X.—: Prices in the Nineteenth Century (p. 704)

The actual movement of prices has been much investigated since the time of Mill; and attempts, in large measure successful, have been made by Jevons and others to reduce the statement of it to precision by the use of Index Numbers. On the theory and practice of Index Numbers, see article by Edgeworth, s. v., in Palgrave's Dictionary of Political Economy, vol. ii.; Fountain's Memorandum in Report on Wholesale and Retail Prices (Board of Trade, 1903); and the article of Flux in (Harvard) Quarterly Journal of Economics (Aug. 1907).

The following table, taken from the Blue-book of the Local Government Board on Public Health and Social Conditions (1909), presents the conclusions of Sauerbeck as to prices, and of Bowley as to wages, in a form convenient for comparison.

INDEX NUMBERS SHOWING COURSE OF AVERAGE WHOLESALE PRICES AND
GENERAL MONEY WAGES.


[The wages and prices in 1850 being taken as 100 ; wages and prices in other
years in percentages of 1850 figures.]

Year.	Index Numbas of		Year.	Index Number of
		Prices.		Wages.		Prices.	Wages.
1850	100	100
			1895	80·5	159·2
1855	131·2	—	1896	79·2	160·7
			1897	80·5	162·3
1860	128·6	119·2	1898	83·1	166·5
			1899	88·3	170·4
1865	131·2	127·5
			1900	97·4	178·7
1870	124·7	134·1	1901	90·9	177·0
			1902	89·6	174·7
1875	124·7	161·4	1903	89·6	173·7
			1904	90·9	172·8
1880	114·3	148·8
			1905	93·5	173·3
1885	93·5	149·6	1906	100·0	175·7
			1907	103·9	181·7
1890	93·5	161·7

NOTE.—The Index Numbers here given have been calculated as regards Wages for the years to 1873 on the averages ascertained by Mr. Bowley—see the Economic Journal (Dec. 1898) and the Journal of the Royal Statistical Society (Dec. 1899)—and for later years on the percentages in the 12th Abstract of Labour Statistics of the United Kingdom (1906–7), p. 54. As regards Prices, Edition: current; Page: [998] the Numbers are based on the Index Numbers calculated by Mr. Sauerbeck—see Report on Wholesale and Retail Prices (1903), p. 451, and particulars in the Journal of the Royal Statistical Society (March 1908).

With this may be compared the calculation of the Board of Trade, taking the level of 1900 as 100, as given in the Twelfth Abstract of Labour Statistics (1908), p. 80.

INDEX NUMBERS OF WHOLESALE PRICES, 1871–1907. 1900=100.

Year.	Index No.	Year.	Index No.	Year.	Index No.	Year.	Index No.
1871	136.0	1881	127.3	1891	107.4	1901	96.9
1872	145.8	1882	128.4	1892	101.8	1902	96.5
1873	152.7	1883	126.8	1893	100.0	1903	96.9
1874	148.1	1884	114.7	1894	94.2	1904	98.3
1875	141.4	1885	107.7	1895	91.0	1905	97.6
1876	138.0	1886	101.6	1896	88.2	1906	100.5
1877	141.6	1887	99.6	1897	90.1	1907	105.7
1878	132.6	1888	102.7	1898	93.2
1879	126.6	1889	104.0	1899	92.3
1880	129.6	1890	104.0	1900	100.0

Before making use of these figures it must be remembered that they indicate the movement of wholesale prices; and attention would need also to be paid to the selection of commodities and the method of “weighting.”

To the Report on Wholesale and Retail Prices (1903) and to the “First Fiscal Blue-book” (British and Foreign Trade and Industry, Memoranda, &c., 1903) is prefixed as Frontispiece a chart combining the Index Numbers of Jevons for 1801–1846, of Sauerbeck for 1846–1871, and of the Board of Trade itself for 1871–1902; and so giving in one view the course of prices, so far as those materials indicate it, for the whole period 1801–1902.

As to Retail Prices, calculations will be found in the First “Fiscal Blue-book,” p. 215, and in the Second (British and Foreign Trade and Industry, Second Series, 1904), as to changes in the Average Retail Price of Workmen's Food in large towns in Great Britain during recent decades, as well as of the other principal items of the workman's budget, viz. rent, clothing, fuel, and light, during a quarter of a century. A considerable fall in food prices and a slight fall in the price of clothing since 1880 were in part counterbalanced by a rise in rents and, in the latter years, in fuel; with the result indicated below (Second Series, p. 32):

Statement showing Estimated Changes in Cost of Living of the Working Classes, based on Cost of Food, Rent, Clothing, Fuel, and Light, in a series of averages for quinquennial periods. (Cost in the year 1900=100.)

Edition: current; Page: [999]