ON BRITISH AND FOREIGN STATISTICS OF INTERNATIONAL TRADE. 318 
subtract the values of imported goods contained in exports, and it would be 
necessary to obtain separate estimates from those conversant with each 
important trade before we could deal with exports as relating to the produce 
of home industry (on this point see Memorandum 23 in Cd. 1761). We 
know of no similar estimate for other countries. The Belgian, German, 
and French treatment of their ‘improvement trade’ add greatly to the 
difficulties in those countries. While it is illogical to use the total values 
of exports to measure the real progress of production or manufacture for 
export before we have an estimate such as described, it is permissible to 
use the values of particular commodities for such a purpose, in some 
cases where we have sufficient means of allowing for the possible causes 
of error. In all cases we are much more likely to come to correct 
conclusions when we are making a comparison of rates of change, whether 
for two countries or for one country in two periods, than when we are 
making comparisons of absolute amount. 
G. Relation of the Statistics of Imports and Kxports to the Balance 
of Trade. 
The Committee do not propose to deal in detail with the causes of the 
difference between the total values of imports and exports, as they have 
been the subject of so much recent and, in some cases, well-informed 
discussion ; but they wish to emphasise the importance of the definitions 
of trade and the methods of valuing it discussed in Sections A and B. 
The totals to be taken are those of General Trade when it includes the 
whole of Classes 1, 2, and 3 with or without 4; Class 4 enters equally 
on the two sides of the account, and it is immaterial whether it is 
included or not. 
The method of valuation is very important. The value may be taken 
as any one of those in the following example :— 
£ 
Value of goods manufactured in inland town in country X . p PAWS ey 
AY », packed and ready for delivery in country X . ; . 1,005=a, 
nf », at exporting agent’s warehouse at portinX . - 1,010=2, 
re » on board at port in X » S : : : . . LOIZ=a, 
pe » insured for sea transit at port in : ‘ , > LOltSa; 
a » on board at port in country Y . fs : . s -. 1,050=2a; 
delivered to customer in country Y . : 1,055 =a, 
[Assuming that duty, if any, has been subtracted from ‘the last total. ] 
Of the sum paid by the customer in Y, 1,012/. will be received by 
various persons in X, and 5/. (#,;—a,) is divided among various persons 
in Y. As regards the country X, the total services up to 1,012/. at least 
must be paid by money or its equivalent from abroad; as regards the 
country Y, not more than 1,050/. is to be paid by exporting money or its 
equivalent. The intermediate 38/. (~;—x,) may be due to X or Y or 
other countries. In most trade accounts the value x, would be taken for 
exports and «, for imports. In U.S.A. 2, is taken for imports ; in 
Germany x, is taken for imports, but an allowance is made for part of 
Ha—2). 
There isa risk that part of «;—a, may be included in imports (if 
market values are taken), while part of x,;—a, may be omitted ; part of 
*4—a, may be omitted from, or part of w,—«, included in, exports if 
manufacturers’ invoices are the basis. 
