# Why are subscriptions to the World Bank's IBRD measured in 1944 US dollars? How is this calculated?

Several official documents published by the World Bank's 'International Bank For Reconstruction and Development' (IBRD), such as https://pubdocs.worldbank.org/en/795101541106471736/IBRDCountryVotingTable.pdf

feature tables of all the subscriptions listed by country. Noticeably, the dollar amounts are measured in '1944 US dollars'.

Considering some of the listed countries didn't even exist in 1944, or had convertible currencies, it seems rather difficult to understand how this amount is calculated or why it's still being used.

I've not been able to find any literature online that would explain the rationale, so any insight anyone may have would be appreciated.

They use 1944 dollars to adjust for inflation. This just means they adjust all dollar values in such a way that price level from 1944 is held constant.

Any currency can be calculated in terms of 1944 dollars even if the currency is brand new.

First, you can convert any present year (2023) currency into 2023 dollar. Then convert 2023 dollar into 1944 using deflator or some other method that adjusts for changing purchasing power. This will express whatever value in whatever currency in 1944 dollars even if the currency did not existed in 1944 like Euro for example.

• How is a "deflator or some other method that adjusts for changing purchasing power" calculated for a country that didn't exist in 1944? Commented Jun 15, 2023 at 21:57
• @M.Y.Zuo deflator is calculated only for US you don't need it for the country, as mentioned in my answer, step 1. convert the money of any country to USD, step 2. apply deflator to USD, that will correct for inflation regardless whether the original country existed in 1944 or not because you are dealing with constant dollars
– 1muflon1
Commented Jun 16, 2023 at 11:31
• What is the 1944 value supposed to measure in this case? Commented Jun 17, 2023 at 19:55
• @M.Y.Zuo value of dollar in 1944. I don't know if you are aware of it but value of money changes over time. This causes problems in measurement over time as this would be an equivalent of lets say length of meter changing every year in physics. To solve this problem people pick some arbitrary year (the year does not really matter) and then recalculate all other years in a way to make the value of 1 dollar same everywhere across the time (continuing with previous analogy you could fix the changing length of meter issue by recalculating all measurement using the measure from a particular year)
– 1muflon1
Commented Jun 17, 2023 at 22:00
• I didn't mean in the general case, what's it supposed to measure in the specific case of this IBRD document with the 1944 dollar values next to each country? Just calculating from the current exchange rate backwards to 1944 does not measure the actual difference as it existed in 1944 because many countries have had sharp discontinuities, such as pegging, change in currencies, etc... Commented Jun 19, 2023 at 13:41