THE INDIA RUBBER WORLD 



491 



were added up separately for each month. 

 Finally, the monthly aggregates were 

 turned into relative* on the prewar base ; 

 that is, the average aggregates of July, 

 1913, to June, 1914, were made equal to 100, 

 and all the montlily aggregates were made 

 over on that scale. 



It is evident that the index numbers 

 made on this plan for an industrj- are 

 strictly comparable to the relative prices 

 for particular commodities shown in the 

 charts. By the use of these indexes a clear 

 idea can be obtained of average price fluc- 

 tuations in a given branch of business, and 

 fluctuations in one industry can be com- 

 pared with those in others. 

 DETAILED STUDY OF PRICE MOVEMENTS. 



In any study covering a period of rapidly 

 changing price levels, the significance of 

 price movements of individual commodities 

 or classes of commodities is fully brought 

 cut neither by absolute increases nor by in- 

 creases relative to prices prevailing in some 

 representative year chosen as a base. In 

 fact, both of these methods are inade- 

 quate for depicting commodity price move- 

 ments, unless some direct comparison can 

 be made at all times with the movement of 

 the price level itself. To represent price 

 changes without such a comparison is much 

 like measuring the height of waves on a 

 lake where the level is continually chang- 

 ing, not only without having any regard for 

 the differences in level but using at the 

 same time a continually varying yardstick 

 as a unit of measure. Hence the first com- 



Veighted Index Numbers of Wholesali 

 Prices. — Long Staple Cotton, average of 4 

 series; Long Staole Cotton Yarns, averaet 

 of 7 series; and Long Staple Cotton Manu 

 factures (except yarns), average of 13 series 

 — By months, January, 1913, to December, 

 1918. (Average quoted prices, July. 1913, tc 

 June. 1914=100.) 



parison is that between the general price 

 level of all commodities and the cot- 

 ton-class level. 



For many purposes it would be advan- 

 tageous to represent the general price 

 level by 100 at all times and to reduce all 



,'eighted Index Numbers of Wholesale 

 Prices. — Short Staple Cotton, Upland 

 ... „. . o._^.- Cotton 



Relative Prices. — Cotton; Upland Middling, 

 New York, and Upland Middling, Liverpool. 

 — Bv months, January, 1913, to December, 

 1918. (Average quoted prices, July, 1913, to 

 June. 1914=100.) 



Relative Prices.— Sea Island Cotton, extra 

 choice. Savannah; Sea Island Weaving Yarn, 

 single combed. 80s: and Cotton Tire Fabrics, 

 17 'A oz., combed. — By months, January. 

 1913. to December. 1918. (Average quoted 

 prices, July, 1913, to June. 1914 = 100.) 



other prices to percentages of that base. 

 This method of presentation will be applied 

 later to cotton, cotton yards, and cotton 

 goods, but as such a method of comparison 

 is not in general use, the ordinary mode of 

 representation has been adopted in the 

 accompanying chart. 



COMPARISON OF THE PRICE MOVEMENTS OF 

 ALL COM- 

 DITIES." 



It may be noted : 



(1) That, as was expected, the minor 

 fluctuations of the Cotton Class were more 

 frequent and more pronounced than those 

 of the general price level. 



(2) That the low prices of cotton and 

 cotton goods prevailing from July, 1914, to 

 July, 1916, had no counterpart in the gen- 

 eral price level, and were consequently a 

 result of forces acting on the Cotton Class 

 as such and not of those affecting the price 

 level in general. 



(3) That the rise in prices of the Cot- 

 ton Class, which started in 1915, began 

 earlier, proceeded faster, had more fre- 

 quent and more extensive reactions, and 

 finally continued further than that of prices 

 in general. 



COMPARISON OF THE PRICE MOVEMENTS OF 



COTTON. COTTON YARNS, AND COTTON 



MANUFACTURES. 



It is found: 



(1) That the fluctuations were most 

 pronounced for cotton and least pro- 

 nounced for cotton goods. 



