ABSTRACT
Is there a long wave in economic activity or only a long wave in prices? In the previous chapter we have seen that most theorizing on the existence of a long cyclical type of fluctuation in aggregate economic activity originated in the observation of long-run fluctuations in price levels of industrializing countries after the Industrial Revolution. Figure 5.1 shows these fluctuations for the United States, England and France, as compiled by Kondratieff in his famous 1926 article. We see a rising price level from about 1790 onwards, reaching a peak around 1815. Then there is a downward trend from 1815 until 1849, followed by a moderate rise until 1873 (American price history differed during the Civil War). Then follows a steady decline to a trough in 1896. From then until 1913 the price level moves up again, with sharp increases after the outbreak of World War I.
