Abstract:
The world‟s most powerful number, the gross domestic product (GDP), was invented exactly 80 years
ago.1 It was indeed in 1934 that a young economist by the name of Simon Kuznets (who would later
on receive a Nobel Prize for this) presented his first report on the design of national income accounts
to the US congress.2 Those were the hard times of the Great Depression and governments were
desperately seeking some type of indicator to gauge if and how the economy was recovering. GDP did
exactly that: it conflated the amount of spending for goods and services into one single number, which
would go up in good times and down in bad times. A few years later, the Second World War, with its
massive need for a top-down command over economic activities, sealed the close relationship between
GDP and politics. Indeed, the availability of regular and detailed statistics on the strengths and
weaknesses of the economy helped the American government outpace its enemies in terms of
munitions‟ production. More importantly, it allowed for the conversion of the civilian economy into a
war machine without hampering internal consumption, which turned out to be a major advantage in
generating revenues for the war (thus avoiding bottlenecks such as those experienced by Hitler‟s war
economy) and propelling large-scale consumption in the post-war period.
