536 KEPORT — 1888. 



Index-nimibers as illustrating the Progressive Exports of British 

 Produce and Manufactures. By Stephen Bourne, F.S.S. 



[A communication ordered by the General Committee to be printed in extenso 



among the Eeports.] 



A PAPER read at the Aberdeen Meeting of 1885 endeavoured to show the 

 'Use of Index- numbers in the Investigation of Trade Statistics,' and set 

 forth in several forms the comparisons which might thus be made 

 between the exports of 1883 and previous years. The pubHcations of the 

 Board of Trade since that date enable similar calculations to be made for 

 the four later years, and it is thought that these figures may be 

 interesting as an addendum to those then produced. The materials then 

 used were wholly drawn from the official tables aud did not extend to the 

 imports, which are generally susceptible of being so treated ; nor does 

 the present inquiry travel beyond the range of that paper. 



The method then adopted was to fix upon 1,000, 100, 10, or 1, as the 

 index for 240,000,OOOL, the whole valae of the British exports of 1883, 

 and to split this up into so many numbers as there were specified articles 

 the values of which made up this sum of 240,000,000/. Thus cotton yarn, 

 having been exported to the value of 13,-500,000Z., had for its index-number 

 56 ; and in like manner every other article comprised in the total of 

 1,000. Such a set of figures if prepared for other years — that is, taking 

 1,000 to represent 240 millions of money — would show at a glance the 

 progress of the export trade for any number of years either backwards or 

 forwards for which the requisite data were available. 



But value alone is no evidence of the extent of our trade, since prices 

 difier greatly in one year from others ; and hence the volume of such 

 exports can only be brought into the requisite proportion to the whole 

 of its own or other years, by reducing the weights and measurements to 

 a common standard or properly altering the index-number. 



This is done by considering the price of each article in 1883 to be 

 the unit 1", and that for other years to be more or less than this by the 

 proportion in which it differs. Thus cotton yarn in that year was 12'25(^. 

 per pound, that for 1887 10'88f?., and reckoning the former to be 1", the 

 latter is between '89 and '90. Now if we wish to convert the value of the 

 1887 export, viz., 11,400,000/., the index-number for which is 47, into 

 the equivalent in volume which at the price of 1883 the value of 1887 

 would have procured, we divide 47 by '89 to find 53 as its index to 

 compare with that of the former year. 



Pursuing a similar course for all the articles of which the quantities 

 and the prices are specified in the accounts, and assuming that those for 

 which these particulars are not attainable should be in the same ratio as 

 those which are so distinguished, we get an index-number for the whole 

 which represents the difference in the extent of our trade as regards 

 quantity. With these materials it can also be shown at a glance wherein 

 the several articles and the several years correspond to or differ from each 

 other. 



The first of the following tables sets forth in detail the method of 

 comparison between 1883 and 1887. The second condenses the figures 

 of the five years into the index-numbers for classes of goods ; and the 

 corresponding indices calculated at the prices of 1887. 



