Economic History Matters

Abstract

This paper considers the future of economic history in the context of its relationship with economics. It is argued that there are strong synergies between the two disciplines and that awareness of the economic past is an important resource for today's economists. Examples are given that illustrate these points. It is clear that the past has useful economics but the potential value of economic history to economics will only be realised if economic historians are fluent in economics and organise the presentation of their research findings with a view to addressing questions that matter from a policy perspective.

Keywords:

• analytic narratives
• economic growth
• institutions
• technological change

JEL classification:

• A12
• N01
• O49

ACKNOWLEDGEMENTS

I wish to thank Gareth Austin and Colin Lewis for helpful suggestions and Mark Harrison and Tim Leunig for valuable comments on an earlier draft. The usual disclaimer applies.

Notes

²These include models of endogenous and directed technological change, recognising the importance of institutions and serious analysis of catch-up growth. The danger that Solow highlighted a quarter century ago, namely that “economic theory learns nothing from economic history, and that economic history is as much corrupted as enriched by economic theory” (1985, p. 328) seems substantially reduced in this context at least.

³Proactive developmental states may have motives of which many would disapprove, for example, military ambitions, as Gerschenkron himself was well aware. For example, the military objectives of Soviet planning have been made very clear by recent scholarship (Kontorovich and Wein 2009).

⁴Economic historians who work in other areas, for example, business history, financial history, labour history could easily generate similar lists.