National income accounting and sectoral rates of returnon UK risk-bearing capital, 1855-1914

Paper number 03/02

A J Arnold*University of Exeter

S McCartneyUniversity of Essex

Abstract

The series in Matthews et al. (in 1982) represent perhaps the most importantindicators of the returns to risk capital in the British economy during the periodconcerned, although suffering from a number of problems concerning theirspecification, accessibility and reliability. In this paper, a set of redefined, extendedand updated series are constructed from published macro-economic data sourceswhich appear to overcome the problems with the earlier series yet result in levels ofreturns to risk-bearing capital that are much higher than in previous studies. Furtherresearch into the basis of macro-economic estimation may therefore be needed beforereliable conclusions can be drawn about the profitability of UK commercial sectors,particularly during the important period from the middle of the nineteenth centuryuntil the start of the First World War.

Keyword : rates of returns, British industry, historical macro-economic estimation

_____________________________________________________________________*Contact Author: Tony Arnold, Professor of Accounting and Business History, School ofBusiness and Economics, University of Exeter, Rennes Drive, Exeter EX4 4PU, Exeter,Devon, England. Email: A.J.Arnold@exeter.ac.uk

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ISSN 1473 2904

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National income accounting and sectoral rates of return on UK risk-bearing capital, 1855-1914

The rate of return on UK risk-bearing capital before 1940, particularly as invested in

commercial firms, is something 'we still know very little about' but which provides a

potentially important input into a number of important and unresolved debates

concerning (alleged) UK economic decline during the second half of the nineteenth

century.1

Despite the importance of these debates, the amount of relevant data that is available

is relatively limited, particularly at a macro-economic level. The series of gross and

net profit rates in the industrial sector for the period 1855-1975 as shown in Matthews

et al. (in 1982) accordingly represent an important indicator of the returns to risk

capital in the British economy, particularly during the period from 1855 to 1914,

when there are few alternative sources of data.

During this period, when the yield on (almost risk-less) consols was between 2.5 and

3.5 per cent, the Matthews et al. series appears to show gross returns of 12-16 per cent

and net returns on industrial capital of 15-20 per cent for much of the period to 1914.2

In this context ‘gross profit’ means profit after all costs apart from depreciation have

been recognised.3 The gross profit rate accordingly excludes cumulative depreciation

from its definition of ‘capital’, whereas the net profit rate shows profits after (annual)

depreciation and capital after the deduction of cumulative depreciation. In principle,

given the lower numerators and denominators used in the net profit rate calculation,

either of the net and the gross profit rates could be the greater; ‘whether the net

measure is higher or lower than the gross measure depends on the length of life of the

capital stock, its age distribution, the rate of growth and so forth’.4 In practice,

however, at least until 1964 the net rate was always the higher of the two.

1 Capie and Webber, Profits and profitability p. 1; see for example, Edelstein, 'Realized rates of return' andOverseas investment; Davis and Huttenback, Mammon.2 See Matthews et al., British economic growth, pp. 184-86; Fig 12.1, p. 346; Mitchell and Deane, Abstract, p. 455.In three years in the period 1865-72 the net returns were in excess of 20%.3 This should not be confused with the standard accounting definition of ‘gross profit’ as the profit after only thedirect costs of sale have been recognised.4 See Matthews et al., British economic growth, p. 186.

4

There are, however, a number of difficulties with the series concerning its limited

specification and the accessibility and reliability of some of the data used in its

preparation. The purpose of this paper is accordingly to examine the series in more

detail, with particular reference to its areas of difficulty and to then put forward and

discuss a modified and updated version of the series showing the rates of return on

UK risk-bearing capital in a number of sectors in the period 1855 to 1914, insofar as

they can be derived from published macro-economic data sources.

I

The Matthews et al. series is presented essentially as a set of graphs, although its

authors also define a number of key years (1856, 1873 and 1913 for the period 1855

to 1914) for which precise figures are given. For these years, underlying data is also

provided or can be calculated or inferred. The series does not appear to have been

published elsewhere.

Although the process is unsatisfactory, the graphs can be read against their x and y

axes to provide a roughly approximated series. The gross series, as set out in Table 1

(col. 17), yields an approximate simple mean across the period 1856-1914 of 13.0 per

cent and the net series, as shown in Table 2 (col. 17), provides a simple mean of 17.6

per cent across the same period. 5 These figures should not, however, be taken as

entirely reliable because the graphs cannot be read with any real accuracy and because

there is evidence (from the data given for the key years) that the net profit graph is not

accurately drawn and that the real returns may be slightly lower than the graphs

suggest.6

Far more precise and reliable figures could be obtained if the series could be recreated

from the original sources used by Matthews et al., although the determination of this

requires the analysis of the various definitions and the connection of the identities

involved with a number of (rather loosely specified) source documents. The profit rate

5 Matthews et al., British economic growth, pp. 184-86, 346.6 The observations from the graph suggest net profit rates of 1856 17.25%, 1873 20% and 1913 17.25% as againstthe rates given for those years of 15.6%, 17.3% and 14.9% respectively.

5

series depend upon three main definitions, of national income, of profit and finally of

capital, each of which needs to be consistent with the others.

As far as national income is concerned, Matthews et al. start with GNP and then

exclude the incomes whose capital, in the foreign, farming and rental sectors, will also

be excluded. The result, described as non-farm, non-rent GDP (NF NR GDP), consists

of GNP less (foreign income + non-farm rent + total farm income).

In the key years this produces (in £m):

1856 1873 1913

Gross net product 667 1172 2343

less foreign income (15) (52) (200)

less non-farm rent (32) (61) (150)

less total farm income (149) (172) (142)

Non-farm, non-rent GDP 471 887 1,8517

Two versions of profit were examined, gross and net. In order to arrive at the gross

profit, the defined version of national income was dichotomised into its overall labour

and property components and the latter, total property income, was then sub-divided

into four constituents, incomes from abroad, rental incomes, farm property incomes

and profits. At the gross level, these components were defined as:

a) income from abroad: net property income from abroad.

b) rent: from dwellings, publicly owned (central and local authority) non-trading

property (inc offices and schools) but NOT agricultural or business premises rents.

c) farm property income: rent of farm land and buildings plus farm profits (usually the

property income of self-employed farmers).

d) profits: all other property income, i.e.

i) the gross trading profits of companies

ii) the gross trading surpluses of the public sector

iii) rent paid by trading concerns and public authorities

7 Matthews et al., British economic growth, in principle use either the estimate of GDP 'most appropriate to theparticular context' or the geometric mean of the measures available. In this particular case the exact basis used isnot apparent; for 1856 for example, Matthews et al. appear (e.g. from p. 164) to use a figure (£667m) which differsfrom the figures set out in Feinstein, National income and in Mitchell, British historical, Tables 4 and 5a for theincome-based and compromise estimates of GNP.

6

iv) the property component of income from non-agricultural self-employment.8

In the second (net) version of the series, 'gross' is converted to 'net' by deducting

depreciation from d) i) and ii).

It should be noted that profits, as defined above, are the residual category such that

any estimation errors in arriving at other components of property incomes will affect

the figures attached to profits.9 There is no way of knowing whether or not this is a

significant consideration. Further, the data to fit these definitions is not readily

available and Matthews et al. accordingly arrive at their measures indirectly, as can be

seen from an examination of data provided throughout chapter 6 of Matthews et al.

relating to the key years 1856, 1873 and 1913.

Gross profits thus equal total property income (foreign income + rent + gross trading

profits) less (foreign + self-employment + non-farm rent + farm incomes).

In the key years this gives (in £m):

1856 1873 1913

Foreign income 15 52 200

Rent 94 137 249

Gross trading profit10 222 424 734

Total property income 331 613 1183

less foreign income (15) (52) (200)

less self-employment income (49) (79) (152)

less non-farm rent (32) (61) (150)

less farm income (67) (84) (56)

Gross profits 168 337 62511

8 See Matthews et al., British economic growth, Table 1 and footnote 26, pp. 164, 185. Annual figures for foreignincome, rent and the gross trading profits of companies are given in Mitchell, British historical, Table NA4.9 The reliability levels for the various components of total property income were defined as +/- 15 to 25% for1855-89 and 1914 and +/- 5 to 15% for 1890-1913; Matthews et al., British economic growth, p. 613.10 From Feinstein, National income.11 These calculations yield proportions of NF NR GDP of 35.6, 38.1 and 33.8% (+/- 0.1%) as in Matthews et al.,British economic growth, Table 6.8 p. 178.

7

The relatively complex route taken in Matthews et al. can, however, be simplified by

using gross trading profits rather than total property incomes as the base, which yields

gross profits as follows, for the key years (in £m):

1856 1873 1913

Gross trading profit 222 424 734

plus commercial rents 15 20 57

less (non-farm) employers’ own imputed wages (27) (52) (126)

less farmers’ incomes (42) (55) (39)

Gross profits (as in Matthews et al. above) 168 337 626

The definitions of gross income used in Matthews et al. are carefully constructed and

correspond closely to the economists’ usual concept of profit, although two of the

components, commercial rents and (non-farm) employers’ own imputed wages, have

been derived from private working papers, rather than from published sources.12

In the case of the third item, capital stock, which converts profit from an absolute

measure to a rate of return, its definition as gross (and then net) reproducible capital

stock at current prices, is relatively straightforward. The collection of the appropriate

data was, however, far more problematic, as the measurement of capital stock is

‘subject to more conceptual and statistical difficulties than the measurement of

income or profits’.13 A good deal of the data was taken from Feinstein (1972),

described as ‘a statistical companion volume’ to Matthews et al., although the tables

relating to investment and capital stock in Feinstein did carry warnings of the

likelihood of higher than usual error rates.14 By 1976, additional investigations had

confirmed the wisdom of these warnings; estimates derived by ‘extrapolating

backwards from 1920 [had] produced an estimate for c. 1860 which is very much too

high’ and Tables 43, 44 and 46 in F72 were accordingly to be ‘regarded as

withdrawn’.15

12 Commercial rents consist of rent (for which Mitchell, British historical, Table NA4, pp. 828-29 provides theseries), less farm rent (ibid., Agr Table 15) less non-farm residential rent (for which there appears to be nopublished series). Non-farm employers’ own imputed wages consist of total employers’ self-wage (for which thereappears to be no published series) less farmers’ self-wage. The latter in turn consists of farm incomes (Feinstein,National income, Table 23) less farmers’ gross profits (for which there appears to be no published series).13 Matthews et al., British economic growth, p.18514 Feinstein, National income. The reliability levels were defined as +/- more than 25% for 1855-1919; Matthewset al., British economic growth, p. 616.15 Feinstein, Statistical tables, p. viii.

8

More work on the period 1760-1860 ‘provided for the first time a reasonably reliable

foundation for estimates of the capital stock in the mid-nineteenth century’, but

exposed an ‘enormous discrepancy' with the earlier figures, particularly concerning

industrial plant and equipment, ships and vehicles and led to a substantial reduction in

the capital stock figures for 1860 from £3380m to £2310m.16 By the time final figures

covering the period 1750-1920 had been published in 1988,17 there had been a series

of ‘major revisions to the statistics relating to investment and the capital stock before

1914’, although not all the sources were published data series.18 The capital stock

figures used in Matthews et al. (in 1982) thus appear to be interim figures taken from

Feinstein’s working papers that were then superseded by the data series subsequently

published in 1988.19

However uncertain and transitory the data, it is the capital stock figures that enable

the two further identities to be determined:20

(a) gross profit rate [gross profits to capital stock]

1856 168/1273 = 13.2%

1873 337/2407 = 14.0%

1913 625/5297 = 11.8% and

(b) the gross capital-output ratio rate [capital stock to gross trading income (i.e. non-

farm, non-rent GDP)]:

1856 1273/471 = 2.7 times

1873 2407/887 = 2.71 times

1913 5297/1851= 2.86 times.

These in turn produce:

16 Feinstein, Capital formation, pp. viii, 78. The earlier estimates were of UK capital stock at 1860 at replacementprices (Feinstein, National income, Table 46) and the later of GB capital stock at 1851-60 replacement costs.17 In Feinstein and Pollard, Studies in capital and Mitchell, British historical, particularly Table NA4, pp. 828-30.18 Mitchell’s sources for 1855-1948 are given as Feinstein, National income, ‘and extensions and revisions theretokindly provided by Professor Feinstein’; Mitchell, British historical, p. 828.19 Matthews et al., British economic growth, p. v. Matthews et al. identified a gross reproducible capital stock (atcurrent prices) in 1856 of £1273m, far lower than the data in Feinstein, National income, Table 46, as withdrawn,and of the same approximate order of magnitude as Feinstein, Capital formation, where only the 1860 data wasgiven (on an illustrative basis). The data used in the Matthews et al. series was based upon 'a preliminary version'of the Feinstein and Pollard data (Studies in capital, p. 260, fn 2) that would be further refined before publicationin 1988.20 Matthews et al., British economic growth, Fig. 6.3, p. 184.

9

(c) the defined proportion of gross profits to gross trading income (i.e. non-farm, non-

rent GDP) as their arithmetic product. Thus in:

1856 GP 168/NF NR GDP 471 = 35.6%; (13.2%* 2.7 =35.6%)

1873 GP 337/NF NR GDP 887 = 38.0%; (14.0%*2.71 =37.9%)

1913 GP 625/NF NR GDP 1851 = 33.8%; (11.8%*2.86 =33.7%).21

Estimation errors in the gross profit rate series (a) will necessarily be offset by

compensating (i.e. opposed) errors in the gross capital-output ratios (b) although only

the former appears to be of any real importance in its own right.

Precisely matching definitions can then be used to compute the net (i.e. post-

depreciation) equivalents of the above.22 Thus, NNP differs from GNP by capital

consumption, GDP differs from GNP by property income from abroad and NDP is

GDP less capital consumption and net trading income is NDP less rent less farm

income.23

More directly, the net share of (net) trading income differs from the gross share of

(gross) trading income, as computed above, in that capital consumption for the year is

deducted from both the numerator and denominator. For the key years:

1856 (168-21)/(471-21) = 147/450 = 32.7%

1873 (337-40)/(887-40) = 297/847 = 35.1%

1913 (625-105)/(1851-105) = 520/1746 = 29.8%.24

This primary ratio can in turn be partitioned into:

(a) net profit rate [net profits to net capital stock, where the net capital stock is (gross)

capital stock less accumulated capital consumption]. Again, in the key years:

1856 147/(1273-331) = 147/942 = 15.6%

1873 297/(2407-690) = 297/1717 = 17.3%

1913 520/(5297-1807) = 520/3490 = 14.9% and

(b) the net capital-output ratio rate [net capital stock to net trading income]:

21 Thus in 1856, for example, the obverse of the 35.6% is the labour share of NF NR GDP (336 - agriculturalwages 60 + non-farm self employment 27) = 303/471 = 64.4%.22 See Matthews et al., British economic growth, Fig 6.4, p. 185.23 The components of farm income are set out in Feinstein, National income, T60, Table 23.24 As in Matthews et al., British economic growth, Table 6.8, p. 178.

10

1856 942/450 = 2.1 times

1873 1717/847 = 2.03 times

1913 3490/1746 = 1.99 times.25

In principle, given the lower numerators and denominators used in the net profit rate

calculation, the net profit rate could be greater or smaller than the gross profit rate,

depending on 'the length of life of the capital stock, its age distribution, the rate of

growth and so forth' 26 although, based on a reading of the two graphs, until 1964 the

net rate was always the higher of the two. In the three key years for which Matthews

et al. provide unequivocal figures this was clearly the case, as follows:

1856 net 15.6% gross 13.2%

1873 17.3% 14.0%

1913 14.9% 11.8%.

II

The gross and net profit series that appear in Matthews et al. provide potentially the

most important macro-based indicator of the returns to risk capital invested in the

industrial sectors of the British economy, particularly during the period from 1855 to

1914.

The series have, however, been seen to suffer from three main deficiencies. Firstly,

they are specified only in graph form, which cannot be readily converted to

unambiguous numerical values. Second, some of the underlying data is contained in

private working papers, rather than in publicly available sources and, finally, the

figures for capital stock used in Matthews et al. have undergone substantial further

revision since that date. In this section, the Matthews et al. methodology, in a

modified, extended and updated form, is used to identify the rates of return on UK

risk capital, as invested in the main sectors of the economy in the period 1855 to

1914, insofar as they can be derived from the most recent, publicly available macro-

economic data sources.

25 As in Matthews et al., British economic growth, Table 6.13, p. 186.26 Matthews et al., British economic growth, Figure 6.3, p. 186. The estimation of depreciation by Feinstein andother authors (for 1855-1920) is discussed in Feinstein, National income, pp. 24, 26-8, 41, 152-3, 156-7.

11

This again requires the definition and identification of relevant data concerning the

three key identities, national income, profit and capital, in each case at the gross and

net levels. As far as gross measures are concerned, the most logical starting point for

national income would appear to be the broadest measure available, GNP. Starting

from this base, the overseas, property rental, agricultural and industrial sectors can

then be viewed as the major alternative investment areas.

There are series in Mitchell for GNP and for the income generated by each of these

sectors (as set out in Table 1, cols. 1 to 6).27 Similarly, Feinstein and Pollard identify

the latest estimates of the gross capital stock employed in each sector (see Table 1,

cols. 7 to 11). Over the period 1855-1910, overseas assets comprised 20.8 per cent,

agricultural assets 23.2 per cent, property assets 30.7 per cent and trading capital 25.3

per cent of the gross capital stock.28 The bringing together of the two sets of data

enables the sectoral gross rates of return (and a composite measure) to be calculated

(see Table 1, cols. 12 to 16 and Figure 1). It is clear that the capital invested in

overseas, agricultural and property rental assets generated similar annual returns,

averaging 4.3, 4.8 and 4.7 per cent respectively. The annual returns on overseas and

property assets were extremely consistent (ranging from 3.7 to 4.9 per cent and from

4.1 to 5.2 per cent respectively; see Table 1, cols. 13 and 15). There was slightly more

variation in the returns on agricultural assets, with an observable low point in 1879 of

3.0 per cent and a distinct upturn in 1902-10 to average returns of 6.3 per cent (see

Table 1, col. 14).

These returns were, however, considerable below those on the (higher-risk)

investment in trading capital, which averaged 18.5 per cent (Table 1, col. 16) or 13

per cent under the earlier Matthews et al. series (see also Figure 1). The greater

variability in the trading capital return series is also apparent; a slight but persistent

downward trend is observable from the peak of 1871, particularly from 1899 until the

start of the First World War. Nonetheless, if returns did indeed range from 15 to 25

27 See Mitchell, British historical, Tables Agr 15 and NA4, pp. 220, 828-30.28 In some cases (overseas assets prior to 1870, and both agricultural and non- agricultural land, the annual figuresare linear interpolations of the ten-yearly figures given in Feinstein and Pollard, Studies in capital.

12

per cent across the period, they would have provided fairly substantial risk premia, at

least until the effects of capital consumption are taken into account.

The series in Mitchell for national income (GNP less capital consumption) as set out

in Table 2 (col. 1) and its subdivision similarly provide sectoral net income figures (as

set out in Table 2, cols. 2 to 6).29 Feinstein and Pollard again identify the latest

estimates of gross capital stock and of capital consumption which, taken together,

provide the net capital stock figures (as set out in Table 2, cols. 7 to 11).30

Bringing the income and capital figures together enables the sectoral net rates of

return (and a composite measure) to be calculated (see Table 2, cols. 12 to 16). Figure

2 shows the various rates of return, including the earlier Matthews et al. series

(although the rate of return on overseas capital has been omitted as being identical

with its gross equivalent).

Capital invested in agricultural and property rental assets generated net returns

averaging 5.0 and 5.2 per cent respectively. Net returns in these two sectors were

slightly above their gross equivalents but otherwise followed very similar paths. The

net returns on agricultural assets fell to a low point of 2.9 per cent in 1879. Until 1899

they remained below 6 per cent in every year, although they were then to average 6.5

per cent through to 1910, with a peak of over 7 per cent in 1906-08 (see Table 2, col.

14).31 Annual net returns on property assets across the period1855-1910 ranged from

4.5 to 5.9 per cent, increasing very slightly from 1895 (see Table 2, col. 15). The rate

of return on overseas assets and the gross and net rates on agricultural assets and

property are also shown in graph form in Figure 3.

29 See Mitchell, British historical (Tables NA4 and Agr 15, pp. 220, 828-30).30 The figures for depreciation of UK capital stock in Feinstein and Pollard for 1855-1914 (1988, Table I, pp. 427-8) are identical with, and presumably the source for the figures for capital consumption in Mitchell 1988 (TableNA4, pp. 828-30). The former work does not provide sectoral figures for depreciation, and these have beencalculated using the information therein, as explained in the notes to Table 2 below, for two sectors, agricultureand property: depreciation on trading capital is a residual.31 Feinstein and Pollard (1988) provide only decennial estimates for land values, and annual figures were derivedby linear interpolation. It was not considered reasonable to do this for the period 1910-1920, and accordingly theseries for those sectors in which land is a constituent (agricultural and property rental assets) end in 1910.

13

III

The main focus of this paper has, however, been the returns on UK trading capital and

the gross and net series, both according to Matthews et al. and in a revised and

updated form. These are shown in graphical form in Figure 4 (see also Table 1, cols.

16 and 17; Table 2, cols. 16 and 17). It is apparent that both series provide rates of

return that are higher in every year in their net (of depreciation) form than in their

gross.32 Equally, the new net and gross series provide rates of return that are

substantially above the equivalent earlier series in Matthews et al. Although there are

differences in the definitions used in the two sets of series, the effects of these

differences on the computed results is very slight; in large measure the higher rates in

the new series reflect the substantial reductions in capital stock figures between the

interim calculations used in Matthews et al. (in 1982) and their final form in Feinstein

and Pollard (in 1988).

The revised net series shows returns on UK trading capital averaging 25.3 per cent

across the period 1855 to 1910. The overall range was from 19.8 to 34.4 per cent with

some evidence of decline over time, although one masked to some extent by cyclical

variations. Nonetheless, the returns of 30 per cent or more experienced in 1862-64

and 1870-72 (with a peak of 34.4 per cent in 1871) were never to be repeated and

average returns from 1900-10 of 21.6 per cent were somewhat below the levels of

earlier parts of the period.

Because of a number of difficulties concerning the specification of, and the

accessibility and reliability of some of the data used in, the earlier series, this paper

has put forward a modified, extended and updated version of the series showing the

rates of return on UK risk-bearing capital in a number of sectors in the period 1855 to

1914, insofar as they can be derived from published macro-economic data sources.

The primary result, the series for net rates of return on UK trading capital, averaging

25.3 per cent across the period 1855 to 1910 (and 26.1 per cent from 1855 to 1899)

32 See previous note.

14

has been derived from the most reputable and authoritative published macro-

economic series.

If the results are to be believed, investment in British industry across the second half

of the nineteenth century provided returns on risk-bearing capital that were a

substantial multiple of the 'riskless' rate available on government consols and would

then seem to have represented a 'golden era' in the history of British industrial

investment. The level of returns indicated is, however, sufficiently high as to invite

some scepticism and to suggest the need for further research into macro-economic

data series before any firm conclusions can be drawn about the returns to risk-bearing

capital across the important period from the middle of the nineteenth century until the

start of the First World War.

15

Sources

Capie F and A Webber, Profits and profitability in British banking, 1870-1939,Discussion Paper of the Centre for Banking and International Finance, City UniversityLondon (1985).

Davis L E and R A Huttenback, Mammon and the pursuit of Empire: the politicaleconomy of British imperialism 1860-1912, (Cambridge, 1986).

Edelstein M, ‘Realized rates of return on UK home and overseas portfolio investmentin the age of High Imperialism’, Explorations in Economic History, 13 (1976), pp.283-329.

Edelstein M, Overseas investment in the age of High Imperialism: the UnitedKingdom, 1850-1914, (New York, 1982).

The Editor of the Statist, ‘Wholesale Prices of Commodities in 1916’, 80 (1917),Journal of the Royal Statistical Society, pp. 289-309.

Feinstein C H, ‘Income and investment in the United Kingdom, 1856-1914’,Economic Journal, 71 (1961) pp. 367-85

Feinstein C H, National income, expenditure and output of the UK 1855-1965(Cambridge, 1972).

Feinstein C H, Statistical tables of national income, expenditure and output of the UK,1855-1965 (Cambridge, 1976).

Feinstein C H, ‘Capital formation in Great Britain’ in Cambridge Economic Historyof Europe, VII, The industrial economies: capital, labour and enterprise (Cambridge,1978), pp. 28-96.

Feinstein C H and S Pollard (eds), Studies in capital formation in the UK, 1750-1920(Oxford, 1988).

Jones, G T, Increasing Return (Cambridge, 1933).

Maiwald, K, ‘An Index of Building Costs in the United Kingdom, 1845-1938’,Economic History Review, ns. 7 (1954), pp. 187-203.

Matthews R C O, C H Feinstein and J C Odling-Smee, British economic growth1856-1973 (Oxford, 1982).

Mitchell B R, British historical statistics (Cambridge, 1988)

Mitchell B R and P Deane, Abstract of British historical statistics (Cambridge, 1962).

Sauerbeck, A, ‘Prices of Commodities and the Precious Metals’, Journal of theStatistical Society of London, 49 (1886), pp. 581-648.

Sauerbeck, A, ‘Prices of Commodities During the Last Seven Years’, Journal of theRoyal Statistical Society, 56, pp. 215-254.

Sauerbeck, A, ‘Prices of Commodities in 1908’, Journal of the Royal StatisticalSociety, 72, pp. 68-80.

16

Table 1: Gross Returns on Capital in the UK 1855-1914

YEAR (1) (2) (3) (4) (5) (6) (7) (8) (9) (10) (11) (12) (13) (14) (15) (16) (17)

£m £m £m £m £m £m £m £m £m £m £m % % % % % %1855 633 305 13 85 48 159 4,293 350 1,914 1,129 900 7.1 3.7 4.4 4.3 17.7 n/a1856 663 327 15 89 47 176 4,317 372 1,918 1,111 916 7.6 4.0 4.6 4.2 19.2 13.21857 650 329 16 98 48 167 4,391 394 1,921 1,149 927 7.5 4.1 5.1 4.2 18.0 12.51858 642 334 16 90 50 178 4,397 416 1,910 1,155 916 7.6 3.8 4.7 4.3 19.4 13.51859 668 331 17 86 53 175 4,455 438 1,920 1,174 923 7.4 3.9 4.5 4.5 19.0 13.31860 693 343 19 86 53 185 4,546 460 1,939 1,203 944 7.5 4.1 4.4 4.4 19.6 13.51861 728 378 20 98 56 204 4,643 493 1,958 1,221 971 8.1 4.1 5.0 4.6 21.0 14.51862 747 395 21 99 58 217 4,740 526 1,975 1,248 991 8.3 4.0 5.0 4.6 21.9 14.81863 778 414 21 103 59 231 4,914 559 2,003 1,304 1,048 8.4 3.8 5.1 4.5 22.0 14.81864 806 430 23 93 62 252 5,115 592 2,037 1,355 1,131 8.4 3.9 4.6 4.6 22.3 15.51865 837 439 24 95 66 254 5,243 625 2,056 1,377 1,185 8.4 3.8 4.6 4.8 21.4 14.81866 859 450 26 100 66 258 5,446 658 2,083 1,447 1,258 8.3 4.0 4.8 4.6 20.5 14.01867 847 438 28 105 66 239 5,527 691 2,097 1,473 1,266 7.9 4.1 5.0 4.5 18.9 13.01868 849 449 31 101 67 250 5,610 724 2,119 1,501 1,266 8.0 4.3 4.8 4.5 19.7 13.51869 878 464 33 87 68 276 5,736 757 2,145 1,558 1,276 8.1 4.4 4.1 4.4 21.6 14.81870 947 516 35 99 74 308 5,915 790 2,175 1,620 1,330 8.7 4.4 4.6 4.6 23.2 15.51871 1,021 564 39 103 76 346 6,203 902 2,205 1,686 1,396 9.1 4.3 4.7 4.5 24.8 16.51872 1,092 580 44 99 78 359 6,751 1,054 2,277 1,842 1,589 8.6 4.2 4.3 4.2 22.6 15.51873 1,173 614 52 111 81 370 7,324 1,175 2,343 1,997 1,814 8.4 4.4 4.7 4.1 20.4 14.01874 1,148 601 57 103 84 357 7,439 1,199 2,348 2,035 1,876 8.1 4.8 4.4 4.1 19.0 13.5

17

Table 1: Gross Returns on Capital in the UK 1855-1914

YEAR (1) (2) (3) (4) (5) (6) (7) (8) (9) (10) (11) (12) (13) (14) (15) (16) (17)

£m £m £m £m £m £m £m £m £m £m £m % % % % % %1875 1,132 588 58 101 86 343 7,326 1,222 2,309 2,012 1,815 8.0 4.7 4.4 4.3 18.9 13.31876 1,114 572 57 100 92 323 7,337 1,203 2,300 2,048 1,789 7.8 4.7 4.3 4.5 18.1 12.51877 1,106 561 55 93 94 319 7,374 1,163 2,297 2,090 1,777 7.6 4.7 4.0 4.5 18.0 12.31878 1,073 547 55 86 99 307 7,331 1,177 2,284 2,084 1,743 7.5 4.7 3.8 4.8 17.6 12.01879 1,049 531 56 68 101 306 7,297 1,163 2,260 2,097 1,710 7.3 4.8 3.0 4.8 17.9 12.51880 1,097 568 58 74 104 332 7,556 1,240 2,272 2,222 1,822 7.5 4.7 3.3 4.7 18.2 12.51881 1,135 588 59 77 106 346 7,556 1,293 2,190 2,242 1,815 7.8 4.6 3.5 4.7 19.1 13.31882 1,176 596 63 84 106 343 7,729 1,352 2,129 2,323 1,899 7.7 4.7 3.9 4.6 18.1 12.51883 1,164 577 64 79 106 328 7,764 1,422 2,055 2,354 1,908 7.4 4.5 3.8 4.5 17.2 12.01884 1,132 564 67 77 109 311 7,754 1,417 1,974 2,363 1,901 7.3 4.7 3.9 4.6 16.4 11.51885 1,117 562 70 72 114 306 7,776 1,447 1,900 2,415 1,876 7.2 4.8 3.8 4.7 16.3 11.51886 1,138 587 74 73 117 323 7,753 1,513 1,818 2,444 1,837 7.6 4.9 4.0 4.8 17.6 12.01887 1,184 605 79 70 118 338 7,796 1,609 1,754 2,485 1,834 7.8 4.9 4.0 4.7 18.4 12.51888 1,261 647 84 71 120 372 7,898 1,683 1,692 2,548 1,866 8.2 5.0 4.2 4.7 19.9 13.51889 1,357 683 89 72 122 400 8,130 1,784 1,647 2,656 1,966 8.4 5.0 4.4 4.6 20.3 13.51890 1,389 685 94 78 124 389 8,406 1,930 1,601 2,770 2,105 8.1 4.9 4.9 4.5 18.5 13.01891 1,370 665 94 85 124 362 8,425 2,008 1,555 2,777 2,101 7.9 4.7 5.5 4.5 17.2 12.31892 1,332 631 95 76 127 333 8,502 2,059 1,518 2,804 2,126 7.4 4.6 5.0 4.5 15.7 11.51893 1,338 634 95 71 131 337 8,526 2,126 1,473 2,824 2,113 7.4 4.5 4.8 4.6 15.9 10.81894 1,425 703 93 67 139 404 8,605 2,149 1,436 2,851 2,140 8.2 4.3 4.7 4.9 18.9 12.0

18

Table 1: Gross Returns on Capital in the UK 1855-1914

YEAR (1) (2) (3) (4) (5) (6) (7) (8) (9) (10) (11) (12) (13) (14) (15) (16) (17)

£m £m £m £m £m £m £m £m £m £m £m % % % % % %1895 1,458 721 94 68 145 414 8,678 2,152 1,395 2,879 2,164 8.3 4.4 4.9 5.0 19.1 13.31896 1,496 730 96 70 149 415 8,871 2,155 1,366 2,950 2,253 8.2 4.5 5.1 5.1 18.4 13.51897 1,548 763 97 73 154 439 9,108 2,285 1,342 3,054 2,348 8.4 4.2 5.4 5.0 18.7 13.01898 1,685 811 101 69 159 482 9,440 2,279 1,325 3,204 2,485 8.6 4.4 5.2 5.0 19.4 13.31899 1,728 871 103 75 163 530 9,852 2,335 1,315 3,367 2,682 8.8 4.4 5.7 4.8 19.8 13.51900 1,781 872 104 74 168 526 10,359 2,550 1,324 3,555 2,930 8.4 4.1 5.6 4.7 18.0 13.81901 1,755 847 106 74 172 495 10,469 2,574 1,297 3,581 2,944 8.1 4.1 5.7 4.8 16.8 12.51902 1,774 875 109 82 175 509 10,519 2,439 1,272 3,525 2,978 8.3 4.5 6.4 5.0 17.1 12.01903 1,748 840 112 71 180 477 10,670 2,571 1,267 3,526 3,036 7.9 4.4 5.6 5.1 15.7 12.51904 1,736 843 113 71 184 475 10,850 2,637 1,263 3,546 3,103 7.8 4.3 5.6 5.2 15.3 11.51905 1,817 904 123 75 186 520 11,047 2,714 1,247 3,588 3,177 8.2 4.5 6.0 5.2 16.4 11.31906 1,924 972 134 82 188 568 11,417 2,848 1,249 3,702 3,334 8.5 4.7 6.6 5.1 17.0 12.01907 2,024 1,016 144 83 191 598 11,805 3,058 1,255 3,835 3,486 8.6 4.7 6.6 5.0 17.2 12.51908 1,934 959 151 89 192 527 11,844 3,218 1,250 3,799 3,469 8.1 4.7 7.1 5.1 15.2 12.51909 1,965 978 158 80 194 546 11,987 3,357 1,243 3,824 3,497 8.2 4.7 6.4 5.1 15.6 11.51910 2,050 1,023 170 78 196 579 12,297 3,520 1,243 3,934 3,600 8.3 4.8 6.3 5.0 16.1 11.51911 2,139 1,074 177 94 200 603 n/a 3,806 n/a n/a 3,730 n/a 4.7 n/a n/a 16.2 12.01912 2,253 1,139 187 89 203 660 n/a 4,130 n/a n/a 3,979 n/a 4.5 n/a n/a 16.6 12.01913 2,333 1,173 200 82 206 685 n/a 4,370 n/a n/a 4,202 n/a 4.6 n/a n/a 16.3 11.81914 2,362 1,152 190 111 208 643 n/a 4,509 n/a n/a 4,301 n/a 4.2 n/a n/a 15.0 12.0

19

Notes for Table 1

Definitions

(1) = GNP at current prices(2) = Total property income(3) = Net overseas income(4) = Total agricultural property income(5) = Property (non-agricultural) rental income(6) = Gross profits of industrial (and commercial & public sector) enterprises(7) = Gross capital stock including overseas assets(8) = Overseas assets(9) = Agricultural assets(10) = Property (non-agricultural) assets(11) = Trading capital (and public sector assets)(12) = Return on overall capital including overseas assets(13) = Return on overseas assets(14) = Return on agricultural assets(15) = Return on property (non-agricultural) assets(16) = Return on trading capital (and public sector assets)(17) = Return on trading capital (gross profit rate) per Matthews et al (1982)

Sources

Col 1 Mitchell (1988, NA 4, pp. 828-30).Col 2 Col 3 + Col 4 + Col 5 + Col 6.Col 3 Mitchell (1988, NA 4, pp. 828-30).Col 4 Mitchell (1988, Agr 15, p. 220).Cols 5-6 Mitchell (1988, Agr 15, p. 220; NA 4, pp. 828-30).Col 7 Col 8 + Col 9 + Col 10 + Col 11.Col 8 Feinstein and Pollard (1988, Table XVII, pp. 462-3; Table XVIII, p. 464;

Table XX, pp. 466-7) give figures for overseas assets at current prices only forselected years (usually decennial), but also give figures for annual netinvestment from 1870. In the above table, stock in intervening years has beencalculated by cumulating annual net investment figures at constant prices andmultiplying the resultant by the implied index used to convert constant tocurrent prices. Before 1870 linear interpolation has been used.

Col 9 Feinstein and Pollard (1988, Table 18.5, p. 400; Table IV, pp. 433-34;for land values, the annual figures are linear interpolations of ten-yearlyfigures).

Col 10 Feinstein and Pollard (1988, Table 18.5, p. 400; Tables IV-V, pp. 433-36; forland values, the annual figures are linear interpolations of ten-yearly figures).

Col 11 Feinstein and Pollard (1988, Tables IV-V, pp. 433-6).Col 12 Col 2/Col 7.Col 13 Col 3/Col 8.Col 14 Col 4/Col 9.Col 15 Col 5/Col 10.Col 16 Col 6/Col 11.Col 17 Matthews et al. (1982, Fig. 6.3, p. 184).

20

Figure 1: Gross returns on capital in the UK, 1855-1914

0

5

10

15

20

25

30

1855

1857

1859

1861

1863

1865

1867

1869

1871

1873

1875

1877

1879

1881

1883

1885

1887

1889

1891

1893

1895

1897

1899

1901

1903

1905

1907

1909

1911

1913

Return on trading capital, Matthews et al. Return on trading capital Return on overseas assets

Return on agricultural capital Return on property Return on overall capital

21

Table 2: Net Returns on Capital in the UK 1855-1914

YEAR (1) (2) (3) (4) (5) (6) (7) (8) (9) (10) (11) (12) (13) (14) (15) (16) (17)£m £m £m £m £m £m £m £m £m £m £m % % % % % %

1855 601 273 13 78 38 144 3,518 350 1,730 827 611 7.8 3.7 4.5 4.6 23.6 n/a1856 630 294 15 82 40 157 3,546 372 1,735 818 621 8.3 4.0 4.7 4.9 25.3 15.61857 617 296 16 91 38 151 3,604 394 1,740 845 625 8.2 4.1 5.2 4.5 24.2 16.51858 610 302 16 84 42 160 3,621 416 1,737 851 617 8.3 3.8 4.8 4.9 25.9 18.01859 636 299 17 80 44 158 3,667 438 1,746 867 616 8.2 3.9 4.6 5.1 25.6 17.51860 660 310 19 80 44 167 3,738 460 1,759 889 630 8.3 4.1 4.5 4.9 26.5 17.81861 694 344 20 90 47 187 3,826 493 1,777 906 650 9.0 4.1 5.1 5.2 28.8 19.51862 712 360 21 92 49 198 3,914 526 1,795 931 662 9.2 4.0 5.1 5.3 29.9 19.81863 742 378 21 95 50 212 4,053 559 1,818 972 704 9.3 3.8 5.2 5.1 30.1 20.31864 767 391 23 85 52 231 4,210 592 1,845 1,010 763 9.3 3.9 4.6 5.1 30.3 20.51865 797 399 24 87 56 232 4,323 625 1,863 1,030 805 9.2 3.8 4.7 5.4 28.8 19.51866 817 408 26 92 56 234 4,480 658 1,885 1,080 857 9.1 4.0 4.9 5.2 27.3 18.81867 804 395 28 97 56 214 4,555 691 1,901 1,104 859 8.7 4.1 5.1 5.1 24.9 17.51868 806 406 31 93 57 225 4,630 724 1,921 1,130 855 8.8 4.3 4.8 5.0 26.3 18.01869 834 420 33 79 57 251 4,727 757 1,944 1,174 852 8.9 4.4 4.1 4.9 29.5 19.31870 901 470 35 91 64 280 4,863 790 1,968 1,223 882 9.7 4.4 4.6 5.2 31.7 21.51871 972 515 39 93 64 319 5,089 902 1,987 1,274 926 10.1 4.3 4.7 5.0 34.4 23.01872 1,036 524 44 88 65 327 5,514 1,054 2,027 1,381 1,052 9.5 4.2 4.3 4.7 31.1 21.51873 1,109 550 52 98 66 334 5,924 1,175 2,064 1,487 1,198 9.3 4.4 4.7 4.4 27.9 17.31874 1,082 535 57 90 69 319 6,026 1,199 2,068 1,523 1,236 8.9 4.8 4.4 4.5 25.8 18.3

22

Table 2: Net Returns on Capital in the UK 1855-1914

YEAR (1) (2) (3) (4) (5) (6) (7) (8) (9) (10) (11) (12) (13) (14) (15) (16) (17)£m £m £m £m £m £m £m £m £m £m £m % % % % % %

1875 1,069 525 58 89 72 306 5,993 1,222 2,050 1,524 1,197 8.8 4.7 4.3 4.7 25.6 18.01876 1,052 510 57 89 78 286 5,998 1,203 2,047 1,562 1,186 8.5 4.7 4.3 5.0 24.1 17.51877 1,045 500 55 82 80 283 5,994 1,163 2,047 1,601 1,183 8.3 4.7 4.0 5.0 23.9 16.51878 1,013 487 55 76 84 272 5,984 1,177 2,042 1,608 1,157 8.1 4.7 3.7 5.2 23.5 16.01879 990 472 56 58 87 271 5,947 1,163 2,032 1,624 1,128 7.9 4.8 2.9 5.4 24.0 16.81880 1,034 505 58 64 89 294 6,188 1,240 2,040 1,709 1,199 8.2 4.7 3.1 5.2 24.5 17.01881 1,073 526 59 67 90 310 6,186 1,293 1,966 1,734 1,193 8.5 4.6 3.4 5.2 26.0 17.01882 1,112 532 63 74 91 304 6,297 1,352 1,903 1,797 1,245 8.4 4.7 3.9 5.1 24.4 18.01883 1,099 512 64 69 91 288 6,333 1,422 1,833 1,829 1,249 8.1 4.5 3.8 5.0 23.1 17.01884 1,068 500 67 67 94 272 6,268 1,417 1,759 1,847 1,245 8.0 4.7 3.8 5.1 21.8 15.81885 1,054 499 70 63 98 268 6,253 1,447 1,689 1,891 1,226 8.0 4.8 3.7 5.2 21.9 15.51886 1,077 526 74 64 102 286 6,244 1,513 1,614 1,920 1,197 8.4 4.9 4.0 5.3 23.9 15.51887 1,123 544 79 61 103 301 6,306 1,609 1,550 1,958 1,189 8.6 4.9 3.9 5.3 25.3 16.81888 1,199 585 84 62 105 334 6,384 1,683 1,486 2,008 1,207 9.2 5.0 4.2 5.2 27.7 17.31889 1,291 617 89 63 106 359 6,568 1,784 1,430 2,086 1,268 9.4 5.0 4.4 5.1 28.3 19.31890 1,319 615 94 68 107 346 6,828 1,930 1,374 2,168 1,356 9.0 4.9 4.9 4.9 25.5 19.51891 1,301 596 94 75 107 320 6,864 2,008 1,334 2,175 1,347 8.7 4.7 5.6 4.9 23.8 18.01892 1,262 561 95 67 110 289 6,912 2,059 1,299 2,195 1,359 8.1 4.6 5.2 5.0 21.3 16.51893 1,268 564 95 62 114 293 6,946 2,126 1,259 2,212 1,349 8.1 4.5 4.9 5.2 21.7 15.01894 1,355 633 93 58 122 360 6,971 2,149 1,224 2,233 1,365 9.1 4.3 4.7 5.5 26.4 16.0

23

Table 2: Net Returns on Capital in the UK 1855-1914

YEAR (1) (2) (3) (4) (5) (6) (7) (8) (9) (10) (11) (12) (13) (14) (15) (16) (17)£m £m £m £m £m £m £m £m £m £m £m % % % % % %

1895 1,388 651 94 59 129 369 6,976 2,152 1,186 2,256 1,382 9.3 4.4 5.0 5.7 26.7 18.81896 1,423 657 96 61 131 369 7,058 2,155 1,156 2,307 1,440 9.3 4.5 5.3 5.7 25.6 19.31897 1,472 687 97 64 135 391 7,299 2,285 1,127 2,380 1,507 9.4 4.2 5.7 5.7 25.9 18.51898 1,605 731 101 60 140 430 7,471 2,279 1,102 2,484 1,606 9.8 4.4 5.4 5.6 26.8 18.81899 1,641 784 103 65 141 475 7,755 2,335 1,080 2,597 1,743 10.1 4.4 6.0 5.4 27.3 19.51900 1,685 776 104 63 143 466 8,255 2,550 1,068 2,722 1,915 9.4 4.1 5.9 5.3 24.3 19.81901 1,659 751 106 63 148 434 8,312 2,574 1,052 2,749 1,937 9.0 4.1 6.0 5.4 22.4 18.01902 1,677 778 109 72 153 444 8,169 2,439 1,037 2,724 1,969 9.5 4.5 6.9 5.6 22.5 16.81903 1,650 742 112 61 157 412 8,355 2,571 1,032 2,734 2,018 8.9 4.4 5.9 5.7 20.4 17.01904 1,636 743 113 61 160 409 8,486 2,637 1,029 2,753 2,067 8.8 4.3 5.9 5.8 19.8 15.51905 1,714 801 123 65 163 450 8,635 2,714 1,019 2,787 2,115 9.3 4.5 6.4 5.8 21.3 15.01906 1,815 863 134 72 164 493 8,940 2,848 1,018 2,862 2,212 9.7 4.7 7.1 5.7 22.3 16.01907 1,909 901 144 73 165 519 9,320 3,058 1,020 2,948 2,294 9.7 4.7 7.2 5.6 22.6 17.01908 1,820 845 151 79 166 449 9,418 3,218 1,016 2,924 2,260 9.0 4.7 7.8 5.7 19.9 17.01909 1,849 862 158 70 169 465 9,563 3,357 1,011 2,939 2,256 9.0 4.7 6.9 5.8 20.6 15.51910 1,930 903 170 68 170 495 9,838 3,520 1,009 3,006 2,303 9.2 4.8 6.7 5.7 21.5 15.81911 2,014 949 177 83 173 516 n/a 3,806 n/a n/a 2,365 n/a 4.7 n/a n/a 21.8 16.31912 2,119 1,005 187 78 174 566 n/a 4,130 n/a n/a 2,501 n/a 4.5 n/a n/a 22.6 16.51913 2,192 1,032 200 70 176 586 n/a 4,370 n/a n/a 2,624 n/a 4.6 n/a n/a 22.3 14.91914 2,217 957 190 99 177 491 n/a 4,509 n/a n/a 2,672 n/a 4.2 n/a n/a 18.4 16.8

24

Notes for Table 2

Definitions

(1) = National Income(2) = Net property income = National Income less Employment Income(3) = Net overseas income(4) = Total net agricultural property income(5) = Net property (non-agricultural) rental income(6) = Net profits of industrial (and commercial & public sector) enterprises(7) = Net capital stock inc overseas assets(8) = Overseas assets(9) = Net agricultural assets(10) = Net property (non-agricultural) assets(11) = Net trading capital (and public sector assets)(12) = Net return on overall capital including overseas assets(13) = Return on overseas assets(14) = Net return on agricultural assets(15) = Net return on property (non-agricultural) assets(16) = Net return on trading capital (and public sector assets)(17) = Net return on trading capital (net profit rate) per Matthews et al. (1982)

Sources

Cols 1 to 3 Mitchell (1988, NA 4, pp. 828-30).Col 4 This is gross agricultural property income (Table 1 Col 4) less depreciation on

agricultural capital other than land. Depreciation has been computed byconstructing annual figures at constant prices for the components of non-landcapital, i.e. buildings and equipment, from the decennial figures given byFeinstein and Pollard in Table 10.2 (p. 272) and Table 10.4 (p. 278)respectively, and converting these into current prices by the indices used inthat work. For buildings the index is given in Table XXIII (pp. 470-1); aspecial index was used for equipment, which is not in Feinstein and Pollardand apparently has not been published. This index combines the index for‘General plant and machinery’ (Table XXIII, pp. 470-1) with an index forhorse-drawn vehicles, with weightings of 3:1. This latter is apparentlyunpublished, but is ‘constructed by combining wages of carpenters and joiners(weight 45) with price indices for iron (35) and timber (20)’ (p. 327). The firstis taken from Jones (1933, pp. 261-3). The index for iron is the series ‘Iron A’used by Maiwald (1954), except that sources for figures for 1856-8 and 1901-14 could not be traced, and so the price of iron bars taken from Sauerbeck(1886; 1913) and ‘The Editor of the Statist’ (1917) has been used to completethe index for this paper. The index for timber is constructed from figures for‘Sawn or Split’ timber in Sauerbeck (1886; 1893;1909) and ‘The Editor of theStatist’ (1917). See Feinstein and Pollard (1988, pp. 279, 327 and 310, fn. 4).

Col 5 This is Gross Property (Non-agricultural) Rental Income (Table 1 Col 5) lessdepreciation on Dwellings (excluding farmhouses) and Industrial and

25

Commercial buildings. Depreciation has been calculated in constant pricesfrom the figures for capital formation and capital stock in Table X (pp. 446-7),Table XII (pp. 450-1) and Table XIV (pp. 454-5), and then converted tocurrent prices using the index of building costs computed by Maiwald (1954)which is reproduced in Feinstein and Pollard (rebased to 1900=100) as theprice index of 'Buildings including dwellings' in Table XXIII (pp. 470-1). SeeFeinstein and Pollard (1988, pp. 292, 309, 390).

Col 6 Col 2 - [Col 3 + Col 4 + Col 5].Col 7 Col 8 + Col 9 + Col 10 + Col 11.Col 8 See Table 1 Col 8.Col 9 Feinstein and Pollard (1988, Table 18.5, p. 400; Table VI, pp. 437-8; in the

former table (of farmland) ten-yearly figures only are given: annual figures arelinearly interpolated until 1910.)

Col 10 Feinstein and Pollard (1988, Table 18.5, p. 400; Table VII, pp. 439-40; in the former table (of non-farm land) ten-yearly figures only are given: annual figures are linearly interpolated until 1910.)

Col 11 Feinstein and Pollard (1988, Tables VI-VII, pp. 437-40): Total Net Stock ofDomestic Reproducible Fixed Assets, less Agricultural assets, Dwellings andIndustrial and Commercial buildings.

Col 12 Col 2/Col 7.Col 13 Col 3/Col 8.Col 14 Col 4/Col 9.Col 15 Col 5/Col 10.Col 16 Col 6/Col 11.Col 17 Matthews et al. (1982, Fig. 6.4, p. 185).

26

Figure 2: Net returns on capital in the UK, 1855-1914

0

5

10

15

20

25

30

35

40

1855

1857

1859

1861

1863

1865

1867

1869

1871

1873

1875

1877

1879

1881

1883

1885

1887

1889

1891

1893

1895

1897

1899

1901

1903

1905

1907

1909

1911

1913

Return on trading capital, Mathews et al. Return on trading capital Return on agricultural capital

Return on property Return on overall capital

27

Figure 3: Sectoral returns in the UK, 1855-1914

0.0

1.0

2.0

3.0

4.0

5.0

6.0

7.0

8.0

9.0

1855

1857

1859

1861

1863

1865

1867

1869

1871

1873

1875

1877

1879

1881

1883

1885

1887

1889

1891

1893

1895

1897

1899

1901

1903

1905

1907

1909

1911

1913

Return on overseas assets Gross return on agric assets Net return on agric assets

Gross return on property Net return on property

28

Figure 4: Gross and net returns on UK trading capital, 1855-1914

0

5

10

15

20

25

30

35

40

1855

1857

1859

1861

1863

1865

1867

1869

1871

1873

1875

1877

1879

1881

1883

1885

1887

1889

1891

1893

1895

1897

1899

1901

1903

1905

1907

1909

1911

1913

Gross Net Gross, Matthews et al Net, Matthews et al