Spring Tide. Considerations on Industrial Development and Price Movement, originally published in Dutch in 1913 in the Social-Democratic monthly De Nieuwe Tijd and translated by Herman Pieterson is a pioneering work by the first systematic researcher of long waves in economics, Jacob (Bob) van Gelderen, writing as J. Fedder.
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Introduction by Herman Pieterson
At the time of writing these lines, one crisis seems to tumble over another.[1]
The question arises as to where we actually stand. Will the world go down tomorrow or the day after tomorrow, and if so what will be the reason? It makes sense to look at patterns that characterise socio-economic development over longer periods. In this article, I try to point out the particularity of the contribution of the first systematic researcher of long waves in economics, Jacob (Bob) van Gelderen, writing as J. Fedder.
Jacob (Bob) Van Gelderen was born in Amsterdam in 1891, the scion of a dynasty of Jewish butchers. His mother was Frederika Fedder (1860-1908), daughter of a diamond worker with family connections in more affluent circles. After their marriage his father Michel van Gelderen (1857-1908) tried his hand as a shopkeeper but became an office clerk. Bob’s parents died in 1908, the year of his graduation from the State Trade School, a form of secondary education. In 1910, he took state exams in Economics and Statistics.
Alternating periods
In England, the first country where the industrial revolution broke through, from the economic crisis of 1825 a business cycle of 7 to 11 years is visible, directly linked to the nature of the capitalist mode of production. Sometimes, this short cycle is less observable due to periods of war and recovery. From the 1850s, cycles became more international.
In the early twentieth century, the question was raised whether there was also a longer movement in the economy. This was due to a clear period of slowdown and stagnation of growth in the years between 1873 and 1895 and a sharp rebound thereafter. There had been earlier suggestions that such developments existed. W. Stanley Jevons (1835-1882), one of the founders of economic statistics in England, recorded clear periods of ups and downs in price trends as early as 1865. This concerned the first decades of the nineteenth century, but Jevons believed there was no unambiguous explanation.
Even before the capitalist mode of production became dominant, alternating periods of prosperity and famine existed, mostly caused by natural developments, such as fluctuations in the weather, epidemics and crop failures. Explanations for any regularities we leave aside here. Even though there seem to be longer waves that preceded the spread of industrial capitalism, in my opinion, they are not comparable to the long waves discussed here.
In 1901, the Russian Marxist Parvus (Alexander Helphand 1867-1924) was one of the first to note the alternation of periods of rapid and slower growth of production and trade in industrial capitalism. But he did not elaborate on his ideas. Shortly before World War I, others also saw this alternation of periods in price movements. At the time, prominent economists like Russian Ukrainian Michael Tugan-Baranovsky (1865-1919) and Frenchman Albert Aftalion (1874-1956) noticed the phenomenon in 1913. But they did not do more than note it.
In 1913, at just 21 years old, Bob van Gelderen published what was arguably the most pioneering article to appear in the Social-Democratic monthly De Nieuwe Tijd (The New Times, 1896–1921). Writing under the pseudonym J. Fedder, he presented his findings on long-wave movements in the economy in an article entitled “Spring Tide: Considerations on Industrial Development and Price Movements”. Published in three instalments in 1913, though largely written the previous year, the article was the first to combine systematic empirical investigation of long waves with a set of theoretical propositions. A decade later, the Russian economist Nikolai Kondratiev (1892–1938) in his book The World Economy and its Conjunctures During and After the War (1922) would arrive at broadly similar conclusions.
Wave movement
The war prevented Van Gelderen from publishing his text in German. Eight years after Van Gelderen’s contribution in De Nieuwe Tijd, Sam de Wolff (1878-1960) published an article on the long waves in 1921 in De Socialistische Gids, the monthly magazine of the SDAP entitled “Prosperity and Depression Periods”. De Wolff mentioned Van Gelderen and built on his work, which he mainly saw as a commentary on the vision Parvus had elaborated in the book, published in 1901, Die Handelskrisis und die Gewerkschaften. De Wolff’s article, translated into German in 1924, long remained the only international source on Van Gelderen’s work, which, therefore, remained unknown to a wider audience.
Long waves became known via the name of Kondratiev. He published in the 1920s about them in Russia. Some of his work was also published in German. The Austrian-American economist Schumpeter (1883-1950) came up with his own interpretation in which he credited Kondratiev with discovering long waves. After World War II, long waves fell out of attention during the prolonged period of economic expansion. Flemish economist Ernest Mandel (1923-1995) was the first to announce the end of this expansion in 1964, referring to long wave movement. Mandel elaborated his theory further in several books and articles. Since the 1970s, numerous economists have again tried to explain the phenomenon in some form.
Van Gelderen speaking[2]
Van Gelderen formulated general conclusions for the periodic emergence of an era of spring tides, in which rapid business expansion was accompanied by high interest rates and high prices. He saw as a precondition for the emergence of a spring tide period a vigorous, either spontaneous or gradual expansion of production with two main forms:
- The reclamation of sparsely used areas. Agriculture and stockbreeding provide in these newly exploited countries export products, with which the population pays for the products it needs; these are of two kinds: mass consumer goods, mainly textiles and means of production: machinery, railway and other means of transport, building materials.
- The rather sudden emergence of a branch of production, more powerful than before, capable of satisfying a particular human need (automobile and electricity industries). Its operation, according to him, is on a smaller scale the same as the first form.
A sharp expansion in gold production precedes a new upward surge. Recall, here, that gold was the basis for money in the 19th and early 20th centuries.
The boom movement continues, as sales are guaranteed by the population and the reclamation of new lands. The acceleration of production harbours two factors, which prepare its end, Van Gelderen said. Firstly, the expansion of production is going faster than sales, the markets of the countries to which the high-capitalist countries export are becoming oversupplied. This is greatly facilitated by the industrialisation beginning in those countries. Second, the expansion of industrial production is going faster than that of the production of raw materials. Van Gelderen:
The increasing price rise of raw materials during the spring tide period hampers further industrial growth. Production costs are rising; the market no longer tolerates a proportional increase in the prices of manufactured products; demand is decreasing, profits are falling. The turning of the tide is imminent. (p. 76)
Van Gelderen argued that the root cause of the spring tide phenomena must be sought in capitalist expansion. The quantitatively and qualitatively uncontrolled course of the capitalist mode of production is the explanation of the periodicity. Gold production has a secondary significance in this context because it affects the general price level.
His article aimed to show that the wave of price increases is essentially nothing more than the expression of a periodicity inherent to capitalism. Its function consists in “the ever renewed, efficient distribution of the social productive forces (capital and labour) among the constantly waxing number of countries drawn within the circle of their activities” (p. 78).
Van Gelderen reached these conclusions based on data on prices and production in the economically most important countries, especially England. He sought an explanation of the period of price increases in the years from 1895 onwards. Therefore, he looked at detailed figures on price trends from 1850 onwards.
Price movement and production in waves
Van Gelderen saw a fairly regular wave motion, the 7 to 11-year economic cycle. The industrial wave movement was entirely parallel to the fluctuation in the price level. England was, in the nineteenth century, the centre of world trade. And it was a free trade country. Therefore, the English market reflected particularly clearly the fluctuations of world market prices.
Industrial raw materials and nutrients participated in the rise, but not to the same extent. Since the periodic movement of prices, and especially raw material prices, is a symptom of the course of production, Van Gelderen wondered: in the continuous rise since 1896, are we dealing with a phenomenon analogous to the boom? To investigate this, he went further back into the nineteenth century.
He saw a general trend in the price indices also for Germany, the US, Belgium and Austria-Hungary. Again, apart from the average decennial fluctuations in the general price level, the price index showed a larger wave movement over several decades. A general trend was observable: an increase from 1850-1873 – a decrease from 1873 -1895 and an increase from 1896 (which was still running during his study).
In his view, this could not be a coincidence, because this was a phenomenon inherent to capitalism. And then it must be evident from the course of business. The symptoms of a boom period in the industrial cycle must correspond to those of an era of spring tides (1850-1873; 1896-1911). Both stem from the mechanism of the capitalist reproductive process. And he continued:
In the concrete historical development of capitalism, we already find the clue to the existence of this larger wave movement. In the main capitalist countries, economic life receives a powerful upward thrust in the early 1850s. (p. 37)
After 1873, the picture changed.
Sales were insufficient in most leading industries and improved only slightly in the few boom years of 1879-81, 1887-1890. The railway network, most of which had been completed in Europe, no longer demanded such capitals; the metal industry suffered from the decline in the formerly exerted demand for railway equipment. (p. 38)
Thirst for colonies
Finally, the supply of cheap grain from North America led to a prolonged depression in agriculture. The purchasing power of European farmers fell, resulting in a loss of sales for industry.
Trade policy turned from free trade to protectionist in most major countries. However, this did not prevent the depression or the price fall. As a result:
The thirst for colonies awakens in the governments of the main countries with increased vigour. […] The British Empire, in particular, is expanding at an awe-inspiring pace. […] For the population of the countries to which capital is exported, an ever-growing stream of emigrants provides. The agricultural population that has become redundant can no longer find work in Europe in industries that are growing too slowly, and migrates across the oceans. (p. 39)
Van Gelderen also provided an explanation for the beginning of a new spring tide period from 1895. Two branches of production par excellence fulfilled the function of booster. First, since 1890: increased gold production in Australia (especially West Australia) and in the Transvaal. Second, the stormy development of the electricity industry. The countries at the forefront of this were the United States and Germany. With increases in several areas: the number of electrical plants, capital, value of product and number of workers. These increased in the US 10 times, 125 times, over 50 times and nearly 60 times respectively from 1880 to 1905. In Germany, power generation capacity increased 20 times from 1895 to 1907. The quantity and value of power cable exports from 1891 to 1907 increased 15- and 19-fold. This development brought with it a rapidly increasing demand for metals (especially copper) and insulating materials, which the greatly benefited metal industry, mining and electrical engineering.
Thus began the upward surge that gave economic life a feverish pace from 1895–1896. This upswing reached higher and further and was more general and stronger than in 1850–1873, as capitalism itself had grown.
As a peculiarity, Van Gelderen mentioned that emigration to the US was not decreasing but changing in composition. Meanwhile, in Germany and England, the ‘surplus’ rural population found work in industry. Migration came more from Italy, Austria-Hungary and Russia.
Tempo changes
In Van Gelderen’s view, it was Parvus who in 1901 first drew the distinction between the cyclical years of boom and what he called the Sturm und Drang periods of capital. At certain times, according to Parvus, a strong expansion of the world market had to take place, and the entire world production had to be put on a new more comprehensive basis. Parvus called the alternation of Sturm und Drang periods and depression periods tempo changes of a business development that otherwise obeyed the laws of the capitalist cycle.
The price indices showed that the distance between highest and lowest cycle-points was shorter in the upturn, longer in the depression, as in the periods before 1873 and from 1896 onwards. Figures for English exports showed the same. The numerical ratio of boom-and-bust years in one cycle also proved different. The spring-tide periods 1851–1873 and 1895–1911 had more years of upward than downward business cycles. In the 1873–1895 period, it was the reverse.
This prolonged depression seemed to many to be permanent. Even Tugan-Baranovsky, in the first editions of his work on England, failed to see that this change of pace was temporary, mistaking English development for the quintessentially capitalist and, according to Van Gelderen, failing to take sufficient account of England’s being outstripped by the United States and Germany. For Van Gelderen, the latter two were the countries where we should study capitalism first.
Further consideration
Van Gelderen was the first to empirically substantiate the longer-wave movement across prices, interest rates, trade and production. His explanation was comprehensive and tried to encompass developments in various economic, as well as social and political fields. He saw a parallel between the course of the short cycle and the longer alternation of rapid expansion and slowed growth. He explained the start of a new spring tide from a convergence of enlarged outlets with renewal through the emergence of new industries and the involvement of new areas in the global market.
He did not answer the question of why new industries develop. He explained the turnaround at the end of a period of spring tide as a result of sales opportunities lagging behind the growth of production, and of raw materials becoming more expensive, whose production could not rise as fast. Van Gelderen based his description of the characteristics of a spring tide period mainly on the period of rapid growth from 1896 onwards. He gave a more or less theoretical framework in the passages on the conditions for the onset of a spring-tide period, without really making it explicit. His empirical attitude apparently made him cautious.
Van Gelderen underexposed
The question of why Van Gelderen’s work was long underexposed, and he is rather referred to as a precursor, more in passing, can be partly explained simply. The “Spring Tide” article was not translated into a language more common at the time such as German. It was only through the German version of an article by Sam de Wolff that people outside the Dutch-speaking world learnt of the existence of Van Gelderen’s pioneering work. Because De Wolff tried to capture the idea of a long-wave movement in a tight cyclical regularity, a veil was simultaneously hung over Van Gelderen’s actual originality. It takes us too far to go into De Wolff’s contribution in more detail here. That, by the 1920s, De Wolff had also become an odd man out in his own country, too Marxist for the SDAP and too moderate for the revolutionary socialists and communists did not really help either.
Soon after Schumpeter attached Kondratiev’s name to the long waves, Jan Tinbergen (1903-1994) in his Theory of Economic Movement correctly noted that the long waves had been previously described by Van Gelderen and De Wolff.
It was authors who were proficient in the Dutch language who appreciated Van Gelderen’s contribution. Mandel, in his Late Capitalism, acknowledged Van Gelderen and not only for collecting data in support of the wave theory but also as someone who offered an initial explanation, particularly focusing on sudden expansions of production. According to Mandel, contemporaries such as Kondratiev and Schumpeter did not, in theoretical terms, stand above Van Gelderen’s conception. This is also the opinion of Dutch economists Alfred Kleinknecht and Jan Reijnders. The latter calls Van Gelderen’s article “Kondratiev in a nutshell”. Kleinknecht points out that Van Gelderen mentions six important elements: the hypothesis of a leading sector; the hypothesis of periodic over- and under-investment of capital; credit expansion and financial crisis; periodic scarcity and abundance of raw materials; the opening of new territories and waves of migration; and fluctuations in gold production. All factors can be found in various combinations among later authors.
Meaning today
Van Gelderen’s efforts had a practical political motive. He was concerned with explaining the continuous price rises that prevented improvement in the living standards of the working class. And, today, it is also useful to interpret prospects in economic development.
But confirming and applying a theory of long waves has several problems. At the moment, the main one is that, after the revival of the capitalist economy between roughly 1940 (for the US) and 1973, and a period of markedly slowing growth, no real new upswing can be observed. No beginning of a new Kondratiev. We did see a start in the 1990s, but it soon encountered limitations. First, the dotcom bubble (the overvaluation of new internet companies) burst in 2000. Then the financial crisis broke out in 2007–2008, leading to a prolonged period of limited growth, at least in the US and Europe.
The key question in long-wave discussions is always: how does a fresh start of an upward period come about. It is important to remember here that there is no single factor, it is a complex of factors. Each period is a totally new one with its own characteristics. History also shows that it is not a fixed repeating pattern. The period around 1850 was very different from the period around 1895, which in turn was very different from the period around World War II. The recovery in the rate of profit, i.e. the profitability of capital, from 1990 onwards may be part of a fresh start. But it does not appear to be a sufficient boost. We see financialisation occurring, with huge capitals all over the world looking for possible returns. What exactly is causing this delay of a new upturn requires further investigation.
In doing so, it seems useful to look not only at the long waves but also at an even longer movement in which the centre of gravity of the world economy shifted each time, from the Netherlands to England, from England to the US. This approach by Immanuel Wallerstein (1930–2019), world-systems analysis, assumes such shifts. In that context, we are today facing a crisis of US hegemony and the possible beginning of a shift. That such a period is accompanied by trade conflicts, economic crisis and wars fits the 2025 world reasonably well. The question of whether and how world-systems analysis and long-wave theory can be combined is still under discussion. Can we see the long waves as applying to the entire capitalist world economy, or is there a pattern that does not work the same way when hegemony shifts from one country to another? Van Gelderen pointed out that we should look at the most developed countries, i.e. at the end of the nineteenth century to Germany and the US. And so, these days to China?
To conclude: in almost all elaborations of the long waves, two developments occupy an important place: the supply of raw materials and the expansion of the scope of capitalist accumulation. But are we in a whole new situation as a result of the climate crisis? An answer to the question of economic prospects today will have to integrate those aspects as well.
[1]This introduction is a lightly updated version of Pieterson, Herman 2024, “De Lange Golven in de Economie – de Bijzondere Bijdrage van Bob van Gelderen in 1913,” SOC21. https://soc21.nl/wp-content/uploads/2024/12/De-bijzondere-bijdrage-van-Bob-van-Gelderen-24.4.pdf. December. It forms part of a broader project on the history and theory of long waves. My thanks go to Jan Willem Stutje, Hans Boot and Joost Kircz for their comments.
[2]In the following paragraphs, Van Gelderen’s article translated here is partly summarised, partly paraphrased, partly quoted verbatim. The literal quotes are referenced in the text with page numbers.
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