ABSTRACT
Much of the argument of this book has turned on the ability of domestic resources to meet a major part of capital requirements. This was not necessarily a matter of choice; there were no massive surpluses of capital for export, and, perhaps, no compelling reasons for borrowing. Even the exporting countries had much, like their own railway systems, to keep their capital where in any case they preferred it to be – at home. Once real surpluses developed, fluctuations in the terms of trade must indeed have supplied at least a partial explanation for the distribution of investment between home and abroad. It becomes possible to identify the inverse character of the long swings (eighteen to twenty years) in such important areas as the home investment of the United Kingdom and the United States. 1 For the middle decades of the nineteenth century, however, when capital exports were determined much more individually and piecemeal, it was the curiously uniform ten-year cycle in international finance – from boom to slump to boom again – that affected the will to borrow and invest.
