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Examining flour prices in England

An examination of flour prices in England also helps evaluate Malthus' claims.
© Adam Smith Center, Singapore

The history of flour prices, GDP per Capita, and population growth in England from 1700 to 1798 provides some specific evidence to evaluate some of the claims of Malthus.

Population in England from 1700 to 1798 increased 49.1 percent from 5.2 million to 7.75 million. If flour was a fixed resource, then a 49.1 percent increase in population would mean that everyone would get 32.9 percent less flour. What in fact happened is that personal flour abundance increased by 43.6 percent. During this 98-year period the nominal price of flour increased 34.9 percent from 1.67 to 2.25 pence. But GDP per capita increased 93.8 percent from 12.37 to 23.97 pounds. The ratio of flour prices to GDP per capita declined 30.4 percent from 0.135 to 0.094.

So while the population increased by 49.1 percent, the time price of flour (money price divided by GDP per capita) declined by 30.4 percent. More people were discovering and creating knowledge that made flour more abundant. For the time required to earn the money to buy one pound of flour in 1700, you would get 1.436 pounds in 1798. So flour had become 43.6 percent more abundant for the average person. While population increased by 49.1 percent, the size of flour resources in England grew by 114.2 percent. Every one percent increase in population corresponded to a 2.3 percent in England’s flour abundance.

What made it possible for England to produce more flour to support its larger population? That’s the central question worth thinking about.

© Adam Smith Center, Singapore
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