Documents / FOIA release
This Joint Committee Print, dated December 8, 1982, gathers studies that the Central Intelligence Agency's Directorate of Intelligence prepared for the Joint Economic Committee of the US Congress. It gives estimates of Soviet gross national product for 1950 to 1980, with indexes of industrial production, agricultural production and consumption, and explains the methods and data behind them. The foreword says official Soviet statistics inflate growth and that the CIA measures offer a more accurate picture. The document contains no UFO material.
“Hill”4 pages
Approved for Release: 2019/07/19 C05210421 that machinery is the branch most affected by the value series. The value series are used to measure changes in only about one-fifth of industrial production. Because quantity series and value series are not evenly distributed among the branches, indexes dominated by value series suffer most from the distortion caused by disguised inflation. Shares in 1970 of Value Added Percent Value Series Quantity Series Branch Chemicals and petrochemicals 95 5 Wood, pulp, and paper 85 15 Light industry 65 35 Machinery Producer durables 41 59 Consumer durables 27 73 The Importance of Disguised Inflation. Considerable attention has been devoted to the possibility of hidden inflation in the value series included in the SPIOER samples. The major industrial branches in which value series are used to measure production are listed in table 17. The branch samples are divided into quantity or official value series, and two separate indexes are calculated for each branch—one for prod- ucts reported in physical units and one for products reported by value. (Value-added weights are used to aggregate individual series.) The table compares the growth rates for these components of the branch indexes in which value series are important. The value series generally grow substantially faster than the physical series. This does not necessarily mean that the differences are caused by disguised inflation of the value series. For example, in the wood, pulp, and paper industry the rapidly growing value series is furniture. While new-product pricing un- doubtedly is a problem in the furniture industry, furniture output has been a stellar performer in a branch that otherwise is nearly stagnant. Similarly, it is not surprising that sewn goods—-measured in rubles—-is one of the fastest growing components of light industry; in later phases of development the processing of fabrics becomes more important than the manufacture of the fabrics themselves. The results for consumer durables are surprising. Value series comprise a larger share of the sample than in any other part of SPIOER; ironically, the value series increase more rapidly than the quantity series only in three of the six periods. During the entire 29-year period, the value series increased only 0.9 percentage points per year faster. The producer durables comparison is more troublesome. Between 1950 and 1979 the value series in the producer durables sample increased on average nearly 4 per- centage points faster than the quantity subsample— suggesting a substantial upward bias in the official value series. Not all of the discrepancy in the machinery series can be attributed to index distortions, however. The quan- "tity series do include machinery sectors that are actually growing more slowly than sectors represented by value series. For example, transport machinery—a quantity series—traditionally grows slowly once a :nation’s transportation infrastructure is in place, and instruments and computers—a value series——has been a fast growing sector since l960. We can test this hypothesis in a rough way. The Soviets publish GVO indexes for subgroups of machinery at a level of detail that is unavailable in most of the other industrial branches. The official GVO machinery branch indexes for the years 1960, 1965, 1970, 1975, and 1980 were used to estimate subsample growth based strictly on official GVO data. These component in- dexes were then classified according to whether they were predominantly represented by quantity or value series in the SPIOER machinery sample. According to the rates of growth shown in table 18, the branch subsample represented by quantity series is growing about 2 percentage points less rapidly than the sub- sample described by value series. We conclude, there- fore, that the machinery represented by quantity data are less dynamic machinery sectors. 215 Approved for Release: 2019/07/19 C05210421
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FOIA release, from the cia-readingroom collection. The PDF is mirrored here; the original link is under it. 399 pages are in the text index: search them above, or from the library's search.