Brad DeLong's Notes of Jan de Vries's Talk on the Purpose of Economic History


Econ 210a, January 23, 2008. Jan de Vries Speaks:
Here to present "apologetics"--a response to the question "why are we here, in this class, studying this material?"

This talk is going to give a historian's answer, a narrative, in response to this question...

History and Economics:


The emergence of the 'social sciences' out of moral philosophy in the 19th century. Positivism--seek truth from facts. resisted positivism; economics embraced it... "Historicism": you can't test, you have to understand... "Historicism": it's an illusion to suppose that we van reduce social science to natural science-like laws like those of mechanical physics... History: Inductive, descriptive, narrative, unique, example... As opposed Economics: Deductive, analytical, model-based, general, experiment...
Robert Solow: Writes of the "embedding" of economy in society. All data are historical data... All theory is crystalized history... And all historical narratives are in turn based on a theory, at least an implicit theory...

Classical Economics and Classical Athens:


CE is a historically-based inquiry into the nature and causes of the wealth of nations--to see through the accidents of history to the natural laws of social organization...

For the CEs, "natural" is good...
Moses Finley: Aristotle was a really smart guy, but Aristotle the economist is not very impressive. Finley claims this was the fault of ancient society--organized in such a different way so that Arostotle's categories make no sense. Wealth should flow to virtue...
So how eternal are the theoretical insights of Adam Smith? Do they apply to Athens in 350 BC?

Reactions Against Classical Economics:


The reaction against CE--German and Austrian reaction. Between 1860 and 1890: Jevons, Walras, Marshall and the rise of NE (neoclssical economics); institutional and historical critique--economics should recognize that different eras and different regions have different economicses. German Historical School vs. Austrians in the streets of Vienna: methodenstreit. Who won this battle? NE. But should we recover something of the losing side? Cunningham's review of Marshall and his Principles of Economics
Schumpeter...

Solow: economic history has a civilizing function when applied to economists...

Marx: What's going down in Manchester tells us what will go down in Bombay...

Gerschenkron: modified stage theory Return of institutionalism via DE (development economics)...
Cliometrics: the New Economic History: economic history as a branch of applied NE...

Reaction: The New Institutional Economics, the Annales School, and Paul David's call for a historical economics. Doug North: NIE: price theory is not enough. Transaction costs as the only thing worth thinking about. The old institutionalist agenda in new clothes...
Annales: Braudel, Le Roy Ladurie... Longue duree... The different paces of time... The interplay of event and structure...
Paul David: The demand for a Historical Economics: make up your own mind for how valuable Paul David's project is... Replace mechanical with biological metaphors, complexity instead of linearity. Are episodes of path-dependence trivial? Does qwerty matter? Is qwerty typical? Decreasing/constant/increasing returns? How long and how large a shadow does the past cast? If you have ever seen a typewriter in a museum...
How much does the path of historical development matter?

Big Questions:


Is capitalism "natural" in a Smithian sense, or a unique historical individual process?
Does the market system allows us to partake "of the common heritage of mankind", or is it a particular--and passing--phase?

Reference: John Maloney (1976), "Marshall, Cunningham, and the Emerging Economics Profession," _The Economic History Review_ New Series, 29:3 (August), pp. 440-451.