British Foreign Capital Issues, 1865–1894

In the half-century before 1914 international capital movements Played a significant role in the development of the world economy. This paper—which is a prelude to a more comprehensive study—focuses upon the British experience. We will first present new annual series on British foreign capital issues for the period 1865–1894. Our analysis of their behavior is centered about the following questions. First, how did the volume of British foreign investment fluctuate during the latter part of the nineteenth century? Were there long swings in these capital movements? Second, how did the geographic distribution of British foreign investment change over time? Was there an increasing tendency to invest within the British Empire? How was the total volume of investment apportioned between the tropics and the temperate regions of recent settlement? Third, how was British foreign investment allocated among economic sectors? Did the industrial composition vary significantly among countries, continents, and climatic-ethnic regions? Finally, what types of enterprises were nourished by British capital? How did the shares vary among government, private and mixed—government and private—undertakings? We believe that our time series provide more reliable answers to these questions than do previously available data.