74 Generating Economic Cycles 



official estimates of the actual yield per acre. Figure 20 

 shows not only that the record of prices in England 

 from 1760 to 1875 exhibits a clear-cut cycle of eight 

 years in the yield per acre, but also that the cycle is 

 continuous with the eight-year cycle which is estab- 

 lished directly from the official estimates of the crop 

 yields since 1884. 



The theory of the generating cycle also requires that 

 the movement of general prices should follow the 

 rhythmic changes in the yield of agricultural products. 

 As nearly all foods are derived either directly or in- 

 directly from the farms, and as eighty per cent of 

 the raw materials of manufactures — according to the 

 United States census of 1900 — are organic raw materials 

 produced on the famis, the movement of general 

 prices should reflect the rhythm in the yield of the crops. 

 The theory of the relation between the generating 

 cycles of crops and the movement of general prices 

 was subjected to a searching empirical test. Sauer- 

 beck's index numbers of general prices, covering the 

 interval of nearly a century between the Napoleonic 

 wars and the Great War, were examined by means 

 of Fourier analysis with a view to discovering real 

 periodicities. The analysis showed that if there were 

 a sequence of real cycles in the century of prices in 

 England, the most probable length of the constituent 

 cycle was approximately eight years. When this cycle 

 of general prices was computed and plotted, its graph 

 was found to be practically congruent with the graph 

 of the yield of wheat determined indirectly from the 

 record of wheat prices from 1760 to 1875, and practic- 

 ally congruent with the graph of the cycles in the 



