¹ It has been correctly pointed out that in the literature of the interwar period, there has, hitherto, existed a very real tendency to confuse “new” with “rapidly expanding” industries. See Dowie, J. A., “Growth in the Interwar Period: Some More Arithmetic,” Economic History Review, 2nd ser., XXI (1968), 104Google Scholar. In order that the results presented in this paper may, however, be compared to those of H. W. Richardson, the division employed by the latter into “staple” and “new” industries has been used throughout. The “staple” industries comprise agriculture and fishing, coal and other forms of mining and quarrying, iron and steel, shipbuilding, mechanical engineering, and cotton and woollen textiles. The “new” industries consist of vehicle manufacture, electrical engineering, rayon, non-ferrous metals, and paper, printing and publishing. See Richardson, , “The Economic Significance of the Depression in Britain,” Journal of Contemporary History, IV (1969), 66–69Google Scholar.

² Aldcroft, D. H., “Economic Progress in Britain in the 1920s,” Scottish Journal of Political Economy, XIII (1966), 297–316CrossRefGoogle Scholar; Richardson, H. W., “The Basis of Economic Recovery in the Nineteen-Thirties: A Review and a New Interpretation,” Economic History Review, 2nd ser., XV (1962), 344–363Google Scholar; Richardson, H. W., Economic Recovery in Britain 1932-39 (London, 1967), 80–99Google Scholar.

³ H. W. Richardson, “The Basis of Economic Recovery in the Nineteen-Thirties,” 360.

⁴ See especially in this context Richardson, H. W., “The New Industries between the Wars,” Oxford Economic Papers, XIII (1961), 360–384CrossRefGoogle Scholar.

⁵ H. W. Richardson, “The Economic Significance of the Depression in Britain,” 3-19.

⁶ Ibid., 12.

⁷ This does not, of course, preclude the possibility that autonomous investment may be undertaken during the slump. Such investment might occur since it bears no functional relationship to expanding output, and the growing competition experienced during depression increases the pressure to reduce costs. Under certain circumstances, too, induced investment in specific sectors might bring the slump to an end even before aggregate income has stopped falling. See Richardson, Economic Recovery in Britain, 134-135.

⁸ It should be noted, however, that in one major component, plant and equipment, net investment was indeed negative both in 1932 and 1933. See Feinstein, C. H., Domestic Capital Formation in the United Kingdom, 1920-1938 (Cambridge, 1965), 222–223Google Scholar.

⁹ Between 1929 and 1932, the real value of capital stock in the U.K. rose by an average of 1.2 per cent per annum, as opposed to 1.6 per cent between 1924 and 1929 and 1.8 per cent between 1932 and 1937.

¹⁰ It should be emphasised that care must be exercised when attempting to compare the investment figures given for different sectors. Investment in industry, for instance, is a measure of the value of plant, equipment, etc. necessary to produce a given output. Investment in the “ownership of residential dwellings,” on the other hand, is primarily that undertaken by different sectors, personal and government, rather than company. It is, therefore, a measure of part of the output of the building and contracting industry.

¹¹ Not until 1936-1937 was the extent of disinvestment significantly reduced due to the rearmament drive.

¹² Lewis, W. A., Economic Survey 1919-1939 (London, 1950), 79Google Scholar; Richardson, “The New Industries Between the Wars,” 366; see also Richardson, “The Economic Significance of the Depression,” 12.

¹³ Richardson, “The Basis of Economic Recovery in the Nineteen-Thirties,” 363.

¹⁴ Richardson, Economic Recovery in Britain, especially 180-181.

¹⁵ Ibid., 137.

¹⁶ Richardson, “The Significance of the Depression,” 8-12.

¹⁷ Ibid., 10.

¹⁸ Richardson, Economic Recovery in Britain, 136. The italics are mine.

¹⁰ Richardson, Economic Recovery in Britain, 137.

²⁰ Feinstein, C. H., National Income, Expenditure and Output of the United Kingdom 1855-1965 (Cambridge, 1972Google Scholar).

²¹ Between 1920 and 1938, services accounted for over half of the value of G.D.P.; the contribution made by agriculture, fishing and forestry fell from 6 per cent in 1920-1924 to 4 per cent in 1935-1938, and that of mining and quarrying from 6 to 3 per cent.

²² Undoubtedly, however, the short-term increase in output of the building industry, and the consequent short-term multiplier effects must have contributed significantly to the upswing of the 1930s.

²³ Dowie, “Growth in the Interwar Period,” 67-71.

²⁴ The major exception was non-ferrous metals, in which little change was recorded.

²⁵ Dowie, “Growth in the Interwar Period,” 68-69.

²⁶ See Aldcroft, D. H., “Economic Growth in Britain in the Inter-War Years: A Re-Assessment,” Economic History Review, 2nd series, XX (1967), 357–360Google Scholar; Richardson, “The Basis of Economic Recovery in the Nineteen-Thirties,” 356-361.

²⁷ This accords with the conclusion reached by Dr. B. W. E. Alford, who points out that it is commonly supposed that the “new” sectors of industry were relatively capital intensive when compared to the older staples. “Therefore if these sectors had been making a major contribution to overall industrial growth, in either the 1920s or 1930s, it would seem reasonable to expect a disproportionate rise in aggregate capital investment. Clearly this did not occur.” Alford, , Depression and Recovery? British Economic Growth 1918-1939, (London, 1972), 41Google Scholar.