statistics of banking and insurance. The returns of the railroads, the output and employment of labour in mining and other fundamental industries, are valid evidence of the material prosperity of a country.
Values and volumes of imports and exports taken by themselves are no reliable index of the industrial prosperity of a nation, for there is no fixed law of interdependence between external trade and internal industries even with regard to the production of material wealth: a temporary contraction of internal trade and industry is quite consistent with an expansion of external trade, and vice versâ. Of the two trades, import and export, the former, however, is a somewhat truer index of the shorter fluctuations in the material prosperity of a nation than the latter, inasmuch as increasing wealth brought into a country from outside, as food, raw material, or manufactured goods, implies an expansion both of internal industry and of consumption, whereas a temporary increase of exports may imply not an expansion of home industries so large as to overflow more freely into foreign markets, but a positive contraction of home markets. The necessity, however, of a balance between import and export trade in the long run does not justify us in asserting this superiority of import trade as an index of national prosperity excepting for short periodic changes.
