Page 68 - Encyclopedia Of World History Vol V

trade cycles 1845

Pratt, M. E. (1992). Imperial eyes: Travel writing and transculturation. Europe’s money supply and quadrupled its prices). The
London: Routledge. Black Death, which raised the amount of arable land per
Shaffer, M. S. (2001). See America first: Tourism and national identity,
1880–1940. Washington, DC: Smithsonian Institution Press. person by killing a third of Europe’s population, was fol-
Sterngass, J. (2001). First resorts: Pursuing pleasure at Saratoga Springs, lowed by more than half a century of high real wages. A
Newport & Coney Island. Baltimore: Johns Hopkins University Press.
Towner, J. (1996). A historical geography of recreation and tourism in the financial shock, such as the failure of the Bardi and
Western world 1540–1940. Chichester, UK: John Wiley & Sons. Peruzzi banking houses in Florence when Edward III of
Towner, J., & Wall, G. (1991). History and tourism. Annals of Tourism England defaulted, rippled through the commercial cities
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Urry, J. (1997). The tourist gaze:Travel and leisure in contemporary soci- of northern Italy and Flanders and their trading partners
eties. London: Sage. around the Mediterranean and Baltic. Lord Overstone, a
banker, introduced the phrase cycles of trade in the
1840s, and in 1862 the economist Clément Juglar pub-
lished his pioneering history of commercial crises and
Trade Cycles their periodic recurrence in England, France, and the

United States (including cycles in French marriage, birth,
ver since Old Testament days, when Joseph prophe- and death rates).The phenomenon itself was much older:
Esied to Pharaoh that Egypt would experience seven The economist Thomas Ashton identified twenty-two
fat years followed by seven lean years, economic activity economic fluctuations in eighteenth-century England,
has been characterized by wavelike rhythms and by finding their origins in Britain’s wars, seventeen financial
longer-term trends and irregular fluctuations. Boom peri- crises, and eleven bad harvests.
ods of prosperity and expansion are succeeded by reces-
sions and depressions, which in turn give way to recovery Long Waves
and renewed prosperity. In preindustrial societies, cycles In 1925 the economist Nikolai D. Kondratieff observed
and fluctuations in the weather, which affected harvests, recurring long waves of fifty to sixty years (twenty to
had the largest effect on the level of prosperity, while all thirty years of rapid economic growth, followed by an
aspects of life were affected by the cycle of the seasons. equally long period of slow growth) in British, French,
The “little Ice Age” of the fourteenth century was a period and U.S. data on output, prices, wages, and interest
of economic depression in Europe. In the 1870s the rates from the Industrial Revolution onwards, an analy-
economist and philosopher William Stanley Jevons sis that led to his arrest and death in Stalin’s purges and
argued that an eleven-year cycle in sunspots caused cycles the suppression of the Moscow Business Conditions
of the same average length in the weather, harvests, and Institute because of the implication that the Great
economic activity, but this theory has since been rejected Depression following the Wall Street crash of 1929 was
so completely that in current macroeconomics the term not the final crisis of capitalism, but merely a severe
sunspots is used to refer to any intrinsically irrelevant downturn that would be succeeded by an upswing in the
variable. capitalist economies.
Beyond the weather and the seasons, preindustrial The economist Joseph Schumpeter attributed the eco-
cycles and fluctuations in economic activity were set off nomic expansion at the start of each Kondratieff wave to
by real shocks (wars, inventions, and plagues such as the a clustering of technological innovations that both
Black Death of 1348–1351, or discovery of trade routes improved productivity and induced a surge of investment:
such as the seas route around the Cape of Good Hope to water power, cotton textiles (spinning jenny, power loom,
Asian spices) or by monetary shocks (such as the “price cotton gin), and iron (coked coal replacing wood as fuel)
revolution of the sixteenth century,” as silver from the new in the first Kondratieff wave from the 1780s (the Indus-
Spanish colonies in Mexico and Upper Peru raised trial Revolution); steam, railways, and steel in the second