252

INTERNATIONAL TRADE

Ey

Ba
TRG

decrease of the physical quantities of the imports and exports.
Columns 5 and 6 then show in what way the quantity relations of
different years compare. The year 1900 is taken as the base for
this purpose, just as it is for the price comparisons. The proportion
 of exports to imports — physical quantities — for that year
1900 is taken as 100. According as the proportion is found to be
greater or less in another year, the figure is greater or less. The
figures thus deduced for the several years give an index of changes
in the gross barter terms of trade. Let it be borne in mind that
here, as in the figures on net terms, we have nothing which indicates
 whether the terms are in themselves favorable for any given
year. They indicate only the direction and extent of changes.
There is nothing to show whether the barter terms of trade with
foreign countries in 1900 gave Great Britain a large or a small
share of the total divisible gain from foreign trade. But such as
they were in 1900, favorable or not, it appears that in 1890 they
were less favorable than in 1900; more of physical exports was
given for each unit or given assortment of physical imports than
in 1900. And it appears that in 1910 also the relation was less
favorable than in 1900; then also more of exports was given in
exchange for a given quantity of imports than in 1900.
We have then an index of the gross barter terms of trade. The
chart on the opposite page shows at a glance the general trends
from 1880 to 1913. First follow the dotted line, indicating the
course of the gross barter terms of trade.! The terms of trade became
 markedly more favorable to Great.Britain from 1880 until
1900. During these two decades less and less of exports went
out in relation to the imports; a given physical quantity of imports
 was purchased for a steadily declining physical quantity of
exports. After 1900 the tendency is the other way; more and
more of exports are sent out, in comparison to the imports that
come in.
The course of the net barter terms is indicated by the unbroken

1 The figures on which the chart is based are given in detail in Appendix I, p. 411.
Both for chart and figures, I make use of a paper printed in the Economic Journal,
March, 1925.