F.—ECONOMIC SCIENCE AND STATISTICS 121 
economic and efficient system of transport that our present means and 
knowledge permit, combine to make it one of the most pressing problems 
that we have to face. Nor is it a situation confronting this country alone. 
A similar position has arisen in practically every country in the world. 
In view of these considerations, and quite apart from the fact that my 
own studies have mainly been in the subject of transport, I felt that 
I could not choose a subject more appropriate for a presidential address 
to this Section, and for a city so dependent on transport as Aberdeen than 
the future of rail transport. 
If justification for my choice were needed, I think I could find it in the 
Presidential Address of my predecessor, Henry Sidgwick, when the 
British Association last met in Aberdeen forty-nine years ago. The 
subject of that Address was the ‘ Scope and Method of Economic Science,’ 
and I venture to think that my own paper comes well within the field 
which he there mapped out for economic thought. 
It will be well at the outset to examine briefly the position of the rail- 
ways of this country in the post-war years. For this purpose some 
statistics are essential, though I will endeavour to reduce them to the 
minimum. 
The table opposite gives the revenue earned by the four grouped 
railway companies and the percentage change for the chief of the post-war 
years. The corresponding figures for 1913 are given, though in comparing 
the later years with 1913 it is, of course, necessary to bear in mind the 
change which has taken place in the value of money. 
The form of railway accounts was amended in 1928, and though the 
figures for 1927 have been recompiled on the new method, it has been 
possible only to make approximate adjustments for the earlier years. 
Nevertheless, if not pressed too far they may be used for comparative 
purposes. 
Railway revenue has, it will be seen, fallen by no less than 26 per cent. 
since 1923, and the fall has been most marked since 1929. Owing to the 
general strike and the coal dispute, 1926 was, of course, an exceptional 
year. The fall has been more severe in the case of passenger traffic and 
merchandise than in that of coal and minerals, though the revenue from 
the carriage of live stock also shows a big decline. The revenue from 
mails, parcels, and goods by passenger train has been surprisingly well 
maintained. 
Compared with pre-war years the expenditure of the railways shows 
a considerable increase, due in part to the increase in the cost of materials, 
but chiefly to the rise in the level of railway wages, which in 1932 were 
117 per cent. higher than in 1914; or allowing for the rise in the cost of 
living, 51 per cent. above the pre-war level. But since 1924 the expendi- 
ture shows a considerable reduction, partly owing to the lower cost of 
materials, partly owing to the numerous economies effected by the 
companies in their mode of working since 1923, and partly, of course, due 
to diminished traffic. 
The changes in expenditure and the net revenue of the companies, 
both from railways proper and from their ancillary undertakings, such 
as canals, hotels, and docks, are shown in the table on the next page. 
