ABSTRACT
The comparative scale of Britain's involvement in international trade is abundantly clear, therefore. But the central question concerns the nature of the relationship between foreign trade and domestic economic performance. Whilst demand-side theory still clearly begs the question of the dynamic role of foreign trade as against domestic factors, the supply-side theories depend on very tight and unrealistic assumptions. The idea of trade as an 'engine of growth' has provided the basis for the best known analysis of international expansion before 1914, and it provides a useful starting point for examining the major theoretical issues that underlie our historical analysis. World trade grew more rapidly than British trade over the period as a whole. Among the large economies the USA and Germany achieved particularly high rates of growth, whilst Belgium and Switzerland are prime examples of what could be achieved by small nations.
