Skip to main content Accessibility help
×
Hostname: page-component-78c5997874-xbtfd Total loading time: 0 Render date: 2024-11-17T18:06:25.528Z Has data issue: false hasContentIssue false

8 - Foreign investment, accumulation and Empire, 1860–1914

Published online by Cambridge University Press:  28 March 2008

Roderick Floud
Affiliation:
London Metropolitan University
Paul Johnson
Affiliation:
London School of Economics and Political Science
Get access

Summary

INTRODUCTION

Great Britain’s immense capital export is among the most important historical phenomena of the period between 1860 and 1914. Rising in the 1850s and 1860s, the flow of net foreign investment averaged about a third of the nation’s annual accumulations from 1870 to 1914. As a result of these annual flows, net overseas assets grew from around 7 per cent of the stock of net national wealth in 1850 to around 14 per cent in 1870 and then to around 32 per cent in 1913. Paish (1914), estimating the value of the stock of British overseas assets just before the First World War, net of repatriations and foreign sales, suggested that the total stock at the end of 1913 was not less than £4,000 million (see also Platt 1986; Kennedy 1987b; Feinstein 1990b). Never before or since has one nation committed so much of its national income and savings to capital formation abroad.

To some observers the immense capital export went abroad because of the high profitability of railroad and other social overhead investments in the emerging primary product economies of North America, South America and Australasia. Others have argued that the capital export was a result of weaknesses in the domestic British economy. In one argument domestic investment demand weakened due to a pause or slowdown in British productivity growth – a productivity climacteric – and, because Britons continued to save despite slowing domestic investment demand, funds moved abroad by default. Another argument is that the British distribution of income and wealth led to tendencies to oversave, with the excess carried off abroad.

Type
Chapter
Information
Publisher: Cambridge University Press
Print publication year: 2004

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

References

Davis, L. E. and Huttenback, R. A. 1986. Mammon and the Pursuit of Empire: The Political Economy of British Imperialism, 1860–1912. Cambridge.Google Scholar
Feinstein, C. H. 1972. National Income, Expenditure and Output in the UK, 1855–1965. Cambridge.Google Scholar
Hall, A. R. 1963. The London Capital Market and Australia 1870–1914. Canberra.Google Scholar
Maddock, R., McLean, I. W., eds. 1987. The Australian Economy in the Long-Run. Cambridge.Google Scholar
Mitchell, B. R. 1988. British Historical Statistics. Cambridge.Google Scholar
Pearce, I. F. 1970. International Trade.
Saul, S. B. 1960. Studies in British Overseas Trade, 1870–1914. Liverpool.Google Scholar
Stone, I. 1999. The Global Export of Capital from Great Britain, 1865–1914: A Statistical Survey. New York.CrossRefGoogle Scholar
Urquhart, M. C., Buckley, K. A. H., eds. 1965. Historical Statistics of Canada. Toronto.Google Scholar

Save book to Kindle

To save this book to your Kindle, first ensure [email protected] is added to your Approved Personal Document E-mail List under your Personal Document Settings on the Manage Your Content and Devices page of your Amazon account. Then enter the ‘name’ part of your Kindle email address below. Find out more about saving to your Kindle.

Note you can select to save to either the @free.kindle.com or @kindle.com variations. ‘@free.kindle.com’ emails are free but can only be saved to your device when it is connected to wi-fi. ‘@kindle.com’ emails can be delivered even when you are not connected to wi-fi, but note that service fees apply.

Find out more about the Kindle Personal Document Service.

Available formats
×

Save book to Dropbox

To save content items to your account, please confirm that you agree to abide by our usage policies. If this is the first time you use this feature, you will be asked to authorise Cambridge Core to connect with your account. Find out more about saving content to Dropbox.

Available formats
×

Save book to Google Drive

To save content items to your account, please confirm that you agree to abide by our usage policies. If this is the first time you use this feature, you will be asked to authorise Cambridge Core to connect with your account. Find out more about saving content to Google Drive.

Available formats
×