Phelps Brown & Weber (1953): Accumulation, Productivity and Distribution in the British Economy, 1870-1938

Overview

"Accumulation, Productivity and Distribution in the British Economy, 1870–1938" is a 1953 article by the London School of Economics labour economist E. H. Phelps Brown and Bernard Weber, published in The Economic Journal (vol. 63, no. 250, pp. 263–288).[1] The paper reconstructs long-run British data on capital accumulation, output, and the division of income between factors of production across nearly seven decades — the kind of national-accounts reconstruction that, a few years later, fed into the growth-accounting tradition associated with Robert Solow's residual.

Within the Georgist literature the paper is best known at second hand: Fred Harrison cites it in The Power in the Land (Ch. 6) as the source for a long-run decline in the rate of return to industrial capital in Britain — one blade of a "scissors" divergence in which falling returns to capital open up against rising returns to land, which Harrison presents as a driver of the 18-year land cycle.[2]

The Paper's Own Figures (verified against the primary text)

The June 1953 Economic Journal issue (vol. 63, no. 250) carrying this article is digitized on the Internet Archive (item sim_economic-journal_1953-06_63_250, not access-restricted), and its OCR full text was read directly this session, confirming the article's own printed pages and figures — an independent check on Harrison's secondhand citation, not merely a repetition of it:[1]

• Overall rate of return on capital. "The rate of return on capital of all kinds ... relating yield in £s with replacement cost, both being expressed in 1912/3 £s, remained between 10 and 11% throughout most of 1870–1913; from 1924 to 1938 it fluctuated about a level of 7%" (p. 266). This is the specific declining-return figure Harrison's "scissors" citation rests on, and it is now independently confirmed against the primary text rather than taken on Harrison's word alone.
• Industrial sector (excluding buildings). "The rate of return was very stable ... at about 15%, from 1879 to 1900; it had been rather higher, around 17 and 16%, in the 1870s, and from 1900 to 1913 it was rather lower, around 14%. In the inter-war years it fluctuated about 11%" (pp. 266–267).
• Building sector. "This rate rose from 4 to over 6% between 1870 and 1895, and remained around 6% until 1913. In 1924 (though both terms of the ratio are now more uncertain) it seems to have been much lower again, at about 3½%" (p. 271).
• Land is not separately analyzed. The article treats capital as buildings, plant/equipment, and stocks; a full-text search of the article for "land," "site value," and "ground rent" as a distinct factor-of-production category found no discussion — Phelps Brown and Weber's own paper does not itself frame a land-vs-capital "scissors," and does not address land or site-rent returns at all. Harrison's "scissors mechanism" (rising land returns set against these declining capital returns) is Harrison's own construction built on top of the paper's capital-return data, not a claim the paper makes.

Status of This Page

The original 1953 text is now confirmed via the freely accessible Internet Archive OCR scan of the Economic Journal issue (see above), which is not paywalled and required no login. Harrison's characterization of the paper's declining-capital-returns finding is corroborated by the primary text: the 10–11%-to-~7% overall decline he cites is accurately represented. However, Harrison's "scissors" framing (land returns rising as capital returns fall) is his own synthesis, not a claim advanced in the paper itself, which does not discuss land returns. A future editor with continued access could expand this page further into the paper's methodology (Schedule A assessments, replacement-cost valuation) and its place in the growth-accounting literature.

See Also

• Harrison, The Power in the Land — the book that cites this paper (Ch. 6)
• 18-Year Land Cycle — the cycle theory this paper's capital-returns data is cited to support
• Boom-Bust Cycle — the wider evidence assessment for land-and-capital cycle theories

Sources

1. E. H. Phelps Brown and Bernard Weber (1953), "Accumulation, Productivity and Distribution in the British Economy, 1870–1938," The Economic Journal, 63(250), pp. 263–288. Oxford Academic · DOI/JSTOR 10.2307/2227124 — bibliographic details confirmed against the publisher/JSTOR record. Primary text obtained free of charge via the Internet Archive's digitized run of The Economic Journal: item sim_economic-journal_1953-06_63_250 (OCR full text, not access-restricted, no login required), read directly this session — used for the pp. 266, 266–267, and 271 quotations and figures above (A/B-claim, capital-return magnitudes; confirmed against the article's own printed pages, not Harrison's secondhand citation of them).
2. Fred Harrison (1983), The Power in the Land, Universe Books / Shepheard-Walwyn, Ch. 6 — the discovery source and the origin of the "scissors mechanism" framing (Harrison's own synthesis; the primary paper does not use this framing or discuss land returns — see "The Paper's Own Figures" above). wiki summary