An introductory text Fourth edition A. G. Kenwood and A. L. Lougheed B3 55 London and New York
Contents Figures x Tables xii List of Abbreviations xiv Introduction 1 Parti The international economy, 1820-191 3 1 The causes of the growth of the international economy in the nineteenth century 9 Technological progress: industry and agriculture 9 Technical progress: transport and communications 12 The accumulation of capital 15 The growth of world population,, 17 The supply of natural resources 18 The growth of real incomes 19 The spread of economic freedom 22 The growth of international trade 23 2 International long-term capital movements, 1820-1913 26 The growth of foreign investment 27 Direction of foreign investment 27 Determinants of capital outflow 34 The use of foreign funds in borrowing countries 3 7 Economic consequences of foreign investment 39 3 International migration, 1820-1913 45 European migration, 1821-1913 45
vi Contents Migration and its causes Aids to mass emigration Economic consequences of migration Intracontinental migration Asiatic migration and tropical development 4 Commercial policy in the nineteenth century Britain adopts free trade The spread of free trade The economic consequences of free trade The return to protection The economic consequences ofprotection 5 Foreign trade in the nineteenth century The growth of world trade before 1913 The direction of world trade before 1913 The composition of world trade before 1913 Conclusions 6 The growth of a multilateral payments network Introduction Development of the system Foreign investment and the multilateral settlements network Concluding remarks 48 51 54 56 57 61 62 64 67 69 73 78 78 79 83 90 93 93 95 99 100 7 The growth of an international monetary system: the gold standard before 1913 104 Bimetallic and monometallic standards 105 Britain adopts the gold standard 105 International monetary standards up to 1870 106 The spread of the gold standard 107 The role of sterling as an international currency and the importance of the London capital market 109 The working of the gold standard 111 Divergence between classical theory and empirical evidence 114 Other features of the adjustment mechanism 115 Conclusions 117
Contents vii 8 International aspects of economic growth in the nineteenth century: the spread of industrialization 120 Introduction 120 The spread of industrialization 122 The contribution of the international economy 123 Causes of the limited spread of industrialization 125 Conclusions 130 9 International aspects of economic growth in the nineteenth century: the export economies 132 Introduction 132 Regions of recent settlement 133 The export economies 134 Economic imperialism and colonialism 142 10 Trends and fluctuations in the international economy before 1913 148 The international transmission of business cycles 148 Long swings and the international economy 150 Long-run trends in the terms of trade 155 Phases of growth 159 Part II The interwar years 11 The international economy in the interwar years 165 Primary production 166 Population growth and migration 168 Manufacturing production 171 Growth of world incomes 175 The intensification of protectionism 177 12 The restoration of the gold standard and the economic recovery of the 1920s 181 Postwar inflation and the restoration of the gold standard 181 Weaknesses in the postwar gold standard: international investment 184 Institutional weaknesses of the restored gold standard 187 The economic boom of the late 1920s 190
viii Contents 13 The collapse of the gold standard and the disintegration of the international economy 193 Crisis in agriculture 193 Financial crisis in Europe - 195 The end of the gold standard 197 Growth of restrictions on finance and trade 198 International financial co-operation 205 Regional economic co-operation 207 International commodity control schemes 208 Conclusions 209 14 International trade during the interwar period 211 The growth of world trade in the interwar years 211 The direction of world trade between the wars 212 The changing composition of world trade 214 Diminishing trade hypothesis 223 15 The Great Depression: an overview 226 The United States and the Great Depression 226 Other factors in the Great Depression 228 Long-run factors and the Great Depression 231 Part III The post-1945 international economy 16 Planning the future international economy and the transitional period, 1944 50 237 The International Monetary Fund 238 The International Bank for Reconstruction and Development 240 The General Agreement on Tariffs and Trade 241 Postwar reconstruction 242 17 The international economy since 1950 247 Economic growth, an overview 247 Population growth and migration 251 International capital flows private investment 253 International capital flows: foreign aid and other resource flows to developing countries 259
Contents ix Technological change and world trade 263 Concluding remarks 265 18 International monetary relations, 1945-2000 269 The IMF: 1947-61 269 The IMF in the 1960s 272 Uncertain years, 1971 6 276 The post-jamaican period, 1976-2000 278 Concluding remarks 282 19 The GATT, the World Trade Organization, and international commercial policy, 1947-2000 284 The early years, 1947-60 284 The GATT, the WTO and commercial policy, 1960-2000 286 Concluding remarks 296 20 Trade and growth in the international economy, 1945-2000: the developed countries 299 World Trade 299 Economic growth in the advanced countries, 1950 2000 307 21 Trade and growth in the international economy, 1945 2000: the developing economies, the centrallyplanned economies and countries in transition 317 The developing economies 317 The centrally-planned economies 326 The countries in transition (CITs) 330 22 A summary: 1820-2000 and ahead 334 j Index 341