2 Generating Economic Cycles 



(2) The rainfall of the Ohio Valley fluctuated in 

 clearly defined eight-year cycles during the 

 seventy-two years from 1839 to 1910; 



(3) The cycles in the Ohio Valley were congruent 

 with those in the United States considered as a 



unit. 



The course of rainfall before 1839, when there were 

 no meteorological records in the middle and western 

 portions of the United States, may be a subject of dis- 

 pute, and one may have individual doubts as to the 

 course of rainfall in the unrealized future. But the 

 revelations of the existing record of eighty-three years 

 describe a sequence of regular natural changes of such 

 magnitude and of such economic importance that the 

 observant explorer in quest of economic regularities 

 will not ignore their suggestiveness. They supply a 

 clue to the intricate economic disorder. 



Three Types of Contemporary Theories of Cycles 



Wlien the theory of economic cycles is completely 

 worked out and the critical stages in its development 

 are reviewed, there wdll be a grateful recognition of the 

 helpfulness of Cournot's distinction between secular, 

 cyclical, and random causes of change. This classifica- 

 tion is an essential preliminary to a wise choice of 

 methods of investigation, and there must be a marked 

 difference in theories of cycles according to the degree 

 in which the necessity of the segregation of causes 

 is realized and methods appropriate to the three types 

 of causes are devised. 



The degree in which these exigencies are recognized 



