Xxxx Xxxxxx xxxxxxxxxx at
Fri Mar 9 10:09:16 MST 2001

by Richard Lee

ECONOMIC HISTORY: "the history of actual human practice with respect to the
material basis of life", but not necessarily the history of economic
thought; "a half-way house between the abstract and the concrete" which
takes into account multiple causation, uses inductive method and practices
generalization (Ashley, 1927, 1, 9).

Economic history is rooted in the concerns which gave rise to "mercantilism"
and "political arithmetic": policy oriented explanations of the wealth and
power of nations. Although Adam
Smith rejected the deductivism of the Physiocrats and relied primarily on
historical observation in formulating his principles, from Smith, economics
traces its lineage through Ricardo to Jevons and Marshall. Their abstract
deductive methods and the essentialist qualities of the behavioralist
premise of "economic man" were criticized by Cliffe Leslie in the 1870's. In
an effort to establish a reformist school of inductive, relativist economic
history in England, he opposed the historical method to the deductive and
favorably contrasted the new German historians with what he termed the
"obsolete or decadent English school" and called for a return to the Adam
Smith of "facts" (Price, 1906, 14, 15; Koot, 1987, 39-53). Here the
historical approach was unsuccessful in the English round of the
Methodenstreit. Following Marshall, English, and American, economics became
more and more theoretical.

>From the seventeenth century a long line of precursors may be cited (Gras,
1927), but it was in Germany with the emergence of the "historical school"
of List, Hildebrand, Schmoller, Knies,
and Roscher, and eventually Sombart and Weber, that a challenge to the
universality of deductive theory in the classical approach in favor of the
relativity of inductive history was mounted. The phrase "economic history"
was first used in a book title in 1879, in German, by Karl Theodor von
Inama-Sternegg. He also supplied a major impetus to the study in his 1877
address to the Vienna academy on the sources of German economic history.
Menger's (1883) attack was initially beaten back by the already
institutionalized historical approach which initially stood its
ground in the German Methodenstreit.(6) As Irish problems focused Leslie (in
opposition to the mainstream conservatism) and as the Revolution had kept
the historical approach alive in
France in work of Saint-Simon for instance, the crises of 1866 and 1873 and
the controversy over the mark beginning in 1883 prompted German scholars to
investigate the historical aspects of
economic problems. The decade of the 1880's constituted a high point with
the appearance of major works in England, the United States and on the
Continent where national schools of economic history have tended to focus on
periods perceived as key to the nation's history (at least until the
post-1945 period), e.g., the seventeenth and eighteenth centuries in France
and the nineteenth century in the United States.

Closely associated with the Methodenstreit was the Werturteilstreit, whether
or not social science should be value-free. In Germany, Schmoller recognized
explicitly the importance of responding to policy questions with the
foundation of the Verein für Sozialpolitik in 1872. In Great Britain in 1878
the President [J. K. Ingram] of Section F of the National Association for
the Promotion of Social Science bluntly asserted that 'political economy at
the present hour is  undergoing a crisis' ... [and] urge[d] that the
association turn Section F into a sociology section! Once done, social
scientists could then be part of a more general science of social causality
(Manicas, 1987, 125)  directly relevant to the "war of classes." Although an
abstract, deductivist "science" as an autonomous discipline was tenaciously
opposed in favor of a unitary historical science as in the case of Schmoller
(Gesellschaftswissenschaft), Ingram, or Durkheim, by the turn of the century
the "neo-classicists" had triumphed.

Whether Fustel de Coulanges, Schmoller and Knapp, or Cunningham, the
alliance with institutional and political history was strong; also much of
the best work of the period was done on
classical, medieval or very early modern times. With the first two editions
of Das Kapital (1867 and 1873), however, Marx beckoned both historians and
economists into the contemporary
world. And according to Gras,  it is to the clearer formulation from the pen
of Karl Marx that we must look for real scientific influence. At least since
the publication of the first volume of Capital (1867), the idea has been in
the air that economic history is important because it is the key to other
kinds of history (1927, 21-22).

Inspiration during the decade of the 1880's also came from a surge in the
publication of documents (much as had stimulated eighteenth century work).

The decade of the 1880's witnessed the early work in economic history in the
United States at Johns Hopkins where Ely insisted on the inductive method as
well as Schmoller's historical approach, and at Columbia with Seligman's
work on medieval guilds. Dunbar gave the first formal instruction in
economic history at Harvard in 1883 where Ashley became the first professor
of economic history in America in 1892. Similar chairs followed at Columbia
and Yale. Manchester led in England with the first chair, 1910, (Cambridge,
1928; Oxford, 1931; the London School of Economics, lectureship, 1904),
although economic history had had a place in the Cambridge curriculum since
1878. In France both the Sorbonne and Aix-Marseille emphasized regional and
geographical concerns of the discipline.

The Gesellschaft für Sozial- und Wirtschaftsgeschichte with its
Vierteljahrschrift (originally as Zeitschrift, 1893, the oldest journal of
economic history) dates from the beginning of the twentieth century. In 1926
N. S. B. Gras founded the Business History Society and its Journal of
Business History. In England the Economic History Society with its Economic
History Review was established in 1927. In France the Revue d'histoire des
doctrines économiques et sociales was founded in 1908 but changed its name
in 1913 to Revue d'histoire économique et sociale to signal the relationship
between the history of theories and the histories of institutions and
promote empirical studies; Annales (d'Histoire Economique et Sociale, later
Annales E.S.C.), began publishing in 1929. In the Netherlands the
Economisch-historisch jaarbock saw the light in 1916. And finally in 1940
the Economic History Association with its Journal of Economic History was
founded; Clough noted in 1970 that over the years, the profile of membership
changed from about equal numbers with backgrounds in economics and history
to a large majority with backgrounds in the former (1970, 12). Expressly to
spread the discipline, the International Economic History Association was
established in 1960.

In the U. S. the Carnegie Institution financed a series of co operative
studies beginning in 1904; from the 1920's the systematic study of business
cycles by the National Bureau of Economic
Research benefited economic historians as well as economists. Beginning in
1940 the SSRC sponsored the Committee on Research in Economic History and
then during the 1950's a
Committee on Economic Growth studying long-run, irreversible, trends rather
than short-term fluctuations. Goodrich (1960) cites the strengths of this
work in its central problem, economic evelopment, its use and development of
quantitative method, and its method of comparison among countries; and its
weaknesses in its limitations to contemporary times and subject matters, and
its neglect of social costs and the qualitative aspects of causation.

Developments of quantitative methods and the construction of national income
accounts set the stage for the "new economic history" or "cliometrics" which
Landes maintains was announced
by Rostow's British Economy of the Nineteenth Century, 1949 (1978, 3).
Purdue University sponsored its first Seminar on Quantitative Methods in
Economic History in December of 1960.
This "new" history attempted to do four things:

First to state precisely the questions subject to examination and to define
operationally the relevant variables. Second, to build explicit models that
are relevant to the questions at hand. Third, to produce evidence
(frequently quantitative, but at times qualitative) of the world as it
actually existed. And finally, to test the model (a logical
statement of assumptions and conclusions) against the evidence (the world
that did exist) and the counterfactual deduction (the world that did not
exist) (Davis, 1966, 657).

In its preoccupation with becoming more scientific, the new economic history
emphasized measurement and the relation of measurement to theory and
typically made use of sophisticated
statistical methods including regression analysis--in contrast with the
descriptive techniques of Annales. However, its hypothetico-deductive method
based on counterfactual propositions is
the very basis on which it has been attacked as "anti-empiricist",
"anti-positivistic" and resulting in "quasi-history" (Fogel, 1966).
Xxxx Xxxxx Xxxxxx
Ph.D Student
Department of Political Science
SUNY at Albany
Nelson A. Rockefeller College
135 Western Ave.; Milne 102
Albany, NY 12222

More information about the Marxism mailing list