These figures are more eloquent than words could be. Huge masses of products are being thrown out of the production process to enter into the channels of circulation. The old markets could not have absorbed a hundredth part of what is now absorbed by the world market every year. The world market presupposes not only a certain level of development of production in the strict sense of the word; one of its material conditions of existence is the development of the transportation industry. The more developed the transport facilities, the faster and the more intensive the movement of commodities, the faster is the process of welding together the individual, local and "national" markets, the faster is the growth of the world economy's production organism as a unit. Such is in modern economic life the role of steam and electric transportation. The railroad mileage by the middle of the last century (7850) was 38,600 kilometers; by 1880 the figure grew to 372,000 kilometers.¹⁹⁾ Since then the length of the railroad tracks has grown with astounding rapidity.

During twenty years (1890‑1911) ), the length of the railroad tracks increased 1.71 times (171 per cent).

The same development may be observed in the merchant marine. Marine transportation, be it noted, plays an exclusive role, since it alone facilitates the movement of commodities from continent to continent ("transoceanic trade"), but its role is also greatly due to its comparative cheapness even as far as Europe is concerned. Compare the movement of commodities between the Black and the Baltic Seas. The following figures illustrate the growth of marine transportation:

World ship‑building for commercial purposes has grown in the last years as follows:

According to Harms,²³⁾ the tonage of the world merchant marine grew 55.6 per cent between 1899 and 1909 alone. This gigantic growth of marine transportation has made it possible to unite the economic organisms of several continents and to revolutionise the pre-capitalist methods of production in the most backward corners of the world commodity circulation in astounding proportions. The latter, however, is accelerated not in this way alone. In reality the entire movement of the capitalist mechanism is much more complicated, since commodity circulation and the rotation of capital do not necessarily presuppose that commodities are changing their places in space.

Within the rotation of capital and metamorphoses of commodities which are a part of that rotation, the mutation process of social labour takes place. These mutation processes may require a change of location on the part of the products, their transportation from one place to another. Still a circulation of commodities may take place without their change from place to place, and a transportation of products without the circulation of commodities or even without a direct exchange of products. A house which is sold by A to B does not wander from one place to another, although it circulates as a commodity. Movable commodity values, such as cotton or iron, remain in the same warehouse at a time when they are passing through dozens of circulation processes when they are bought and sold by speculators. That which really changes its place here is the title of ownership, not the thing itself. ²⁴⁾

Similar processes take place also in modern times in gigantic proportions due to the development of the most abstract form of capitalism, to the ever growing impersonal character of capital, to the growth of the volume of stocks and bonds as an expression of the form of property that is characteristic for our times, in a word, due to the growth of "stock" capitalism (Liefmann) or "finance" capitalism (Hilferding). The international leveling of commodity prices and of stock and bond values is accomplished by wire (activities of the stock and commodity exchanges). The network of telegraphs grows with the same feverish tempo as the means of transportation. Of particular importance is the increase in the length of cables connecting various continents. By the end of 1913, there were 2.547 cables (the number has already increased to 2,583); the length of all these cables was 515,578 kilometers.²⁵⁾ The length of the cables is equal to half the length of all the railroads of the world (which in 1911 was 1,057,809 kilometers). Thus there grows an extremely flexible economic structure of world capitalism, all parts of which are mutually inter‑dependent. The slightest change in one part is immediately reflected in all.

Let us now examine the process itself. We have seen that the most primitive form in which economic interdependence expresses itself in a system of commodity economy, is exchange. The category of world prices expresses this interdependence on a world scale. An outward expression of the same phenomenon is the international movement of commodities, "international trade." Although the figures quoted below cannot pretend to be absolutely accurate, they correctly reflect the persistent trend towards widening the sphere of the world market.

Thus, within eight years, from 1903 to 1911, international trade increased 50 per cent‑a very substantial increase indeed. The quicker the pulse of economic life, the faster the growth of the productive forces, the wider and deeper goes the process of internationalisation of economy. W. Sombart's thesis of the diminishing importance of international relations (abnehmende Bedeutung der weltwirtschaftlichen Beziehungen) is therefore absolutely incorrect.²⁸⁾ This most paradoxical of modern economists had paid a certain tribute long before the war, to the imperialistic ideology which, he said, strives towards economic "autarchy" and creates a large self‑sufficient whole ²⁹⁾ His "theory" is a generalisation of the fact that the home sale of manufactured goods in Germany grew faster than the export of such goods. It is from this fact that Sombart drew a queer conclusion concerning the diminishing significance of foreign trade in general. However, as Harms ³⁰⁾ correctly remarks, even assuming that manufactured goods gravitate towards the internal market more than towards foreign markets (a conclusion to which Sombart arrives from the analysis of German data only), one must not, on the other hand, overlook the increasing import of raw materials and foodstuffs which serve as a prerequisite for the home trade in manufactured goods, for the internal market, since it is due to such an import that the country is not compelled to waste productive forces on the production of raw materials and food. Definite conclusions can be drawn only after an analysis is made of both sides of the international exchange and of the distribution of productive forces in all the branches of social production. The tendencies of modern development are highly conducive to the growth of international relations of exchange (and with them many others), in that the industrialisation of the agrarian and semiagrarian countries proceeds at an unbelievably quick tempo, a demand for foreign agricultural products is created in those countries, and the dumping policy of the cartels is given unusual impetus. The growth of world market connections proceeds apace, tying up various sections of world economy into one strong knot, bringing ever closer to each other hitherto "nationally" and economically secluded regions, creating an ever larger basis for world production in its new, higher, noncapitalist form.

If the international movement of commodities expresses the "mutation process" in the socio‑economic world organism, then the international movement of the populations expresses mainly the redistribution of the main factor of economic life, the labour power. Just as within the framework of "national economy" the distribution of labour power among the various production branches is regulated by the scales of wages which tend to one level, so in the framework of world economy the process of equalising the various wage scales is taking place with the aid of migration. The gigantic reservoir of the capitalist New World absorbs the "superfluous population" of Europe and Asia, from the pauperised peasants who are being driven out of agriculture, to the "reserve army" of the unemployed in the cities. Thus there is being created on a world scale a correspondence between the supply and demand of "hands" in proportions necessary for capital. An idea of the quantitative side of the process may be gleaned from the following figures:

In 1912, 711,446 emigrated from Italy, 467,762 from England and Ireland, 175,567 from Spain (1917), 127,747 from Russia, etc. ³³⁾ To this number of final emigrants, i.e., of workers who relinquish their fatherland forever and look for a new country, must be added a number of emigrants of a temporary and seasonal character. Thus the Italian emigrants are mostly of a temporary character; Russian and Polish workers immigrate into Germany for agricultural work (the so‑called Sacksengängerei, etc.). These ebbs and flows of labour power already form one of the phenomena of the world labour market.

Corresponding to the movement of labour power as one of the poles of capitalist relations is the movement of capital as another pole. As in the former case the movement is regulated by the law of equalisation of the wage scale, so in the latter case there takes place an international equalisation of the rates of profit. The movement of capital, which from the point of view of the capital exporting country is usually called capital export, has acquired an unrivalled importance in modern economic life, so that some economists (like Sartorius von Waltershausen) define modern capitalism as export capitalism (Exportkapitalismus). We shall touch upon this phenomenon in another connection. At present we only wish to point out the main forms and the approximate size of the international movement of capital which forms one of the most essential elements in the process of internationalising economic life, and in the process of growth of world capitalism. Export capital is divided into two main categories. It appears either as capital yielding interest, or as capital yielding profits.

Inside of this division one can discern various sub‑species and forms. In the first place, there are state and communal loans. The vast growth of the state budgets, caused both by the growing complexity of economic life in general, and by the militarisation of the entire "national economy," makes it ever more necessary to contract foreign loans to defray the current expenses. The growth of large cities, on the other hand, demands a series of works (electric railways, electric light, sewage system and water supply, pavements, central steam heat, telegraph and telephone, slaughter houses, etc., etc.), which require large sums of money for their construction. These sums are also often obtained in the forms of foreign loans. Another form of capital export is the system of "participation," where an enterprise (industrial, commercial, or banking) of country A holds stocks or bonds of an enterprise in country B. A third form is the financing of foreign enterprises, creating of capital for a definite and specified aim; for instance, a bank finances foreign enterprises created by other institutions or by itself; an industrial enterprise finances its branch enterprise which it allows to take the form of an independent corporation;a financing society finances foreign enterprises. ³⁴⁾ A fourth form is credit without any specified aim (the latter calls for "financing") extended by the large banks of one country to the banks of another country. The fifth and last form is the buying of foreign stocks, etc., with the purpose of holding them (compare activities of banks of issue), etc. (The last of the enumerated forms differs from the others in that it does not create a lasting community of interests.)

In various ways there thus takes place the transfusion of capital from one "national" sphere into the other; there grows the intertwining of "national capitals"; there proceeds the "internationalisation" of capital. Capital flows into foreign factories and mines, plantations and railroads, steamship lines and banks; it grows in volume; it sends part of the surplus value "home" where it may begin an independent movement; it accumulates the other part; it widens over and over again the sphere of its application; it creates an ever thickening net­ work of international interdependence. The numerical side of the process may be partly realised from the following:

Leroy‑Bolieu computes for 1902 the figure of French capital invested in foreign enterprise and loans as equal to 34 billion francs.³⁷⁾ In 1905 the figure had already reached 40 billion francs. The total value of stocks and bonds in the Paris stock exchange was, for 1904, 63,990 million francs in French securities plus 66,780 million francs in foreign securities; for the year 1913 the respective figures were 64,104 and 70,761. ³⁸⁾

English capital invested in foreign countries, including English colonies, amounted at the beginning of 1915, according to Lloyd George's statement, to four billion pounds sterling.

As to Germany, figures relative to the placing of foreign securities and to the quotation of foreign securities on the German stock exchange show a decline of the latter (according to the Statistisches Jahrbuch für das Deutsche Reich for 1913, the nominal value of admitted securities was in 1910, 2,242 million marks, in 1911, 1,208 million marks, in 1912, 835 million marks), but this seeming decline in capital export is explained by the fact that the German banks are buying securities in increasing quantities at the foreign exchanges, especially in London, Paris, Antwerp, and Brussels, and also by the "financial mobilisation of capital" for the purposes of war. The total of German investments abroad amounts to some 35 billion marks.

A word or two about Belgian capital whose investment abroad amounts to 2.75 billion francs. Its total is distributed among the various countries as follows:

The United States, while importing large amounts of capital, exports considerable quantities of it into Central and South America, especially into Mexico, Cuba, and Canada.

The finance system of Cuba was the first to attract the attention of the capitalists of the United States. Americans own large plantations in Cuba. American enterprise helped considerably in developing the neighbouring Mexican republic, particularly in building and utilising the Mexican railroads. It was natural that the Mexican 5 and 4 per cent loans (amounting to $150,000,000.00) should have been placed on the market of the United States. The 4 per cent loan of the Philippine Islands was also placed on the American market. In Canada the United States placed over $590,000,000.00, in Mexico over $700,000,000.00, etc ⁴¹⁾

Even such countries as Italy, Japan, Chile, and others play an active part in this great migration of capital. The general direction for the movement is, of course, indicated by the difference in the rates of profit (or the rate of interest): the more developed the country, the lower is the rate of profit, the greater is the "over‑production" of capital, and consequently the lower is the demand for capital and the stronger the expulsion process. Conversely, the higher the rate of profit, the lower the organic composition of capital, the greater is the demand for it and the stronger is the attraction.

In the same way as the international movement of commodities brings the local and "national" prices to the one and only level of world prices; in the same way as migration tends to bring the nationally different wage scales for hired workers to one level, so the movement of capital tends to bring the "national" rates of profit to one level, which tendency expresses nothing but one of the most general laws of the capitalist mode of production on a world scale.

We must dwell here with greater detail on that form of capital export which expresses itself in "participating in" and "financing" of foreign enterprises. Within the framework of world economy the concentration tendencies of capitalist development assume the same organisational forms as are manifest within the framework of "national" economy: namely, there come more strikingly to the foreground the tendencies towards limiting free competition by means of forming monopoly enterprises. It is in this process of forming monopoly organisations that participation and financing play a very large part. If we were to follow up "participation" in its various stages, to be judged by the number of acquired shares, we would realise how complete fusion is gradually being prepared. When you own a small number of shares, you can take part in shareholders' meetings; when you own a greater number of shares, you establish a closer contact with the enterprise (you can try to share with the enterprise new production methods or patents, you can speak of dividing the market, etc.), a certain community of interests is thus established; if you own more than 50 per cent of the shares, your "participation" already amounts to complete fusion. Quite wide‑spread is the practice of establishing branches in the form of nominally independent corporations whose funds, however, are held by their "mother" corporation (Muttergesellschaft).⁴²⁾ The latter phenomenon is often observed in international relations. To avoid legal obstacles in a "foreign" country and to be able to use the privileges of native industrialists in the new "fatherland," branches are being established in those countries under the guise of independent corporations.

Thus the cellulose factory of Waldhof in Mannheim has (or we may now use the past tense) a Russian branch in Pernov; the bronze paint factory, Carl Schlenk, Inc., in Nuremburg, has an American "daughter corporation"; the same is true of Varziner Papierfabrik, which has an American branch known as the Hammerville Paper Company; the largest cable enterprise on the continent, the Westfälische Drahtindustrie, has a daughter corporation in Riga, etc. Conversely, foreign corporations have branches in Germany and other countries; for instance, the Maggi corporation of Kempttal, Switzerland, has branches in Singen and Berlin, Germany, also in Paris (Compagnie Maggie and Société des boissons hygieniques). In 1903 the American Westinghouse Electric Company, Pittsburgh, organised a branch near Manchester, England; in 1902 the American Diamond Match Company, having gradually increased its participation in an enterprise located in Liverpool, finally absorbed it, and reduced it to the state of a branch of the American main firm, etc. ⁴³⁾ The same is true of numerous Swiss chocolate factories and weaving enterprises, English soap factories, machine shops and twine factories, American sewing machine factories, machine plants, etc.

One must not think, however, that participation in foreign enterprises is limited to this form alone. In reality there are a great many forms of "participation" of various degrees, from ownership of a comparatively insignificant number of shares, particularly when a given enterprise (commercial, industrial, or banking) "participates" simultaneously in several enterprises, to ownership of nearly all the shares. The mechanism of "participation" consists in the fact that a given corporation issues its own stocks and bonds with the purpose of acquiring the securities of other enterprises. Liefmann distinguishes three forms of such "substitution of securities" (Efjektensubstitution) which he classifies according to the aim of the respective "substituting corporations" (Substituionsgesellschaften): "Investment Trust" where the "substitution of securities" is made with the purpose of receiving dividends from more lucrative, if more risky, enterprises; 2) "Placement Societies" (Effektenübernahmegesellschaften) whose aim it is to place the securities of enterprises whose stocks and bonds, in consequence of legal or material difficulties, cannot be placed in the hands of the public directly; 3) "Holding Companies" (Kontrollgesellschaften) which buy up the securities of various enterprises, eliminating them from circulation and replacing them by securities of the holding company, which thus acquires influence over these enterprises without spending its own capital. The aim is clearly influence, "control," i. e., practical domination over given enterprises.

In all these cases it is assumed that the securities to be replaced are already in existence. Where the latter have to be created, we have before us the financing operation which, as we have seen, may be carried out by banks, industrial and commercial enterprises, also special "financing companies." In so far as the financing is done by industrial enterprises, it is ordinarily connected with the establishment of foreign branches, since it is there that the new securities are being issued.

The financing enterprises may have a very wide range of activities. Thus the mechanical enterprise Orenstein Koppel-Arthur Koppel, Inc., has founded ten "daughter companies," of which the largest are located in Russia, Paris, Madrid, Vienna, and Johannesburg (South Africa); the firm of Körting Bros. in Hanover has branches in Austria, Manchuria, France, Russia, Belgium, Italy, Argentina; numerous German cement plants have "daughter companies" in the United States; German chemical plants have branches in Russia, France, and England; the Norwegian nitrate enterprises are to a very large extent financed by foreign capital. The Norwegian, French, and Canadian capitalists have formed the Norsk Hydro Elektrisk Kvälstofaktieselskab (also known as Société Norvegienne de I'Azote et des Forces Hydro‑Electriques), which in its turn has founded two companies with participation also of German capital. The greatest internationalisation of production has been attained in the electrical industry. The Siemens Halske firm has its enterprises in Norway, Sweden, South Africa, and Italy; it has branches in Russia, England, and Austria. The famous Allgemeine Elektrizitätsgesellschaft (for short, A‑E‑G) has its daughter companies in London, Petrograd, Paris, Genoa, Stockholm, Brussels, Vienna, Milan, Madrid, Berlin, in American cities, etc; similar activities are shown by the Thomson-Houston Company and by its successor, the General Electric Company, by the Singer Manufacturing Company, the Dunlop Pneumatic Tire Company, etc. ⁴⁴⁾

The large banks naturally play a very large part in financing foreign enterprises. A glance at the activities of those institutions shows how strong the international connections of "national" organisations have already grown. A 1913 report of the Société Générale de Belgique declares its "national" securities to be equal to 108,322,425 francs, whereas its foreign securities were equal to 77,899,237. The latter capital is invested in enterprises and loans of such diverse countries as Argentina, Austria, Canada, China, Congo, Egypt, Spain, the United States, France, Morocco, New Caledonia, Russia, etc. ⁴⁵⁾ Data concerning the activities of the German banks have been worked out in great detail. We quote here facts relating to the largest German banks as typical of the entire banking business of Germany.

Die Deutsche Bank. 1) Founded the Deutsche Ueberseeische Bank with 23 branches: 7 in Argentina, 4 in Peru, 2 in Bolivia, 1 in Uruguay, 2 in Spain, 1 in Rio de Janeiro; 2) founded, together with the Dresdner Bank, the Anatolische Eisenbahngesellschaft (Société du chemin de fer Ottoman D'Anatolie); 3) bought, together with the Wiener Bankverein, the shares of the Betriebsgesellschaft der orientalischen Eisenbahnen; 4) founded the Deutsche Treuhandgesellschaft operating in America; 5) participates in the Deutsch‑Asiatische Bank, Shanghai; 6) participates in the Bank für orientalische Eisenbahnen, Zürich; 7) participates in the Banca Commerciale Italiana, Milan; 8) participates in the Deutsch‑Atlantische, Ost‑Europäische, Deutsch‑Niederländische Telegraphengesellschaft, the Norddeutsche Seekabelwerke and the Deutsch‑Südamerikanische Telegraphengesellschaft; 9) participates in the Schantung‑Bergbau and in the Schantung‑Eisenbahngesellschaft; 10) participates, together with Turkish, Austrian, German, French, Swiss and Italian firms, in the Imperial Ottoman Society of the Bagdad Railroad; 11) founded the Ost‑Afrikanische Gesellschaft; 12) participates in the Deutsch‑Ost‑Afrikanische Bank; 13) participates, together with Swiss and German firms, in the Zentral‑Amerika‑Bank (later known as Aktiengesellschaft für überseeische Bauunternehmungen) ; 14) participates in the banking firm of Güterbook, Horwitz & Co., Vienna; 15) participates in the firm of Ad. Goerz, Berlin (the firm operates mines in Johannesburg).

Diskonto‑Gesellschaft. 1) Participates in the Deutsche Handels‑ and Plantagengesellscbaft der Südseeinseln and in the Neu‑Guinea‑Kompagnie; a) founded, together with the NordDeutsche Bank, the Brasilianische Bank für Deutschland with five branch banks; 3) participates, together with other banks, in the Deutsch‑Asiatische Bank; 4) participates in the banking firm of Ernesto Tornquist, Buenos‑Aires, and in the firm of Albert de Bary & Co., Antwerp, that is connected with the former; 5) participates in the Banca Commerciale Italiana; 6) founded, together with the Nord‑Deutsche Bank, the Bank für Chile and Deutschland, with eight branches; 7) founded, together with the firm of Bleichröder, the Banca Generale Romana in Bucharest (now has six branches); 8) participates, together with many firms, in the Banque Internationale de Bruxelles; 9) participates in the Schantung‑Eisenbahngesellschaft, the Schantung‑Bergbaugesellschaft, and in a number of cable and telegraph enterprises; 10) founded the OtaviMinen‑ and Eisenbahngesellschaft, Africa; 11) founded the Ost‑Afrikanische Eisenbahngesellschaft; 12) participates in the Deutsch‑Ost‑Afrikanische Bank; i3) founded, together with Bleichröder, a Bulgarian firm and the Nord‑Deutsche Bank, the Kreditna Banka in Sophia; 14) founded, together with Woermann, Hamburg, the Deutsch‑Afrika‑Bank; 15) participates in the General Mining and Finance Corporation Ltd., London; 16) founded, together with other firms, the Kamerun‑Eiscnbahngesellschaft; 17) opened a branch bank in London in 1900; 18) financed, together with Krupp, the Grosse Venezuela‑Eisenbahn; i9) participated, as a member of the Rothschild banking trust, m Austro‑Hungarian, Finnish, Russian, and Roumanian state railways, loans, industrial enterprises, etc. ⁴⁶⁾

Similar activities are shown by the other large banks of Germany, the Dresdner Bank, the Darmstädter Bank, Berliner Handelsgesellschaft, Schaffhausen'scher Bankverein, and Nationalbank für Deutschland, which also have a number of daughter societies in common throughout the countries of the world!⁴⁷⁾

Of course, it is not the German banks alone that develop such intensive activities abroad. A comparison of figures would show that England and France are in the lead. While the foreign banks of German origin numbered only 13 by the beginning of 1906 (with 100 million marks of capital, and 70 branch banks), England possessed by the end of 1910 36 colonial banks with branches in London, and with 3,358 local bureaus in the colonies, also 36 other banks in foreign countries with 2,091 branches. France, in 1904‑5, possessed 18 colonial and foreign banks with 104 branches; Holland, 16 foreign banks with 68 branches, etc. Individual banks of France also show great economic power in relation to the colonies and foreign countries. Thus, in 1911, the Credit Lyonnais had about 16 branches abroad, and 5 in Algeria; the Comptoir National d'Escompt had 12 branches abroad, and m in Tunis and Madagascar; the Société Generate and the Credit Industriel have branches only in London, but on the other hand they have numerous daughter companies abroad. ⁴⁸⁾

"Participation," and "financing" as a further step in participation, signify that industry is being moulded to an ever growing degree into one organised system. The most modern types of capitalist monopoly in their most centralised forms, like the trusts, are only one of the forms of "participating companies" or "financing companies." They enjoy a more or less monopolistic ownership of the capitalist property of our times, and they are looked upon and classified, from the point of view of the movement of securities, as a specific expression of the capitalist property of our times.

We thus see that the growth of the world economic process, having as its basis. the growth of productive forces, not only calls forth an intensification of production relations among various countries, not only widens and deepens general capitalist interrelations, but also calls to life new economic formations, new economic forms unknown to the past epochs in the history of capitalist development.

The beginnings of the organisation process that characterises the development of industry within "national" economic boundaries, become ever more evident also against the background of world economy relations. Just as the growth of productive forces within "national" economy, on a capitalist basis, brought about the formation of national cartels and trusts, so the growth of productive forces within world capitalism makes the formation of international agreements between the various national capitalist groups, from the most elemental forms to the centralised form of an international trust, ever more urgent. These formations will be the object of our inquiry in the next chapter.

Notes

¹⁾ "In the manufacturing period, the division of labour within society was greatly accelerated by the expansion of the world market, and by the colonial system, both of which form part of the general conditions of existence of the period in question." (Karl Marx: Capital, Vol. I, p. 373.) This is true also in relation to our present time.

²⁾ Konrad Matschoss: Grundriss der technisch‑geschichtlicken Entwickelung, (in Die Technik im XX. Jahrhundert, herausgegeben von A. Miethe), I. Band.

³⁾ Augustus D. Webb: New Dictionary of Statistics p. 450.

⁴⁾ Webb, l.c., p. 450; Statistisches Jahrbuch für das Deutsche Reich.

⁵⁾ Webb, l.c.p.449.

⁶⁾ Ibid, p. 450.

⁷⁾ Marx was the first to discover this law, and gave a splendid analysis of its function in his examination of the causes of the falling rate of profit (Capital, Vol. III, Part I). Modern bourgeois political economy which, in the person of Böhm‑Bawerk, declares Marx's entire theory to be a house of cards, plagiarises ail the more diligently certain portions of his theory, covering up the traces that lead to the source, such as Böhm‑Bawerk's theory of the "by‑ways of production" (Produktionsumwege), which is a poor version of Marx's law of the growing organic composition of capital.

⁸⁾ Juraschek: "Bergbaustatistik," in Handwörterbuch der Staatswissenschaften.

⁹⁾ Juraschek, l.c. The last year is computed according to Statistische Jahrbücher, etc.

¹⁰⁾ Juraschek: "Eisen and Eisenindustrie " in Statistische Jahrbücher.

¹¹⁾ Statesman's Year-Book, 1915; l.c.; Webb, l.c..

¹²⁾ Statistische Jahrbücher des Deutschen Reiches, the figures are below the real production, as for Asia, Africa, and Australia, the 1910 figures were used.

¹³⁾ Vestnik Finansov, No. 6, 1915. Gold serves here as a medium of circulation. The table shows that its production grows considerably despite the tremendous role of credit and the economy in circulation media in general.

¹⁴⁾ Figures for wheat quoted from Friedrich and Vestnik Finansov No. 15.

¹⁵⁾ Vestnik Finansov, Nos. 19 and 39, 1915, (concerning cotton).

¹⁶⁾ Webb, l.c.; Statesman's Year-book, 1915.

¹⁷⁾ Friedrich, l.c.

¹⁸⁾ Ibid.

¹⁹⁾ Professor Wiedenfeld: "Eisenbahnstatistik," in Handworterbuch der Staatswissenschaften.

²⁰⁾ Statistisches Jahrbuch für das Deutsche Reich, 1913.

²¹⁾ G. Lecarpentier: Commerce maritime et marine marchande, Paris, 1910, p. 53.

²²⁾ Statesman's Year‑Book

²³⁾ Harms, l.c., p. 126.

²⁴⁾ Capital, Vol. II, translated by Ernest Untermann, p. 169.

²⁵⁾ Statistisches Jahrbuch fur das Deutsche Reich, 1913, p. 39; The statesman's Yearbook.

²⁶⁾ Ibid.

²⁷⁾ l.c. p. 212.

²⁸⁾ W. Sombart: Die deutsche Volkswirtschaft im XIX. Berlin, 1913.

²⁹⁾ Sombart, who during the war turned into a raving imperialist, is not an isolated phenomenon. In analysing the economic problems connected with world economy, one may discern two trends. One is optimistic, the other demands first of all a strengthening of the inner forces of an imperialist nation fighting for power, hence this trend pays great attention to the problems of the internal market. See, for instance, Dr. Heinrich Pudor, "Weltwirtschaft and Inlandproduktion," in Zeitschrift fur die gesamte Staatswissenschaften, herausgegeben von K. Bücher, 71. (deutsche Weltwirtschaft), insofar only as our production, our industry, seizes ever greater markets and unsaddles foreign competition. In that case, [he says] world trade expands accordingly. The foundation, however, must be home (heimische) production" (pp. 147‑148).

³⁰⁾ Harms, l.c. p. 202, footnote; also Sigmund Schilder: Entwickelungstendenzen der Weltwirtschaft, Berlin, 1912‑15.

³¹⁾ D. Lewin: Der Arbeitslohn und die soziale Entwickelung, Berlin, 1913, p. 141; also U. Philippov: Emigration, p. 13.American Year‑Book for 1914, p. 385.

³²⁾ Lewin, l.c. p. 141.

³³⁾ Statistisches Jahrbuch für das Deutsche Reich, etc.

³⁴⁾ For more about such companies see R. Liefmann: Beteiligungs‑and Finanzierungsgesellschaften, Jena, 1913.

³⁵⁾ Harms, l.c. pp. 228‑229.

³⁶⁾ Sartorius von Waltershausen: Das volkswirtshaftliche System der Kapitalanlage im Auslande, Berlin, 1907, p. 56.

³⁷⁾ Economiste Francais, 1902, II, p. 449 (quoted by Sartorius).

³⁸⁾ Sartorius von Waltershausen, l.c.; Vestnik Finansov, 1915, No. 4.

³⁹⁾ Harms, 1. c., p. 235.

⁴⁰⁾ Harms, l.c., p. 242 ; Schilder: Entwickelungstendenzen der Weltwirtschaft, 364.

⁴¹⁾ M. Bogolepov: "The American Market," in Vestnik Finansov, 1915, No.

⁴²⁾ R. Liefmann: Beteiligungs‑ and Finanzierungsgesellschaften, pp. 47‑48. It must be noted that under certain conditions "control" and fusion can be achieved with much less than 50 per cent of the shares.

⁴³⁾ Sartorius von Walterhausen, l.c. p. 174.

⁴⁴⁾ Liefman, l.c. pp. 99‑104. Of course, financing may be extended not only to branches of the same firm. Thus the firm of Knop, together with the Soloviev Brothers and the Kraft Brothers, financed in 1912 the Caspian Manufacture, a partnership organisation that bad acquired the property of a liquidated association formed in the province of Daghestan by the Moscow financier Reshetnikov, the Siberian banker Petrokokino and by the ParisNetherland Bank (Birzhevye Vyedemosti, April 15, 1915).

⁴⁵⁾ La Vie Internationale, Vol. V, 1914, p. 449 (Published by the Office Centrale des Associations Internationales. Brussels).

⁴⁶⁾ Dr. Jacob Riesser: Die deutschen Grossbarzkerz und ihre Konzentration im Zusammenhang mit der Entwickelung der Gesamtwirtschaft in Deutschland, fourth edition, 1912, p. 354 [English translation: J. Riesser: The German Great Banks and their Concentration in Connection with the Economic Development of Germany, Washington, Government Printing Office, 1911 Further references to this volume are to the German edition.‑Trans.]

⁴⁷⁾ Riesser, l.c., p. 371 ff.

⁴⁸⁾ Ibid., p. 375. The rapid growth of the German banks deserves attention. There were only 4 of them by the end of the nineties, 6 in 1903, with 32 branch banks, and 13 in 1906, with 70 branch banks.

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