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Investigates the importance of price inflation in causing the amortization funds accruing to individual industries in Great Britain to fall short of their replacement needs. Presentation of the formula; Estimates of the average life-time of plants for different industries; Computation of the actual average of price inflation.

The article presents a response by A. I. MacBean and D. T. Nguyen to R. E. Turner and P. J. Lambert's comments on their article regarding the instability of commodity concentration and export earnings in Great Britain. Turner and Lambert provide a rigorous proof of the point made in our article. But we would wish to qualify their policy conclusion which is a little stronger than our own. They conclude that the theoretical analysis should throw further doubt on the wisdom of those policies which advocate decreasing export instability by decreasing commodity concentration. A major part of that policy conclusion stems from the empirical observation that there is a wide dispersion of instability in the list of major traded commodities. But this does not imply that most countries will find such a wide dispersion in the sample of commodities which they happen to export. While it may be true that the swings in export earnings for many commodities tend to be positively correlated this is not true for all. Moreover, for individual countries' exports there is evidence that they have often moved in opposite directions. While it is true that large exporters of a commodity tend to have more stable export proceeds from it, one must remember that most developing countries are small and consequently are individually seldom dominant suppliers. The conclusion in our paper, which is stressed by Turner and Lambert, ought not to discourage governments from considering diversification as a possible means to reduce export earnings instability.