What is economic history? Dr Glen O’Hara Senior Lecturer in Modern History

Seeing this again… This slideshow is available online It is available at the following URL: www.SlideShare.net

This slideshow is available online

It is available at the following URL:

www.SlideShare.net

Definitions ‘ Economic history is not… a story – still less a chronological story, for most events in economic history cannot be neatly dated. Instead it is a list of questions; some can be answered, some cannot, but it is the search for answers, and for the best way to seek answers, which gives the subject both its justification and its interest’. -Roderick Floud and Donald McCloskey, The Economic History of Britain since 1700 ( 1994)

‘ Economic history is not… a story – still less a chronological story, for most events in economic history cannot be neatly dated. Instead it is a list of questions; some can be answered, some cannot, but it is the search for answers, and for the best way to seek answers, which gives the subject both its justification and its interest’.

-Roderick Floud and Donald McCloskey, The Economic History of Britain since 1700 ( 1994)

Definitions ‘ Economic history offers about the biggest contrast to political history that can be imagined. Its chronology is quite different. It often makes light of differences of political culture and national tradition… and it gives minimal scope to personality and motive, the classic preoccupations of historians; instead ‘impersonal’ forces such as inflation or investment tend to hold the centre of the stage’. -John Tosh, The Pursuit of History , 2 nd edn. (1991)

‘ Economic history offers about the biggest contrast to political history that can be imagined. Its chronology is quite different. It often makes light of differences of political culture and national tradition… and it gives minimal scope to personality and motive, the classic preoccupations of historians; instead ‘impersonal’ forces such as inflation or investment tend to hold the centre of the stage’.

-John Tosh, The Pursuit of History , 2 nd edn. (1991)

Definitions ‘ The science relating to the production and distribution of material wealth; sometimes used as equivalent to political economy , but more frequently with reference to practical and specific applications’. - Oxford English Dictionary

‘ The science relating to the production and distribution of material wealth; sometimes used as equivalent to political economy , but more frequently with reference to practical and specific applications’.

- Oxford English Dictionary

Definitions ‘ The study of how economic phenomena evolved in the past. Analysis in economic history is undertaken using historical methods and statistical methods, sometimes to test economic theories’. -Wikipedia

‘ The study of how economic phenomena evolved in the past. Analysis in economic history is undertaken using historical methods and statistical methods, sometimes to test economic theories’.

-Wikipedia

Definitions ‘ The study of… the human possibilities of subsistence during different time periods. A study of the development of society when markets, production and products change. The problems studied concern growth, structural change, the role of formal and informal institutions in the economy and the division of labour between men and women’. -Umeå university

‘ The study of… the human possibilities of subsistence during different time periods.

A study of the development of society when markets, production and products change. The problems studied concern growth, structural change, the role of formal and informal institutions in the economy and the division of labour between men and women’.

-Umeå university

Definitions ‘ I t provides the key that unlocks our understanding of fundamental processes of change , and can reveal to us great truths about the human condition. It tells us how we arrived in our present state. The significance of economic history also lies in its ability to give us an insight into the differentness of the past: it explains how people coped with problems by devising solutions which are foreign to our world, like the two-field system or turnpike roads’. -Professor Christopher Dyer, University of Leicester (my italics)

‘ I t provides the key that unlocks our understanding of fundamental processes of change , and can reveal to us great truths about the human condition. It tells us how we arrived in our present state. The significance of economic history also lies in its ability to give us an insight into the differentness of the past: it explains how people coped with problems by devising solutions which are foreign to our world, like the two-field system or turnpike roads’.

-Professor Christopher Dyer, University of Leicester (my italics)

Key Concepts Choice under constraints A harsh world of choices Counterintuitive thinking Strangeness

Choice under constraints

A harsh world of choices

Counterintuitive thinking

Strangeness

Key Concepts Statistical calculation Quantification Counterfactuals Alternative realities

Statistical calculation

Quantification

Counterfactuals

Alternative realities

Key Concepts Descriptive, not normative Human nature as a given The concept of ‘hard wiring’ Policy implications in economics

Descriptive, not normative

Human nature as a given

The concept of ‘hard wiring’

Policy implications in economics

Choice under constraints Starting with desired goals Moving to resources Resources are scarce Resources must be used efficiently Humans, left to themselves, will normally do this

Starting with desired goals

Moving to resources

Resources are scarce

Resources must be used efficiently

Humans, left to themselves, will normally do this

Choice under constraints ‘ Bounded rationality’ One thing that’s scarce is information It is, in itself, a resource And we often deal with it badly So physical resources won’t always be used in the ‘best’ manner ‘in the long run’ (Keynes)

‘ Bounded rationality’

One thing that’s scarce is information

It is, in itself, a resource

And we often deal with it badly

So physical resources won’t always be used in the ‘best’ manner ‘in the long run’ (Keynes)

A harsh world of choices Coal mining is a good example Mining was dirty, dangerous and expensive Most pits closed in 1983-1993 Mining areas devastated Now oil and gas are more expensive, coal would be more competitive

Coal mining is a good example

Mining was dirty, dangerous and expensive

Most pits closed in 1983-1993

Mining areas devastated

Now oil and gas are more expensive, coal would be more competitive

Counterintuitive thinking ‘ Prices and incomes’ policies G. O’Hara, ‘“Intractable, Obscure and Baffling”: The Incomes Policy of the Conservative Government, 1957-64’, Contemporary British History 18, 1 (2004), pp. 25-53. M. Roodhouse, ‘The 1948 Belcher Affair and the Lynskey Tribunal’, Twentieth Century British History , 13, 4 (2002), pp. 389-411.

‘ Prices and incomes’ policies

G. O’Hara, ‘“Intractable, Obscure and Baffling”: The Incomes Policy of the Conservative Government, 1957-64’, Contemporary British History 18, 1 (2004), pp. 25-53.

M. Roodhouse, ‘The 1948 Belcher Affair and the Lynskey Tribunal’, Twentieth Century British History , 13, 4 (2002), pp. 389-411.

Counterintuitive thinking The malignant effects of price suppression Price suppression causes grey markets It causes bureaucratization It privileges the views of the powerful It leads to the inefficient use of resources

The malignant effects of price suppression

Price suppression causes grey markets

It causes bureaucratization

It privileges the views of the powerful

It leads to the inefficient use of resources

‘ Strangeness’ Histories we don’t expect The ‘slips and the folds’ of life (Ankersmit) Searching for evidence in unusual places

Histories we don’t expect

The ‘slips and the folds’ of life (Ankersmit)

Searching for evidence in unusual places

‘ Strangeness’ The height of convicts Criminal records to answer economic history questions Did wages rise? What about: did diets get better?

The height of convicts

Criminal records to answer economic history questions

Did wages rise?

What about: did diets get better?

Stephen Nicholas, Convict Workers: Reinterpreting Australia's Past (Cambridge, 1988).

Statistical calculation The concept of ‘regressions’ Matching a ‘dependent variable’ to an ‘independent variable’ The latter helps to cause the former Complex statistical tests to see how: ‘R-squared’ and t-tests

The concept of ‘regressions’

Matching a ‘dependent variable’ to an ‘independent variable’

The latter helps to cause the former

Complex statistical tests to see how: ‘R-squared’ and t-tests

Statistical calculation

Statistical calculation

Statistical calculation (yields of fenced and unfenced land)

Statistical calculation Popperian reasoning Karl Popper (1902-94) Historian and philosopher of science Only what can be false can be true Verifiability

Popperian reasoning

Karl Popper (1902-94)

Historian and philosopher of science

Only what can be false can be true

Verifiability

Quantification ‘ Cliometrics’ The science and the art of counting E. Cary Brown, ‘Fiscal Policy in the 'Thirties: A Reappraisal’, American Economic Review 46, 5 (1956), pp. 857-879. A.H. Conrad and J.R. Meyer, ‘The Economics of Slavery in the Ante Bellum South’, Journal of Political Economy , 66, 2 (1958), pp. 95-130.

‘ Cliometrics’

The science and the art of counting

E. Cary Brown, ‘Fiscal Policy in the 'Thirties: A Reappraisal’, American Economic Review 46, 5 (1956), pp. 857-879.

A.H. Conrad and J.R. Meyer, ‘The Economics of Slavery in the Ante Bellum South’, Journal of Political Economy , 66, 2 (1958), pp. 95-130.

Quantification ‘ From the elites to the masses’ Sophisticated computer programmes, e.g. SPSS, Excel Common/ globalised language of numbers Comparability of results P. Hudson, History by Numbers: An Introduction to Quantitative Approaches (London, 2000).

‘ From the elites to the masses’

Sophisticated computer programmes, e.g. SPSS, Excel

Common/ globalised language of numbers

Comparability of results

P. Hudson, History by Numbers: An Introduction to Quantitative Approaches (London, 2000).

Counterfactuals Changing one variable This demonstrates the effects of different elements in the ‘mix’ A physics approach to life Against ‘determinism’

Changing one variable

This demonstrates the effects of different elements in the ‘mix’

A physics approach to life

Against ‘determinism’

Counterfactuals What would have happened to the United States if it was not for railroads? Robert W. Fogel, Railroads and American Economic Growth: Essays in Econometric History (Baltimore, 1964). Fogel concludes little effect.

What would have happened to the United States if it was not for railroads?

Robert W. Fogel, Railroads and American Economic Growth: Essays in Econometric History (Baltimore, 1964).

Fogel concludes little effect.

Counterfactuals: Ferguson as advocate

Alternative realities Parallel universes ‘ Unknown unknowns’ Taking chaos theory into account A recent fashion

Parallel universes

‘ Unknown unknowns’

Taking chaos theory into account

A recent fashion

New alternative universes

Descriptive, not normative Not intended to further the point of view of any one school of thought Not interested in good and bad, but in efficiency as the only given ‘good’ Shades of grey A ‘science of choice’ – more pensions, or more health care in the 1930s, for instance

Not intended to further the point of view of any one school of thought

Not interested in good and bad, but in efficiency as the only given ‘good’

Shades of grey

A ‘science of choice’ – more pensions, or more health care in the 1930s, for instance

Human nature as a given Humans as defined by an inborn pattern of neural circuits Humans as instinctive; MRI science Behaviour as not learned, but innate Influence of cybernetics

Humans as defined by an inborn pattern of neural circuits

Humans as instinctive; MRI science

Behaviour as not learned, but innate

Influence of cybernetics

MRI scan of brain: false colours and correlation: motors are red, and yellow is language

The concept of ‘hard wiring’ Human beings as ‘put together’ in a certain manner The influence of psychoevolutionary biology Pursuing ‘regard’, perhaps: A. Offer, ‘Between the Gift and the Market: The Economy of Regard’, Economic History Review 50, 3 (1997), pp. 450-76.

Human beings as ‘put together’ in a certain manner

The influence of psychoevolutionary biology

Pursuing ‘regard’, perhaps: A. Offer, ‘Between the Gift and the Market: The Economy of Regard’, Economic History Review 50, 3 (1997), pp. 450-76.

Policy implications in economics If we can change variables, we can test hypotheses We can give policymakers ‘rules’ or ways of thinking We can use data that goes further back than just the 1930s corporate state

If we can change variables, we can test hypotheses

We can give policymakers ‘rules’ or ways of thinking

We can use data that goes further back than just the 1930s corporate state

Adam Smith (1723-1790)

Key Smithian insights Rationalism Benign self-interest Conjoined sympathy and self-interest Charity

Rationalism

Benign self-interest

Conjoined sympathy and self-interest

Charity

Key Smithian insights The invisible hand Specialisation Equilibrium as resources flow to efficient use ‘ Factor replacements’

The invisible hand

Specialisation

Equilibrium as resources flow to efficient use

‘ Factor replacements’

Conclusions (I): why economic history? A world, not of impressions, but of ‘more’ and ‘less’. Testabillity; verifiability; falsifiability Recovering raw data Comparable results Key survival concepts that comfortable modernity can forget

A world, not of impressions, but of ‘more’ and ‘less’.

Testabillity; verifiability; falsifiability

Recovering raw data

Comparable results

Key survival concepts that comfortable modernity can forget

Conclusions (II): implications Refusing to chose between rationality and charity Speculation is limited to what can be true Breaking away from narrative and towards explanation Policy recommendations are possible

Refusing to chose between rationality and charity

Speculation is limited to what can be true

Breaking away from narrative and towards explanation

Policy recommendations are possible

Bibliography E. Cary Brown, ‘Fiscal Policy in the 'Thirties: A Reappraisal’, American Economic Review 46, 5 (1956), pp. 857-879. A.H. Conrad and J.R. Meyer, ‘The Economics of Slavery in the Ante Bellum South’, Journal of Political Economy , 66, 2 (1958), pp. 95-130. R. Cowley, What If? Military Historians Imagine What Might Have Been (London, 2001). G. Dozois and S. Schmidt (eds.), Roads Not Taken: Tales of Alternate History (New York, 1999). N. Ferguson (ed.), Virtual History: Alternatives and Counterfactuals (London, 1997). R.W. Fogel, Railroads and American Economic Growth: Essays in Econometric History (Baltimore, 1964). P. Hudson, History by Numbers: An Introduction to Quantitative Approaches (London, 2000). S. Nicholas, Convict Workers: Reinterpreting Australia's Past (Cambridge, 1988). A. Offer, ‘Between the Gift and the Market: The Economy of Regard’, Economic History Review 50, 3 (1997), pp. 450-76. G. O’Hara, ‘”Intractable, Obscure and Baffling”: The Conservatives and Incomes Policy, 1957-64’, Contemporary British History 18, 1 (2004), pp. 25-53. M. Roodhouse, ‘The 1948 Belcher Affair and the Lynskey Tribunal’, Twentieth Century British History , 13, 4 (2002), pp. 389-411.

E. Cary Brown, ‘Fiscal Policy in the 'Thirties: A Reappraisal’, American Economic Review 46, 5 (1956), pp. 857-879.

A.H. Conrad and J.R. Meyer, ‘The Economics of Slavery in the Ante Bellum South’, Journal of Political Economy , 66, 2 (1958), pp. 95-130.

R. Cowley, What If? Military Historians Imagine What Might Have Been (London, 2001).

G. Dozois and S. Schmidt (eds.), Roads Not Taken: Tales of Alternate History (New York, 1999).

N. Ferguson (ed.), Virtual History: Alternatives and Counterfactuals (London, 1997).

R.W. Fogel, Railroads and American Economic Growth: Essays in Econometric History (Baltimore, 1964).

P. Hudson, History by Numbers: An Introduction to Quantitative Approaches (London, 2000).

S. Nicholas, Convict Workers: Reinterpreting Australia's Past (Cambridge, 1988).

A. Offer, ‘Between the Gift and the Market: The Economy of Regard’, Economic History Review 50, 3 (1997), pp. 450-76.

G. O’Hara, ‘”Intractable, Obscure and Baffling”: The Conservatives and Incomes Policy, 1957-64’, Contemporary British History 18, 1 (2004), pp. 25-53.

M. Roodhouse, ‘The 1948 Belcher Affair and the Lynskey Tribunal’, Twentieth Century British History , 13, 4 (2002), pp. 389-411.