Page:Indian Journal of Economics Volume 2.djvu/54

 H. $. JEVON$ cations, adoption of free trade, the progress of invention, and the expansion of population and wealth together with a comparatively small gold production, thus restricting the growth of normal, i.e., non-belligerent, credit. The rise from 1850 to 1878 is usually attributed to the discoveries of gold in California and Australia, t which were added the effects of the Crimean War and the wars of Prussia with Austria and France. The great boom of 1878 may have been due partly to the re-establishment of European peace, but probably was caused mainly by world-wide bumper harvests in two succeeding years. The period of falling prices from 1878 to 1896 was probably partly due to the falling price of silver and the ]emand for gold fcr coinage thereby occasioned, partly to low gold production, and partly to a continuous tightening of credit by British banks after experience of crises, and the conraction of credit in America. The rise since 1896 appears to have been initiated and stimulated by the great output of gold from South Africa combined with the opening up of colonial countries, and the great expansion of credit in Continental Europe. A great series of inven- tions, such as the internal combustion engine leading to the motor car, and in all fields of electrical apparatus, has also continually stimulated demand. 10. ' Cdca Fluct.aHons of Prces.--The cyclical fluctuations of prices clearly reveal themselves in the curve as steps or jagged teeth in the upward or down- ward secular movement of prices. in length and clearly fall into They are irregular two classes: minor, from 8 to 5 years duration (from maximran to maximum); and major, from 7 to 14 years duration. The minor cycles are not very important in their. absolute effect on prices, and might be neglected were it not that it is important to notice that they appear to be sub- multiples of the longer cycles. I have elsewhere put