I've always been a huge admirer of Princeton historian Harold James – for example, his The End of Globalization: Lessons from the Great Depression is a brilliant and possibly scarily prescient 2002 book looking at the political conditions under which the then-onward march of globalization might start to unravel. What's more, Professor James once invited me to give a seminar in his department so is clearly a man of judgment. So when he bigs up a book he's reviewing, I take notice.

That book is Why The West Rules – For Now by Ian Morris. Professor James reviews it in today's Financial Times (registration needed). The publisher bills it as being about the 'patterns' of history. The review majors on the impact of climate and disease, and how these affect the distribution of global dynamism and power over periods of a millennium or so. It sounds not a million miles from Jared Diamond's thesis in his 2005 book  Collapse. As the review of Why the West Rules concludes:

The line in the review that really caught my eye was:

That's my kind of book!

Reading history is so important for economists. This was brought home by the symposium I attended recently on Economics Made Fun, and a discussion of the importance of narrative as well as models. As a young econometrician, I was taught about the observational equivalence problem – the same observable distribution of data can be generated by several underlying models. Reality is over-determined. So identification of any single model is the most difficult task in econometrics. Indeed, I think identification is never possible without a separate source of knowledge. Hence the importance of reading some history or drawing on psychology as well as manipulating the data through instrumented regressions. A good econometrician needs to have a well-rounded mind as well as a solid grasp of statistics and a decent pinch of humility for seasoning.