ABSTRACT
Hughes: He wanted to turn the discussion to the more general underlying issue. Economic historians his age or older had been raised to believe in a ‘Great Depression’ of the late nineteenth century. A student of his, William Kennedy, had found that there was a good deal to be said for turning the idea on its head. One would expect a developed industrial economy like Britain to stop expanding its pig iron and coal output at some point and start expanding its tertiary industries. This is exactly what the British were doing before 1914: Britain serviced the world then as New York City services the Midwest of the United States now. What went wrong was not anything British businessmen did, but World War I. Had it not been for the war and the resulting destruction of the international economy, they would have gone ahead selling manufactured products to the tropics, as New York sells light manufactures to Chicago, and would have concentrated still more on foreign investment, banking, insurance and shipping. The discussion of the period is based on the premise that everything the British did was wrong and stupid. This is an unreasonable premise. An alternative and more favourable view flows from what the men of the late nineteenth century themselves, such as Wicksell, wrote about their times.
