GOVERNMENTAL PRICE POLICIES IN THE THIRD REICH

392 Pages·032.17 MB·English

by  JANSSEN, HANS

DOCTORAL DISSERTATION SERIES
Governmental m e t G lid e s
TITLE.
in the Third Reich

Hans J&nssen Jm m i
AUTHOR DATE
Tbinsybania S late College
UNIVERSITY.
v56 9
Ph.D.
DEGREE PUBLICATION NO.
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UNIVERSITY MICROFILMS
M A N N ARBOR - M I C H I G A N
eul-air.U'rf in fiilfilh n o n f
of* the r _ 'Oiircoeenfc
fo r the derree of
Doctor o f Philoso.pViy
*
rO V^jjl^nU’CIJTAL PRICE '■ POLICIES
-!--r rn^T'-ri ;;rrr*r ■p'ra "p*!pTriTT
. j.a. ±xL:jj ~ ujIuj 1 »
,ns Janssen.
motto :
“ Aile i'olitik ist kunst. Sie bewegt sicri
in der "Veit der historischen Taten,
verwaridelt sic’i und trei'bt neue Bindungen,
vd’irend v/ir reden.
Dalier muss jede Tlieorie mangelhaft bleibsn,
(All policy is art, at work in a world of
historic deeds, changing and actuating new
. combinations, while we talk. '
.'fence every theory must remain imperfect.)
Heinr, v„ Treitschke , "Bolitik"
Vol.I, p. 51. Berlin,1918
PREFACE.
This study in .Pul:lie price policy-has been made possible
tbr~’ ■ -• -; o arch-grant. of the Henry Janssen Foundation, Reading,
Pbhncyl vania. '• To Hr. J’enry Janssen this treatise 'therefore is
res cct.full; end grx tefixlly dedicated. p
The author started' M s investigations during - the summer.-'
of 1937, visile on a journey ..hiprcugh. Gorxiony in search for on ansner
to the then rather px:soling pricing problems arising from the "Price
Change Uoratorium11 declared oitl: the launching of the "Four- Year-
Plan”. It is hoped that, this effort at interpretation-of .public
policies abroad . may serve to clarify the. 'intricacy - of the problem
confronting our United .States' to-day.
Grateful acbnoniedp'ment of most valuable cooperation and
service is due to numerous friends. The la.to Ea.rdelcgeric-htsre.t
Anton Deutanenn, founder and director of the jlaus_fuer Berufs vestal ttmg,
Tlcuv/ied at Rhein, rmr. most I'elpful ir: securing introductions to vari­
ous Gorman political and academic authorities interviewed. The- present
v.ritor1 s father, Johannes Jansson, deserves particular thanks for his
indefatigable efforts in securing vital information under adverse cir­
cumstances. The incentive Director of the Research Institute for
Tva.de (Ff.Il), Berlin, Dr. Joachim Tiburtius, and the executive staff
of the Economic Group- Retail Trade, Senator Heinrich Beythien of the
Cooperative rd&coxint St amp Association, the board of directors of
the KDEKA movement, the executives of the "Puarnberger Eund" Wholesale
Cooperatives, particularly Dr. falter Pelletier as -veil as Editor
1(1
Horst 7'elmor of the RETOPEI - Official' 'Retail Trade Weekly, Berlin,
have been most courteous in their service of furnishing authentic
source data. -
The generous•hospitality and cooperation of Professor Dr.
YJilheLn' Vcrsk&fen- and of his scholarly staff at the Consumption Re­
search Institute in Inarebberg, of Dr. G. lartske at the : American
Institute of the Berlin University,, of the Eej^e^haus and the Berlin
Branch ofathe Gustav Oberlaender Trust, and .-of the Retail Trade Re­
search Institute at the author’s former ^Iria^ijiater, the University
end College of Commerce of - Cologne, : is .herewith gratefully achnov/ledged.
Dr. Carl b. Hasok, 'tad of the. Department'of Economics and
Sociology -.at -The Pcnnsylvt nia State College has suggested ancl super­
vised this research project. The manuscript in various sieges has
been read by Associate Professor of .marketing, Dr. Kenneth D. Hutchin- •
son. Justisrat Dr. jur. Druno Stern and fir. Allen V. hiley also
have read the entire .Manuscript, Professor of Accounting, Charles J,
Ro-aiand and Professor of Business I,an, Sheldon C. Tenner of the Econom­
ics Department of The Pennsylvania State College, read chapters IX, X
and XI, and Professor Dr. Robert E, Dangler, Head, of the Classical
Language Department, rendered valuable assistance in philological prob­
lems concerning proper definition and' diction. All their suggestions
led to the elimination of many Impcrfactions. The author assumes full
responsibility for the short-comings remaining in the treatise. All
translations, iron primary and secondary sources are tho author’s own
version,' -which aimed at accuracy in meaning rather than toward elegance
of eor.TG.sc ion. frs. indeline C. Cam obeli ore-pared the manuscript.
w
To the courteous staff of The Pennsylvania State College Library,
particularly to the Assistant Librarian in charge of Reader !:S
Service, hliss Katherine in Stokes, who ..succeeded in tracking' .dorm' Hios
elusive sources, the atithor expresses with pleasure his grateful ;
a pore ciation.
.Germany's invasion of. Russia represents the date of debarkation
up to which this study has tried to trace the political 'and' economic
develooiaents in the Third : Reich.
TABLE. OF COPTENTS
Preface : V
Introduction. The Problem and. its Setting. I
.'PART I.
INSTITUTIONAL AND. IESTOEICAL PRECEDENTS AilD ECONOMIC
CONDITIONS FAVORING GOVE1T1REUTAL INTERVENTION .IN
.TEE PRICING PROCESS.
CHAPTER I. IH-
HISTORICAL PRECEDENTS'OF-EFFORTS AT PRICE AJ.-1D :LARKET CONTROL BY
PREVIOUS PERSIAN GOVERNI JEN.TS. ~ '
I. The 'Alternatives, available ■ during the first-Tor Id -Tar.
1. . The; Principle of "Laisses fairs".. 2. The idea
of the ^'Closed ■. Commercial State”• 3. Elasticity
in price policy. A. Complete Socialisation.
II. Price Policies of the 'Aeimar Republic.
A. Sporadic'efforts; a complete lack of co-ordinated
planning during the period of post-war inflation
resulting in a weakening of the economic basis of
German democracy.
B. Deflation policy by Emergency Decree. - The price
lowering' decrees of the Bruening government. -
Dictatorial powers granted to a Federal Commissary
for the Supervision of Prices resulting in a
co-ordinated program successful as a short-term
measure. A balanced price level attained; but
international and internal political factors frus­
trating the economic success; democracy doomed.
CHAPTER II.
ECONOMIC COHDITIQHS IN 1933 DEMANDING MARKET CONTROLS. OBJECTIVES
OF NATIOML SOCIALISTS.
I. ''Unemployment, how. can- it be cured? By attacking the
structural maladjustments of the German economy.
II. Agriculture. "Back to the soil"I in spite of an tmfavor-
' able-ratio of productivity, which might be minimised by
control of the price mechanism.
III. Transportation, the system in need of co-ordination.
This can be acconrolished if the rising price level is
ixed by state control.
IV. Rearmament, some economic aspects of the "Defense Economy",
involving market controls.
V. "Ersatz", synthetic production will be px-ofitable in the
long run; the cxitical period of product evolution is
accelerated through the program of the second "Four Year
' Plan". ■
VI. The'.Cartel, problem in industry demands state intervention.
VII. The Marketing sphere suffers from over expansion of enter­
prises in various branches. "Closed EI-3TRY" established by
government decree necessitates adequate price controls to
safeguard a semblance of free competition.
VIII. The "Multiplier Principle" can be effectively supported
by rigging the price level.
IX. Social productivity versus capital productivity.
H. v. Staclcelberg* s theoretical justification of State
intervention in the price mechanism.
PART II.
VARIOUS PHASES OF GOVEREMERT PRICE POLICIES ADD THEIR
DIVERGED! STRATEGIC OBJECTIVES.
CHAPTER III.
RESTORATION OF THE "NORMAL MARKET PRICE” THROUGH REGULATED'BUSINESS
PRICE POLICY UNDER GOVERNMENTAL PRICE SUPERVISION.
I Price stability' endangered by short-run factor
II Central price supervision
III. Methods and means
A. Measures for setting the price ceiling.
B. ... Measures for controlling the price bottom, through
regulation.of competitive practices.
G. Market police through enforcernent of "prlce-publicity"
and "price lucidity".
D. The Trade-Discount Reform
IV. Conclusion of the phase of Price supervision
CHAPTER IV.
THE EMERGENCE OF A "SOCIAL PRICE" THROUGH THE TRANSFQRMATION OF
THE GERMAN CARTEL FROM AN INSTITUTION OF MONOPOLISTIC
COMPETITION TO A SOCIAL MONOPOLOID UNDER STATE CONTROL.
Cartel aims: Monopoly position or regulated competition?
II Origins: The Thesis of Schmalenbach versus the view of Mises
III. Cartel price policy.. YJho administers prices and how are
they determined? The Policy-determing agencies. Criteria
for the calculation of cartel prices: l). The "Highest Cost"
principle. 2). The "Normal Calculation" principle., 3).
"Fighting the Outsider" motivation. l). Individual member
price. 5). Preference Cartel price.
IV. Price Indeterminateness in oligopolistic markets
V The alternative between collecting differential rent and
eorpanding the market.
economy.
VI. The principle of social control over cartel prices.
VII. The Cartel form as an instrument of state policy.
VIII. Price differentiation.
IX. Cartel orice regulation in the VJar Economy Decree
(9-1-1939).
CHAPTER V.
THE "POLITICAL PRICE'hOF THE AGRICULTURAL SECTIOH OF THE MARKET
APPLIED AS A STRATEGIC VJEAPOI-3 OF PUBLIC PRICE POLICY TO
COItPEL STRUCTURAL CHAHGES IK HATIOML LCOHOMY.
I. Aims. : ■
II. Origins..
III. The value and price theory, of G. Rutland.
IV. Similarity and differences of the KS "Harket-Order" and
the Ruhland scheme.
V. The Problematic relation between agricultural prices and
farm production regarded from the viewpoint of the in—
dividual entrepreneur.
VI. Alternatives open to the government.
VII. Fundamental principles of narket-order and price policy.
''/III. Three distinct phases of agricultural price nolicy.
a). 1933-March 1937; b). 193 7-Februkry 194-0:
c). February 194-0 to date.
IX. A three-dimensional price system.
Conclusion.