I T is not difficult to identify the major types of investment which contributed to the mid-Victorian expansion: agriculture, railways, housebuilding, industrial production, overseas trade and capital exports. However, their relative importance throughout the period, their particular characteristics and the role they played in British economic growth, has been the subject of considerable debate to which we now turn. An examination of the disposition of the various components of expenditure generating national product shows fixed domestic capital formation exceeding foreign investment by a substantial margin throughout the 1850s and 1860s (see Table 3).* When private domestic investment fell back from the high peak of the railway construction boom of the mid-1840s, public expenditure associated with the Crimean War more than offset the decline in domestic capital formation, which resumed its upward course in the 1860s and 1870s [152:114]. By that time, public current expenditure had fallen from slightly more than 7 per cent to a little more than 5 per cent, probably its lowest level for the nineteenth century [8:99]. A breakdown of gross domestic fixed-capital-formation estimates show transport and communications to have accounted for over one-half of the gross capital formation in the 1850s and 1860s.
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