INDEBTEDNESS FROM 1900 TO 1913 157 
that the amount of privately invested capital rose from £125 to 
£150 millions between 1900 and 1913. In order to determine the 
amount of the return upon this capital the average rate of 
interest upon capital invested during the period was estimated 
from various sources, and the computation is presented in the 
next table. 
TasLE XXXV 
Estimated Rate of Return on Private Capital 
Year. 
301 
1902 
1903 
1904 
1905 
1906 
1907 
1908 
1909 
1910 
1911. 
912 
1913 
Lehfeldt.t 
3-4 
3-2 
3-2 
3-8 
3-8 
2-9 
1.0 
£0 
£0 
1-2 
J 
2 
Australian 
productive 
activity 2 
00 
23 
27 
19 
31 
42 
34 
128 
138 
Average 
of 12 
companies.’ 
4 
5-0 
0 
8 
0 
3-0 
56 
55 
51 
52 
55 
5:2 
54 
Estimated 
Average. 
“4 
4-0 
3-5 
42 
4 
1.7 
1.8 
, 2 
1-8 
£9 
5-4 
3.9 
3:0 
The estimates made by Lehfeldt based on the return for prefer- 
ence and government stocks issued in London have little bearing 
upon the immediate problem ; but they are of interest in marking 
the general trend of interest rates during the period, and the 
minimum return which might be expected upon capital. The 
steady increase in productivity as indicated by the official index 
of productive activity, and the ready market which existed for 
Australian loan issues, would seem to indicate that a fairly high 
relative rate of interest might be expected ; and this was con- 
firmed by the analysis of the dividends of twelve representative 
companies. The estimate of average yield can, therefore, scarcely 
be considered too high in the light of all the circumstances of 
the time. It now remains to estimate the total of interest 
1 Lehfeldt, ‘The Rate of Interest on British and Foreign Investments’, Journal 
of the Royal Statistical Society, Jan. and Mar. 1913. 
? Commonwealth Bureau of Statistics, Labour Report No. 13, p. 88. 
3 From Insurance and Banking Record, for 2 banks, 3 mercantile agencies, 2 life 
and fire assurance companies, 2 mining companies, 3 industrial companies,