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³ p. 276, Divisia Index.

⁴ Feinstein, “Capital Formation,” Table 3 (col. 10), and pp. 84 and 86. Crafts, “British Economic Growth,” also offers new estimates for aggregate output growth, industrial output growth, and the investment rate. While his revisions may turn out to be superior, Crafts' choice of benchmark dates–1760, 1780, 1801, and 1831–are inconvenient for the analysis in this paper, where wars are at issue and the 1815 or 1821 benchmark is critical.Google Scholar

⁵ Lindert and Williamson, “English Workers' Living Standards,” Table 5, p. 13.Google Scholar

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¹¹ Deane, and Cole, (British Economic Growth, p. 276) call it a “modest” increase and in Peter Mathias's wordsGoogle Scholar(“Preface” in Crouzet, François, Capital Formation in the Industrial Revolution [London, 1972], p. viii), the “modesty of rates of capital accumulation” is one profound difference between eighteenth-century England and contemporary Third World economies.Google Scholar

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²⁸ pp. 86–87.

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³⁹ If this estimate seems large, recall that it covers business reinvestment rates in a precorporate era. The estimate is very close to that favored for America by Kuznets, Simon, Shares of Upper Income Groups in Income and Savings, National Bureau of Economic Research, Occasional Paper No. 35 (New York, 1950).Google Scholar

⁴⁰ The counterfactual assumes that all of the rise would be allocated to domestic accumulation, implying one-for-one crowding-in. It should also be pointed out that I ignore the possibility that the rate of return to capital might have declined in response to the higher rates of accumulation. Unless capital rationing under usury continued to bind capital markets, rates of return would have fallen with more rapid accumulation.

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⁴³ Mokyr and Savin (“Stagflation in Historical Perspective,” p. 221) feel that these estimates of the mobilization effect are too high. They estimate that those mobilized went from 2 to 5 percent, rather than from 2 to 10 percent as reported in the text. My estimate covers the period 1790–1812, while the Mokyr and Savin figure covers the period 1800–1812. Furthermore, my estimate includes the navy and marines while the Mokyr and Savin estimate does not. I shall stick to my estimate in what follows, but if Mokyr and Savin are correct the impact of war on the standard of living, per capita income, and industrialization is understated in Section IV. the right direction of bias.Google Scholar

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⁵² Hueckel's “War and the British Economy” was the pioneering application of such methods to the problem, but his approach differs from what follows. For example, there are only two sectors in Hueckel's model—agriculture and manufacturing, no raw material inputs to manufacturing, and no nontradables. The most important difference is that Hueckel did not offer a quantitative assessment of the impact of capital formation.Google Scholar

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⁵⁵ Table 5, p. 276.

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