The Mechanism of Cycles 107 



crops, cycles in the activity of industry, and cycles in 

 general prices. But we approach our general problem 

 by considering first the temporary fluctuations which 

 we have agreed to call deviations, and we inquire 

 whether there is a relation between the deviations of 

 the yield of the crops and the deviations in the produc- 

 tion of pig-iron. The method that was adopted was 

 first to obtain the general cyclical movements of the 

 two series by averaging, in case of each series, the 

 figures for each year with the figures that immediately 

 preceded and followed the given year. For example, 

 the index number of the yield per acre for the years 

 1870, 1871, 1872, 1873 were respectively 108, 105, 110, 

 99. The smoothed figure for the yield per acre in 1871 



would therefore be = = 107.7. Simi- 



3 3 



larly, the smoothed index for 1872 would be 104.7. In 

 Tables II and III of the Appendix to this chapter are 

 presented the original and the smoothed figures for the 

 production of pig-iron and for the index number of the 

 yield per acre of the nine crops. The statistics of the 

 production of pig-iron were obtained from the Statis- 

 tical Abstract of the United States for 1912, p. 774. 



After the general cyclical movements of the two series 

 were determined, the deviations of the actual figures 

 from the smoothed figures for each of the years were 

 calculated for both series of figures. These deviations 

 are also given in Tables II and III of the Appendix to 

 this chapter. The question upon which these differ- 

 ences are to throw fight may be put in this form: Is 



