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Long-Term Changes in Total Capital-Product Ratios in Mining, 1870-1948

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Long-Term Changes in Total Capital-Product Ratios in Mining, 1870-1948 This PDF is a selection from an out-of-print volume from the National Bureau of Economic Research Volume Title: Capital and Output Trends in Mining Industries, 1870-1948 Volume Author/Editor: Israel Borenstein Volume Publisher: NBER Volume ISBN: 0-87014-359-X Volume URL: http://www.nber.org/books/bore54-1 Publication Date: 1954 Chapter Title: Long-Term Changes in Total Capital-Product Ratios in Mining, 1870-1948 Chapter Author: Israel Borenstein Chapter URL: http://www.nber.org/chapters/c4707 Chapter pages in book: (p. 29 - 52) 2 Long-Term Changes in Total Capital-Product Ratios in Mining, 1870—1948 Rate of Change in Capital and in Output, by Industries Before analyzing the changes in th& capital-product ratios we shall compare the average annual percentage rates of change in capital and product. Although both types of comparison bear on the same subject, there is some advantage in the latter comparison. While the capital- product ratios reflect the different rates of movement in the two vari- ables, they do not indicate the direction of movement in a single variable at a given time. Table 61 shows that the highest rate of growth for total mining took place between 1870 and 1880 and that in all major branches except bituminous coal capital grew faster than output.2 In the next decade, total mining output continued to grow rapidly, at a rate slightly less than that of the 1870—1 880 period. Capital increased more than prod- uct in all major industries except anthracite mining.3 The pattern of 1 The comparison given here and in Tables 7, 8, and 13 is somewhat affected by differences between the bench marks with respect to employment levels. For a dis- cussion of this problem see Appendix C. 2 The rates of growth for this period are probably somewhat overstated because the coverage of the 1870 census is incomplete, particularly in the case of precious metals. Note that during this decade

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