Segar. — The Balance of Trade. 187 



highest of a maximum period and the lowest of either of the 

 adjoining minimum periods. These maximum and minimum 

 periods are due to the movements of capital, but we should be 

 careful not to exaggerate their importance. Investments may 

 often be diverted either from foreign trade to home trade, or 

 vice versa, with advantage, and any such considerable movement 

 makes a great change in the balance of trade in one direction or 

 the other. Although such great importance is usually attached 

 to the value of the exports, it is true that the very prosperity of 

 a nation, giving full employment to its capital, may be such as 

 to diminish for a period its exports, either absolutely or rela- 

 tively to the imports, by leaving it little or no surplus capital 

 to be invested abroad ; and a flight of capital abroad, increasing 

 the exports, may be due to want of opportunity at home. The 

 former seems recently to have been the condition of both Eng- 

 land and Germany, which, during a period of almost unprece- 

 dented prosperity, increased their imports far more rapidly 

 than their exports. That a great growth of the imports is 

 consistent with great national prosperity is well illustrated by a 

 table issued by the Board of Trade, showing that whereas during 

 the years 1893-99 the value of manufactured and partly manu- 

 factured goods imported into the United Kingdom increased 

 from £98,000,000 to £140,000,000, the percentage of members of 

 trade-unions unemployed diminished steadily from 7*5 to 2 - 4 

 — i.e., to less than one-third of the former proportion. On the 

 other hand, it was in 1886, when the exports came nearer in value 

 to the imports than they had done for twelve years fc that the 

 acute commercial depression set in. 



Balance of Trade of the United Kingdom. 



Fig. 1 illustrates the balance of trade of the United Kingdom 

 from 1854 to 1902. From 1899 onwards the graph is double : 

 the lower line gives the balance of trade when the exports of 

 ships and their machinery are taken into account, and the upper 

 line when they are not. The values of these exports were first 

 given in 1899, though the tonnage, from which a rough estimate 

 of the values can be found, is given for a much longer period. 

 The item has in recent years been a much more valuable one than 

 ever before, and has in some years exceeded £9,000,000 in value 

 —too big an item altogether to be left out of account in the total 

 of the exports, though its inclusion now and its omission formerly 

 vitiates to some extent comparisons between different periods. 

 For this reason it is as well perhaps to exclude it from actual 

 values compared, though allowance should always be made 

 mentally for its great increase in value. 



We have previously described the general character of the 



