2

10.5
5.0
3.8
1.6

9.7
4.9
3.2
1.6

10.0
4.9
3.5
1.6

10.7
5.1
3.9
1.7

40.9
19.9
14.5

10.9
6.3
3.8
1.7

11.7
5.4
4.5
1.8

11.5
5.5
4.3
1.9

11.5
5.4
4.1
1.9

45.6
21.6
16.7
7.2

8
9
10
11

2.0
3.2
1.3
1.9
-.3

4.0
4.7
1.9
2.8
-.7

4.5
6.5
2.6
3.9
-2.0

5.9
8.1
3.3
4.8
-2.2

17.3
22.6
9.1
13.4
-5.3

4.7
7.3
2.8
4.5
-2.5

5.8
6.8
2,6
4.2
— 1.0

6.0
7.1
2.7
4.4
-1.1

7.1
8.3
3.2
5.2
-1.2

23.6

6.5
7.4
2.8
4.6
-.9

7.7
8.1
3.1
5.0
-.4

7.7
8.6
3.3
5.3
-.9

8.7
8.7
3.3
5.4
.0

30.6
32.8
12.5
20.3
-2.2

12
13
14
15
16

29. r>
11.3

18.2
— 5.9

3.1

1.0

3.8

1.1

1.2

4.5

6.4

5.2

4.5

4.7

20.7

4.4

4.3

3.7

4.2

16.7

4.2

4.3

4.1

4.7

17.4

Table 42.—National Income by Distributive Shares, Quarterly, 1951-53
(Billions of dollars]
1952

1951

1953

Line
I

III

Year

III

Year

III

Year

65.9

68.9

69.9

72.4

277.0

70.2

71.8

72.9

76.0

291.0

75.4

77.2

76.9

75.6

305.0

42.8
40.4
33.7
1.9
4.8
2.4

44.6
42.1
35.1
2.1
4.9
2.5

45.8
43.4
36.2
2.3
4.9
2.4

47.2
44.9
37.0
2.4
5.5
2.3

180.4
170.9
142.1
8.7
20.1
9.5

46,9
44.3
36.2
2.5
5.6
2.6

47.8
45.1
36.9
2.6
5.5
2.7

46.1
46.5
38.5
2.7
5.3
2.6

51.6
49.1
40.6
2.6
5.9
2.5

195.4
185.0
152.2
10.5
22.4
10.4

50.9
48.0
39.6
2.6
5.8
2.9

52.2
49.4
40.9
2.6
5.8
2.9

52.9
50.1
42.1
2.6
6.5
2.7

53.1
50.5
41.9
2.5
6.1
2.6

209.1
188.0
164.5
10.2
23.3
11.1

2
3
4
5
6
7

12.3
6.3
3.8
2.2

12.3
6.2
3.9
2.2

12.4
6.1
4.0
2.3

12.8
6.2
4.2
2.4

49.9
24.8
16.0
9.1

12.4
6.3
3.7
2.4

12.5
6.4
3.6
2.5

12.6
6.4
3.6
2.6

12.5
6.6
3.3
2.6

49.9
25.7
14.2
10.0

12.6
6.6
3.3
2.6

12.2
6.6
3.0
2.6

12.0
6.5
2.8
2.6

12.3
6.5
3.1
2.7

49.0
26.2
12.2
10.6

8
9
10
11

9.2
11.3
6.2
5.1
-2.1

10.2
10.4
5.7
4.7
-.2

9.9
9.3
5.1
4.2
.6

10.6
10.2
5.6
4.6
.4

39.9
41.2
22.5
18.7
-1.3

9.1
9.1
4.9
4.2
.0

9.7
9.2
4.9
4.3
.5

9.3
9.1
4.9
4.2
.2

10.0
9.8
5.2
4.5
.3

38.2
37.2
20.0
17.2
1.0

10.0
10.2
5.5
4.7
-.2

10.6
10.9
5.8
5.0
-.2

9.9
10.5
5.7
4.9
-.7

8.0
7.8
4.2
3.6
.2

38.5
39.4
21.1
18.3
-1.0

12
13
14
15
16

1.6

1.7

1.8

6.8

1.8

1.9

7.4

2.0

2.1

2.2

8.4

7.4

27.2

7.7

7.8

7.5

8.0

31.0

7.9

8.0

7.5

8.0

31.4

6.3

6.7

6.8

220

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS
Table 43.—National Income by Distributive Shares, Seasonally Adjusted Quarterly Totals at Annual Rates, 1939-40
[Billions of dollars]
1939

1940

Line
III
National income

Year

III

71.3

70.9

72.9

75.8

72.8

77.6

79.4

81.5

87.7

47.0
45.0
36.6
.4
8.1
2.0

47.4
45.3
36.9
.4
8.0
2.1

48.2
46.0
38.0
.4
7.6
2.2

49.7
47.4
39.4
.4
7.6
2.3

48.1
45.9
37.7
.4

50.1
47.9
39.6
.5
7.8
2.2

50.8
48.5
40.2
.5
7.8
2.3

52.4
50.1
41.8
.5
7.8
2.3

55.1
52.7
43.9
.7
8.0
2.5

14.3
7.2
4.3
2.7

13.9
7.1
4.1
2.7

14.2
7.3
4.2
2.7

15.0

14.4
7.3
4.3
2.7

15.2
7.9
4.5

15.3

2.8

8.3
4.2
2.8

15.8
8.5
4.4
2.9

17.3

7.6
4.6
2.8

Corporate profits and inventory valuation adjustment
Corporate profits before tax
Corporate profits tax liability
Corporate profits after t a r . .
Inventory valuation adjustment

5.4
5.0
1.1
3.8
.4

5.0
5.2
1.2
4.0
-.3

6.0
6.3
1.4
4.9
-.3

6.4
9.1
2.0
7.1

5.7
6.4
1.4
5.0
-.7

7.8
8.1
2.5
5.7
-.4

8.8
8.3
2.5
5.7
.5

8.9
8.9
2.7
6.2
.1

10.9
11.8
3.6
8.2
-1.0

Net interest

4.6

Addendum: Compensation of general government employees

7.8

7.4

Compensation of employees
Wages and salaries
Private.
Military
Government civilian
Supplements to wages and salaries

_
_

Proprietors' and rental income
Business and professional
Farm
_
Rental income of persons...

-2.7
4.6
7.4

7.8
2.2

9.2
5.1
3.0

4.6

4.5

7.6

7.7

7.6

8.1

1. Includes noncorporate inventory valuation adjustment.
Table 43.—National Income by Distributive Shares, Seasonally Adjusted Quartzrly Totals at Annual Rates, 1944-45
[Billions of dollars]
1944

1945

Line
III

Year

III

180.6

182.5

184.7

182.6

189.9

189.2

177.6

168.2

118.3
114.1
83.3
18.0
12.8
4.2

120.0
115.6
83.1
19.6
12.9
4.4

122.4
117.9
83.9
20.9
13.1
4.5

124.4
119.6
84.9
21.7
13.0

121.3
116.8
83.8
20.0

4.8

12.9
4.5

127.5
122.3
86.9
22.3
13.2
5.2

127.0
121.4
85.4
22.9
13.2
5.5

122.9
117.1
80.6
23.0
13.5
5.8

115.3
109.4
77.7
19.2
12.5
5.9

Proprietors'and rental income'
Business and professional
Farm
Rental income of persons

35.1
17.7
12.1
5.3

35.6
17.9
12.3
5.4

34.2
18.2
10.6
5.4

35.0
18.4
11.0
5.5

35.0
18.0
11.5
5.4

36.7
18.8
12.3
5.7

36.5
19.1
11.8
5.6

35.9
18.9
11.4
5.6

36.7
19.2
11.8
5.7

Corporate profits and inventory valuation adjustment
Corporate profits before tax
Corporate profits tax liability
Corporate profits after tax.-.
Inventory valuation adjustment

23.8
24.1
13.4
10.7
-.3

23.6
24.0
13.3
10.7
-.4

22.6
22.7
12.6
10.1
-. 1

22.1
22.4
12.4
10.0
-.3

23.0
23.3
12.9
10.4
-.3

22.4
22.9
12.9
10.0
-.5

22.5
23.0
13.0
10.1

15.6
16.1
9.1
7.0
-.5

13.2
13.9
7.8
6.1
-.7

National income.
Compensation of employees
Wages aad salaries.
Private
Military
Government civilian.
Supplements to wages and salaries

3.4

Net interest
Addendum: Compensation of general government employees

3.3

3.4

3.3

3.1

3.0

29.8

31.6

33.2

34.1

32.2

35.2

36.2

36.9

32.2

1. Includes noncorporate inventory valuation adjustment.
Table 43.—National Income by Distributive Shares, Seasonally Adjusted Quarterly Totals at Annual Rates, 1949-50
[Billions of dollars]
1949

1950

Line
IV
220.5

Corporate profits and inventory valuation adjustment
Corporate profits before tax
Corporate profits tax liability
Corporate profits after tax..
Inventory valuation adjustment
Net interest
Addendum: Compensation of general government employees.
I. Includes noncorporate inventory valuation adjustment.

217.8

215.2

211.3

216.2

218.9

232.2

249.9

258.8

142.0
135.7
115.6
4.2
15.9
6.3

National income
Compensation of employees
Wages and salaries.
Private.
Military
Government civilian
Supplements to wages and salaries
Proprietors' and rental income l
Business and professional
Farm
Rental income of persons

Year

141.0
134.5
114.3
4.1
16.1
6.5

140.1
133.5
112.!)
4.2
16.3

140.4
133.6
112.6
4.5
16.5
6.7

140.9
134.3
113.9
4.2
16.2
6.5

143.0
135.7
114.7
4.4
16.6
7.3

149.8
142.2
121.0
4.3
16.9
7.5

158.5
150.5
128.1
4.9
17.5
8.0

168.1
157.7
133.4
6.3
18.0
8.4

44.0
21.5
14.9
7.6

42.6
21.6
13.2
7.8

41.3

40.2
21.3
10.8
8.1

42.0
21.4
12.7
7.9

42.4
21.6
12 A
8.4

43.8
22.5
13.0
8.4

45.4
23.7
13.2
8.5

46.9
23.6
14.5
8.7

29.7
28.6
11.4
17.2
1.1

29.2
25.1
10.0
15.1
4.1

28.6
26.4
10.5
15.9
2.2

25.3

28.1
26.2
10.4
15.8
1.9

27.8
29.1
13.0
16.1
-1.3

32.8
34.7
15.5
19.2
-1.9

40.0
47.1
21.0
26.1
-7.1

39.7
48.9
21.8
27.1
-9.2

4.9

5.1

5.3

19.0

19.1

19.4

21.3
12.0
7.9

24.8

9.9
15.0
.4
5.5

19.9

S.2

5.7

5.8

6.0

6.1

19.3

19.7

19.8

20.9

22.8

221

NATIONAL INCOME, 195 4 EDITION
Table 43.—National /ncome by Distributive Shares, Seasonally Adjusted Quarterly Totals at Annual Rates, 1941-43
[Billions of dollars]
1943

1942

1941

Line
I

III

93.9

10!..r,

103.0

58.5
58.0
46.6
I 1

62.7
60.0
50.1
16

67.2
64.4
54.0
22

8.2
2.5

8.3
2.6

18.6
10.0

Year

114.1

104.7

120.1

70.6
67.7
56.6

64.8
62.1
51.9

74.7
71.7
59.6

8.2
2.8

2.5
8.6
2.9

1.9
8.3
2.7

3.2
9.0
2.9

131.0
81.1
78.0
63.7
4.8
9.6
3.0

Year

III

144.1

155.9

-1.2

23.0
24.0
13.8
10.2
-1.0

24.0
25.0
14.3
10.7
-1.0

4.3

3.9

3.7

3.6

9.5
4.5

12.3
13.4
6 0

14.1
16.3

15.3
18.9

16.2
19.1

14.5
17.0

16.2
18.8
10.3

18.3
20.0
10.9

21.0
21.3
11.6

4.7

8.5

8.6

—1.2

-2.1

10.4
-3.7

10.6
-2.9

-2.5

-2.6

-1.6

- .3

23.6
23.9
13.0
10.8
-.3

4.5

4.6

4.5

4.4

4.2

4.0

10.3

9.1

9.7

13.5

11.4

9.4

27.9

19.7
20.9
11.4

33.3
17.0
11.1
5.1
24.5
24.9
14.3
10.8
-.4

27.3
13.3

8.1
4.1

9.6

26.6

33.2
16.4
11.7

24.7
12.4

6.5
3.5

9.2

108.1
104.4
78.6
13.4
12.5
3.7

33.0
16.5
11.5
5.0

20.9
10.9

7.3
3.8

8.6

103.5
100.0
75.5
12.3
12.2
3.5

109.6
105.8
79.2
14.1
12.5
3.8
33.3
16.8
11.4
5.1
23.8
24.6
14.1
10.5
-.8
3.7

28.5
13.9
10.0

22.7
11.6

6.9
3.6

8.5

170.3

115.2
111.3
82.3
16.2
12.8
4.0
33.6
17.4
11.1
5.2
23.6
24.3
13.9
10.4
-.7
3.5

32.0
15.5
11.6
4.9

3.3

21.9
11.4

7.6
9.4

176.0

111.5
107.6
80.5
14.6
12.6
3.8

29.9
14.4
10.8

7.0

10.0

6.3
3.4

7.3
9.0

172.9

85.3
82.1
66.1

20.2
10.5

7.4

169.1

163.4

96.4
92.9
72.5
9.7
10.7
3.4

89.0
85.7
68.6

5.5
3.1

!
1

137.7

16.2

19.5

6.2
9.8
3.2

4.5

9.5

Year

III

15.1

O.I

26.1

24.8

23.5

<
i
1(
1
1
1
1
1
1
1
1

Tcblc 43.—National Income by Distributive Shares, Seasonally Adjusted Quarterly Totals at Annual Rates, 1946-48
[Billions of dollars]
1947

1946

1948
Line

Year

III

Year

III

168.9

175.5

183.3

190.4

179.6

192.2

193.4

197.0

205.7

197.2

212.4

221.5

225.2

227.1

221.6

113.2
107.3
82.4
12.5
12.4
5.8

115.2
109.3
89.1
7.6
12.6
5.9

119.5
113.6
91.8
5.9
12.9
5.9

122.7
116.8
98.4
5.3
13.2
5.9

117.7
111.8
91.2
7.8
12.8
5.9

125.7
119.6
101.8
4.7
13.2
6.0

127.1
121.0
103.6
4.0
13.4
6.1

128.8
123.2
106.3
3.8
13.1
5.7

133.2
127.5
110.1
3.9
13.5
5.8

128.8
122.9
105.5
4.1
13.3
5.9

136.0
130.3
112.6
3.8
13.9
5.7

138.9
133.2
115.1
3.9
14.2
5.7

143.7
137.9
118.7
4.0
15.2
5.8

144.8
139.0
119.0
4.2
16.8
5.9

140.9
135.2
116.4
4.0
14.8
6.8

2
3
4
5
6
7

39.2
20.7
12.5
5.9

40.8
21.7
13.0
6.1

42.8
21.8
14.7
6.2

43.2
21.0
15.6
6.6

41.5
21.3
13.9
6.2

41.9
20.1
15.3
6.5

38.9
19.8
12.9
6.2

40.1
19.6
14.1
6.4

42.8
20.3
15.6
6.9

40.9
19.9
14.5
6.5

43.4
21.3
15.3
6.8

46.9
21.7
18.1
7.1

46.2
21.9
17.1
7.1

45.8
21.7
16.4
7.7

45.6
21.6
16.7
7.2

8
9
10
11

13.5
14.8
6.0
8.8
-1.2

16.5
19.3
7.8
11.5
-2.8

17.9
26.0
10.5
15.5
-8.1

21.2
30.2
12.2
18.0
-8.9

17.3
22.6
9.1
13.4
-5.3

21.1
31.2
11.9
19.3
-10.1

23.6
27.7
10.6
17.1
-4.1

24.1
28.6
10.9
17.6
-4.4

25.5
30.4
11.6
18.8
-4.9

23.6
29.5
11.3
18.2
-5.9

28.7
32.3
12.3
20.0
-3.7

31.2
32.8
12.5
20.2
-1.5

30.7
34.3
13.1
21.2
-3.6

31.7
31.6
12.0
19.5
.2

30.6
32.8
12.5
20.3
-2.2

12
13
14
15
16

3.0

3.1

3.3

3.1

3.5

3.8

3.9

4.1

3.8

4.3

4.5

4.6

4.7

4.5

25.3

20.5

18.9

18.2

20.7

17.6

17.1

15.8

16.2

16.7

16.5

16.8

17.7

18.5

17.4

Table 43.—National income by Distributive Shares, Seasonally Adjusted Quarterly Totals at Annual Rates, 7957-53
[Billions of dollars]
1952

1951

Year

1953
Year

Line

III

268.9

275.8

278.4

285.1

277.0

286.1

287.2

290.3

300.1

291.0

305.9

308.2

306.2

299.9

305.0

173. 7
164. 5
138.2
7.4
19.0
9.2

179.5
170.0
141.9
8.5
19.6
9.5

182.7
173. 1
143. 0
9.2
20.9
9.6

185.8
175.9
145.1
9.7
21.0
9.9

180.4
170.9
142.1
8.7
20.1
9.5

190.1
IS"). 2
148. 2
10.2
21.8
10.0

192.1
181. S
149. 2
10. 0
22.2
10.2

166.1
185 5
152.3
10.7
22. 6
10.5

20.3.2
192.4
159. 1
10.4
22.9
10.8

195.4
185. 0
152.2
10.5
22.4
10.4

206.2
195.3
162.0
10.3
23.1
10.9

210.0
108. 9
ln.5. 3
10.4
23.2
11.1

211.4
200.3
166.7
10.2
23.4
11.1

208.8
197.6
164.1
9.9
23.5
11.2

209.1
198.0
164.5
10.2
23.3
11.1

2
3
4
6
6
7

49.3
25.2
15.3
8.9

49.4
24.7
15.7
9.0

49.8
24.4
16.1
9.2

51.3
24.8
17.0
9.5

49.9
24.8
16.0
9.1

49.5
25.1
14.8
9.6

50.1
25.7
14.5
10.0

50.3
25.8
14.3
10.2

49.8
26.4
13.2
10.2

49.9
25.7
14.2
10.0

50.3
26.5
13.4
10.5

48.9
26.3
12.1
10.5

47.8
26.1
11.1
10.6

49.1
25.9
12.3
10.8

49.0
26.2
12.2
10.6

39.5
47.9
26.2
21.8
-8.4

40.2
41.0
22.4
18.6
-.8

39.0
3G. 5
19.9
16.6
2.5

41.0
30.2
21.4
17.8
1.7

39.9
41.2
22.5
18.7
-1.3

39.3
39.1
21.0
18.1
.1

37.5
35.5
19.0
16.4
2.1

36.5
35.8
19.2
16.«
.7

39.4
38.3
20.6
17.7
1.1

38.2
37.2
20.0
17.2
1.0

41.4
42.4
22.7
19.7
-.9

41.0
41.9
22.5
19.5
-.9

38.3
40.9
21.9
19.0
-2.6

33.1
32.5
17.4
15.1
.6

38.5
39.4
21.1
18.3
-1.0

III

Year

12
13
14
15
16

6.4

6.7

6.9

7.1

6.8

7.2

7.4

7.5

7.6

7.4

7.9

8.3

8.6

8.9

8.4

25.0

26.7

28.3

29.0

27.2

30.1

30.9

31.4

31.5

31.0

31.4

31.6

31.5

31.3

31.4

222

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS
Table 44.—Gross National Product or Expenditure, Quarterly, 1939-40
(Billions of dollars]
1940

1939
I
1
2

4
5

fi
7
R
<)

n
12

Gross national product...

21.5

III

21.8

22.8

Year

25.0

91.1

I
23.8

24.1

24.9

27.8

100.6

19.9
2 4
10.6
6.9

71.9
7 8
37.2
26.9

Gross private domestic investment.
New construction
Residential nonfarm
Other
Producers' durable equipment
Change in business inventories—total
Nonfarm only

3.6
15
.8
7
15
.6

13.2
5 5
3.0
2 5
5 5
2.2
1.9

16.7
1 7
8.0
6.4

16. C
1 5
8.6
6.4

18.7
2 1
10.1
6.5

67.6
67
35.1
25.8

16.8
16
8.5
6.7

17.8
2 0
9.0
6.7

17.5
17
9.1
6.6

2.5
1 0

Nondurable goods
Services
_

Year

III

15. G
1 4
7.8
6.4

Personal consumption expenditures

1.5
1 2

2.6
1 3

3.3
10

6
1 2
.1
.1

9.3
48
2.7
21
4 2
.1
.3

2.5
13
.7
6

13
1.0
.9

1 4
-.3

3.8
16
.9
7
1.3
.9

1 0
.6
.6
.2

Government purchases of goods and services

National security
National defense
..
Other national security
Other

. .

_
•

Less: Government sales
State and local
._

1 1
-.8
-.8

2.8
1 3
.7
6
1 0
.5
.4

3.3
1 3
.3

3.4
1 3
.3

3.2
1 2
.3

3.5
1.4
3

13.3
52
1.3

3.3
14
.4

3.4
1. 4
4

3.3
1. 5
4

4.0
1. 9
9

1.0
.0
2.0

1.0
.0
2.1

.9
.0
2.0

i.6
.0
2.1

3.9
.(1
8.2

1.1
.0
1.9

1.0
.0
2.0

.9
.0
1.9

1.0
.0
2.1

•?

13
14
15
16
17
18
19
20
21

...

. . . .

•I

.5
5

-.3

Table 44.—Gross National Product or Expenditure, Quarterly, 1944-45
[Billions of dollars]
1945
III

Year

III

50. C

Gross private domestic investment

53.3

55.8

211.4

54.4

54.8

52.6

51.7

26.8
1.6
15.7
9.4

27.2
1.5
16.2
9.4

30.8
2.2
18.9

109.8
6.8
65.4
37.7

28.1
1.6
16.6
9.9

29.1
1.8
17.3
10.0

29.7
1.8
17.8
10.1

34.8
2.9
21.5
10.4

2.4

Personal consumption expenditures..
s
p
bl
d
Durable goods
Nondurable goods
Services-

51.7

25.1
1.4
14.5
9.2

Gross national product.

1.5
.7
.2
.5
1.4
-.6
-.5

2.5
.8
.2
.5
1.3

.7
.2
.5
1.6
-1.4
-1.2

7.1
2.7
.8
1.9
5.4
-1.0
-.6

2.4
.6
.1
.6
1.7
.1
.2

2.0
.8
.2
.6
1.8
-.6
-.4

1.1
.3
.8
2.1
.1
.2

2.7
1.3
.4
.9
2.0
-.6
-.5

New construction
Residential uonfarm
Other
Producers' durable equipment
Change in business inventories—total.
Nonfarm only..

-.7

-.3

-.4

-2.1

-.7

-.3

23.8
21.9
21.9

24.1
22.2
22.1

24.0
22.3
22.2

24.6
22.6
22.5

9G.5
89.0
88.6

24.7
22.7
22.7

24.4
22.4
22.4

19.9
18.0
18.5

13.9
11.7
12.3

.3
.3
1.9

.4
.3
1.9

.5
.3
1.7

.4
.3
2.0

1.6
1.2
7.5

.3
.3
2.0

Net foreign investment
Government purchases of goods and service;
Federal
National security
National defense
Other national security
Other
_
Less: Government sales
State and local

.2
.8
2.2

Table 44.—Gross National Product or Expenditure, Quarterly, 1949-50
[Billions of dollars]
1949

1950

III

Year

III

Gross national product

63.0

63.1

64.0

67.2

257.3

64.1

67.7

73.5

79.8

Personal consumption expenditures

42.0
4.7
22.5
14.8

45.0
5.9
24.0
15.0

44.1
5.9
23.2
15.0

49.5
7.0
27.1
15.4

180.6
23.6
96.9
60.1

43.7
5.6
22.3
15.8

47.1
6.7
24.2
16.2

49.7
8.2
25.2
16.3

53.6
8.1
28.8
16.7

Gross private domestic investment
New construction
Residential nonfarm
Other
Producers' durable equipment
Change in business inventories—total
Nonfarm only...

10.1
3.6
1.5
2.1
4.5
2.0
1.9

6.6
4.2
1.9
2.3
4.8
-2.5
-2.2

9.0
4.8
2.3
2.5
4.4
-.2
.2

6.8
4.7
2.5
2.3
4.2
-2.1
-1.8

32.5
17.5

10.7

9.2
17.8
-2.7
-1.9

4.3
2.2
2.1
4.1
2.3
2.3

10.9
5.5
3.1
2.4
5.1
.2
.0

14.5
6.8
3.9
2.9
6.0
1.7
1.4

15.2
6.1
3.4
2.8
5.9
3.1
2.8

-.4

—A

10.1
5.5
4.2
3.2
1.1
1.3
.1
4.6

10.1
5.2
4.3
3.0
1.3
.9
.1
5.0

Durable goods
Nondurable goods
Services

Net foreign investment
Government purchases of goods and services
Federal
_
National security
National defense
.Other national security
Other
Less: Government sales
State and local

8.3

-.1

10.5
6.4
4.8
3.4
1.4
1.6
.1
4.1

11.2
6.6
5.1
3.5
1.7
1.6
.1

10.9
6.3
4.9
3.4
1.6
1.6
.2
4.6

11.0
6.1
4.5
3.3
1.2
1.8
.1
4.9

43.6
25.4
19.3
13.6
5.7
6.6
.4
18.2

-.6
10.2
5.2
4.4
3.5
.1
6.0

11.6
6.3
5.5
4.6
1.0
.8
.1
5.3

1.5
14.1
6 2

2.2
4.0
.0
7.9

NATIONAL

INCOME,

1954

223

EDITION

Table 44.—Gross National Product or Expenditure, Quarterly, 1941-43
[Billions of dollars]
1941

1943

1942

Lint
II

III

Year

III

Year

III

Year

27.5

30.3

31.9

36.1

125.8

34.6

37.9

40.9

45.6

159.1

44.8

47.1

48.7

51.8

192.5

18.2

20.3

20.6

22.8

20.5

21.7

22.1

25.4

89.7

2.3

2.5

1.6

1.7

1.6

2.1

7.0

6.6

12.7

11.3

12.2

12.7

15.2

51.3
31.5

24.8
1.5
14.6
8.7

2.0

11.0

24.7
1.7
14.4
8.6

100.5

2.8

10.3

23.1
1.4
13.3
8.4

27.9

2.0
9.1
7.0

81.9
9.7
43.2
29.0

17.0
9.0

59.3
34.7

4.3
1.3
.6
.7
1.7
1.3
1.2

4.4
1.7
.9
.8
2.0
.7
.6

4.8
2.0
1.1
.9
1.7
1.1
1.0

4.5
1.7
.9
.8
1.6
1.3
1.2

18.1

4.1
1.1
.5
.6
1.2
1.7
1.6

3.0
1.1
.6
.5
1.3
.6
.3

1.9
.8
.3
.5
1.0
.1

.8
.7
.3
.4
.8
-.6

2.4
.7

-1.0

.9
.5
.2
.3
.8
-.4
-.5

.8
.6
.2
.3

9.9
3.7
1.7
2.0
4.3
1.8
.7

•»

.7
.8

1.5
.6
.2
.4
1.2
-.3
-.2

5.6
2.3
.9
1.4
4.0
-.8
-.6

1
1
1

7.2

7.6

7.8

7.7

6.6
3.5
3.1
6.9
4.5
4.0

7.8

8.1

.3
.4
1.1

1.0

-is

1.1

-.2

-.4

-.6

-.5

-.7

-2.2

4.7
2.8
1.9

5.4
3.4
2.7

6.4
4.5
3.8

8.3
6.2
5.4

24.8
16.9
13.8

9.8
7.8
7.0

13.5
11.5
10.8

16.9
16.1
14.6

19.6
17.6
17.1

59.7
52.0
49.6

21.3
19.4
19.0

22.2
20.3
20.0

22.0
20.3
20.2

23.1
21.2
21.1

88.6
81.2
80.4

1
1

.9
.0
1.9

.7
.0
2.0

.7
.0
1.9

.8
.0
2.1

3.2
.0
7.8

.8
.0
1.9

.7
.1
2.0

.6
.0
1.8

.6
.1
2.0

2.7
.2

.5
.1
1.9

.4
.1
1.9

.3
.2
1.7

.3
.2
1.9

1.5
.6
7.4

7.7

1
1
1
1
2
2

Table 44.—Gross National Product or Expenditure, Quarterly, 1946-48
[Billions of dollars]
1946

1947

1948
;Line

III

Year

III

Year

III

Year

47.7

50.1

53.6

57.8

209.2

54.1

56.0

57.5

64.6

232.2

60.2

62.7

65.1

69.3

257.3 ;

32.2

35.3

36.9

42.1

146.6
15.9
84.5
46.2

37.4

40.5

40.6

46.5

41.2

43.7

43.8

48.9

4.2

5.1

4.9

6.4

4.7

5.6

5.5

6.4

20.9
12.4

22.7
12.7

22.7
12.9

26.9
13.3

165.0
20.6
93.1
51.3

22.8
13.8

24.0
14.1

24.0
14.3

27.9
14.5

177.6
22.2
98.7
56.7 : '

2
3
4

6.0
3.2
1.3
1.8
4.3

8.5
4.2
2.1
2.1
4.4
-.1
.2

29.7
14.0

10.3
3. 6

9.3
4.5
2.2

11.6

10.0

2.3
4.9
-.1
-.5

5.2
2.5
2.7
4.8
1.7
1.3

4.6
2.2
2.4
4.8

2.7

3.7

4.1

5.4

18.6
11.0

20.2
11.4

21.1
11.8

24.6
12.1

5.3
1.7
.6
1.1
2.0
2.3
2.3

6.0
2.5
.9
1.5
2.4
1.0
1.1

8.3
3.1
1.3
1.9
2.8
2.3
2.4

7.0
3.0
1.2
1.8
3.5
.5
.6

27.1
10.3
6.1
6.4

7.6
2.6
1.0
1.6
4.0
1.0
1.4

-.7

7.7
4.0
1.8
2.2
4.0
-.4
.3

1.3

1.2

4.6

2.2

2.6

2.2

2.0

8.9

1.0

-.1

8.9
6.6
6.9

7.5
5.1
5.5

7.1
4.6
4.6

7.5
4.6
4.2

SO. 9
20.9
21.2

.9
.4
2.8

2.5
2.7

7.6
4.0
3.3
3.0
.3
.!)
.2
3.6

7.7
4.2
3.6
2.9
.8
.9
.3
3.5

9.8
5.8
4.2
2.8

.8
.8
2.5

7.1
3.9
2.9
2.7
.2
1.2
.2
3.2

9.0
5.1
3.9
2.9

.5
.9
2.4

7.0
3.8
3.5
3.0
.5
.7
.4
3.2

28.8
15.8
13.3
12. 3
1 1

.3
.6
2.3

6.9
4.0
3.6
3.5
.1
.9

1.3
.1
3.9

1.7
.1
4.0

4.0

6. 3
10.7

-1.5

.5
2.8

10.0

1.7
1.9
4.6
2.1
2.0

6.3
7.7

16.7
-1.0
1.3

3.8
1.3

12.8

!
:

8.6
9.3 :

5
6
7

•

19.1
4.2
3.0

10
11
12

2.0

10.1

1 2

36.6
21.0
16.0
11.6
44

1.7
.1
4.3

15.6

14
15
16
17
18
19
20
21

.5
.2

5.9
4.3
3.1

1 4

1 0

41.2
17. B

5.6
.5

Table 44.—Gross National Product or Expenditure, Quarterly, 1951-53
[Billions of dollars]
1951

1952

1953
j Line

Year

III

Year

III

Year

77.9

80.6

82.3

87.4

328.2

83.1

84.6

85.1

93.3

346.1

88.5

91.5

91.1

93.8

364.9

49.8

50.7

57.1

208.3
27.1
111.1
70.1

50.5

53.9

53.2

60.7

54.4

57.4

58.7

5.7

6.8

6.1

8.2

61.6

6.8

7.7

7.4

7.8

26.3
18.6

28.2
18.8

28.3
18.8

33.1
19.4

218.4
26.8
116.0
75.6

27.6
20.0

29.3
20.4

28.9
20.3

33.1
20.7

230.1
29.7
118.9
81.4

56.9
23.3
11.0
12.4
23.2
10.4

14.0

10.9

13.0

12.8

13.6

5.9
2.S
3.2
6.4

6.5
3.1
3.4
5.3
1.2
1.1

6.2
3.0
3.2
5.6
.9
.9

50.7
23.7
11.1
12.6
23.3

14.3

5.0
2.2
2.9
5.9
3.0
2.7

5.4
2.4
2.9
6.0
2.9
3.1

6.5
3.1
3.4
6.5
-.1
.1

7.1
3.3
3.7
6.0
.5
.8

10.7
6.6
3.1
3.5
6.0
-1.8
-1.7

51.4
25.5
11.9
13.6
24.4

6.8

6.6

6.3

7.4

25.8
17.2

26.6
17.5

26.9
17.4

31.7
18.0

16.1

14.7

14.6

11.5

5.2
2.6
2.6
5.9
5.0
4.7

5.9
2.8
3.1
6.1
2.6
2.3

6.4
2.9
3.5
5.4
2.8
2.5

5.8
2.7
3.1
5.8
-.1
-.5

9.0

-1.5
-1.7

3.6
3.0

1.5
2.2

1
1
1

-.7

-.6

-.2

-.5

-.6

-.7

-.1

-1.9

12.7

15.2

7.7
6.9
6.0
.8
.9
.1
5.0

9.7
8.8
7.9
.9
1.0
.1
5.5

16.9
11.3
10.4

18.0
12.3
11.2
10.4

62.8
41.0
37.3
33.9

18.1
12.7
11.6
11.0
.6
1.3

19.6
13.8
12.5
11.8
.7
1.4
.1
5.9

19.4
13.5
12.0
11.2

20.0
13.9
12.5
12.0

77.2
54.0
48.5
46.1

20.3
14.5
12.7
12.2

21.8
15.5
13.6
13.0

21.5
15.1
13.1
12.6

21.6
15.0
12.6
12.2

85.2
60.1
52.0
50.0

1
1
1
1
1
1
2
2

9.6
.8
1.1
.1
5.6

.9
1.2
.1
5.7

3.4
4.2
.4

21.8

5.3

1.7

.7
.1

.5
1.5
.1

5.9

6.1

2.4
5.8
.4

23.2

.6
1.9
.1
5.8

.6
2.1
.1
6.2

.4
2.1
.1
6.4

.5
2.4
.1
6.7

2.0
8.5

.4
25.1

224

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS
Table 45.—Gross National Product or Expenditure, Seasonally Adjusted Quarterly Totals at Annual Rates, 1939-40
[Billions of dollars]
1939
II

1940
IV

III

Year

III

Gross national product.

88.8

89.1

92.6

93.9

91.1

97.3

98.5

101.7

104.9

Personal consumption expenditures.
Durable goods
Nondurable goods
Services
._

65.5
6.1
34.0
25.4

67.3
8.5
35.1
25.7

68.3
6.9
35.5
25.9

69.2
7.1
36.0
26.1

67.6
6.7
35.1
25.8

70.1
7.3
36.4
26.4

71.7
7.7
37.2
26.8

72.2
7.9
37.3
27.0

73.5
8.2
37.9
27.4

9.1
4.7
2.8
1.9
3.7

7.8
4.8
2.7
2.0
3.9
-.9
-1.0

10.4
4.7
2.6
2.1
4.3
1.4
1.3

10.0
4.9
2.6
2.2
4.8
.4
.3

9.3
4.8
2.7
2.1
4.2
.4
.3

11.9

14.6
5.6
3.1
2.5
5.8
3.2
2.9

14.3
5.8
3.2
2.7
6.1
2.4
2.0

Gross private domestic investment
New construction
__
Residential nonfarm___
__
Other____
Producers' durable equipment
Change in business inventories—total.
Nonfarmonly
__
Net foreign investment

Government purchases of goods and services.
Federal.
National security
National defense
Other national security
Other
Less: Government sales
State and local

4.9
2.7
2.2
5.1
1.9
1.7

5.4
3.0
2.4
5.2
1.3
1.1

1.0

1.2

1.8

1.6

1.4

1.3

13.5
5.2
1.1

13.4

5.3
1.2

12.9
4.8
1.3

13.4

5.4
1.4

13.3
5.2
1.3

13.6
5.8
1.6

13.4
5.5
1.7

13.5
5.6
1.8

15.8
7.8
3.8

4.1
.0
8.3

4.1
.0
8.1

3.4
.0
8.1

3.9
.0
8.1

3.9
.0
8.2

4.2
.0
7.8

3.9
.0
7.9

3.7
.0
7.9

4.0
.0
8.0

Table 45.—Gross National Product or Expenditure, Seasonally Adjusted Quarterly Totals at Annual Rates, 1944-45
[Billions of dollars!
1945
III

Year

III

Gross national product..

205.6

209.4

214.1

216.5

211.4

221.2

223.7

212.2

197.1

Personal consumption expenditure;
Durable goods
Nondurable goods
Services..

105.3
6.6
62.1
36.7

108.4
6.6
64.3
37.5

111.4
6.7
6C..7
38.1

114.1
7.1
68.4
38.6

109.8
6.8
65.4
37.7

117.4
7.5
70.6
39.3

118.8
7.4
71.6
39.8

122.2
7.9
73.7
40.7

128.4
9.6
77.1
41.7

8.0

7.6
2.7
.8
1.9
5.5
-.6

7.0
2.7
.7
2.0
5.2
-.9
-.5

5.9
2.7
.7
2.0
6.2
-3.1
-2.6

7.1
2.7
.8

8.0
2.8
.7
2.1
6.7
-1.6
-1.1

10.2
3.3

10.7
3.9

12.9
5.3
1.8
3.5
8.4
-.8
-.5

-2.7
95.0
87.5
87.5

—2.9
96.2
88.8

-1.2
96.9
89.3
88.6

-1.6
98.1
90.4
90.0

-2.1
96.5
89.0

-2.7
98.6
90.8
90.9

-2.7
97.4
89.5

-1.0

80.2
72.1
73.9

55.2
46.8
49.2

1.1
1.0
7.5

1.6
1.2
7.4

2.0
1.3
7.6

1.6
1.2
7.7

1.6
1.2
7.5

1.0
1.1
7.8

1.1
1.3
7.8

1.1
2.9
8.1

3.4
8.5

Gross private domestic investment
New construction
Residential nonfarm
Other...
Producers' durable equipment..
Change in business inventories—total.
Nonfarmonly.Net foreign investment
Government purchases of goods and services..
Federal
National security
National defense
Other national security..
Other
Less: Government sales
State and local

1.0
1.7
4.9
.5

1.9
5.4
-1.0

2.5
6.9
.0
.5

1.1
2.8
8.6

-1.8
-1.3

Table 45.—Gross National Product or Expenditure, Seasonally Adjusted Quarterly Totals at Annual Rates, 1949-50
[Billions of dollars]
1949

1950
I

III

257.3

264.9

275.9

294.4

305.0

285.1

180.6
23.6
96.9
60.1

185.2
25.7
96.7
62.8

189.1
26.4
98.3
64.5

202.9
33.2
103.9
65.3

198.8
29.2
102.7
67.0

194.0
28.6
100.4
65.0

29.1
18.6

32.5
17.5

39.9
20.7
11.2

49.0
22.0
12.4

9.5

9.6

16.9
—6. 3
-5.1

17.8
-2.7
-1.9

16.6

19.6

53.4
24.1
13.7
10.4
24.4

51.2
22.7
12.6
10.1
21.1

2.5
2.6

7.3
6.3

4.8
3.5

62.6
24.1
13.1
11.0
23.8
14.7
13.3

III

Gross national product

259.9

257.2

256.5

255.5

Personal consumption expenditures
Durable goods
Nondurable goods
Services

178.4
21.6
98.0
58.8

180.4
23.4
97.3
59.6

180.1
24.2
95.6
60.4

183.5
25.1
96.6
61.7

37.0
17.3

32.1
16.9

32.0
17.1

18.2

18.3
-3.1
-2.0

17.9
-3.0
-1.3

Gross private domestic investment
New construction..
Residential nonfarm
Other
Producers' durable equipment
Change in business Inventories—total
Nonfarmonly.
_.
Net foreign investment
Government purchases of goods and services.
Federal...:
National security
National defense
Other national security
Other
Less: Government sales
State and local
_

7.8
9.6

1.5
.9

7.6
9.3

8.2
8.9

Year

9.6
9.0

8.3
9.2

Year

7.4
6.4

1.4

-.5

-1.5

-2.3

-2.5

-2.4

-2.2

43.1
25.6
19.4
13.6

44.4
26.6
20.5
13.9

43.5
25.1
19.5
13.6

43.4
24.5
17.8
18.2

43.6
25.4
19.3
13.6

41.3
21.9
17.0
12.6

40.1
20.7
17.2
12.2

40.7
20.7
17.8

5.1
3.8
.2

H.O
3.7
3.2
.2

42.0
22.1
18.5
14.3

4.3
5.2
.3

19.4

20.0

46.0
25.1
22.1
18.2
3.9
3.3
.3
20.8

5.8
6.6

.3
17.5

6.6
6.3
.3

17.8

5.9
6.4

.7
18.4

4.7
7.0
.3

18.9

5.7
6.6
.4

18.2

4.3

3.9
.3
19.9

NATIONAL INCOME,

1954

225

EDITION

Table 45.—Gross National Product or Expenditure, Seasonally Adjusted Quarterly Totals at Annual Rates, 1941-43
[Billions of dollars]
1941

1943

1942

Line
Year

III

112.5

122.8

129.3

138.7

125.8

141.7

153.6

163. G

177.6

159.1

182.6

191.3

194.9

201.3

192.5

76.8

84.5
10.1
45.3
29.2

84.9

81.9
9.7

94.3
6.8
55.1
32.4

7.0

6.5

51.3
31.6

57.4
33.3

99.9
6.9
58.7
34.3

59.7
35.1

103.6
6.4
61.2
36.0

100.5

43.2
29.0

90.4
6.8
51.9
31.8

101.5

9.1

87.8
6.9
49.8
31.1

97.2

45.5
30.3

88.4
7.4
48.5
30.5

89.7

39.8
27.9

81.2
10.4
42.2
28.6

59.3
34.7

2
3
4
5

15.7

19.5

18.2

18.8

18.1

6.2
3.2
3.0
6.6
2.9
2.5

15.4

6.9
3.6
3.3
7.3
5.3
4.9

7.0
3.9
3.1
7.2
4.0
3.6

6.4
3.4
3.1
6.6
5.7
5.3

6.6
3.5
3.1
6.9
4.5
4.0

5.4
2.7
2.7
4.9
5.2
4.6

12.8
4.1
2.1
2.0
5.1
3.7
2.6

4.8
2.8
1.1
1.8
4.1
-2.1
-3.6

6.4
2.6
1.0
1.6
3.3
.5
-1.0

9.9
3.7
1.7
2.0
4.3
1.8
.7

1.9
2.3
.8
1.5
3.3

5.4
2.2

-3.7
-4.2

.9
1.4
3.7
-.5
-.1

6.9
2.4
.9
1.4
4.4
.1
.6

8.2
2.4
1.0
1.5
4.7
1.0
1.5

5.6
2.3
.9
1.4
4.0
-.8
-.6

6
7
8
9
10
11
12
13

9.1

III

Year

III

6.6

Year

6.6

1.1

2.1

1.1

-.6

-1.0

-.2

-1.7

-2.5

-2.2

-2.7

-2.2

18.8
11.2
7.5

21.4
13.6
10.7

25.9
18.0
15.2

32.9
24.9
21.7

24.8
16.9
13.8

39.2
31.3
28.2

53.6
45.8
43.4

68.2
60.6
58.4

77.9
70.4
68.3

59.7
52.0
49.6

85.1
77.7
76.0

88.5
81.1
80.1

88.7
81.3
81.0

92.1
84.8
84.4

88.6
81.2
80.4

3.7
.0
7.6

2.9
.0
7.8

2.8
.1
7.9

3.2
.0
7.8

3.2

2.8
.3
7.7

2.4
.2
7.6

2.3
.3
7.5

2.7
.2
7.7

2.2
.5
7.5

1.5
.5
7.4

.7
7.4

1.6

1.2
.8
7.3

1.5
.6
7.4

3.1"
.1
7.9

7.9

14
15

16
17
18
19
20
21

Table 45.—Gross National Product or Expenditure, Seasonally Adjusted Quarterly Totals at Annual Rates, 1946-48
[Billions of dollars]
1948

1948

1947

Line
I

III

Year

III

Year

196.7

205.0

215.2

220.1

209.2

223.2

229.4

232.6

243.7

232.2

247.9

255.5

261.9

264.0

257.3

137.0
12.7
80.6
43.7

142.5
14.9
82.3
45.3

152.1
17.4
87.4
47.3

154.8
18.6
87.7
48.5

146.6
15.9
84.5
46.2

158.9
19.2
90.3
49.4

163.5
20.4
92.6
50.5

166.8
20.8
93.9
52.1

170.7
22.0
95.5
53.2

165.0
20.6
93.1
51.3

174.1
21.4
97.9
54.8

176.8
22.2
98.6
56.0

179.5
23.0
99.0
57.4

180.1
22.3
99.4
58.4

177.6
22.2
98.7
56.7

2
5

21.3

28.0
10.1

28.5
11.4

30.8
11.8

27.1
10.3

27.4
12.5

29.1
12.7

27.4
14.3

35.0
16.6

29.7
14.0

38.6
17.1

41.2
18.1

42.5
18.4

41.2
17.9

11.4

14.5

10.7

16.1
-1.2

16.4

16.7
-3.7
— 9

17.4

7.7
16.7
-1.0
1.3

18.4

18.9

19.7

42.4
18.0
8.3
9.7
19.5
4.9
3.6

7.9
3.0
4.9
7.7
5.7
6.0

3.8
6.2
9.4
8.5
8.7

4.5
6.9

4.8
7.0

5.7
5.9

4.5
4.8

5.3
7.2

4.0
6.3
6.1
6.4

6.3
8.0

5.3
7.4

-.1
3.1

8.3
8.3

1.0
2.3

3.0

4.6

5.9

4.8

4.6

8.8

9.2

9.8

8.0

35.5
26.4
27.7

29.9
20.4
22.1

28.7
18.4
18.3

29.6
18.5
16.7

30.9
20.9
21.2

28.0
16.1
14.4
14.1

27.7
15.3
14.1
12.]

28.7
15.7
11.7
10 8

30.0
16.1
13.2
12.0

12.5

13.0

13.9

i.9

1.2
2.5
9.0

3.6
9.5

3.2
3.1

3.6
1.7

2.5
2.7

10.3

11.1

10.0

2.0
2.8
1.6

.3
3.5
1.8

11.9

.9
5.0
1.0

1.3
3.8
.9

8.3
8.9

6.3

8.9
9.2

3.0
2.6

8.9
28.6
15.8
13.3
12.3
1.1
3.8
1.3
12.8

8.8
9.5

4.4
2.9

4.3
2.9

3.9

1.9

35.6
20.5
15.5
11.5

39.2
23.2
16.8
11.2

14.3

15.1

1.3
40.2
23.4
17.1
12 2
4.9
6.6
.3
16.8

31.2
16.9
14.5
11 4

16.0

3.1
3.5
1.1

4.1
5.4
.4

5.5
6.7
.3

8.6
9.3

19.1
4.2
3.0

2.0

5
5
£
c

10
11
12

36.6
21.0
16.0
11.6

15.6

20
21

4.4
5.6
.5

15
16
17
18
19

Table 45.—Gross National Product or Expenditure, Seasonally Adjusted Quarterly Totals at Annual Rates, 1951-53
[Billions of dollars]
1951

1953

1952

Line
I

III

Year

III

Year

319.3

326.1

331.3

336.3

328.2

340.3

341.4

344.2

358.5

346.1

361.8

369.9

367.2

360.5

364.9

210.0
30.6
111.1
68.3

204.4
26.0
109.1
69.3

207.3
26.2
110.5
70.7

211.6
25.8
113.5
72.2

208.3
27.1
111.1
70.1

213.5
25.8
114.2
73.5

216.7
27.0
114.9
74.8

218.2
25.4
116.6
76.2

225.3
29.1
118.4
77.8

218.4
26.8
116.0
75.6

228.6
30.4
118.8
79.4

230.8
30.3
119.6
80.9

231.2
30.3
118.6
82.3

229.7
28.0
118.7
83.0

230.1
29.7
118.9
81.4

2
3
4
5

59.6
24.0
12.1
11.8
23.8
11.8
10.4

62.2
23.5
10.9
12.6
23.1
15.5
14.1

55.4
23.1
10.4
12.7
22.5

50.3
22.7
10.5
12.3
23.3

56.9
23.3
11.0
12.4
23.2
10.4

50.7
23.3
10.5
12.8
24.0

47.2
23.7
10.9
12.7
24.5

50.2
23.7
11.3
12.4
22.0

54.4
24.2
11.6
12.6
22.8

50.7
23.7
11.1
12.6
23.3

51.9
25.0
11.7
13.3
24.1

55.9
25.9
12.2
13.7
24.6

52.4
25.6
12.1
13.5
24.8

45.5
25.7
11.7
13.9
24.0
-4.2
-3.7

61.4
25.5
11.9
13.6
24.4

6
7

-2.5

-1.1

1.7

2.8

52.2
30.6
27.4
24.1

60.5
38.8
35.2
31.5

66.9
45.2
41.4
38.3

71.6
49.4
45.0
41.5

62.8
41.0
37.3
33.9

21.6

.3
21.8

.6
21.7

3.3
3.5
.3

3.7
3.9

9.9
8.4

3.1
4.4

4.2
2.8

3.5
4.9
.5

22.2

9.0

3.4
4.2
.4

21.8

1.8
2.2

-.6

-1.9

86.0
59.8
50.6
48.7

85.2
60.1
52.0
50.0

14
15
16
17

2.3

-.7

-1.5

-.8

-.2

-1.8

-3.3

-1.8

73.7
50.9
46.2
44.0

78.1
55.1
50.0
47.3

77.3
54.1
47.8
45.0

79.6
55.7
50.0
48.1

77.2
54.0
48.5
46.1

83.0
58.1
51.0
48.7

86.6
62.2
54.3
52.0

85.4
60.3
52.3
50.6
1.7
8.4
.4

1.9
9.6
.3

23.9

5.8
.4
23.2

25.1

26.2

8.5
.4
25.1

22.8

2.7
5.5
.4

23.0

2.8
6.6
.3

23.1

7.5
7.5

5.4
6.2

4.6
4.0

2.2
5.1
.4

-.9

3.6
3.0

-1.8

3.4
2.1

1.9
6.0
.3

2.4

2.8
3.3

2.2
7.7
.5

24.9

2.3
8.3
.4

24.4

2.0
2.9

8
9

10
11
12

2.0

18
19
20
21

226

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS

Table 46.—Disposition of Personal Income, Quarterly, 1939-40
[Billions of dollars]
1939

1940

Line
II

III

Year

III

17.6

72.9

18.6

19.2

19.5

21.4

78.7

.5
.2
.3.

2.4
1.2
1.2

.9
.5
.4

.6
.3
.3

.5
.3
.2

.6
.3
.3

2.6
1.4
1.2

17.2

17.4

19.0

70.4

17.8

18.6

18.9

20.8

76.1

16.7

16.6

18.7

67.6

16.8

17.8

17.5

19.9

71.9

1.3

Less: Personal consumption expenditures

19.5

.5
.3
.2

15.6

State and local
Equals: Disposable personal income

17.9

.6
.3
.3

16.8

Less: Personal tax and nontax payments.
Federal
_
_

17.9

.8
.4
.4

Personal income

2.9

1.0

1.5

4.2

Equals: Personal saving

Table 46.—Disposition of Personal Income, Quarterly,

1944-45

[Billions of dollars]
1945
Line
IV

III

Year

41.2

41.3

42.9

165.7

42.8

43.4

42.2

42.7

171.2

5.2
4.8
.4

6.0
5.6
.4

4.4
4.1

3.3
3.0
.3

18.9
17.5
1.4

8.5
8.0

4.9
4.5
.4

3.9
3.6
.3

3.6
3.3

20.9
19.4

35.0

35.2

39.6

146.8

38.6

38.3

39.1

...j

25.1

26.8

30.8

109.8

29.1

29.7

34.8

9.9

8.5

8.8

36.9

9.5

8.6

4.3

Less: Personal tax and nontax payments
Federal
State and local..
Equals: Disposable personal income

Equals: Personal saving

40.3

Personal income

Less: Personal consumption expenditures

Year

.3
36.9
27.2
9.7

Tcble 46.—Disposition of Personal Income, Quarterly,

.4
34.4
28.1
6.3

1.5
150.4
121.7
28.7

1949-50

[Billions of dollars]
1949

1950

Line
III

Year

III

Year

51.3

51.7

51.1

52.6

206.8

53.9

54.9

57.0

61.3

227.1

7.3
6.6
.7

3.4
2.7
.7

4.4
3.8

3.6
3.1

18.7
16.2
2.5

7.1
6.3

4.0
3.3
.7

4.9
4.3
.7

4.9
4.3

20.9
18.2
2.7

Equals: Disposable personal income

44.0

48.4

46.8

Less: Personal consumption expenditures.

42.0

45.0

44.1

2.1

3.4

2.6

Personal income
Less: Personal tax and nontax paymentsFederal
State and local
_

Equals: Personal saving

.5
49.0
49.5
-.5

188.2

46.8

50.9

52.1

56.4

206.1

180.6

43.7

47.1

49.7

53.6

194.0

7.6

3.1

2.4

2.8

12.1

227

NATIONAL INCOME, 195 4 EDITION

Toble 46.—Disposition of Personal Income, Quarterly,

1941-43

[Billions of dollars]
1941

1942

1943
Line

Year

21.5

23.4

24.7

26.7

96.3

27.1

29.6

31.9

34.9

123.5

35.8

37.5

38.1

40.0

151.4

1.2
.8
.4

.8
.5
.4

.6
.4
.3

3.3
2.0
1.3

2.4
2.0
.4

1.3
.9
.4

1.2
1.0
.3

1.0
.7
.3

6.0
4.7
1.3

3.8
3.4
.4

3.7
3.4
.4

4.9
4.7
.3

5.4
5.1
.3

17.8
16.5
1.3

2
3
4

III

Year

III

Year

20.3

22.6

24.1

26.0

93.0

24.6

28.3

30.7

33.9

117.5

32.0

33.8

33.2

34.6

133.5

18.2

20.3

20.6

22.8

81.9

20.5

21.7

22.1

25.4

89.7

23.1

24.7

24.8

27.9

100.5

2.1

2.3

3.5

3.2

11.1

4.1

6.6

8.6

8.5

27.8

9.0

8.4

6.6

33.0

Table 46.—Disposition of Personal Income, Quarterly,

1946-48

[Billions of dollars]
1946

1947

1948
Line

III

Year

III

Year

III

41.9

43.9

45.1

47.1

178.0

45.8

46.1

48.1

50.5

190.5

49.6

51.8

7.6
7.1
.5

3.4
2.9
.4

•12
3.9
.4

3.6
3.3
.4

18.8
17.2
1.6

8.7
8.2
.5

4.0
3.5
.5

4.7
4.3
.4

4.1
3.7
.4

21.5
19.6
1.9

9.3
8.6
.6

3.9
3.3
.6

4.2
3.8
.5

34.3

40.5

40.9

43.4

159.2

37.1

42.1

43.4

46.4

169.0

40.3

47.9

32.2

35.3

36.9

42.1

146.6

37.4

40.5

40.6

46.5

165.0

41.2

43.7

2.1

5.2

4.0

1.3

12.6

-.3

1.7

2.9

—.1

4.0

-.9

4.2

Table 46.—Disposition of Personal Income, Quarterly,

Year
208.7

3.7
3.3
.5

21.1
19.0
2.1

2
3
4

48.7

50.7

187.6

43.8

48.9

177.6

4.9

1.8

10.0

52.9

54.4

1951-53

[Billions of dollars]
1952

1951

1953
Line

III

Year

III

Year

III

Year

60.7

63.1

64.1

67.4

255.3

64.9

66.7

68.1

71.6

271.2

69.6

71.5

71.6

73.4

286.1

10.7
9.8
.9

5.9
5.1
.8

6.6
5.9
.7

6.0
5.3
.6

29.3
26.3
3.0

12.2
11.2
.9

7.3
6.4
.8

8.0
7.3
.8

6.9
6.2
.7

34.4
31.1
3.2

12.7
11.7
1.0

7.2
6.3
.9

8.8
8.0
.8

7.3
6.5
.8

36.0
32.5
3.5

2
3
4

60.0

57.2

57.4

61.5

226.1

52.7

89.4

60.0

64.7

236.9

56.9

64.3

62.8

66.1

250.1

49.8

50.7

57.1

208.3

50.5

53.9

53.2

60.7

218.4

54.4

57.4

56.7

61.6

230.1

6.5

6.8

4.3

17.7

2.2

5.5

6.8

4.0

18.4

2.6

6.8

6.2

4.5

20.0

228

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS

Table 47.—Disposition of Personal Income, Seasonally Adjusted Quarterly Totals at Annual Rates, 1939-40
[Billions of dollars]
1939

1940

Line
I
Personal income

III

Year

III

Year

71.3

71.7

72.9

75.5

72.9

76.3

76.7

78.8

82,9

78.7

2.4
1.2
1.2

2.6
1.4
1.2

2.6
1.4
1.3

2 6
1.4
1.2

68.9

69.3

70.4

73.1

70.4

73.8

74.1

76.2

80.3

76.1

65.5

67.3

68.3

69.2

67.6

70.1

71.7

72.2

73.5

71.9

3.4

2.0

2.1

3.9

2.9

3.7

2.4

4.0

6.7

4.2

Less: Personal tax and nontax payments.
Federal
State and local
Equals: Disposable personal income
Less: Personal consumption expenditures.
Equals: Personal saving

Table 47.—Disposition of Personal Income, Seasonally Adjusted Quarterly Totals at Annual Rates, 1944-45
[Billions of dollars]
1944

1945

Line
II

III

165.7

173.6

173.5

169.7

168.1

171.2

18.9
17.5
1.4

21.3
19.9
1.4

21.2
19.8
1.5

20.7
19.2
1.5

20.3
18.7
1.5

20.9
19.4
1.5

149.7

146.8

152.3

152.2

149.1

147.8

150.4

114.1

109.8

117.4

118.8

122.2

128.4

121.7

35.6

36.9

34.9

33.4

26.8

19.5

28.7

III

163.1

164.9

165.8

168.8

18.9
17.5
1.4

19.0
17.6
1.4

Equals: Disposable personal income

144.2

146.0

146.9

Less: Personal consumption expenditures

105.3

108.4

111.4

38.9

37.6

35.4

Personal income
Less: Personal tax and nontax paymentsFederal
State and local

Equals: Personal saving

Year

Table 47.—Disposition of Personal Income, Seasonally Adjusted Quarterly Totals at Annual Rates, 1949-50
[Billions of dollars]
1950

1949

Line
I

Less: Personal tax and nontax payments.
Federal
State and local

Equals: Disposable personal income
Less: Personal consumption expenditures
Equals: Personal saving

III

208.9

Personal i n c o m e . . .

II
207.6

205.5

205.3

18.7
16.3
2.4

18.7
16.2
2.4

18.6
16.2
2.5

18.6
16.1
2.5

III

206.8

218.5

220.7

229.2

239.8

227.1

18.7
16.2
2.5

19.4
16.7
2.7

20.0
17.3
2.7

20.7
17.9
2.8

23. 6
20.8
2.8

20.9
i8.2
2.7

Year

190.2

188.9

186.9

186.7

188.2

199.1

200.7

208.5

216.2

206.1

178.4

180.4

180.1

183.5

180.6

185.2

189. 1

202.9

198.8

194.0

11.8

8.6

6.7

3.2

7.6

13.9

11.6

5.6

17.4

12.1

229

NATIONAL INCOME, 195 4 EDITION

Table 47.—Disposition of Personal Income, Seasonally Adjusted Quarterly Totals at Annual Rates, 1941-43
[Billions of dollars]
1941

1942

1943

Lino
I

III

Year

III

Year

III

Year

87.7

93.4

99.7

103.8

96.3

110.1

118.4

128.4

137.3

123.5

145.2

149.8

153.2

157.3

151.4

3.3
2.0
1.3

6.0
4.7
1.3

14.6
13.3
1.3

14.7
13.4
1.3

20.9
19.6
1.3

21.2
19.8
1.3

17.8
16.5
1.3

2
3
4

84.4

90.1

96.4

100.6

93.0

104.1

112.4

122.4

131.4

117.5

130.7

135.1

132.3

136.1

133.5

76.8

81.2

84.5

84.9

81.9

86.4

87.8

90.4

94.3

89.7

97.2

99.9

101.5

103.6

100.5

7.6

8.9

11.8

15.6

11.1

17.7

24.6

32.0

37.1

27.8

33.5

35.2

30.8

32.5

33.0

Table 47.—Disposition of Personal Income, Seasonally Adjusted Quarterly Totals at Annual Rates, 1946-48
[Billions of dollars]
1946

1947

1948
Line

Year

III

170.6

175.6

181.0

184.5

178.0

186.7

185.0

192.7

197.4

190.5

201.5

208.1

212.3

212.8

208.7

17.8
16.2
1.6

18.6
17.0
1.6

19.1
17.5
1.7

19.6
17.9
1.7

18.8
17.2
1.6

21.2
19.3
1.8

21.2
19.4
1.8

21.6
19.7
1.9

22.1
20.2
1.9

21.5
19.6
1.9

23.2
21.1
2.1

20.8
18.7
2.1

20.2
18.0
2.2

20.4
18.2
2.2

21.1
19.0
2.1

2
3
4

152.8

157.0

161.9

164.9

159.2

165.6

163.8

171.1

175.3

169.0

178.3

187.3

192.1

192.4

187.6

137.0

142. 5

152.1

154.8

146.6

158.9

163.5

166.8

170.7

165.0

174.1

176.8

179.5

180.1

177.6

15.8

14.4

9.8

10.1

12.6

6.7

4.4

4.6

4.0

4.2

10.6

12.6

12.3

10.0

III

Year

Table 47.—Disposition of Personal Income, Seasonally Adjusted Quarterly Totals at Annual Rates, 1951-53
[Billions of dollars]
1952

1951

1953

Line
Year

III

Year

III

247.1

253.7

257.1

263.4

255.3

264.7

267.8

272.8

279.4

271.2

283.3

286.4

287.5

287.3

286.1

28.4
25.5
2.9

28.9
25.9
3.0

29.2
26.2
3.0

30.6
27.5
3.0

29.3
26.3
3.0

34.0
30.8
3.2

34.5
31.3
3.3

35.0
31.7
3.3

34.4
31.1
3.2

35.5
32.1
3.4

35.9
32.5
3.5

36.3
32.8

3.5

36.1
32.6
3.6

36.0
32.5
3.5

2
3
4

218.7

224.8

227.9

232.8

226.1

230.7

233.8

238.3

244.4

236.9

247.8

250.4

251.2

250.1

210.0

204.4

207.3

211.6

208.3

213.5

216.7

218.2

225.3

218.4

228.6

230.8

231.2

229.7

230.1

8.6

20.3

20.6

21.3

17.7

17.2

17.1

20.2

19.1

18.4

19.2

19.6

20.0

21.5

20.0

III

230

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS
Table 48.—Relation of Gross National Product, National Income, and Personal Income, Quarterly, 1939-40
[Billions of dollars]
1939

Gross national product..
Less: Capital consumption allowances
Indirect business tax and nontax liability
_.
Business transfer payments
Statistical discrepancy
Plus: Subsidies less current surplus of government enterprises
Equals: National income.
Less: Corporate profits and inventory valuation adjustment..
Contributions for social insurance
Excess of wage accruals over disbursements
Plus: Government transfer payments...
Net interest paid by government
Dividends
*
^
Business transfer payments.
Equals: Personal income.._
_
_

1940

III

Year

III

21.5

21.8

22.8

25.0

91.1

23.8

24.1

24.9

27.8

100.6

1.9
2.2
.1
.0

1.9
2.3
.1
-.2

2.0
2.4
.1
.3

2.0
2.4
.1
1.0

7.8
9.4
.5
1.2

2.0
2.3
.1
.6

2.0
2.5
.1
-.3

2.1
2.6
.1
.0

2.1
2.6
.1
.5

8.1
10.0
.4
.8

17.4

17.7

18.1

19.5

72.8

18.9

19.9

20.2

22.6

81.6

1.0
.5
.0

1.2
5
.0

1.5
.5
.0

1.9
.6
.0

5.7
2.1
.0

1.6
.0
.0

2.2
.6
.0

3.0
.6
.0

9.1
2.3
.0

.6
.3
.8
.1

.6
.3
1.4
.1

2.5
1.2
3.8
.5

.7
.3
.8
.1

.7
.4
.9
.1

.7
.3
.9
.1

.6
.3
1.4
.1

2.7
1.3
4.0
.4

17.6

17.9

19.5

72.9

18.6

19.2

19.5

21.4

78.7

Table 48.—Relation of Gross National Product, National Income, and Personal Income, Quarterly, 1944-45
[Billions of dollars]
1944

II
Gross national product..

Less: Capital consumption allowances
Indirect business tax and nontax liability.
Business transfer payments
Statistical discrepancy
.
Plus: Subsidies less current surplus of government enterprises
Equals: National income
_
_
Less: Corporate profits and inventory valuation adjustment...
Contributions for social insurance
Excess of wage accruals over disbursements..
_.
Plus: Government transfer payments.__
Net interest paid by government
Dividends
Business transfer payments
Equals: Personal income

1945

III

Year

III

Year

50.6

51.7

53.3

55.8

211.4

54.4

54.8

52.6

51.7

213.6

2.9
3.1
.1

3.0
3.5
.1

3.0
3.7
.1

3.1
3.7
.1

12.0
14.1
.5

3.2
3.7
.1

3.3
3.8
.1

3.4
3.9
.1

2.7
4.1
.1

12.5
15.5
.5

-.2

-.5

1.0

2.5

2.8

1.2

2.4

4.5

44.8
5.9
1.3
-.2

45.8
6.0
1.3
.0

45.6
5.6
1.3
.0

46.5
5.6
1.3
.0

182.6
23.0
5.2
-.2

47.0
5.5
1.5
.0

47.4
5.6
1.6
.0

44.2
3.7
1.5
.0

42.7
3.5
1.5
.0

181.2
18.4
6.1
.0

.7
.6
1.0
.1

.8
.7
1.1
.1

.7
1.1
.1

1.5
.1

3.1
2.8
4.7
.5

.9
.9
1.0
.1

1.0
1.0
1.1
.1

1.2
.9
1.1
.1

2.5
1.0
1.5
.1

5.6
3.7
4.7
.5

40.3

41.2

41.3

42.9

165.7

42.8

43.4

42.2

42.7

171.2

Table 48.—Relation of Gross National Product, National Income, and Personal Income, Quarterly, 1949—50
[Billions of dollars]
1949
HI
Gross national product

Less: Capital consumption allowances.
Indirect business tax and nontax liability
Business transfer payments
Statistical discrepancy—
Plus: Subsidies less current surplus of government enterprises.
Equals: National income
_
Less: Corporate profits and inventory valuation adjustment...
Contributions for;social insurance
Excess of wage accruals over disbursements
Plus: Government transfer payments..
Net interest paid by government
Dividends
Business transfer payments
Equals: Personal income

1950
IV

Year

III

Year

63.0

63.1

64.0

67.2

257.3

64.1

67.7

73.5

79.8

285.1

4.4
5.1
.2

4.6
5.3
.2

4.7
5.6
.2

4.8
5.7
.2

18.4
21.6
.8

4.9
5.4
.2

5.1
5.8
.2

5.2
6.4
.2

5.3
6.2
.2

20.5
23.7
.8

-.4

-1.3

-.6

2.3

-1.2

-1.1

2.2

-. 1

-.1

-.2

53.7
1.5
.0

54.2
7.3
1.5
-. 1

54.1
7.2
1.4
.0

54.2
7.1
1.3
.0

216.2
28.1
5.7
.0

53.3
6.1
1.8
.0

58.1
8.4
1.8
.0

62.7
10.2
1.7
.0

65.9
10.5
1.6
.0

240.0
35.1
6.9
.0

2.8
1.0
1.7
.2

2.9
1.4
1.7
.2

2.9
1.0
1.6
.2

3.0
1.2
2.4
.2

11.6
4.6
7.5
.8

5.3
1.1
1.9
.2

3.6
1.4
1.9
.2

2.7
1.0
2.2
.2

2.8
1.2
3.3
.2

14.3
4.7
9.2

51.3

51.7

51.6

52.6

206.8

53.9

54.9

57.0

61.3

227.1

231

NATIONAL INCOME, 1 9 5 4 EDITION
Table 48.—Relation of Gross National Product, National Income, and Personal Income, Quarterly, 1941-43
[Billions of dollars]
1943

1942

1941

Line
I

III

Year

III

Year

III

27.5

30.3

31.9

3S.1

125.8

34.6

37.9

40.9

45.6

159.1

44.8

47.1

48.7

51.8

192.5

2.1
2. S
.1
-.2

2.2
2.8

2.3
2.9
.1
-.6

2.4
3.0

9.0
11.3
.5
.4

2.5
2.9
.1
-.4

2.6
3.0
.1
—. 7

2.6
3.0
.1
.7

10.2
11.8
.5
-.8

2.6
3.1
.1
-1.3

2.7
3.1
.1
-1.2

2.7
3.3
.1
-.4

2.8
3.3
.1
1.3

10.9
12.7
.5
-1.7

-A

i:J

-.1

22.9

25.6

27.2

29.1

104.7

29.5

32.9

36.1

39.2

137.7

40.4

42.5

43.1

44.3

170.3

2.7
.6
.0

3.7
.7
.0

3.8
.0

4.3
.7
.0

14.5
2.8
.0

3.8
.8
.0

4.6
.8
.0

5.4
.9
.0

5.9
.9
.0

19.7
3.5
.0

5.6
1.1
.0

0.1
1.1
.1

5.1
1.2
.1

5.9
1.1
.0

23.8
4.5
.2

.7
.3
.9
.1

.7
.4
1.0
.1

.6
.3
1.0
.1

6
.3
1.5
.1

2.6
1.3
4.5
.5

.7
.3
.9
.1

.7
.4
1.0
.1

.7
.3
1.0
.1

.6
.4
1.4
.1

2.6
1.5
4.3
.5

.8
. I
1.0
.1

.6
.6
1.0
.1

.6
.5
1.0
.1

.6
.6
1.4
.1

2.5
2.1
4.5
.5

1
1
1
1

21.5

23.4

24.7

26.7

98.3

27.1

29.6

31.9

34.9

123.5

35.8

37.5

38.1

40.0

151.4

Table 48.—Relation of Gross National Product, National Income, artel Personal Income, Quarterly, 1946-48
[Billions of dollars]
1947

194,1

1948

Line
I

lit

Year

III

Year

III

Year

47.7

50.1

53.6

57.8

209.2

54.1

56.0

57.5

64.6

232.2

60.2

62.7

65.1

69.3

257.3

2.7
4.0
.1
.0

2.8
4.2
.1
-.4

3.0
4.5
.1
.1

3.1
4.6
.1
1.3

11.7
17.3
.6
.9

3.3
4.4
2

3.5
4.5
.2
-.1

3.6
4.7
.2
—.0

3 S

14.1
18.7
.7
1.4

3.9
4.8
^2
—.7

4.1
5.0
.2
— 1.7

4.2
5.2
.2
-1.1

4.3
5.4
.2
1.3

2
3
4
5

-.1

-.2

-.1

—.1

16.5
20.4
.7
-2.1
o

41.3

43.8

45.9

48.6

179.6

46.9

48.1

49.5

52.7

197.2

51.9

55.1

56.6

58.1

221.6

2.9
1.6
.2

4.0
1.6
o

4.5
1.5
.0

5.9
l.i
.0

17.3
6.0
.0

4.7
1.6
.0

5.8
1.6
.0

6.0
1.3
.0

7.1
1.2
.0

23.6
5.7
.0

6.5
1.3
.0

7.7
1.3
.0

8.7
1.2
.0

30.6
5.2
.0

8
9
10

3.0
1.0
1.2
.1

2.8
1.3
1.3
.1

2.6
1.0
1.3
.1

2.5
1.1
2.0
.1

10.9
4.5
5.8
.6

2.6
1.0
1.4

2.5
1.2
1.5
.2

3.3
1.0
1.5
.2

2.7
1.1
2.1
.2

11.1
4.4
6.5
.7

2.8
1.0
1.6
.2

2.7
1.3
1.6
.2

2.5
1.0
1.6
.2

2.6
1.2
2.4
.2

10.5
4.4
7.2
.7

11
12
13
14

41.9

43.9

45.1

47.1

178.0

45.8

46.1

48.1

50.5

190.5

49.6

51.8

52.9

54.4

208.7

-!e

b.\
.2
2.7

Table 48.—Relation of Gross National Product, National Income, and Personal Income, Quarterly, 1951—53
[Billions of dollars]
1952

1951

1953

Line
U

III

Yc.u-

Year

111

III

Year

77. D

80.6

S2.3

87.4

328.2

83.1

S4.6

S3.:

93.3

346.1

81*. 5

91.5.

91.1

93.8

364.9

5.6
0.3
2
.0

5.8
6.2
.2
-.4

0.0
6.4

6.1
6.7
2

23.5
25.6
1.0
1.3

6.1
6.6
.2

6.3
6.9
.3

6. 4

6.5
7.4
.3
3.0

25. 3
28.0
1.0
.6

6.6
7.2
.3
-1.0

6.8
7.5
.3
„ 4

6.8
7.6
.3
-.6

7.0
7.7
.3
3.1

27.2
30.0
1.0
1.0

3
4
5

-.2

.3
— 1.6

-.1

-.2

—.1

-.1

-.5

277.0

70.2

71.8

72.9

76.0

291.0

75.4

77.2

76.9

75.6

305.0

65.9

68.9

69.9

72.4

9.2
2.2
.1

10.2
2.2
.0

9.9
2.0
.2

10.6
1.8
-.1

39.9
8.2
.1

9.1
2.5
.0

9.7
2.2
.0

9.3
2.1
-.1

10.0
1.9
.0

38.2
8.7
.0

10.0
2.6
0.

10.6
2.3
0.

9.9
2.1
.0

8.0
1.8
.0

38.5
8.8-.1

8
9
10

2.9
1.0
2.0
.2

2.9
1.4
2.1
.2

2.9
1.0
2.1
.2

2.9
1.3
2.8
.2

11.6
4.8
9.1
1.0

2.9
1.0
2.1
.2

3.0
1.4
2.2
.3

3.1
1.1
2.1
.3

3.1
1.4
2.8
.3

12.1
4.9
9.1
1.0

3.2
1.1
2.2
.3

3.2
1.5
2.2
.3

3.1
1.0
2.2
.3

3.3
1.3
2.7
.3

12.8!
5.0
9.4
1.0

11
12
13
14

60.7

63.1

64.1

67.4

255.3

64.9

66.7

68.1

71.6

271.2

69.6

71.5

71.6

73.4

286. r

232

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS

Toble 49.—Relation of Gross National Product, National Income, and Personal Income, Seasonally Adjusted Quarterly Totals at Annual Rates, 1939-40
[Billions of dollars]
1939

1940

Line
III
Gross national product

Year

III

Year

89.1

Less: Capital consumption allowances
Indirect business tax and nontax liability
Business transfer payments

7.7
9.2
.4

92.6

93.9

91.1

97.3

98.5

101.7

104.9

100.6

7.8
9.3

7.9
9.4
.5
2.5

8.0
9.6
.5
.5

7.8
9.4
.5
1.2

8.0
9.6
.4
2.1

8.1
9.9
.4
1.2

8.2
10.2
.4
1.8

8.3
10.4
.4
-1.6

8.1
10.0
.4
.8

Statistical discrepancy

1.2

Plus: Subsidies less current surplus of government enterprises.

.4
71.3

Equals: National Income
Less: Corporate profits and inventory valuation adjustment..
Contributions for social insurance
_
Excess of wage accruals over disbursements
Plus: Government transfer payments
Net interest paid by government
Dividends
Business transfer payments
_
__.
Equate: Personal income

5.4
2.0
.0

2.6
1.1
3.2
.4
71.3

72.9

75.8

72.8

77.6

79.4

81.5

87.7

81.6

6.0
2.2
.0

6.4
2.3
.0

5.7
2.1
.0

7.8
2.2
.0

8.8
2.2
.0

8.9
2.3
.0

10.9
2.4
.0

9.1
2.3
.0

2.5
1.2
3.9
.5

2.4
1.3
4.3
.5

2.5
1.2
3.8
.5

2.7
1.3
4.3
.4

2.8
1.3
3.8
.4

2.7
1.3
4.0
.4

2.5
1.3
4.2
.4

2.7
1.3
4.0
.4

72.9

75.5

72.9

76.3

76.7

78.8

82.9

78.7

.5
70.9
5.0
2.1
.0
2.5
1.2
3.7
.5
71.7

Table 49.—Relation of Gross National Product, National Income, and Personal Income, Seasonally Adjusted Quarterly Totals at Annual Rates, 1944-45
[Billions of dollars]
1944

1945

Line
III

Gross national product

III

Year

205.6

Less: Capital consumption allowances.Indirect business tax and nontax liability
Business transfer payments
Statistical discrepancy

Year

209.4

214.1

216.5

211.4

221.2

223.7

212.2

197.1

213.6

11.5
13.0

11.9
14.2
.5

12.2
14.6
.5

12.5
14.7
.5
4.7

12.0
14.1
.5

12.8
15.0
.5
3.5

13.2
15.3
.5

13.4
15.6
.5
5.9

10.7
16.1
.5

12.5
15.5
.5
4.5

177.6

168.2
13.2
6.3
.0

181.2

3.8
4.7

9.9
4.1
4.8
.5

5.6
3.7
4.7
.5

169.7

168.1

171.2

4.9

Equals: National income
Less: Corporate profits and inventory valuation adjustment..
Contributions for social insurance
Excess of wage accruals over disbursements
-..
Plus: Government transfer payments
Net interest paid by government
_
Dividends...
--Business transfer payments
Equals: Personal income

Plus: Subsidies less current surplus of government enterprises.

184.7

180.6

182.5

23.8
5.0

23.6
5.1
.0

22.6
5.2
.0

3.0
2.5
4.5
.5

3.1
2.7
4.6
.5

3.0
2.9
4.7
.5

22.1
5.4
.0
3.2
3.1
4.7
.5

163.1

164.9

165.8

168.8

182.5

2.8

.7
182.6
23.0
5.2
-.2
3.1

5.5

189.9

22.4
5.8
.0

2.8
4.7

3.4
3.3
4.6
.5

165.7

173.6

189.2
22.5
6.1
.0
4.2
3.6
4.6
.5
173.5

3.0
1.5

.2
15.6
6.3
.0
5.0

18.4
6.1
.0

Table 49.—Relation of Gross National Product, National Income, and Personal Income, Seasonally Adjusted Quarterly Totals at Annual Rates, 1949-50
[Billions of dollars]
1949
Line
II

Gross national productLess: Capital consumption allowances
Indirect business tax and nontax liability
Business transfer payments
_

III

259.9

257.2

256.5

255.5

257.3

264.9

17.6
20.9

18.3
21.5
.8

18.7
22.1

19.1
22.0

.8
-.7

18.4
21.6
.8

19.6
22.3
.8

2.0

3.6

-.3

-.2

211.3

216.2

218.9

25.3
5.7
.0
11.8
4.6
7.8

27.8
6.6
.0

88.1
5.7
.0
11.6
4.6
7.5
.8

205.3

206.8

218.5

-1.1

Statistical discrepancy
Plus: Subsidies less current surplus of government enterprises.
Equals: National income
Less: Corporate profits and inventory valuation adjustment..
Contributions for social insurance..
Excess of wage accruals over disbursements
Plus: Government transfer p a y m e n t s . . .
Net interest paid by government
Dividends
Business transfer payments
Equals: Personal income

.0
220.5

-.4
215.2

29.7
5.8
.1

217.8
29.2
5.7
-.3

11.2
4.6
7.4

11.7
4.6
7.3
.8

28.6
5.7
.0
11.9
4.6
7.3
.8

208.9

207.6

205.5

Year

III

20.6
4.7
7.9

275.9

294.4

305.0

285.1

20.2
23.3

20.9

25.2
.8

21.3
24.2
.9

20.5
23.7

-2.6

-.2

249.9

258.8

240.0

39.7
7.3
.0

35.1
6.9
.0
14.3
4.7
9.2

232.2
32.8
6.7
.0

40.0
6.9
.0

14.2
4.7
8.3

11.1
4.7
9.5

220.7

229.2

Year

11.3
4.8
11.1
.9

239.8

.8
227.1

NATIONAL INCOME, 195 4 EDITION

233

Table 49.—Relation of Gross National Product, National Income, and Personal Income, Seasonally Adjusted Quarterly

Totals at Annual Rates,

1941-43

[Billions of dollars]
1941
I

1942

Year

1943

III

112.5

122.8

129.3

138.7

125.8

141.7

153.6

163.6

177.6

159.1

182.6

191.3

194.9

201.3

192.5

8.4
10.8
.5
-.8

8.8
11.2
.5
.9

9.3
11.3
.5
-.6

9.7
11.9
.5
2.4

9.0
11.3
.5
.4

9.9
11.8
.5
-.9

10.1
11.5
.5
.7

10.3
11.8
.5
-2.3

10.4
12.0
.5
-1.2

10.2
11.8
.5
-.8

10.5
12.6
.5
-4.3

10.8
12.6
.6
-1.3

11.0
12.8
.5
-1.8

11.2
12.9
.5
.5

10.9
12.7
.5
-1.7

2
3
4
5

-.1

-.2

93.9

101.5

109.0

114.1

104.7

120.1

131.0

144.1

155.9

137.7

163.4

169.1

172.9

176.0

170.3

12.3
2.5
.0

14.1
2.7
.0

15.3
2.9
.0

16.2
3.0
.0

14.5
2.8
.0

16.2
3.1
.0

18.3
3.3
.0

21.0
3.6
.0

23.6
3.9
.0

19.7
3.5
.0

23.0
4.2
.1

24.0
4.5
.3

24.5
4.7
.3

23.6
4.8
.2

23.8
4.5
.2

8
9
10

2.7
1.3
4.2
.5

2.6
1.3
4.3
.5

2.6
1.3
4.5
.5

2.6
1.3
4.6
.6

2.6
1.3
4.5
.5

2.8
1.3
4.6
.5

2.7
1.5
4.4
.5

2.6
1.6
4.3
.5

2.4
1.7
4.2
.5

2.6
1.5
4.3
.5

2.4
1.9
4.4
.5

2.4
2.1
4.5
.5

2.5
2.2
4.5
.5

2.5
2.4
4.5
.5

2.5
2.1
4.5
.5

11
12
13
14

87.7

93.4

99.7

103.8

96.3

110.1

118.4

128.4

137.3

123.5

145.2

149.8

153.2

157.3

151.4

III

Year

III

Table 49.—Relation of Gross National Product, National Income, and Personal Income, Seasonally Adjusted Quarterly

Year

Totals at Annual Rates, 1946—48

[Billions of dollars]
1946

1948

1947

Line

Year

III

196.7

205.0

215.2

220.1

209.2

223.2

229.4

232.6

243.7

232.2

247.9

255.5

261.9

264.0

257.3

11.0
16.5
.5
1.5

11.4
17.1
.6
2.4

11.8
17.8
.6
1.5

12.5
18.0
.6
-1.5

11.7
17.3
.6
.9

13.1
18.0
.6
-.7

13.9
18.2
.7
3.5

14.4
18.7
.7
1.1

15.0
19.7
.7
2.0

14.1
18.7
.7
1.4

15.6
19.6
.7
-.9

16.4
20.3
.7
-3.4

16.7
20.7
.8
-1.7

17.3
20.9
.8
-2.0

16.5
20.4
.7
-2.1

2
3
4
5

1.7

1.9

-.1

-.6

-.2

-.4

-.2

168.9

175.5

183.3

190.4

179.6

192.2

193.4

197.0

205.7

197.2

212.4

221.5

225.2

227.1

221.6

13.5
6.1
.8

16.5
6.1
Q

17.9
5.9
.0

21.2
5.8
.0

17.3
6.0
.0

21.1
6.1
.0

23.6
6.1
.0

24.1
5.3
.0

25.5
5.3
.0

23.6
5.7
.0

28.7
5.2
.1

31.2
5.1
.1

30.7
5.3
-.1

31.7
5.3
.1

30.6
5.2
.0

8
9
10

12.0
4.4
5.3
.5

11.1
4.5
5.6
.6

10.6
4.5
5.9
.6

9.7
4.4
6.4
.6

10.9
4.5
5.8
.6

10.1
4.4
6.6
.6

9.9
4.4
6.3
.7

13.7
4.4
6.4
.7

10.7
4.4
6.8
.7

11.1
4.4
6.5
.7

11.0
4.4
6.9
.7

10.8
4.4
7.1
.7

10.4
4.4
7.4
.8

9.9
4.5
7.6
.8

10.5
4.4
7.2
.7

11
12
13
14

170.6

175.6

181.0

184.5

178.0

186.7

185.0

192.7

197.4

190.5

201.5

208.1

212.3

212.8

208.7

III

Table 49.—Relation of Gross National Product, National Income, and Personal Income, Seasonally Adjusted Quarterly

Totals at Annual Rates, 1951—53

[Billions of dollars]
1952

1951

1953
Line

Year

III

319.3

326.1

331.3

336.3

328.2

340.3

341.4

344.2

358.5

346.1

361.8

369.9

367.2

360.5

364.9

22.5
25. 9
1.0
1.5

23.1
25.0
1.0
1.8

23.8
25.4
1.0
2.6

24.5
26.3
1.0
-.7

23.5
25.6
1.0
1.3

24.5
27.0
1.0
1.3

25.2
28.0
1.0
.0

25.5
28.3
1.0
-1.2

26.0
28.8
1.0
2.2

25.3
28.0
1.0
.6

26.2
29.4
1.0
-1.2

27.4
30.2
1.0
2.6

27.4
30.1
1.0
2.1

27.9
30.3
1.0
.6

27.2
30.0
1.0
1.0

2
3
4
5

III

Year

-.1

-.2

-.4

-.2

-.4

-.6

-.4

-.8

-.5

268.9

275.8

278.4

285.1

277.0

286.1

287.2

290.3

300.1

291.0

305.9

308.2

306.2

299.9

305.0

39.5
8.1
.2

40.2
8.2
-.1

39.0
8.1
.8

41.0
8.3
-.6

39.9
8.2
.1

39.3
8.5
.1

37.5
8.6
.0

36.5
8.7
-.3

39.4
8.9
.0

38.2
8.7
.0

41.4
8.8
.0

41.0
8.9
-.1

38.3
8.7
-.1

33.1
8.6

38.5
8.8
-.1

8
9
10

11.3
4.8
9.0
1.0

11.6
4.8
8.9
1.0

11.7
4.8
9.1
1.0

11.7
4.8
9.4
1.0

11.6
4.8
9. 1
1.0

11.5
4.9
9.1
1.0

11.8
4.9
9.1
1.0

12.5
4.9
9.1
1.0

12.6
4.9
9.1
1.0

12.1
4.9
9.1
1.0

12.6
4.9
9.1
1.0

12.6
5.0
9.3
1.0

12.6
5.1
9.5
1.0

13.3
5.2
9.6
1.0

12.8
5.0
9.4
1.0

11
12
13
14

247.1

253.7

257.1

263 4

255.3

264.7

267.8

272.8

279.4

271.2

283.3

286.4

287.5

287.3

286.1

234

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS
Table 50.—Personal Consumption Expenditures by Major Type, Quarterly, 1939-40
[Billions of dollars]
1939

1940

Line
I

III

Year

III

Year

15.6

16.7

16.6

18.7

67.6

16.8

17.8

17.5

19.9

71.9

2
3

1.4

1.7
.6
.9

1.5
.5
.9
.2

6.7
22
8.5
1.0

1.6
6
.8
.2

2.0
.8
1.0
.2

1.7
5
1.0
.2

2.4
8
1.1
.4

7.8
2 7
3.9
1.1

8.6
1.5
56
0
.2
.4
.9

2.1
.6
1.1
.4
10.)
2.1
50

35.1
7.1
19 2
22
.7
1.8
4.2

8 5
1.5
47
5
2
'.I
1.2

9,0
1.8
51

9 1
1.6
5 2

10 6
2.5
53

.2
.4
.9

.2
.5
1.0

.2
.6
1.4

37 2
7.4
20 3
2 3
.7
1.9
4.5

6.4
.9
2.3
.4
4
.5
2.0

25.8
3.8
9.0
14
15
2.0
8.0

6.7
1.0
2.3
4

6.6
1.0
2.3
4

6.9
1.0
2.4
4

Automobiles and parts
Furniture and household equipment. ._
Other durable goods

.7
.2

6
7
8

Nondurable goods, total
..
Clothing and shoes
Food and alcoholic beverages.

7.8
1.4
43

10
11
12

Semidurable housefurnishings
Other nondurable goods

.1
.4
1.1

8.6
1.8
4.8
6
.2
.4
.9

Personal services

6.4
1.0
2.2
.3

6.4
.9
2 2
.4

.5
2.0

13
14
15
16

. . .

17
18
19

...

.2
.5
1.4
6.5
1.0
2.3
.4

.5
2.0

.5
2.1

.6
2.0

.5
2.1

26.9
4.0
9.3
15
17
2.1
8.2

Table 50.—Personal Consumption Expenditures by Major Type, Quarterly, 1944—45
[Billions of dollars]
1945
III

II
Goods and services, total..

25.1

26.8

27.2

Services, total
Household operationHousing
Personal services
Eecreation
Transportation
Other services...

15.7
3.5
9.1
.4
.4
.7
1.7

16.2
3.3
9.8
.4
.3
.7
1.8

9.2
1.4
2.9
.6

Nondurable goods, total..
Clothing and shoes
Food and alcoholic beverages..
Gasoline and oil
Semidurable housefurnishings..
Tobacco
,
Other nondurable goods.

9.4
1.5
3.0
.7

30.8

2.2
.2
1.2

1.5
.2
.9
.4

14.5
3.0
8.4
.8
.3
.6
1.8

Durable goods, total
Automobiles and parts
Furniture and household equipment..
Other durable goods...

9.4

1.4

'.&
.4

1.6
t 2

I'O

18.9

4.9
10.0
.3
.5
.8
2.4
9.6
1.5
3.0
.7
.7
.9
2.8

1.4
3.0
.7
.7
1.0
2.6

Year

109.8

28.1

29.1

29.7

6.8

1.6
.2
.9
.5

1.8
.2
1.1
.5

1.8
.3
1.0
.5

17.3
3.7
10.1
.4
.4
.7
2.1

17.8

l.S
2.7
7.7

16.6
3.8
9.3
.3
.4
.6
2.2

37.7
.5.9
11.9
2.7
2.7
3.7
10.9

9.9
1.6
3.0
.7
.7
.9
2.9

10.0
1.6
3.1
.8

10.1
1.6
3.1
.7

.8
3.8
2.2

65.4
14.6
37.4
1.4

3.6

10.7
.5
.3

.8
1.1
2.8

34.8

Year
121.7

2.9
.3
1.6
1.0

8.1
1.0
4.6
2.5

21.5
5.4
11.5
.6
.5
.9
2.7

73.2
16.5
41.6
1.8
1.5
3.0
8.8

10.4
1.6
3.2
.7
.8
1.0
3.0

40.4

6.4
12.4

2.9
3.0
4.0

11.6

Table 50.—Personal Consumption Expenditures by Major Type, Quarterly, 1949-50
[Billions of dollars]
1949

III

Goods and services, total-

1950
Year

Year

45.0

44.1

49.5

180.6

43.7

47.1

49.7

53.6

194.0

4.7
1.8
2.2
.6

5.9
2.5
2.6
.7

5.9
2.7
2.6
.7

7.0
2.4
3.4
1.2

23.6
9.5
10.9
3.2

5.6
2.4
2.6
.6

6.7
3.0
2.9
.7

8.2
3.8
3.7

8.1
3.1
3.7
1.3

28.6
12.4
12.9
3.3

Nondurable goods, total
Clothing and shoes
Food and alcoholic beverages...
Gasoline and oil
Semidurable housefurnishings..
Tobacco
Other nondurable goods

22.5
4.0
13.4
1.0
.5
1.0
2.6

24.0
4.8
14.0
1.3
.5
1.0
2.4

23.2
3.8
14.3
1.3
.5
1.0
2.3

27.1

96.9

5.9
14.8
1.2
.6
1.2
3.4

18.5
56.5
4.7
2.2
4.3
10.7

22.3
3.7
13.3
1.1
.5
1.0
2.6

24.2
4.5
14.3
1.8
.5

28.8
6.1
15.8
1.2
.7
1.8
3. 6

100.4

1.0
2.4

25.2
4.1
15.4
1.4
.7
1.1
2.5

Services, total
Household operation.
Housing..
Personal services
Recreation...
_
Transportation
Other services..

14.8
2.2
4.7
.9
.9
1.4
4.6

15.0
2.1
4.8
1.0
1.0
1.5
4.7

15.0
2.0
4.9
.9
1.0
1.5
4.6

15.4
2.2
5.0
1.0
1.0
1.4
4.8

60.1
8.5
19.4
3.8
3.9
5.8
18.7

15.8
2.4
5.2

16.2
2.3
5.3
1.0
1.0
1.5
5.2

16.3
2.2
5.4
1.0
1.0
1.5
5.1

16.7
2.4
5.5
1.0
1.0
1.5
5.3

65.0
9.4
21.4
3.9
3.9
5.8
20.6

Durable goods, total
Automobiles and parts
Furniture and household equipmentOther durable goods

42.0

1.3
5.0

18.5
58.8
5.0
2.4
4.4
11.2

NATIONAL

INCOME,

1954

235

EDITION

Table 50.—Personal Consumption Expenditures by Major Type, Quarterly, 1941-43
[Billions of dollars]
1941

1943

1942

Line
II

III

Year

III

Year

18.2

20.3

20.6

22.8

81.9

20.5

21.7

22.1

25.4

89.7

2.8
1.2
1.3
.3

2.3
.7
1.4

2.5
.7
1.3
.5

9.7
3.4
4.9
1.4

1.6
.2
1.1
.3

1.7
2
1.2
.3

1.6
.2
1.0
.3

2.1
.2
1.3
.6

7.0
.7
4.7
1.0

9.1
1.6
5.1
.6
.2

10.3

11.0
21

12.7

1.2

1.0

43.2
8.8
23.6
2.6
.9
2.1
5.1

11.3
2.4
6.2
.6
.3
.5
1.4

12.2
2.5
7 0
.6

.2
.5
1.2

2.9
6.5
.7
.3
.6
1.7

.6
1.4

12.7
2. 4
7! 5
.5
.3
.6
1.3

15.2
3.7
8.0
.4
.4
.8
1.9

51.3
11.0
28.8
2.1
1.1
2.4
6.0

13.3
3.0
7.6
.3
.3
.6
1.6

7.0
1.1
2.4
.4

7.2
1.0
2.5
.4
.4
.6
2.2

7.6
1.1
2.6
.5
.6
.6
2.2

29.0
4.3
10.0
1.7
1.8
2.4
8.7

7.7
1.2
2.7
.4
.5
.6
2.3

7.8
1.2
2.7
.5
.5
.7
2.3

7.8
1.2
2.7
.5
.6
.7
2.2

8.1
1.3
2.8
.5
.5
.7
2.3

31.5
4.8
10.8
2.0
2.1
2. 7

8.4
1.3
2.8
.5
.5
.8
2.4

2.2
5.7
.7
.2

.4
.6
2.2

e!s
.8

9'o

27.9

100.5

1.5
.2
.9
.4

2.0
.2
1.1
.8

6.6
.8
3.9
1.9

2
3
I
5

14.6
2.9
8.8
.4
.3
.6
1.5

17.0
4.3
9.0
.3
.4
.8
2.2

59.3
13.4
33.7

6
7
8
9
10
11
12

8.6
1.3
2.8
.6
.6
.9
2.4

1.4
2
'.9
.3

24.8

14.4
3.3
8.3
.4
.3
.6
1.6

23.1

2.0
.9
.9
.2

Year

III

8.7
1.3
2.9
.6
.6
.9
2.4

9.0
1.3
2.9
.6

34.7

13
14
15
16
17
18
19

24.7
1.7
_2
1.0
.4

.7
.9
2.6

1.3
1.3
2.7
6.8
6.2

11.3
2.4
2.4
3.4
9.9

Table 50.—Personal Consumption Expenditures by Major Type, Quarterly, 1946-48
[Billions of dollars]
1948

1948

1947

Line
I

III

Year

III

Year

III

Year

35.3

36.9

42.1

146.6

37.4

40.5

40.6

46.5

41.2

43.7

43.8

48.9

177.6

3.7
.8
2.1
.8

5,4
1.4
2.8
1.2

15.9
3.9
8.7
3.3

4.2
1.4
2.2
.6

5.1
1.6
2.7
.8

4.9
1.6
2.7
.7

6.4
1.7
3.4
1.3

20.6
6.3
11.0
3. 1

4.7
1.6
2.4
.6

5.6
1.8
3.0
.8

5.5
2.0
2.9
.7

6.4
1.9
3.2
1.3

22.2

1.6
.6

4.1
1.2
2.2
.7

2
3
4
5

18.6

20.2

21.1

24.6

84.5
18.2
48.8
3.0
2.0
3.5
8.9

20.9
4.0
12.4
_7
5
!9
2.4

22.7
4.6
13.3
1.0
.5
.9
2.3

22.7
4.0
13.9
1.0
.5
.9
2.3

26.9
6.2
14.5
.9
.7
1.1
3.4

93.1
18.8
54.2
3.6
2.1
3.9
10. 5

22.8
4.3
13.4
.9
.5
.9
2.7

24.0
4.7
14.2
1.1

24.0
4.2
14.6
1.2

98.7
19.6
57.3

1.0
2.4

1.0
2.5

27.9
6.4
15.1
1.1
.7
1.2
3.5

46.2
6.7
13.6
3.4
3.7
5.1
13.7

12.4
1.9
3.6
.9
.9
1.3
3.8

12.7
1.8
3.8
1.0
.9
1.4
3.8

12.9
1.8
3.9
.9
1.0
1.5
3.9

13.3
1.9
4.1
.9
.9
1.4
4.0

51.3
7.4
16.4
3.7
3.8
5.5
15.5

13.8
2.1
4.2
.9
.9
1.3
4.3

14.1
2.0
4.3
1.0
.9
1.5
4.4

14.3
1.9
4.4
.9
1.0
1.6
4.4

14.5
2.0
4.6
1.0
1.0
1.5
4.5

56.7

32. .2
2.7

4.6

4.1

5.7

10.9

11.6

12.8

13.5

.6
.4
.8
2.0

.8
.5
.8
1.8

2.0

.8
.6
1.0
2.9

11.0
1. 7

11.4

11.8

12.1

3.S

1.6
3.4
.9
.9
1.3
3.3

3.3

.8
.S
1. 1
3.3

1.7
3.5
.9
.9
1.3
3.7

1.0
3.4
.9
1.0
1.4
3.4

165.0

7.3

11.5
3.4

4.3
2.3
4.1

11.1
8.0

17.5
3.8
3.8
5.9

17.5

6
7
8
9
10
11
12
13
14
15
16
17
18
19

Table 50.—Personal Consumption Expenditures by Major Type, Quarterly, 1951-53
[Billions of dollars]
1953

1952

1951

Line
I

III

Year

III

Year

49.8

50.7

57.1

208.3

50.5

53.8

53.2

60.7

218.4

54.4

57.4

56.7

61.6

230.1

6.S
3.0
3.2
.6

6.6
2.9
2.9
.8

6.3
2.6
3.0

7.4
2.3
3.7
1.4

27.1
10.9
12.7

5.7
2.3
2.7
.6

6.8
3.1
3.0
.8

6.1
2.3
3.0
.8

8.2
2.9
3.8
1.5

26.8
10.6
12.5

6.8
3.2
2.8
.7

7.7
3.7
3.1
.9

7.4
3.6
3.1
.8

7.8
2.7
3.7
1.4

29.7
13.1
12.8

2
3
4
5

25.8

26.6

26.9

31.7

111.1
19.8
66.5

26.3

28.2

28.3

33.1

116.0
20.1
70.0

27.6

28.3

28.9

33.1
6.4

118.9
19.8
71.8

6
7
8
9
10
11
12

4.1

6.5

15.5

16.3

17.0

17.7

1.2
.6
1.1
2.8

1.4
.6
1.1
2.6

1.5
.6
1.2
2.6

1.4
.7
1.4
4.0

17.2

17.5

17.4

18.0

2.5
5.8
1.1
i.O
1.6
5.4

2.4
5.9
1.0
1.1
1.7
5.4

2.6
6.1
1.0
1.0
1.6
5.6

4.5

0. 6
1.0

1.5
5.5

4.7

291692'—54

3.5

5.5
2.5
4.7

12.0
70.1
10.3
23.4
4.1
4.1
6.4

21.9

4.0

4.9

4.4

6.8

16.3

17.3
1.2
2.7

1.6
.6
1.3
2.6

18.4

1.3
.5
1.2
3.0

1.6

17.9

18.6

18.8

19.4

2.9
6.2
1.0
1.0
1.6
5.8

2.7
6.4
1.1
1.1
1.7
5.9

2.6
6.6
1.0
1.1
1.8
5.8

2.8
6.6
1.1
1.1
1.7

1.5
.8
1.4
4.2

6.1

3.7

6.0
2.4
5.1

12.4
75.6
11.1
25.6
4.2
4.2
6.8

23.6

4.2

5.0

4.2

17.0

17.9

18.3

1.4
.6
1.3
3.1

1.7
.6
1.3
2.8

20.0

20.4

3.2

3.0
6.8
1.2
1.1
1.8
6.5

6.7
1.0
1.0
1.7
6.4

1.8
.6
1.3
2.7

18.7
1.7
.8
1.4
4.2

20.3
2.8
7.0
1.1
1.2
1.9
6.4

20.7
3.0
7.2
1.1
1.1
1.8
6.6

3.9

6.6
2.5
5.3

12.9
81.4
12.0
27.7
4.4
4.4
7.1

25.8

13
14

15
16
17
18
19

236

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS
Table 51.—Personal Consumption Expenditures by Major Type, Seasonally Adjusted Quarterly Totals at Annual Rates, 1939-40
[Billions of dollars]
1939

1940

Line
II

I
1
2
3

4
5
6
7
8

9
10
11
12
13
14
15
16
17
18
19

Other services

III

Year

67.3

68.3

69.2

67.6

70.1

71.7

72.2

73.5

71.9

6.9
2.3

3.7
1.0

6.7
2.2

7.8
2.7

3.7
1.0

4.0
1.1

7.9
2.8

8.2
3.1

3.5
1.0

7.3
2.5

7.7
2.6

3.5
1.0

3.6
1.0

7.1
2.4

3.2
.9

6.5
2.0

4.1
1.1

3.9
1.2

3.9
1.1

. ._ _

34.0

35.1

35.5

37.9

37.2

...
._

18.5
2.1
.6
1.7
4.1

19.2
2.2
.7
1.8
4.1

19.4
2.2
.7
1.8
4.2

36.0
74
19.5
2.2
.7
1.8
4.4

35.1
71
19 2
2.2
.7
1.8
4.2

36.4
72
19 9
2.3
.7
18
4.5

37.2
74
20 5
2.3
.7
1.9
4.4

37.3
75
20.3
2.3
.8
1.9
4.6

20.7
2.3
.8
1.9
4.6

20.3
2.3
.7
1.9
4.5

25.4
3 7
8.9
1.4
15
2.0
7.9

25.7
3.8
9.0
1.4
1.5
2.0
7.9

2S.9
3.8
9.0
1.4
1.6
2.0
8.0

26.1
3.8
9.1
1.5
1.6
2.1
8.0

25.8
3.8
9.0
1.4
1.5
2.0
8.0

26 4
4.0
9.2
15
1.7
2.1
8.0

26 8
4.0
9.3
15
1.7
2.1
8.2

27 0
4.1
9.4
15
1.6
2.1
8.3

27 4
4.1
9.5
16
1.7
2.2
8.4

26 9
4.0
9.3
15
1.7
2.1
8.2

6.9

-_ __
...

- -__

6.1
1.9

- .-

Personal services

Year

65.5

Goods and services, total
Durable goods, total
_ _
Automobiles and parts
Furniture and household equipment
Other durable goods ._
Nondurable goods, total
Clothing and shoos
Food and alcoholic beverages
Gasoline and oil
Semidurable housefurnishings
Tobacco
..
_.

III

7.1

7.7

7.4

Table 51.—Personal Consumption Expenditures by Major Type, Seasonally Adjusted Quarterly Totals at Annual Rates, 1944-45
[Billions of dollars]
1945
III

105.3

108.4

111.4

114.1

6.6

6.6
.8
3.8
2.1

Nondurable goo*ls, total
Clothing and shoes
Food and alcoholic beverages...
Gasoline and oil
Semidurable housefurnishings-.
Tobacco...
Other nondurable goods.

62.1
13.5
35. 6
1.4
1.4
2.8
7.5

64.3
14.4
36.8

66.7
15.1
38.1

68.4
15.6
39.2

1.3
1.5
2.7
7.9

Services, total
Household operation.
Housing
Personal services
Recreation
Transportation
Other services-

36.7
5.6
11.7
2.6
2.6
3.6
10.7

37.5

7.1

.7
3.7
2.1

6.7
.8
3.8
2.2

Year

Goods and services, totalDurable goods, total
Automobiles and parts
Furniture and household equipment.
Other durable goods

1.4
1.5
2.8
7.5

38.1

5.8

6.0

11.8

12.0

10.9

11.0

2.6
2.7
3.6

2.7
2.7
3.7

III

Year

109.8

117.4

118.8

122.2

128.4

121.7

7.4
.8
4.2
2.4

7.9
1.0
4.3
2.5

9.6

3.8
2.2

7.5
.9
4.2
2.4

1.3
5.6
2.7

8.1
1.0
4.6
2.5

1.5
2.6
8.0

65.4
14.6
37.4
1.4
1.5
2.7
7.7

70.6
16.1
39.6
1.5
1.5
2.8
9.1

71.6
15.9
40.8
1.6
1.5
2.8
9.0

73.7
16.7
42.0
1.8
1.5
3.0
8.7

77.1
17.1
44.0
2.4
1.7
3.3

73.2
16.5
41.6
1.8
1.5
3.0

38.6 ,
6.0

37.7
5.9

12.1 I

11.9

39.3
6.3
12.1
2.8
2.8
3.9
11.3

39.8
6. 3
12.3
2.9
2.9
3.9
11.5

40.7
6.5
12.5
2.9
3.0
4.0
11.7

41.7
6.6
12.8
3.0
3.1
4.3
12.0

40.4
6.4
12.4
2.9
3.0
4.0
11.6

.8
4.1
2.2

1.4

2.7 i
2.7
3.9

11.2

2 7
3.7
10.9

Table 51.—Personal Consumption Expenditures by Major Type, Seasonally Adjusted Quarterly Totals at Annual Rates, 1949-50
[Billions of dollars]
1949

1950

Line
I

III

Year

III

Year

178.4

180.4

180.1

183.5

180.6

185.2

189.1

202.9

198.8

194.0

2
3
4
5

21.6
8.0
10.3
3.3

23.4
9.8
10.3
3.3

24.2
10.0
11.1
3.1

25.1
10.1
11.9
3.2

23.6
9.5
10.9
3.2

25.7
10. 6
11.9
3.2

26.4
11.6
11.5
3.2

33.2
14.2
15.6
3.5

29.2
13.1
12.8
3.4

28.6
12.4
12.9
3.3

6
7
g

98.0
19.5
56.8

97.3
18.8
56.6

95.6
17.7
56.1

96.6
18.0
56.5

96.9
18.5
56.5

96.7
17.9
56.6

4.8

4.9

4.7

98.3
18.0
57 7

103.9
19.1
60 7

4.9

5.1

100.4
18.5
58 8
50
2.4
4 4
11.2
65 0
9.4
21 4
3.9
39
5.8
20.6

4.5

2.3
4.2
10.7

2.1
4.3
10.7

2.2
4.2
10.6

2.2
4.3
10.8

2.2
4.3
10.7

2.2
4.3
10.8

2.2
4.4
11.0

5.1

10
11
12

2.9
45
11.6

102.7
18.8
60 4
5. 1
2.4
45
11.4

13
14
15
16
17
18
19

58.8
8.3
18.7
3.8
3.9
5.9
18.2

59.6
8.4
19.2
3.8
3.8
5.9
18.5

60.4
8.3
19.6
3.8
3.9
5.8
18.9

61.7
8.8
20.2
3.9
3.9
5.7
19.2

60.1
8.5
19.4
3.8
3.9
5.8
18.7

62.8
9.1
20.7
3.8
3.9
5.7
19.7

64.5
9.3
21.1
3.8
3.9
5.8
20.5

65.8
9.4
21.6
3.9
4.0
5.9
21.0

67.0
9.8
22.0
4.0
4.0
6.0
21.2

237

NATIONAL INCOME, 195 4 EDITION
Table 51.—Personal Consumption Expenditures by Major Type, Seasonally Adjusted Quarterly Totals at Annual Rates, 1941-43
[Billions of dollars]
1942

1941

1943
Line

III

Year

III

Year

III

76.8

81.2

84.5

84.9

81.9

86.4

87.8

90.4

94.3

89.7

97.2

99.9

101.5

103.6

100.5

9.1
3.6
4.3
1.2

10.4

10.1
2.9
5.7
1.5

9.7
3.4
4.9
1.4

7.4
.7
5.1
1.5

6.9
.7
4.7
1.5

6.8
.7
4.4
1.6

6.8
.7
4.4
1.7

7.0
.7
4.7
1.6

6.5

4.0
5.1
1.3

9.1
3.0
4.7
1.4

4.0
1.8

6.9
.9
4.1
1.9

6.6
.8
3.9
2.0

6.4
.7
3.7
2.0

6.6
.8
3.9
1.9

2
3
4
5

39.8

42.2

45.3

45.5

43.2

8.1

8.6

9.6

8.9

8.8

21.8

23.1

24.4

25.3

23.6

48.5
10.5
26.5

49.8
10.2
28.0

51.9
11.2
29.3

55.1
12.0
31.3

51.3
11.0
28.8

57.4
13.4
32.3

58.7
13.3
33.2

59.7
13.2
34.3

61.2
13.7
34.9

59.3
13.4
33.7

6
7
8
9
10
11
12

27.9

28.6

29.2

30.3

29.0

30.5

31.1

31.8

32.4

31.5

33.3

34.3

35.1

36.0

34.7

4.1
9.7
1.6
1.7
2.3
8.5

4.2
9.9
1.7
1.8
2.4

13
14
15
16
17
IS
19

2.5
.8
2.1
4.7

2.7
.9
2.1
4.9

8.7

2.7
1.0
2.1
5.4

2.7
1.0
2.2
5.4

2.6
1.1
2.2
5.7

2.6
.9
2.1
5.1

2.2
1.0
2.3
6.0

1.9
1.1
2.4
5.9

1.6
1.2
2.7
6.2

2.1
1.1
2.4
6.0

1.4
1.3
2.6
6.4

1.4
1.3
2.7
0.9

1.3
1.4
2.6
7.0

1.4
1.4
2.8
7.1

1.3
1.3
2.7
6.8

4.3

4.5

4.3

4.6

4.7

4.9

5.1

4.8

5.1

5.2

5.3

5.2

10.2

10.4

10.0

10.6

10.8

11.0

10.8

11.1

11.2

11.4

11.6

11.3

10.0

10.4

1.7
1.7
2.4
8.9

1.8
2.1
2.5

8.9

1.8
2.1
2.5
8.8

1.7
1.8
2.4

8.7

1.9
2.1
2.6
9.0

2.0
2.1
2.8
9.1

2.1
2.1

3.0
9.2

2.0
2.1
2.7
9.0

2.3
2.2
3.2
9.4

2.4

2.4
2.5
3.5

S. 4

3.4
9.7

2.5
2.6
3.6

2.4
2.4
3.4
9.9

Table 51.—Personal Consumption Expenditures by Major Type, Seasonally Adjusted Quarterly Totals at Annual Rate:, 1946-48
[Billions of dollars]
1948

1947

1946

Line
II

Year

III

Year

III

137.0

142.5

152.1

154.8

146.6

158.9

163.5

166.8

170.7

165.0

174.1

178.8

179.5

180.1

177.6

12.7

14.9

17.4

18.6

15.9

19.2

20.4

20.8

22.0

20.6

21.4

22.2

23.0

22.3

22.2

2.3
7.3
3.2

3.3
8.3
3.3

4.6
9.4
3.5

5.6
9.7
3.3

3.9
8.7
3.3

5.6

6.4

6.2

6.8

6.3

6.9

7.0

7.6

7.8

7.3

10.2

10.6

11.2

11.8

11.0

11.1

11.7

12.0

11.2

11.5

80.6
18.0
46.2

82.3
18.0
47.0

87.4
19.0
50.4

87.7
18.0
51.5

90.3
18.4
52.7

99.0
19.7
57.2

99.4
20.0
57.5

98.7
19.6
57.3

2^2
4.0

3.6
2.1
3.9

98.6
19.6
57.4

2.1
3.9

3.7
2.1
3.9

97.9
19.3
57.1

3.1
2.1
3.5
9.3

95.5
19.3
55.4
39

93.1
18.8
54.2

3.0
2.1
3.5
8.8

92.6
18.6
53.9
3.6

93.9
18.9
54.7

2.7
1.9
3.4
8.5

3.3
2.1
3.6
9.1

84.5
18.2
48.8

43.7

45.3

47.3

48.5

3.4

3.4
2.1
3.7

3.4

III

3.4

4.1
2.2
4.1

4.2
2.3
4.0

3.4

4.4
2.3
4.3

3.4

4.4
2.3
4.2

4.3
2.3
4.1

3.0
2.0
3.5
8.9

10.1

10.5

10.8

10.5

11.2

11.1

11.2

10.9

11.1

46.2

49.4

50.5

52.1

53.2

51.3

54.8

56.0

57.4

58.4

56.7

6.6

6.5

6.7

6.9

6.7

7.1

7.3

7.5

7.6

7.4

7.9

8.1

8.0

13.1

13.4

13.8

14.2

13.6

14.6

15.0

15.7

16.5

15.4

16.9

17.3

17.8

18.3

17.5

12.7

13.3

14.2

14.6

13.7

14.9

15.2

15.8

16.1

15.5

16.8

17.3

17.9

18.1

17.5

3.2
3.5
4.7

3.4
3.7
5.0

3.5
3.8
5.3

3.6
3.8
5.4

3.4
3.7
5.1

3.6
3.8
5.4

3.7
3.8
5.5

3.8
3.8
5.7

3.8
3.8
5.8

3.8
3.8
6.0

3.9
3.9
6.1

3.8
3.8
5.9

1
1
1
1
1
1
1
1
1
1

Table 51.—Personal Consumption Expenditures by Major Type, Seasonally Adjusted Quarterly Totals at Annual Rates, 1951-53
[Billions of dollars]
1952

1951

1953
Line

Year

III

210.0

204.4

207.3

211.6

208.3

213.5

216.7

218.2

225.3

218.4

228.6

230.8

231.2

229.7

230.1

30.6
12.6
14.4

26.0
10.6
11.9

28.2
10.4
12.2

25.8

25.8
12.4

27.0
11.2
12.2

25.4

12.4

27.1
10.9
12.7

12.6

29.1
12.3
12.8

26.8
10.6
12.5

30.4
13.5
12.9

30.3
13.7
12.7

30.3
13.5
12.9

28.0
11.7
12.6

29.7
13.1
12.8

2
3
4
5

111.1
20.5
65.9

109.1
19 2
65.8

110.5
19.3
66.7

113.5
20.1
67.7

111.1
19.8
66.5

114.2
20.0
68.8

Hi. 9
19.5
«9. 7

116.6
20.2
70.4

118.4
20.7
71.1

116. 0
20.1
70.0

118.8
20.2
71.7

119.6
20.2
72.0

118.6
19.4
71.9

118.7
19.5
71.9

118.9
19.8
71.8

6
7
8
9
10
11
12

3.6

3.5

Year

9.8
3.6

3.5

9.8
3.6

5.9
2.4
5.0

III

3.7

5.9
2.4
5.1

9.0
3.8

6.0
2.4
5.1

3.9

6.2
2.5
5.1

3.7

6.0
2.4
5.1

3.9

6.4
2.4
5.3

3.9

6.5
2.5
5.5

Year

3.9

6.7
2.5
5.2

3.7

6.9
2.4
5.1

3.9

6.6
2.5

5.5
2.8
4.6

5.4
2.4
4.6

11.8

11.6

11.9

12.7

12.0

12.1

12.2

12.4

12.9

12.4

12.8

12.9

5.3
12.9

68.3
10.1
22.5

69.3
10.2
23.0

70.7
10.4
23.6

72.2
10.6
24.3

73.5
10.7
24.9

74.8
10.9
25.4

76.2
11.2
25.9

77.8
11.4
26.4

75.6
11.1
25.6

79.4
11.7
26.9

80.9
12.0
27.3

82.3
12.2
28.0

83.0
12.1
28.6

81.4
12.0
27.7

4.0
4.0
6.2

4.1
4.0
6.4

4.1
4.1
6.5

4.1
4.1
6.6

70.1
10.3
23.4

21.4

21.6

22.0

22.5

21.9

0.7
22.8

23.3

23.9

24.5

23.6

25.2

25.7

26.1

26.4

25.8

5.5
2.4
4.7

5.8
2.3
4.9

5.5
2.5
4.7

4.1
4.1
6.4

4.2
4.2

4.2
4.2
6.8

4.2
4.2
6.9

4.3
4.3
6.9

4.2
4.2
6.8

4.3
4.4
7.0

4.4
4.5
7.1

4.4
4.4
7.1

4.4
4.3
7.2

4.4
4.4
7.1

13
14
15
16
17

18
19

238

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS
Table 52.—Personal Income, Seasonally Adjusted Monthly Totals at Annual Rates, 1929-53
[Billions of dollars]
Wage and salary disbursements
Year and month

1929

Personal
income

Total

Commodity Distribu! producing tive indus- Service industries
industries
tries

i Other labor Proprietors'
and rental
income
Governincome
ment

Dividends
and personal interest income

Transfer
payments

Less: Personal contributions
for social
insurance

21. 0
20.3
20.6
2'). 6
19.6
IB. 7

13. 6
13.5
13.5
13.4
13.4
13. 3

1.6
1.6
1.5
1.5
1.5
1.5

0.2
.1
.1
.1
.1
.1

86.3
85.6
86.1
86.1
86.3
85.8

49.7
49.7
50.0
50.1
60.3
50.8

21.3
21.3 i
21.3
21.4
21.5
21.9

15.2
15.2
15.5
15.4
15.5
15.6

8.4
8.4
8.4
8.4
8.4
8.4

4.8
4.8
4.8
4.9
4.9
4.9

July
August
SeptemberOctober
November...
December, _.

87.0
87.4
87.1
86.7
83.8
83.3

50.9
51.4
51.4
50.9
50.1
49.4

21.6
22.1
22.1
21.7
21.1
20.4

15.8
16.8
16.8
15.7
15.6
15.6

8.5
8.5
8.6
8.5
8.4
8.4

5.0
5.0
5.0
5.0
5.0
5.0

21.0
20.8
20.5
20.0
18.6
18.9

13.2
13. 2
13.3
13.2
13.1
13.0

1.5
l.ii
l.-l
l.fl
1.5
1.5

.2
.1
.1
.1
.1
.1

Total..

85.8

50.4

21.5

15.6

8.4

4.9

20.2

13.2

1.5

January
February
March
April
May
June

82.1
81.2
80.1
80.8
79.5
78.5

48.9
48.3
47.9
47.8
47.3
47.3

20.3
19.9
19.5
19.5
19.2
19.2

15.3
15.2
15.1
15.0
14.9
14.8

8.3
8.2
8.2
8.2
8.1
8.1

5.0
5.0
5.1
5.1
5.1
5.2

18.3
18.0
17.4
18.2
17.5
16.7

12.9
12.9
12.8
12.8
12.7
12.6

1.6
1.5
1.5
1.5
1.5
1.4

July.
August
September..
October
NovemberDecember..

76.2
75.1
715
73.2
71.6
70.2

46.2
45.2
44.9
44.2
43.5
42.7

18.5
18.0
17.9
17.4
17.0
16.4

14.5
14.1
14.0
13.8
13.6
13.5

8.0
7.9
7.8
7.8
7.7
7.6

5.2
5.2
5.2
5.2
5.2
5.2

15.5
15.6
15.4
16.0
14.2
13.8

12.6
12.4
12.2
12.0
11.8
11.6

1.5
1.5
1.5
1.6
1.6
1.7

76.9

46.2

18.5

14.5

8.0

5.2

16.3

12.4

1.5

69.3
69.1
72.8
73.3
68.4
66.3

41.9
41.7
41.7
41.1
40.5
39.9

16.0
15.8
15.7
15.4
15.1
14.7

13.2
13.3
13.3
13.1
12.9
12.8

7.5
7.4
7.4
7.3
7.2
7.1

5.2
5.2
5.3
5.3
5.3
5.3

13.8
13.8
13.9
14.5
13.4
12.7

11.4
11.4
11.4
11.4
11.3
11.2

1.9
1.9
5.4
5.9
2.8
2.2

66.2
62.8
61.6
60.7
59.9
58.9

39.2
38.2
37.3
36.4
36.1
35.6

14.3
13.8
13.2
12.6
12.6
12.3

12.6
12.3
12.1
11.8
11.7
11. 4

7.0
6.9
6.8
6.8
6.6
6.5

5.3
5.2
5.2
5.2
5.2
6.3

12.4
11.3
11.1
11.3
11.0
10.7

11.1
10.9
10.8
10.6
10.4
10.2

2.2
2.0
2.0
2.1
2.0
2.2

65.7

39.1

14.3

12.5

7.1

5.3

12.5

11.0

2.7

57.5
56.5
54.9
53.4
51.6
49.2

34.7
33.9
33.2
32.2
31.1
30.1

12.1
11.7
11.1
10.6
9.9
9.4

11.1
10.8
10.7
10.3
10.1

6.3
6.2
6.2
6.1
6.0
5.8

5.2
5.2
5.2

10.5
10.3
9.3
9.1
8.4
7.4

9.9
9.9
9.8
9.7
9.6
9.3

2.1
2.1
2.2
2.1
2.1
2.1

47.8
47.0
4.7.0
46.2
46.1
45.2

28.9
28.4
28.6
28.7
28.7
28.0

9.0
8.9
9.1
9.3
9.4
9.0

9.4
9.1
9.1
9.1
9.0

5.7
6.6
6.6
5.5
5.5
5.4

4. S
4.8
4.8
4.8
4.8
4.8

7.2
7.2
7.3

9.2

6.2

8.4
8.4
8.5

2.3
2.3
2.2
2.1
2.1
2.2

50.1

30.5

9.9

9.8

5.8

5.0

8.0

9.1

2.2

45.6
44.4
43.0
44.1
46.3
48.4

28.0
27.5
26.4
26.6
27.2
28.4

9.0
8.8
8.0
8.2
8.8
9.6

8.8
8.6
8.3
8.4
8.4
8.5

5.3
5.2
5.1
5.1
5.1
5.2

4.9
4.9
5.0
4.9
4.9
5.1

6.5
5.8
5.4
6.6
8.4
9.1

8.6
8.5
8.5
8.4
8.3
8.2

2.3
2.3
2.4
2.3
2.2
2.4

July
August
September..
October
NovemberDecember...

49.2
48.4
48.7
48.6
49.0
60.8

30.2
30.8
30.8
31.1
32.3

10.2
11.0
11.3
11.1
11.0
10.8

9.0
9.2
9.4
9.3
9.1

5.2
5.3
5.4
5.4
5.4
5.4

4.9
4.9
4.9
4.9
5.4
7.0

10.1
8.0
7.7
7.6
7.6
8.0

8.1
8.1
8.0
8.0
8.1
8.2

1.9
1.9
1.9
1.9
2.0
2.0

Total.

47.2

29.0

8.8

5.2

5.1

7.6

8.3

2.1

January...
February..
March
April
May
June.

Total.
January
February
March
April
May.
June

1931

July.
August
SeptemberOctober
November...
December...
Total.
January
February
March
April
May
June

1932

July
August
SeptemberOctober
NovemberDecember. .
Total.
January
February
March
April..
May...
June

1933

5'.T
5.1

0.6
.6
.6
.6

Nonagricultural
income

NATIONAL INCOME,

1954

239

EDITION

Table 52.—Personal Income, Seasonally Adjusted Monthly Totals at Annual Rates,

1929-53—Continued

[Billions of dollars]
Wage and salary disbursements
Year and month

1934

Personal
income

Total

[Commodity! Distribu- Service inproducing tive indus- dustries
industries
tries

Government

Other labor Proprietors'
and rental
income
income

Dividends
and personal interest income

Transfer
payments

Less: Personal contributions
for social
insurance

52.1
52.7
53.2
53.2
53.8
54.1

33.5
33.9
34.1
33.8
34.2
34.0

11.1
11.9
12.3
12.8
13.0
12.7

9.5
9.7
9.8
9.9
10.0
10.0

5.5
5.5
5.6
5.7
5.7
5.7

7.4
6.8
6.4
5.4
5.5
5.6

0.4
.4
.4
.4
.4
.5

8.1
8.3
8.4
8.6
8.6
9.0

8.3
8.3
8.3
8.4
8.5

2.0
2.0
2.1
2.2
2.3
2.2

0.2
.2
.1
.2
.2
.2

54.4
54.2
53.0
53.5
53.7
54.3

33.7
33.8
32.8
33.3
33.6
34.1

12.2
12.1
11.3
11.5
11.7
12.3

10.1
10.0
10.0
10.1
10.0
10.0

5.7
5.7
5.6
5.7
5.7
5.7

5.7
6.0
5.9
6.0
6.2
6.1

.5
.5
.5
.5
.5
.5

9.5
9.1
8.8
8.7
8.6
8.7

8.7
8.8
8.8
8.9
8.8
8.8

2.2
2.2
2.2
2.3
2.3
2.4

.2
.2
.1
.2
.1
.2

53.6

33.7

12.1

9.9

5.7

6.1

8.7

55.6
56.7
57.7
59.7
00.0
59.8

35.0
35.6
35.7
36.1
36.2
36.1

12.7
13.3
13.2
13.4
13.3
13.3

10.2
10.3
10.4
10.5
10.6
10.7

5.8
5.8
5.9
5.9
5.9
5.9

6.3
6.2
6.2
6.3
6.4
6.2

9.1
9.8
10.7
12.3
12.5
12.5

8.7
8.6
8.6
8.6
8.6
8.6

2.5
2.4
2.4
2.4
2.4
2.3

60.1
61.3
61.7
62.3
62.8
63.8

36.4
37.0
37.2
37.5
38.0
39.1

13.2
13.6
13.8
13.8
14.0
14.5

10.8
10.9
11.0
11.0
11.0
11.0

6.0
6.0
6.0
6.0
6.1
6.1

6.4
6.5
6.4
6.7
6.9
7.5

12.5
12.9
13.0
13.1
13.1
13.0

8.6
8.7
8.8
8.9
9.0
9.1

2.3
2.4
2.4
2.5
2.4
2.3

GO. 2

36.7

13.5

10.7

5.9

6.5

12.0

64.0
63.9
04.0
64.7
65.6
76.3

39.5
39.9
40.2
40.9
41.7
42.0

14.4
14.4
14.6
15.2
15.7
15.9

11.2
11.4
11.4
11.5
11.6
11.7

6.2
6.3
6.3
6.4
6.5
6.5

7.7
7.S
7.9
7.8
7.9
7.9

12.6
12.0
11.7
11.6
11.4
11.9

9.4
9.5
9.6
9.7
10.1
10.4

2.2
2.2
2.1
2.1
2.0
11.6

72.8
69.1
68.7
69.3
70.8
72.1

42.2
42.5
42.4
43.0
43.9
44.8

15.9
16.2
18.0
l<i. 2
16.9
17.8

11.8
11.8
11.9
12.1
12.2
12.3

6. fi
6.6
6.7
6.8

7.9
7.9
7.9
8.1
8.1
7.9

12.5
12.4
12.3
12.4
13.0
13.3

10.7
10.9
11.0
11.0
11.1
11.1

7.0
2.9
2.6
2.5
2.4
2.5

68.5

41.9

15.8

11.8

6.S

7.9

12.3

10.4

3.5

71.2
72.5
74.4
76.2
75.8
76.8

44.4
45.2
4B. 0
4,'\ 9
47.6
47.6

17.5
18.1
18.4
19.2
19.fi
19.5

12.4
12.6
12.9
13.0
13.2
13.3

6.9
7.0
7.1
7.1
7.2

7.7
7.6
7.7
7.6
7.7
7.6

13.3
13.7
14.7
14.7
14.9
15.9

11.1
11.2
11.2
11.2
11.0
10.9

2.5
2.4
2.5
2.4
2.3
2.4

76.2
76.4
74.6
73.3
71.7

47. 5
47.6
46.5
4S.0
45.0
43.6

19.3
19.5
18.5
17.9
17.1
15.8

13.4
13.5
13. 5
13. 5
13.3
13.2

7.3
7.2
7.2
7.2
7.2
7.1

7.5
.4
.3
.4
A

15. 6
15.9
15.4
14.8
14.4
13.9

10.7
10.5
10.3
10.1

2.4
2.4
2.4
2.4
2.4
2.6

73.9

46.1

18.4

13.2

7.1

14.8

10.6

2.4

68.7
68.7
68.5
67.7
67.1
67.5

42.4
42.4
42.2
42.3
42.0
42.1

15.0
15.2
15.0
14.8
14.6
14.6

12.9
12.8
12.6
12.7
12.5
12.4

7.0
6.9
6.8
6.8
6.8

7.5
7.5
7.8
8.0
8.1
8.3

14.2
14.0
13.8
13.3
13.1
13.4

9.5
9.4
9.3
9.1
9.0
9.0

2.6
2.8
3.1
2.9
2.9
2.9

July
August
September
October
November
December

67.7
68.6
69.0
69.2
69.8
70.1

42.4
43.0
43.7
43.7
44.4
44.9

14.7
15.3
15.7
15.6
16.1
16.6

12.4
12.4
12.6
12.6
12.7
12.8

6.9
6.8
6.8
6.8
6.9

8.4

8.5
8.6
8.7
8.7
8.6

13.6
13.7
13.7
13.9
13.9
13.7

8.9
8.9
8.8
8.8
8.8
8.7

2.8
2.9
2.8
2.8
2.7
2.8

Total

68.6

43.0

15.3

12.6

6.8

8.2

13.7

9.0

2.8

January
February
March
April
May
June

July
August
September
October
Novein ber
•December
Total
January
February
March
April
May
June

1935

July
August
September
October
November
December
Total
January
February
March
April
May
June

1936

July
August
September
October
November
December
Total
January
February
March
April
May
June

1937

July
August
September
October
November
December
Total
January
February
March
April.
May
June...

1938

2.4

Nonagricultural
income

240

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS
Table 52.—Personal Income, Seasonally Adjusted Monthly Totals at Annual Rates, 7929-53—Continued
[Billions of dollars]
Wage and salary disbursements
Personal
income

Year and month

1939

Total

Commodity Distribu- Service inproducing tive indus- dustries
tries
industries

Government

Other labor Proprietors'
and rental
income
income

Dividends
and personal interest income

Transfer
payments

Iiess: Personal contributions
for social
insurance

Nonagricultural
income

71.0
71.0
71.7
71.1
71.8
72.2

Total

0.6
.6
.6
.6
.6
.6

65.4
66.0
65.5
66.1
66.8

45.6
46.0
46.4
47.1
47.4
47.8

17.1
17.5
17.8
18.2
18.6
18.7

13.2
13.3
13.6
13.7
13.7
13.8

7.2
7.2
7.2
7.2
7.2
7.2

8. 1
8.0
7.8
8.0
8.0
8.1

.6
.6
.6
.6
.6
.6

13.7
14.0
14.8
14.8
15.2
15.1

9 6
9.7
9.9
10.0
10.2
10.3

2.9
3.1
3.0
2.9
2.9
3.0

.6
.6
.6
.6
.6
.6

66.4
67.3
68.1
68.8
69.6
70.1

45.9

17.4

13.3

7.1

8.2

14.4

9.6

3.0

67.1

47.9
47.8
47.8
48.0
48.7
48.9

18.6
18.4
18.2
18 3
18.7
19 1

13.8
13.8
13.8
13.8
14.0
14.1

7.3
7.3
7.4

8.2
8.3
8.4
84

.6
.7
.7

15.0
15.4
15.2
15 4
15.3
15 3

10.4
10.1
9.8
9 5

3.1
3.2
3.2

.7.
.6
.6
.6
.6
.6

70.5
70.*
70.3
70.1
71.2
71.5

49.3
50.1
50.6
51.4
52.4
54.1

19 3
20.0
20.4
20.7
21.6
22.8

14.2
14.3
14.4
14.5
14.6
14.9

7.6

7.5
7.5
7.6
7.5
7.5

8.3
8.3
8.6
8.7
8.9

15.4
15.8
16.1
17.1
17.1
17.6

97
9.8
9.9
9.9
9.9
9.9

3.2

.7
.7
.7
.7
.7

.6
.7
.7
.7
.7
.7

72.0
73.0
73.6
74.7
75.8
78.1

49.8

19.7

14.2

7.5

8.4

15.9

9.8

3.1

72.6

54.9
55.9
56.9
57.8
60.1
62.2

23.3
24.0
24 4
24.5
26.2
27.6

14.7
15.0
15.2
15.6
15.9
16.4

7.7
7.7
7.8
7.9
8.0

9.2
9.2
9.5
9.8
10.0
10.1

.7
.7
.7
.7
.7

18.2
18.7
19.0
19.4
20.2
21.0

9.9
9.9
10 0
10.0
10.1
10.2

3.2
3.2
3.2
3.1
3.1

.7
.7
.7
.7
.8

3.1

79.5
80.0
81.8
82.8
85.4
88.0

63.3
64.6
65.5
66.4
66.8
69.9

28.4
29.2
29.7
30.3
30.6
31.5

16.6
16.9
16.9
17.0
17.0
18.4

8.1
8.1

.7
.7

10.3
10.3
10.4
10.5
10 5
10.5

.8
.8

.7
.7
.7

21.3
22.2
22.2
22.0
22 5
23.6

3.1
3.1

8.3
8.3
8.3
8.4

10.2
10.4
10.6
10.8
10.9
11.6

.8
.9
.9
.9

89.4
91.3
92.2
93.0
93.9
97.3

62.1

27.5

16.3

8.1

10.2

20.9

10.3

3.1

88.0

108.5
109.8
112.2
115.6
118.0
121.7

2.9
3.2
2.9
3.0
3.0

96.3

88
8.9
9.1
9.5
9.5
9.6

70.2
71.5
73.6
75.5
77.7
80.8

32 5
33.3
34.6
35.8
37.1
38.6

17.7
17.6
17.6
17.6
17.8
17.7

8.4

11.6
12.1
12.7
13.4
14.0
15.6

.8
.8
.8
.8
.8
.8

24 4
24.6
25 0
26.7
27.1
27.9

10 6
10.5
10 4
10.3
10.2
10.2

3.4

3.3
3.4
3.3
3.2
3.1

.9
1.0
1.0
1.0
1.1

98.6
99.6
102. d
104.4
106.5
109.9

125.3
128.8
131.2
134.6
137.7
140.0

83.5
86.0
87.7
90.6
93.3
95.1

40.1
41.7
42.4
43.4
44.7
45.4

17.9
18.1
18.2
18.5
18.7
18.9

9.1
9.2

16.4
17.0
17.9
19.4
20.4
21.5

.9
.9
.9
.9
.9
1.0

28.8
30.0
30.9
31.5
32.0
32.5

10.1
10 0
10.0
9.9
10.0
10.0

3.2

1.2
1.2

113. C

9.2
9.3
9.5
9.3

123.5

82.1

39.2

18.0

9.0

16.0

28.5

10.1

142.6
145. 5
147.7
148.7
149.8
150. 7

98.1
99.8
101.8
103.2
104.0
105.3

45.9
46.7
47.7
48.3
48.6
48.9

18.9
19.2
19.4
19.5
19.8
20.2

9.4
9.4
9.6

1.0
1.0
1.0

10.1

23.9
24.5
25.1
25.7
25.8
26.1

32.0
33.3
33.5
33.2
33.5
33.0

10 1
10.1
10.2
10 2
10.2
10.3

152.0
153.9
153.5
155. 2
157.9
158.7

October

14 3
14.2
14.3
13.9
14.1
13.7

97.9
100.1
101.0
101.7
102.6
107.0

July

.6
.6
.6
.6
.6

86.2
87.7
89.1
90.3
93.4
96.4

April

0.6

78.7

1940

85
8.4
8.5
8.4
8.4
8.3

77.6
79.0
79.6
81.4
82.3
84.6

Total

6.9
7.0
7.0
7.1
7.2

76.3
76.6
76.1
76.1
76.9
77.2

September

12.9
12.9
12.9
13.0
13.1
13.3

72.9

July

16 7
16.8
16.7
16.4
16.6
17.1

71.8
72.8
74.1
74.8
75.7
76.2

June

45.0
45.0
45.1
44.8
45.2
45.9

10S. 5
107.3
108.1
109. 5
111.5
112.3

49.3
49.6
50.0
50.6
51.2
51.2

20.5
20.7
20.5
20.6
20.9
21.3

10.0
9.9
10.0
10.1
10.2
10.2

26.7
27.1
27.6
28.2
29.2
29.6

1.1
1.1

1.1
1.2
1.2
1.3

33.0
34.1
32.8
33.1
33.8
33.9

151.4

105.6

49.0

20.1

9.9

26.6

1.1

33.3

1941

July

Total
1942

July

Total

_
1943

July

Total—

6.9

7.5
7.6
7.5

8.1

8.5
8.7
8.7
8.8
8.9

9.7
9.8

8.4

82
8.2

7
.7

1.0
1.0
1.1

9.6

9 7

2.9

3.1
3.2
3.2

3.2
3.0
3.0
2.9
3.0

3.0
3.0
3.0
3.2

3.1
3.0
3.0
2.9
2.9

65. a

1.3
1.3
1.4
1.5

117. i
121. C
123.5
125.8

3.1

1.2

1H.S

2.9
2.9
2.9

1.5
1.6
1.7

2.9
2.9
2.9

1.8
1.8
1.9

129.1
131.7
133.1
134.8
135.2
137.1

10.3
10.3
10.4
10 4
10.4
10.3

3.0
3.0

1.9
1.9

3.0
3.0
3.0
3.0

1.9
2.0
2.0
2.1

138.7
139."
140.3
141. i
144. S
145. (

10.3

3.0

1.8

137. (

NATIONAL INCOME,

1954

241

EDITION

Table 52.—Personal Income, Seasonally Adjusted Monthly Totals at Annual Rates,

1929-53—Continued

[Billions of dollars]
Wage and salary disbursements
Year and month

J anuary
February
March
April
May
June

1944

Less: Personal contributions
for social
insurance

113.8
115.6
115.3
114.7
115.5
116.6

51.3
51.0
50.7
50.1
49.9
50.2

21.6
23. fl
22.5
22.0
22.2
22.4

10.4
10. 5
10.7
10.7
10.9
11.0

30.5
30.6
31.4
31.9
32.5
33.0

1.3
1.4
1.4
1.5
1.5
1.5

34.7
35.4
35.4
35.6
35.6
35.7

10.3
10.4
10.5
10.6
10.7
10.8

3.1
3.4
3.9
3.8
3.6
3.5

2.1
2.2
2.2
2.2
2.2
2.3

117.9
118.0
117.8
118.9
119.4
120.5

50.1
50.0
49.9
50.2
50.3
50.9

22.8
22.9
22.8
23.0
23.2
23.5

11.2
11.1
11.0
11.0
11.3
11.3

33.8
34.0
34.1
34.7
34.6
34.8

1.6
1.6
1.6
1.6
1.7
1.7

34.4
34.3
33.9
34.8
3i. 4
34.6

10.9
10.9
11.0
11.1
11.1
11.2

3.5
3.5
3.6
3.6
3.7

2.3
2.3
2.3
2.3
2.3
2.3

117.0

50.4

22.7

10.9

33.0

1.5

35.0

10.8

3.6

2.2

173.4
173.7
173.6
172.2
173.0
175.1

122.0
122.2
122.7
121.9
121.0
121.3

51.5
51.4
51.4
50.4
49.2
48.8

23.7
24.0
24.0
24.1
24.2
24.4

11.4
11.6
11.5
11.5
11.6
11.8

35.4
35.2
35.8
35.9
36.0
36.3

1.7
1.7
1.7
1.8
1.8
1.8

36.9
37.0
36.2
35.6
37.0
37.0

11.2
11.3
11.3
11.2
11.4
11.6

4.0
3.9
4.0
4.1
4.2
5.8

2.4
2.4
2.3
2.4
2.4
2.4

175.0
170.7
163.2
166.8
169. 5
168.2

121.8
117.7
111.9
110.4
109.9
107.8

47.3
44.1
39.2
38.4
39.2
39.5

25.1
24.8
24.9
25.2
28.1
26.6

12.1
12.1
12.3
12.4
12.9
12.9

37.3
36.7
35. 5
34.4
31.7
28.8

1.8
1.8
1.8
1.9
1.9
1.9

36.9
36.7
34.1
36.3
37.4
36.5

11.6
11.7
11.7
11.8
11.9
12.0

5.3
5.1
6.1
8.7
10.7
12.1

2.4
2.3
2.4
2.3
2.3
2.1

171.2

117.6

45.9

24.8

12.0

34.9

1.8

36.5

11.6

6.2

2.3

170.0
169.3
172.6
174.2
175.3
177.3

106.9
104.4
108.2
109.3
110.2
111.3

39.3
38.6
42.7
43.8
44. H
46.4

27.4
28.0

13.1
13.4
13.8
14.0
14.0
14.3

27.1
24.4
22.9
21.1
20.1
19.8

1.8
1.8
1.8
1.8
1.8
1.9

38.1
40.3
39.2
40.2
40.6
41.5

12.4
12.6
12.9
13.0
13.1
13.3

12.9
12.2
12.5
12.0
11.7
11.3

2.1
2.0
2.0
2.1
2.1
2.0

181.9
182.6
178.8
184.0
183.9
185.8

111.9
114.1
115.0
115. 5
116.5
118.6

46.7
48.7
49.6
49.7
50.4
51.5

31.5
32.0
32.1
32.3
32.7
33.2

14.5
14.6
14.8
15.0
15.1
15.2

19.2
18.8
18.5
18.5
18.3
18.7

1.9
1.9
1.9
2.0
2.0
2.1

45.7
44.1
38.5
44.0
43.1
42.4

13.4
13.6
13.8
13.9
14.2
14.4

11.0
10.9
11.5
10.5
10.1
10.3

2.0
2.0
1.9
1.9
2.0
2.0

178.0

111.9

46.0

30.9

14.3

20.6

1.9

41.5

13.4

11.4

2.0

186.7
186.9
186.8
183.8
184.2
187.1

119.3
119.6
120.0
119.4
120.9
122.6

52.4
52.7
53.0
52.9
53.5
53.8

33.5
33.8
33.9
33.4
34.1
35.2

15.3
15.4
15.4
15.7
15.9
16.2

18.1
17.7
17.7
17.4
17.4
17.4

2.1
2.1
2.2
2.2
2.3
2.3

41.9
42.3
41.5
39.3
38.2
39.2

14.6
14.5
14.5
14.4
14.5
14.5

10.9
10.6
10.8
10.8
10.4
10.6

2.1
2.2
2.2
2.3
2.1
2.1

187.3
187.8
202.8
195.5
196.4
200.6

121.7
123.0
124.5
126.0
127.6
129.0

53.4
54.2
55.3
55.8
56.8
58.0

35.4
35. 5
36.2
36.5
37.0
37.2

16.3
16.2
16.2
16.4
16.4
16.5

16.6
17.1
16.8
17.3
17.4
17.3

2.4
2.4
2.4
2.5
2.5
2.6

39.5
39.2
41.7
41.9
42.0
44.6

14.5
14.7
14.9
15.1
15.3
15.4

11.3
10.6
21.3
12.1
10.9
11.1

2.1
2.1
2.0
2.1
1.9
2.1

190.5

Total

122.8

54.3

35.2

16.0

17.3

2.3

40.9

14.7

11.8

2.1

201.5
199.8
203.3
206.0
206.8
211.6

129.9
130.1
130.8
131.1
133.2
135.0

58.1
57.8
57.8
58.3
59.5
60.4

37.5
38.1
37.8
37.8
38.3
38.6

16.7
16.9
16.9
17.2
17.4
17.5

17.6
17.3
IS. 3
17.8
18.0
18.5

2.6
2.6
2.7
2.7
2.7
2.7

44.4
42.1
43.8
46.3
45.7
48.7

15.4
15.6
15.7
15.9
16.0
16.1

11.4
11.4
12.4
12.1
11.3
11.3

2.2
2.0
2.1
2.1
2.1
2.2

210.9
212.7
213.3
213.4
213.0
212.1

136.7
138.3
139.2
138.8
139.3
138.5

60.9
61.7
62.2
62.0
62.0
61.3

39.7
39.9
39 5
39^3
39.3

17.6
17.7
17.6
17.7
17.8
17.7

18.9
19.2
19.5
19.6
20.2
20.2

2.7
2.7
2.7
2.8
2.8
2.8

4<>.2
41.2
41.1
41.5
•i*>. 6

45.4

16.2
16.4
16.7
16.9
16.9
16.8

11.3
11.3
10.9
10.6
10.6
10.9

2.2
2.2
2.3
2.2
2.2
2.3

208.7

135.1

60.2

38.8

17.4

18.7

2.7

45.6

16.2

11.3

2.2

1946

July
August
September
October
November
December
Total
1947

July
August
September
October
November
December
Total
January
February
March
April
May..June

Transfer
payments

161.1
104.0
164.3
164.0
164.7
165.8

1945

July
August
September
October
November
December

January
February
March
April
May
June

Government

Dividends
and personal interest income

165.7

Total

January
February
March
April
May
June

Total

Commodity Distribu- Service inproducing tive indus- dustries
industries
tries

1
Other labor Proprietors
and rental
income
income

166.0
166.0
165. 6
167.7
169.0
169.5

July
August
September
October
November
December

January
February
March
April
May
June

Personal
income

1948

July
August
September
October
November
December
Total

30.4
31.6

Nonagricultural
income

242

A SUPPLEMENT TO THE SURVEY OF CURRENT BUSINESS

Table 52.—Personal Income, Seasonally Adjusted Monthly Totals at Annual Rates, 1929-53—Continued
(Billions of dollars]
Wage and salary disbursements
Personal
income

Year and month

1949

Total

Commodity Distribu- Service inproducing tive indus- dustries
industries
tries

Government

Dividends
and perOther labor Proprietors' sonal inand rental
income
terest inincome
come

Transfer
payments

Less: Persona' contributions
for social
Insurance

Nonagricultural
income

208.7
208.2
209.7
208.6
208.1
206.3

20.0
20.0
20 1
20.2
20.2
20.4

2.8
2.8
2 9
2.9
3.0
3.0

43.2
43.7
45 1
43.3
42.6
41.9

16.8
16.8
16 9
16.9
17.0
17.1

11.3
11.7
12 9
12.5
12.4
12.5

2.3
2.3
2.3
2.2
2.2
2.3

191.4
190.5
190 4
191.4
191.2
190.4

133.2
133.3
134.0
132.6
133.3
135.1

55.9
56.1
56. 3
54.6
55.5
56.9

38.9
39.0
39.1
38.7
38.5
38.9

17.9
17.7
17.9
18.3
18.3
18.3

20.5
20.5
20 7
21.0
21 0
21.0

3 0
3.1
31
3.2
3 2

40 0
41.7
42 2
39.9
40 7
40.0

17 2
17.2
17 2
17.2
17 4
19.1

12.5
12.7
12 8
12.2
12 6
13.0

2.1
2.2
2.2
2.2
2.2
2.2

189.5
190.0
191 0
188.6
190 6
194.4

134.4

56.9

39.0

18.0

20.5

3.0

42.0

17.2

12.4

2.2

190.8

135. 1
134.6
137. 5
139.8
141.9
144.9

56.7
55.9
58.1
59.6
61.4
62.9

39.0
39.0
39.5
39.9
40.4
41.1

18.4
18.7
18.8
19.0
19.1
19.5

21.0
21.0
21.1
21 3
21.0
21.4

42.7
41.8
42.6
42 9
44.6
43.8

18.1
18.3
18.6
18 7
18.8
19.0

18.1
22.1
24.1
17 1
14.3
13.0

2.8
2.7
2.8
2.7
2.8
2.9

198 4
202. f
207."
203 I
203 C
206.3

225.4
229 4
233. 0
235. 2
237. 2
246.9

147.1
151.1
153.4
156.1
157.2
159.8

64.0
66.2
67.2
69.2
69 9
70.9

42.0
42.7
42.9
43.1
42.7
43.7

19.6
19.9
19.9
20.1
20 2
20.4

21.5
22.3
23 4
23.7
24 4
24.8

3.4
3.4
3.5
3 6
3.7
3.8
3.9
4.0
40
4.1
4 2
4 3

45.7
45.9
44 7
45.9
46 8
47 9

19.2
19.5
22 1
19.9
20 0
25 9

12.3
11.9
11 6
12.4
12 1
12 0

2.8
3.0
28
3.2
3.1
3.0

208.1
212.'
217 (
218.1
219 ;
228.,

227.1

146.5

63.5

41.3

19.5

22.2

3.8

44.6

19.8

15.1

2.9

210. £

245. 5
247.1
24S. 7
252 0
253.9
255.2

162.3
164. 2
IDS. 4
16S. 6
IBS. 7
172.0

71.7
72.4
73.5
74.8
75 2
75. 3

49.7
49 4
48.9
49 6
50.1
48.5

20.1
20 1
20.2
20 2
20.3
20.5

12.5
12 2
12.2
12 3
12.7
12.8

3.5
3.3
3.6
3.3
3.6
3.4

226 i
228.!
230. C
232 4
234.C
236 '

74.0
74.8
75.8
76.0
76 1
77.7

21.5
21.5
21.5
21.8
21 9
22.0

25.6
26.4
27.0
27 5
2S.0
28.7
28 9
29.4
29.8
31.1
31 8
31 2

4.4
4 5
4.6
4 6
4.7
4.8

171. 5
171.9
173.4
175. 2
176 4
177.8

44.4
44.8
45.0
45.3
45. 4
46.7
46.2
46.2
46.3
46.3
46 6
46.9

20.6
20.6
20.9
21.0
21.1
21.3

254 9
257.9
258.6
263.1
263 1
264 2

4 8
4.9
4.9
5.0
5 1
5 1

48 7
50.8
49.8
52.2
51 3
50 4

20 6
20.8
21.2
21.1
21 1
22 0

12 7
12.8
12.6
13.1
12 7
12 3

3.4
3.3
3.3
3.5
3.5
3.4

235 £
237. S
238. S
241.1
242 I
244.1

255.3

170.8

74.9

45.8

21.3

28.8

4.8

49.9

20.7

12.6

3.4

235.'

262 5
266 1
2f>5. 5
265 9
268.2
269.2

178.6
ISO. 5
180. 9
180.6
181.7
183.3

77.7
78.8
78.9
78.5
78.3
78.3

47.2
47.3
47.5
47.4
47.9
48.6

22.1
22.4
22.4
22.6
22.9
23.0

31.6
32 0
32.1
32.1
32.6
33.4

5.2
5 2

48.8
50 5
49.3
49 7
50.5
50.1

21.1
21 2
21.3
21 4
21.4
21.4

12.7
12 4
12.5
12 6
12.9
12.8

3.9
3.7

244.4
247. (
247.1
247.'
249.1
251.i

267 9
273.2
277.5
278. 6
278.3
281 2

181.7
186.2
189.6
191.3
192.5
193.3

7.5.7
80. 4
83.4
84.5
85.3
86.5

49.5
49.3
49. 5
sn. o
50.1
50.2

23.4
23.1
23.5
23.5
23.6
23.6

33.1
33.4
33.2
33.3
33.5
33.0

5 5
5.6
5.7
5.7

21 4
21.5
21.6
21.7
21.6
21.6

13.0
13.7
13.7
13.5
13.4
13.9

3.8
3.8
3.9
3.9

5.8
5.9

50 1
50.0
50.8
50.3
48.8
50.4

3.8
3.9

249. i
255.;
259.4
261.'
262. (
264.,

271.2

Total

17.9
17.8
18 0
18.0
18.3
18.1

214.6
217. 5
223.5
219.4
220.5
222.2

July

39.2
38.9
3S.8
39.4
39.6
39.2

206.8

June

59.8
58.8
57.3
57.6
57.2
56.4

203.8
205.8
207.1
202.9
205.0
208.2

April

136.9
135.5
134.2
135.2
135.3
134.1

185.1

80.6

48.7

23.0

32.8

5.5

49.9

21.4

13.1

3.8

253.

282 0
282.2
285 6
285 4
286.3
287 3

193.6
195.2
197.2
197.9
199.0
199.9

86.4
87.5
88.3
88.7
89.2
89.3

50.0
50.3
50.9
51.0
51.5
51.9

23.9
24.1
24.5
24.7
24.6
25.0

33.3
33.3
33.5
33.5
33.7
33.7

5.9

21.7
21.9
22.2
22.4
22.6
22.8

13.7
13.4
13.8
13.7
13.6
13.6

4.0

6.3
6.3

51.1
49.5
50.3
49 2
48.8
48.8

264. (
266. (
268.
269. (
270..
271.

288 2
286 4
287.7
287 8
287.2
287.0

201 4
200.6
199.2
199.1
197.9
196.0

89.8
89.2
88.0
87.9
87.0
85.5

52.7
52.4
52.5
52.5
52.4
52.1

25.3
25.2
24.9
25.0
25.0
25.0

33.6
33.8
33.8
33.7
33.5
33.4

64
6.5
6.5
6 6
6.6
6.7

47 9
46 6
48.9
48 0
49 1
50.2

23 0
23 2
23.4
23 5
23.7
23.8

13 6
13.6
13.7
14 6
13.9
14.4

4.1
4.1
4.0
4.0
4.0

4.1

273. (
272. f
271. S
272.'
271.;
269. £

198.1

88.1

51.7

24.8

33.6

6.3

49.0

22.8

13.8

4.0

270. (

1950

April
July
October

Total
1951

April
July
August

Total
1952
March
April
May

_ _.
-

July
August
November
December
Total
1953
February
April
May
July
September
December
Total

286.1

5.3

5 3
5.4

5.5

6.0
6.1

6 2

3.8
3.7
3.7

3.9

3.8
4.0
4.0
4.0
4.1

INDEX
Statistical tables are denoted by an asterisk (*)

Accidental damage to fixed capital
defined, 60
1929-53*, 164-165
see also Capital consumption allowances
Accounts, national economic (see Economic accounting system)
Agriculture
food and fuel produced and consumed on farms, imputation for, 46
income of farm proprietors, estimation of, 84-86
1929-53*, 162-163
1939-53*
quarterly, 218-219
seasonally adjusted quarterly totals at annual rates, 220-221
income trend since 1929, 9, 10
inventory change, estimation of farm, 85
wages, farm, estimation of, 71
see also Industries
Averages (see National income and product statistics; and Wages and
salaries)

B
Balance of international payments (see Net foreign investment)
Banks, commercial, and investment trusts, imputation for services rendered
by, 46-47
Business decline
1929-33, 15-16
1938, 17
1949, 24
1953 year end, 26
Business expansion
1933-37, 16-17
1938-41, 17-18
1945-48, 20-24
1949-50, 24
1952-53, 26
see also War economy
Business income (see Corporate profits; and Unincorporated enterprises,
income of)
Business income and product, consolidated
account
discussed, 40—49
1950*, 34
1953*, 160
components of, 1929-53*, 168-169
Business inventories, change in (see Inventory change)
Business output, measurement of, 32—34
Business sector
discussed, 40-49
income originating, 1929-53*, 174-175
Business transfer payments (see Transfer payments)

Capital consumption allowances
discussed, 42
estimation of, 150-152
accidental damage to fixed capital, 152
capital outlays charged to current expense, 151—152
depreciation charges, 150-151
revisions, characteristics of, 152
by type, 1929-53*, 164-165
1939-53*
quarterly, 230-231
seasonally adjusted quarterly totals at annual rates, 232-233
Capital outlays charged to current expense
defined, 60
1929-53*, 164-165
see also Capital consumption allowances
Change in business inventories (see Inventory change)
Commodity flow method of estimation (see Personal consumption expenditures for commodities; and Producers' durable equipment)
Communications and public utilities (see Industries)
Compensation of employees
defined, 59
distinguished from transfer payments, 53—54
by industry, 1929-53*, 178-179
by major component
1929-53*, 162-163
1939-53*
quarterly, 218-219
seasonally adjusted quarterly totals at annual rates, 220-221
trend in share of national income, 9-10
Constant dollars (see Gross national product in constant dollars)
Construction activity
estimation of, 122—126
building permits data, use of, 125
contract awards data, use of, 125
reports of work done or paid for, use of, 124-125
revisions, characteristics of, 126
sources and methods, summary of, 122—123
by type, 1929-53*, 208-209
1939-53*
quarterly, 222-223
seasonally adjusted quarterly totals at annual rates, 224—225
Construction, contract (see Industries)
Consumption (see Personal consumption expenditures)
Contributions for social insurance (see Social insurance contributions)
Corporate profits
Corporate income after Federal and State income and excess profits taxes
by industry, 1929-53*, 188-189
1939-53*
quarterly, 218-219
seasonally adjusted quarterly totals at annual rates, 220-221
243

244

INDEX

Corporate profits—Continued
Corporate income and excess profits tax liability
by industry, 1929-53*, 186-187
1939-53*
quarterly, 218-219
seasonally adjusted quarterly totals at annual rates, 220-221
Corporate income before Federal and State income and excess profits
taxes
by industry, 1929-53*, 184-185
1939-53*
quarterly, 218-219
seasonally adjusted quarterly totals at annual rates, 220-221
estimation of, 92-97
base year estimates, 92—94
for recent years, 95—97
revisions, characteristics of the, 96—97
Reconciliation of Department of Commerce estimates with Internal
Revenue Service tabulations, 1929-51*, 214-215
trend in share of national income, 10
Undistributed corporate income, by industry, 1929-53*, 192-193
Corporate profits before tax
defined, 59
see also Corporate profits
Corporate profits tax liability
defined, 59
see also Corporate profits; and Government receipts
Corporate sales by industry, 1929-53*, 204-205
Current surplus of government enterprises
defined, 60
see also Government and government enterprises; and Subsidies minus
current surplus of government enterprises

Definitions of concepts and terms, 58—60
Depreciation charges
defined, 60
1929-53*, 164-165
see also Capital consumption allowances
Disposable income
average per capita, 1929-53*, 24-25
in constant dollars*, 24-25
defined, 58
1929-53*, 164-165
1939-53*
quarterly, 226—227
seasonally adjusted quarterly totals at annual rates, 228—229
see also Personal income
Distributive shares {see National income)
Dividends, corporate
defined, 60
estimation of {see Corporate profits)
by industry, 1929-53*, 190-191
and personal interest income, monthly, 1929—53*, 238-242
by sector of origin, 1950*, 37
1939-53*
quarterly, 230-231
seasonally adjusted quarterly totals at annual rates, 232-233

Earnings per full-time employee, average annual, by industry, 1929-53*,
200-201
Economic accounting system
accounts, sector, 1953*, 160-161
advantages of, 28
business sector, 40-49
government sector, 53—56
improvements needed in, 29

Economic accounting system—Continued
national income and product account, 31-32
personal sector, 49—53
principles of, 27-28
rest of the world sector, 56-57
technical uses of, 28-29
see also Output, measurement of
Employee compensation {see Compensation of employees)
Employees, number of
full-time and part-time, average, by industry, 1929-53*, 198-199
full-time equivalent, by industry, 1929-53*, 196-197
increase in Federal employment since 1929, 8
Equipment, producers' durable {see Producers' durable equipment)
Estimation (sources and methods)
aim and plan of description, 67
guide to sections on methodology, 68
of capital consumption allowances, 150-152
of new construction, 122-126
of corporate profits, 92—97
of government receipts and expenditures, 143—149
of interest, 97-103
of change in business inventories, 135-138
of net foreign investment, 139—143
of personal consumption expenditures for commodities, 103—117
of personal consumption expenditures for services, 117—122
of personal saving, 150
of producers' durable equipment, 126-135
of rental income of persons, 86—92
of contributions for social insurance and other labor income, 73—75
of supplements to wages and salaries, 73—75
of transfer payments, 149-150
of income of unincorporated enterprises, 76-86
of wages and salaries, 68-73
reliability of the estimates, 62—67
appraisal of income and product components, 63-64
degree of independence of income and product estimates, 64-65
error, allowing for statistical, 66—67
factors affecting reliability, 62—63
revisions, characteristics of, 65—66
reporting systems and data collection, 61-62
reporting units, types of, 61
salient features of the statistical methodology, 61—62
stages of statistical measurement, 61
see also under title of particular series

Factor cost or income
concept of, 39-40
and other charges against final product, 31
see also National income
Farms {see Agriculture)
Final product
charges against, 30—31
concept of, 37-39
distinguished from intermediate product, 30
Finance, insurance, and real estate
relative decline since 1929 in, 7-8
see also Industries
Foreign investment {see Net foreign investment)

Government and government enterprises
economic accounting for government enterprises, 49
see also Industries
Government expenditures
estimation of, 146—148
by type, 1929-53*, 172-173

245

INDEX
•Government interest payments
increase since 1929, 13
treatment in economic accounting system, 54
1929-53*, 164-165, 172-173
1939-53*
quarterly, 230-231
seasonally adjusted quarterly totals at annual rates, 232-233
see also Interest
'Government purchases of goods and services
defined, 59-60
estimation of {see Government expenditures)
growth since 1929, 6-7
military requirements dominant after 1940, 18
by supplying sector, 36
1929-53*, 162-163, 172-173
1939-53*
quarterly, 222-223
seasonally adjusted quarterly totals at annual rates, 224-225
•Government receipts
estimation of, 144-145
by type, 1929-53*, 170-171
Government receipts and expenditures
account, consolidated
discussed, 53—56
1950*, 54
1953*, 161
estimation of, 143—149
revisions, characteristics of, 148-149
Government sector
discussed, 53-56
expansion in role of, 15
income originating, 1929-53*, 174—175
measure of output in, discussed, 35, 53-54
Government surplus or deficit on income and product transactions
war generates large deficit, 15
1929-53*, 164-165
Government wages and salaries
estimation of, 70—71
statistics (see Wages and salaries)
Gross national expenditure {see Gross national product)
-Gross national product
average per capita, 1929-53*, 24-25
in constant dollars
average per capita, 1929—53*, 24—25
characteristics of the estimates, 153—155
by major components, 1929-53*, 216-217
statistical sources and methods, 155-158
personal consumption, 155-156
investment, 156
government purchases, 157
summary tables, note on, 157—158
by major components
1929-53*, 162-163
1939-53*
quarterly, 222-223
seasonally adjusted quarterly totals at annual rates, 224-225
defined, 1, 58, 59-60
national income, and personal income, relation of
1929-53*, 164-165
1939-53*
quarterly, 230-231
seasonally adjusted quarterly totals at annual rates, 232—233
patterns of change since 1929, 13—15
percentage distribution
by type of expenditure, in current and constant dollars, 1929 and
1953*, 4
by type of expenditure and type of receipt, 1929-53*, 22-23
price deflators (implicit) for major segments, 1929-53*, 216-217

Gross national product—Continued
by sector of origin, 1950*, 36
shifts in the composition of, 4-7
Gross private domestic investment
defined, 59
fixed investment, 43-44
fluctuations since 1929 in, 13—15
inventory change and the inventory valuation adjustment, 44—45
by major components
1929-53*, 162-163
1939-53*
quarterly, 222-223
seasonally adjusted quarterly totals at annual rates, 224-225
see also Construction activity; Inventory change; and Producers' durable
equipment
Gross saving and investment account
discussed, 57—58
1950*, 58
1953*, 161
Growth of the Nation's economy, 2-4

H
Households and institutions
measure of production in, discussed, 35
income originating, by type, 1929—53*, 174—175
Housing
imputation for rental value of owner-occupied, 46
personal consumption expenditures for
by type, 1929-53*, 206-208
1939-53*
quarterly, 234-235
seasonally adjusted quarterly totals at annual rates, 236—237
rent of tenant-occupied nonfarm dwellings, estimation of, 87-90
rental value of owner-occupied dwellings, estimation of
farm, 84-85
nonfarm, 91

I
Imputation
major items of personal income and personal consumption expenditures
in kind, 1929-53*, 214-215
for production in the business sector, 45—48
for production in the government sector, 55—56
for production in the personal sector, 52
theory of, 30, 38-39
see also Housing; Interest; and Wages and salaries
Income in kind {see Imputation)
Income, national {see National income)
Income, personal (see Personal income)
Income shares (see National income)
Income of unincorporated enterprises (see Unincorporated enterprises,
income of)
Indirect business tax and nontax liability
defined, 60
distinguished from personal taxes, 55
estimation of, 145
for specified taxes, 1929-53*, 170-171
1929-53*, 164-165
1939-53*
quarterly, 230-231
seasonally adjusted quarterly totals at annual rates, 232—233
Industries
classification of, 67-68
exhibit, 66
1929-53*
average annual earnings per full-time employee, 200—201
corporate sales, 204—205
income originating, by type, 176—195
inventory change, business, 210—211

246

INDEX

Industries—Continued
1929-53*
nonagricultural personal income, monthly, 238—242
number of employees, 196-199
number of persons engaged in production, 202-203
wage and salary disbursements, by broad divisions, monthly, 238-242
Institutions, nonprofit, 52
Interest
estimation of, 97-103
imputed interest paid, 100-101
imputed interest received, 102
monetary interest paid, 98-100
monetary interest received, 101—102
net interest paid by government, 103
by industry division, 1929-53*, 194-195
monetary and imputed, 1929-53*, 212-213
relation of major flows, 97—98
by sector of origin, 1950*, 37
trend in share of national income, 10
1939-53*
quarterly, 218-219
seasonally adjusted quarterly totals at annual rates, 220—221
see also Government interest payments; Net interest; and Personal
interest income
Intermediate products {see Final product)
Inventory change
estimation of farm, 85
estimation of nonfarm, 135—138
book value aggregates, 136—137
conversion of book values to constant prices, 137—138
conversion of deflated change to current prices, 138
last-in, first-out (LIFO) inventories, adjustment for, 137
revisions, characteristics of, 138
sources and methods, summary of, 135—136
and the inventory valuation adjustment, 44—45
by legal form of organization and by industry, 1929-53*, 210-211
1939-53*
quarterly, 222-223
seasonally adjusted quarterly totals at annual rates, 224-225
see also Inventory valuation adjustment
Inventory profits and losses
influence on trend of corporate profits, 10
see also Inventory valuation adjustment
Inventory valuation adjustment
defined, 59
estimation of {see Inventory change, estimation of business)
first-in, first-out (FIFO) method of accounting, 44—45
by legal form of organization and industry, 1929-53*, 194-195
last-in, first-out (LIFO) method of accounting, 45, 137
nature of, 44
1939-53 (corporate)*
quarterly, 218-219
seasonally adjusted quarterly totals at annual rates, 220—221
see also Inventory change
Investment {see Net foreign investment; Gross private domestic investment;
and Gross saving and investment)

K
Korean war period {see War economy)

Life insurance
economic accounting for mutual (illustration), 48
and other mutual financial intermediaries, imputation for services
rendered and property income received by, 48
Liquid saving
influence of, 1945-48, 20
items of, 1933-53*, 166-167

M
Manufacturing
growth since 1929 in, 7
see also Industries
Methods, statistical {see Estimation)
Mining {see Industries)

N
National income
average per capita, 1929-53*, 24-25
defined, 1-2, 58, 59
by distributive share or type
in the business sector, 41
changes since 1929, 9-10
interpretation of income share breakdown, 42-43
1929-53*, 162-163
percentage distribution, 22—23
1939-53*
quarterly, 218-219
seasonally adjusted quarterly totals at annual rates, 220-221
by industrial origin
1929-53*, 176-177
percentage distribution of private nonagricultural income, 1929-53*,
22-23
shifts in pattern since 1929, 7-9
by legal form of organization, 1929-53*, 174-175
relation to personal income, 51
by sector of origin
1950*, 36
percentage distribution, 1929-53*, 22-23
personal income, and gross national product, relation of
1929-53*, 164-165
1939-53*
quarterly, 230-231
seasonally adjusted quarterly totals at annual rates, 232—233
see also Factor cost or income
National income and product, review of, 1929-53, 1-26
National income and product account
explanation of, 31—32
by sector of origin, 1950*, 36
1950*, 33
1953*, 160
National income and product statistics
averages per capita for selected series, 1929-53*, 24-25
basic notions underlying national output measurement, 30—32
definitions, 1-2, 58-60
list of statistical tables in Part V, 159
nature and significance of, 27—29
reliability of, 62-67
National product, gross {see Gross national product)
National product, net {see Net national product)
Nation's economy
basic trends in, 2—13
business sector of, 40—49
coverage and definition, 32
fluctuations since 1929 in, 13-26
government sector of, 53—56
Korean war period, 24-26
personal sector of, 49-53
rest of the world sector of, 56-57
war economy, 1942-45, 18-20
Net change in business inventories {see Inventory change)
Net corporate dividend payments {see Dividends, corporate)
Net foreign investment
definition and scope, 59, 139
derivation of measure of, 36—37
estimation of, 139-143
factor income payments to the U. S., 139—140
net foreign purchases from the U. S., 140—143
merchandise exports and imports, 140

INDEX
Net foreign investment—Continued
1929-53*, 162-163
1939-53*
quarterly, 222-223
seasonally adjusted quarterly totals at annual rates, 224-225
see also Rest of the world sector
Net interest
defined, 59
see also Interest
Net national product or expenditure
denned, 58
1929-53*, 164-165
Nonprofit institutions, 52
Number of persons engaged in production, by industry, 1929-53*, 202-203

"Other labor income"
defined, 60
estimation of, 74—75
1929-53*
annually, by type, 210-211
seasonally adjusted monthly totals at annual rates, 238-242
Output, measurement of
business output, 32-34
national output, 30-32
need for market-type measures, 39
nonbusiness output, 34-35
in real terms (see Gross national product in constant dollars)

Pension plans, private (see Private pension and related plans)
Personal consumption expenditures
average per capita, 1929-53*, 24—25
in constant dollars*, 24—25
cyclical stability of, 15
defined, 59
estimation of, for commodities, 103-117
commodity flow method
nature of, 103-104
use of, 1929-39, 106-111
use of, 1947, 111-115
extension of commodity flow benchmarks, 104, 115
methods other than commodity flow, 104, 115-117
reliability, considerations of, 104—105
retail valuation method, 115—117
estimation of, for services, 117—122
comprehensive annual reports, use of, 118—119
periodic comprehensive sources, use of, 119—121
revisions, nature of, 122
sample information, use of, 122
sources and methods, summary of, 117—118
patterns since 1929 reflect price shifts, 4
and personal income in kind, major items of, 1929—53*, 214-215
personal outlay and saving, 51—52
by supplying sector, 36
by type of product, 1929-53*. 206-209
by major type, 1939—53*
quarterly, 234-235
seasonally adjusted quarterly totals at annual rates, 236-237
Personal income
average per capita, 1929-53*, 24-25
classification of, 50-51
defined, 2, 58, 60
and disposable income, nature and uses of measures of, 31
and disposition of income, 1929—53*, 164—165
disposition of, 1939-53*
quarterly, 226-227
seasonally adjusted quarterly totals at annual rates, 228-229

247

Personal income—Continued
expansion of since 1929, 11-13
in real terms, 13
national income, and gross national product, relation of
1929-53*, 164-165
1939-53*
quarterly, 230-231
seasonally adjusted quarterly totals at annual rates, 232-233
and personal consumption expenditures in kind, major items of, 1929—
53*, 214-215
relation to national income, 51
seasonally adjusted monthly totals at annual rates, 1929-53*, 238-242
Personal income and expenditure account
discussed, 49-53
1950*, 50
1953*, 161
Personal interest income
defined, 60
and dividends, monthly, 1929-53*, 238-242
1929-53*, 164-165
see also Interest
Personal saving
defined, 60
estimation of, 150
Securities and Exchange Commission estimates of, and comparison with
Department of Commerce estimates, 1933-53*, 166-167
1929-53*, 164-165
1939-53*
quarterly, 226—227
seasonally adjusted quarterly totals at annual rates, 228—229
and spending, 51—52
Personal sector, 49-53
see also Households and institutions
Personal tax and nontax payments
defined, 60
distinguished from indirect business taxes, 55
estimation of, 145
for specific taxes, 1929-53*, 170-171
1929-53*, 164-165
1939-53*
quarterly, 226-227
seasonally adjusted quarterly totals at annual rates, 228—229
Plant and equipment outlays (see Gross private domestic investment)
Population of the continental United States, 24-25
Prices
implicit price deflators for gross national product
discussed, 157-158
by major segments, 1929-53*, 216-217
see also Gross national product in constant dollars
rise, 1946-48, 20
Private pension and related plans, employer contributions under
estimation of, 74-75
treatment of in relation to social insurance funds, 56
1929-53*, 210-211
Producers' durable equipment
commodity classification of, 126
defined, 43, 128
estimation of, 126—135
commodity flow estimates
1929-39, 128-129
1940-46, 132-133
1947, 129-131
1948-52, 133
methods other than commodity flow, 134-135
reliability, considerations regarding, 127
revisions, nature of, 135
sources and methods, summary of, 126—127
share of investment rises, 4-6

248

INDEX

Producers' durable equipment—Continued
private purchases of
by type, 1929-52*, 210-211
1929-53*, 162-163
1939-53*
quarterly, 222-223
seasonally adjusted quarterly totals at annual rates, 224-225
Product, gross national (see Gross national product)
Production
economic, 30
number of persons engaged in, by industry, 1929-53*, 202-203
see also Gross national product; National income; and Output, measurement of
Productivity
advance in, 2
factors in, 2 4
—
Professional practitioners, estimation of income of, 78
Profits (see Corporate profits; and Unincorporated enterprises, income of)
Proprietors' and rental income
defined, 60
trend in share of national income, 10
1929-53*
annually, 164-165
seasonally adjusted monthly totals at annual rates, 238-242
by type, 1939-53*
quarterly, 218-219
seasonally adjusted quarterly totals at annual rates, 220-221
see also Rental income of persons; and Unincorporated enterprises,
income of

Q
Quarterly statistics, 218-237

R
Reconciliation items
defined, 60
statistics (see Relation of gross national product, national income, and

personal income)
Reconversion, postwar, 20
Relation of gross national product, national income, and personal income
1929-53*, 164-165
1939-53*
quarterly, 230-231
seasonally adjusted quarterly totals at annual rates, 232-233
Reliability of the estimates (see Estimation; and under titles of particular
series)
Rental income of persons
defined, 59
estimation of, 86—92
from farm realty, 91
from owner-occupied nonfarm dwellings, 91
from rented nonfarm property, 86-91
revisions, characteristics of, 91—92
see also Housing
1929-53*, 162-163
1939-53*
quarterly, 218-219
seasonally adjusted quarterly totals at annual rates, 220-221
Rental value of owner-occupied housing, imputation for, 46
Rest of the world sector
account
discussed, 56-57
1950*, 56
1953*, 161
gold, accounting for transactions in, 57
income originating, 1929—53*, 174—175
international gifts, accounting for, 57
measure of U. S. output originating in, 35
shift in foreign transactions since 1929, 6
transactions with the United States, 1929-53*, 174-175
see also Net foreign investment

Revisions in the national income and product statistics, 65-66
see also under titles of particular series

Sales, corporate, by industry, 1929-53*, 204-205
Saving
sources and uses of gross, 1929-53*, 164-165
see also Gross saving and investment; and Personal saving
Sectors of the Nation's economy (see Nation's economy; and Economic
accounting system)
Services (see Personal consumption expenditures; and Industries)
Social insurance contributions
employer, by type of contribution, 1929-53*, 210-211
estimation of, 73—74
growth of since 1929, 12-13
and other labor income, estimation of, 73—75
personal
defined, 60
1929-53*
annually, by type, 212-213
seasonally adjusted monthly totals at annual rates, 238—242
1929-53*, 164-165
1939-53*
quarterly, 230-231
seasonally adjusted quarterly totals at annual rates, 232—233
Social insurance funds
and private pension funds, 56
transactions of, 1929-53*, 172-173
Sources and methods of estimation (see Estimation)
Sources and uses of gross saving, 1929—53*, 164—165
Statistical discrepancy
denned, 60
significance of, 64
1929-53*, 164-165
1939-53*
quarterly, 230-231
seasonally adjusted quarterly totals at annual rates, 232-233
Subsidies
defined, 60
distinguished from government purchases, 55
minus current surplus of government enterprises
1929-53*, 164-165
1939-53*
quarterly, 230-231
seasonally adjusted quarterly totals at annual rates, 232-233
and taxes, treatment of, in measuring business output, 33—34
Supplements to wages and salaries
defined, 59
estimation of, 73—75
by industry division, 1929-53*, 182-183
by sector of origin, 1950*, 37
by type, 1929-53*, 210-211
1939-53*
quarterly, 218-219
seasonally adjusted quarterly totals at annual rates, 220-221

Taxes
and subsidies, treatment of, in measuring business output, 33-34
see also Corporate profits tax liability; Indirect business tax and nontax
liability; and Personal tax and nontax payments
Trade, wholesale and retail
growth since 1929, 7
see also Industries
Transfer payments
business, 41—42
defined, 60

249

INDEX
Transfer payments—Continued
distinguished from compensation of employees, 53-54
estimation of, 149-150
increase since 1929, 11-12
1929-53*
annually, by type, 212-213
seasonally adjusted monthly totals at annual rates, 238-242
1939-53*
quarterly, 230-231
seasonally adjusted quarterly totals at annual rates, 232—233
Transportation (see Industries)

u
Undistributed corporate income, by industry, 1929-53*, 192-193
Unincorporated enterprises, income of
defined, 59
estimation of, 76—86
business enterprises
benchmark estimates, 79—80
estimates for other years, 80-83
farm proprietors
gross farm income, 84—85
production expenses, 85
professional practitioners, 78
revisions, characteristics of, 83—84, 85—86
sources and methods, summary of, 76—77
by industry, 1929, 1939, 1945, 1949*, 77
by industry division, 1929-53*, 182-183
shifts since 1929, 10

Unincorporated enterprises, income of—Continued
1939-53*
quarterly, 218-219
seasonally adjusted quarterly totals at annual rates, 220—221

w
Wage and salary disbursements
defined, 60
estimation of, 72--73
1929-53*
annually, 164—165
seasonally adjusted monthly totals at annual rates, 238-242
Wages and salaries
average annual per full-time employee, by industry, 1929-53*, 200-201
defined, 59
estimation of, 68—73
industries covered by social security programs, 68-70
industries not covered by social security programs, 70—72
by industry, 1929-53*, 180-181
paid in kind, imputation for, 46, 52, 55—56
by sector of origin, 1950*, 37
1939-53*
quarterly, 218-219
seasonally adjusted quarterly totals at annual rates, 220—221
Wages and salaries, supplements to (see Supplements to wages and salaries)
War economy
Korean war period, 25-26
1942-45
peak war production, 1944, 19
problems, 18
war changes distribution of output, 19—20

Full text of National Income and Product Accounts Benchmark Revisions : National Income, 1929-53

FRASER