SECTIONAL TRANSACTIONS.— P. 345 



Monday, September 5. 



Mr. J. Wedgwood. — Some Evidence Concerning the Influence of Inherit- 

 ance on Distribution. 



Among the questions which require an answer, in assessing the relative importance 

 of inheritance as a factor in distribution, are (1) What is the proportion of the aggregate 

 property derived from inheritance ? (2) What degree of correspondence is there 

 between the inheritances and fresh accumulations of individuals ? Lack of data on 

 the subject. Inadequacy of official statistics and of millionaires' biographies. Analysis 

 of a large number of individual cases required. Investigation of a sample at the 

 English Probate Registry. An attempt to compare the fortunes of the hundred 

 richest men dying in 1924-25 with those of their predecessors. Difficulties and 

 limitations of the investigation. Results— high proportion of inherited wealth 

 indicated as regards the aggregate ; comparatively small proportion of ' self-made ' 

 men ; correlation between size of fortunes of predecessors and successors. Review 

 of chief trade interests and social status of predecessors. Miscellaneous results — 

 e.g. average age at inheritance and length of the generation. Evidence from the 

 Estate Duty statistics. Analysis of the figures relating to four pre-war and three 

 post-war years shows that the relative distribution of property in England is remark- 

 ably similar among individuals at different ages, i.e. the nature and slope of the 

 curve of distribution is much the same for all age-groups after thirty-five. This 

 observation is significant, in view of the fact that the size of the average estate increases 

 up to the most advanced age, and that the proportion of property acquired by saving 

 must be greater among the relatively old ; it indicates that the inherited wealth of 

 individuals is a more important factor than is sometimes supposed in determining 

 the extent of their subsequent accumulations. 



Some observations on the question of the proportion of the aggregate capital of 

 the United Kingdom inherited from previous generations. 



Discussion on The Recent Course of Prices : 

 (a) Sir Alfred Yarrow. 



The price of a commodity is its value measured in gold. The value of gold 

 fluctuates like other commodities, dependent upon the cost of production and the 

 supply and demand. Consequently, the price of a commodity varies with the value 

 of gold and the value of the commodity exchanged for it. 



The rapid development of the gold industry in the Transvaal since 1900 has brought 

 into circulation a large increase in the supply of gold, and as much is obtained at 

 the present time from the Transvaal as from all the rest of the world. This great 

 addition in the supply of gold reduces its value, i.e. more gold is now required in 

 exchange for the necessaries of life and other commodities than formerly. This 

 increase of price is proved by the fact that in 1913 eighty-five sovereigns were required 

 to purchase commodities which in 1896 cost sixty sovereigns. 



At the outbreak of war Treasury notes were printed and made legal tender. 



When the credit of Great Britain began to decline Treasury notes were not taken 

 at their face value, and in 1920 251 £1 notes were required to purchase what in 1896 

 cost sixty-one sovereigns. This enormous increase in price was mainly due to, firstly, 

 the supply of gold from the Transvaal ; secondly, the shortage of commodities owing 

 to a large section of the population having been drawn away from producing in order 

 to fight ; thirdly, the reduced credit of this country. When the funding of the British 

 debt to America was agreed upon the increase of price due to the depreciation of our 

 paper currency gradually disappeared. 



The rise in the cost of commodities from 85 in 1913 to 127 in 1926 is mainly due 

 to the increase in the cost of production in this country caused by : — 



1. Excessive taxation. 



2. Reduced production due to strikes, lock-outs, &c. 



3. The restrictions demanded by trade unions which diminish the output per man. 



4. Unwise legislation, such as giving doles without work being done in exchange. 



(6) Miss M. Tappan. — Prices and Price-Control in Great Britain and 

 the United States. 

 Movements in general prices in Great Britain, 1890-1913 ; secular, seasonal and 

 cyclical variations, with suggestions upon the possible inter-relations of these 



