Oil Conservation and Fuel Oil Supply.Review by: George Ward StockingJournal of the American Statistical Association, Vol. 26, No. 174 (Jun., 1931), pp. 236-237Published by: American Statistical AssociationStable URL: http://www.jstor.org/stable/2277787 .

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236 American Statistical Association [122

by a linear function of this index, Baury finally gets the equation xy= 1.1208A-10.19

where A is the Annalist index of employment corrected for seasonal variation. "We thus obtain a first relation between 3 elements: Corrected price, cotton factors, and industrial activity." (Page 25.) The relationship is represented by a very neat three dimensional diagram on page 26.

In working the correlation, the price was smoothed by a 5 months' moving average. One hundred and twenty-eight observations were thus obtained and the correlation was found to be 0.8193. When seasonal variation is eliminated from the price, and annual means for the crop years are taken, 11 observations result and the coefficient of correlation is found to be

R = 0.9945 -0.002. This pamphlet probably fills a gap in French statistical literature by providing

an example of applied mathematics in economics, but it certainly adds nothing to the published work of Bradford B. Smith, H. L. Moore, and others. Baury's correlations are largely spurious. The correlation using the annual means has only 11 observations and there are 5 independent variables. No trends were eliminated. It so chances that the general trends of both cotton prices and the U. S. Bureau of Labor employment index have been down since 1919. As is now well known, the U. S. Bureau of Labor employment index has a considerable bias in the downward direction, and is becoming less and less representative of what it is supposed to measure. Its very imperfection makes it perfect for Baury's purpose. (One cannot help wondering whether the real reason for not pushing the investigation back into earlier years, is that this so convenient index was not available prior to 1919.) The correlation between price and yields uncorrected for trend, is likewise spurious, due to the non-elimination of trend. We need not be surprised then, if Baury's equations cease to maintain such a -high agreement between predicted and actual prices in the future.

VICTOR VON SZELISKI

Oil Conservation and Fuel Oil Supply. New York: National Industrial Con- ference Board, Inc. 1930. xiv, 165 pp. Despite the fears of the conservationists of a decade ago regarding the probable

early exhaustion of our petroleum reserves, the American oil industry has for long witnessed an uninterrupted increase in its annual output of crude oil, annual production having increased from 378,000,000 barrels in 1919 to 1,007,000,000 barrels in 1929. Even this tremendous increase in domestic output would have been inadequate to have supplied current gasoline consumption had improve- ments in refining efficiency not made a barrel of oil go further. Under the old "straight-run" methods of refining with a production of 18 per cent of gasoline from a barrel of crude oil, it would have taken more than twice the amount of crude oil to have produced the 1929 output of gasoline. The introduction of the "cracking" process made possible an average output of 39 per cent of gasoline from every barrel of oil refined in 1929. If the more efficient "cracking" process should be applied to all the oil currently refined, it is estimated that a 60 per cent

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1231 Reviews 237

recovery of gasoline would be achieved. That this does not occur is a reflection of the fact that oil production has increased so rapidly that it has not been found necessary to extract other than the easy-to-get values from a barrel of crude. The partially refined residues have made available an increasing volume of oil for fuel purposes.

Fuel oil has pushed its way into the expanding markets for fuel materials. It has done so along with gas and water power at the expense of coal. The expan- sion in the consumption of these former materials accounts in considerable part for the fact that the coal production of the world and particularly that of the United States and Great Britain has remained almost stationary since 1913. This study by the National Industrial Conference Board involves a detailed statistical analysis by regions and industries of the facts in this expansion of oil in the world's fuel markets, with especial attention to those of the United States.

But as fuel oil has come to play a more important r6le in the fuel markets of the world, shifting centers of oil output, stabilized production and more complete refining methods-particularly the hydrogenation process which promises 100 per cent extraction of gasoline from a barrel of crude-threaten a decline, so the authors believe, in the domestic consumption of fuel oil. They expect the price factor to bring a shift from fuel oil to its various competitors as a source of energy and heat.

The concluding part of this volume is devoted to a study of the probable effects of a decline in fuel oil supply. The conclusion reached is that marine and domestic heating will be the most persistent users and that manufacturing and transportation uses will show the most marked decline. The regions likely to be most seriously affected are those remote from centers of large gasoline con- sumption. More complete refining methods are likely to be accompanied by the transportation of a larger percentage of total crude oil to population centers for refining purposes. The predominance of coastal refining will make a large part of the fuel available for the most essential marine market. The regional and industrial shifts from fuel oil to other fuel materials are expected to be gradual and to be brought about in response to the price factor. They may be expected to ease somewhat the position of the coal industry which has been so precarious during the past decade.

The study is replete with statistical and graphic material and should prove of interest and value to anyone concerned with the market problems of the major fuel industries.

GEORGE WARD STOCKING University of Texas

Social Work Year Book-1929, Editor, Fred S. Hall; Assistant Editor, Mabel B. Ellis. New York: Russell Sage Foundation. 1930. 600 pp. The first yearbook on social work is additional evidence that social work as a

profession is coming of age. The heterogeneous fields included within the scope of social service have long demanded a directory of information such as is herein contained. It will serve to make the general public better acquainted with the many directions in which social work has spread.

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