The provision of capital is generally recognized to be one of the main problems of countries undergoing the process of industrialization. This is true also of the special case of Great Britain, the first country to experience an industrial revolution. In the British case, however, it is important to note that much capital had been accumulated even before the 1760's, the decade when industrial growth began to accelerate and to change its direction. Most of this earlier capital was invested in commerce, in finance, in farming, and in stocks of manufactured goods and raw materials, and what was noteworthy in the next two generations was, not so much the absolute (and probably also relative) growth in the quantity of capital, but a change in its composition: the emergence, for the first time, of large concentrations of fixed capital.

According to W. W. Rostow, “the introduction of the railroad has been historically the most powerful single initiator of take-offs,” having “three major kinds of impact on economic growth during the take-off period,” namely, lowering transport costs and bringing new areas and products into the market; developing a major new export sector; and leading on to the development of modern coal, iron, and engineering industries. But though all these three can be traced in mid-nineteenth-century Britain, the railways are not accorded the role of initiator in that country since, in the Rostow schema, the take-off had already occurred before the invention of the locomotive. The size of the investment in Britain's railways is such, however, that it is worth examining their impact, even if this was not so overwhelming as in some other countries.

Spain ascended to dazzling heights in world affairs during the sixteenth century, thrust there by her political, military, and economic might. Until the seventeenth century began, her position seemed unassailable. Then, with agonizing helplessness, she slipped into a humiliating cycle of decline which persisted until only a shell of her greatness remained one hundred years later. Viewing Spain in such depths of misery, few observers could have guessed that her melancholy drift had ended when Charles II (1665–1700) died and Philip V (1700–1746) succeeded him in 1700. Yet as the Austrian lineage thus came to an end and the Bourbon dynasty began, Spain entered a new epoch marked by the unusually enlightened participation of government in Spanish economic affairs.

If successful prediction were the sole criterion of the merit of a science, economics should long since have ceased to exist as a serious intellectual pursuit. Accurate prognosis is not its forte. The real strength of the discipline lies in another direction—namely, in its apparently limitless capacity to rationalize events after they happen. This helps explain the indifference of most economic theorists to “the lessons of history”; men to whom all things are possible have little to learn from experiments conducted in the laboratory of time. It also helps explain the indifference of most economic historians to abstract theory; what have they to learn from a subject that “yields no predictions, summarizes no empirical generalizations, provides no useful framework of analysis”?

In September 1928, two eminent economists with an interest in price history met and conversed at Hanover, New Hampshire: Sir William Beveridge and Edwin F. Gay. The former was Director of the London School of Economics and the latter, Professor of Economic History at Harvard University. For some time Sir William had been conducting research in medieval English manorial records and had already amassed data on price movements of English commodities. Moreover, he seems to have shared Gay's long-held views that broader research was needed to provide carefully selected and critically handled long homogeneous series of commodity prices and wages for a number of countries.