ABSTRACT
In the nineteenth century, particularly in the United Kingdom, capitalism had been largely freed from the earlier state interference associated with the mercantile system. Indeed, the governments of that day were so imbued with the virtues of free trade and “laissez faire, laissez aller” that they failed to interfere even to save human lives. The chapter concentrates on the British economy, because: it was the dominant economy of the nineteenth century; the British government was committed to laissez-faire. The occurrence of a limit cycle is one possibility, but by no means the only one. Yet, before embarking on complicated theoretical speculation, it is reasonable to first take a look at the historical reality for competitive economic systems, to see whether we can detect anything which looks similar to a limit cycle. The British economy went through a panic in 1816, following the conclusion of the Napoleonic wars.
