134 AUSTRALIA'S FLUCTUATING ADVANTAGE IN
indicated in Chapter VIII which the theory of international
trade would lead us to expect are again to be found here. The
exact measurement of the tendencies in sectional price-levels
cannot be claimed, but the accompanying figures confirm the
observations made by Viner.
TasLe XXIV
Domestic, Export, and Import Price-level. Australia, 1 900-13
Year.’ | Domestic.t! Export? | Import?
1901
1902
1903
1904
1905
1906
1907
1908
1909
1910
911 .
1912 .
1913
[ncrease per cent.
1,000
1,097
1,078
977
1,050
(,046
1,037
1,103
1,107
1,114
1,154
1,328
L371 |
mq
1,000
1,072
1,118
1,123
1,192
1,249
1,309
1,177
1,212
1,243
(,161
1,263
1,290
90.0
1,000
1,008
993
1,001
988
1,032
1,001
1,024
1,016
1,099
1,101
1,123
,117
-
All this has an important and specific bearing upon the terms
of trade over the period, which are now to be examined. The
rise affecting domestic prices and the consequent increased
demand for imports has little compensation for the Australian
producer. With the exception of wool, albeit an important
exception, the volume of Australian production could have had
little effect on world production and world prices. Those
Australian commodities, therefore, which entered into world
trade did so at world prices. But, because of the effect of capital
loans upon price-levels in the lending and borrowing countries,
Australia in the early stages of borrowing cycles procures a
relatively greater physical volume of imports for her exports.
But towards the end of the period the swelling interest payments
sperate in the other direction, and with the approximation once
¢ Adjusted to 1901 as base year from Sydney and Hobart retail prices as com-
puted by Knibbs from State data for forty-six commodities with rent, ‘Prices,
Price Indexes and Cost of Living’, Labour and Industrial Branch, Report No. 1,
ssued by the Commonwealth Bureau of Census and Statistics, 1912.
? and ? Compiled from data given by Knibbs. Section TV. ibid., and adjusted
to 1901 as base.
