It is with some diffidence that I submit the following notes which I have not been able to work up into a fully developed argument. The inartistic use of numerals has been resorted to in order to mark off clearly the various problems touched upon.

By a nation's economic growth we understand a sustained increase in its magnitude as an economic unit. Conversely, stagnation and decline can be defined as a sustained failure of the nation's economic magnitude to increase, or as its persistent decline.

The political events of the interval between the war and the im pending political changes have given new urgency to the critical analysis of the industrial ambitions of undeveloped regions. The older industrial regions face readjustments of substantial magnitude. Every feature of the world economy is distressingly unstable. Cultural and institutional factors will be of importance in determining the rapidity of change and the degree of efficiency achieved in the management of resources, but the direction of change and the magnitudes, of the changes will be conditioned by the basic resources of the various regions. Resource analysis can furnish a concrete background for the various policy problems of the older and newer centers of industrialization.

Every significant index attests to the extraordinary growth of the electric-power industry throughout the first four and a half decades of the present century. Physical output multiplied forty times between 1900 and 1939, a record exceeded during this period only by the automobile and cigarette industries. Labor efficiency and efficiency in the use of fuel increased well above the average for industry generally, and yet employment rose ninefold. Fixed assets were approximately ten times greater at the end of the period than they were at the beginning. Electric rates—the cost of the product to the consumer—have declined throughout. Here is a record of very great progress, even for an industry that was in its infancy in 1900—increased investment, efficiency, employment, and output, and reduced prices. It raises some interesting questions for public policy, questions related both to the future of the electric-power industry and to possibilities in other fields where lessons drawn from this experience may be pertinent.

On the occasion of Thomas Edison's death, in 1931, President Hoover issued a proclamation in which he noted that it had proved impossible to adopt the suggestion to shut down all power plants even for one minute in Edison's memory, but the President concluded that “this demonstration of the country's dependence upon electrical current for life and health is in itself a monument to Mr. Edison's genius.” The ubiquity and indispensability of electricity is, of course, a commonplace. From the standpoint of this paper and its topic, however, it may be emphasized that approximately two thirds of the electrical energy used currently in the country is generated in steam plants and hence derived largely from coal and, in smaller measure, from oil and natural gas.

To discuss the influence of one type of economic activity such as transportation on economic growth is a hazardous undertaking. There is the obvious temptation, which has led many astray, to magnify the importance of that which is particularized. Such a characterization as “Transportation a Measure of Civilization” or the assertion that the railway “is a revolution among nations … [a] moral revolution … affecting the diffusion of knowledge, the interchange of social relations, the perpetuation of peace, the extension of commerce; and a revolution in all the relations of property,” is hardly impartial or balanced with respect to the whole picture of economic activity. A prime objective of this paper is to avoid the dominant parochial note in appraisals of transportation's contributions to economic growth and to present instead thoroughly critical analysis.

Canada has suffered throughout her history by the comparison of her rate of progress with that of the United States. Almost every traveler to this continent during the past two or more centuries has found occasion to comment on the apparent difference in the degree of economic prosperity on the two sides of the border. Lord Durham was compelled to recognize this difference as one of the underlying causes of political disaffection in the country. Local observers joined in deploring the failure of Canada to keep pace economically with the United States. Haliburton, expressing his views through his fictitious Yankee clockmaker, was scathing in his denunciation of the lack of industry and business imagination among his fellow Nova Scotians. Canadians today, with a similarly critical insight into the economic state of their country, are but little less inclined to point out the unfavorable comparison it makes with the neighbor to the south. The belief persists that the really enterprising Canadian must cross the border if he is to realize his fullest ambitions.

Since the time of Ashley at least, it has not been possible to charge the Catholic church of the Middle Ages with having intended to throttle business enterprise by its doctrine of usury. Very few medieval writers, certainly after the early thirteenth century, wished to outlaw profit when it was a legitimate return on investment. To authoritative theologians and jurists there was a world of difference between usury, that is profit openly demanded or secretly hoped for in a contract of loan (mutuutn), and justifiable returns derived from partnerships, where there was a sharing of the risk and venture of the capital. The doctors operated with distinctions of Roman law by which the mutuum, explicitly referred to in the Vulgate at Luke 6:35, was clearly marked off from other transactions, such as the consensual contracts of partnership (societas), letting and hiring (locatio conductio), and purchase and sale (emptio venditio).

I Have found it necessary to deal speculatively rather than historically with the subject assigned to me. The assembly and the organization of facts presuppose principles of organization and criteria of relevancy. As yet these have not been formulated. Until this lack is repaired, therefore, speculation is bound to swamp history.

The main purpose of this paper is to compare the rates of industrial A growth in various periods of Russian history from the middle of the eighties until the end of the interwar period and to describe briefly the specific factors that promoted or obstructed the process of industrialization of the country. While no definitive conclusions are reached, some of the similarities and differences between industrial developments before and after 1914 are pointed out in the last section of this paper. History in the conditional mood is an enticing pastime. However, I have successfully withstood the temptation to concentrate on estimates of the relative level of industrial output that Russia might have attained in the absence of a revolution.