Some history of thought is better than none

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After I last wrote about the history of economic thought, pondering which economists would go into The Worldly Philosophers 2.0, I was shocked when someone asked had I never read Roger Backhouse’s 2002 [amazon_link id=”B002RI9A54″ target=”_blank” ]Penguin History of Economics[/amazon_link]? It turned out I hadn’t missed it, but had read it under its other title [amazon_link id=”0691116296″ target=”_blank” ]The Ordinary Business of Life[/amazon_link]. What’s more, I’d really enjoyed it – just like his [amazon_link id=”0674057759″ target=”_blank” ]Capitalist Revolutionary[/amazon_link] (with Bradley Bateman).

[amazon_image id=”B002RI9A54″ link=”true” target=”_blank” size=”medium” ]The Penguin History of Economics[/amazon_image]   [amazon_image id=”0691096260″ link=”true” target=”_blank” size=”medium” ]The Ordinary Business of Life: A History of Economics from the Ancient World to the Twenty-First Century[/amazon_image]   [amazon_image id=”0674057759″ link=”true” target=”_blank” size=”medium” ]Capitalist Revolutionary: John Maynard Keynes[/amazon_image]

I just quickly re-read the History of Economics/Ordinary Business. The book is a masterful overview of thinking about economics from the ancient world to the present. It does this in a compact 330 pages too. This makes it quite dense reading, inevitably, so it isn’t as easy to polish off as Heilbroner’s classic [amazon_link id=”068486214X” target=”_blank” ]The Worldly Philosophers[/amazon_link], say. Equally, it doesn’t go into the same depth about the economics as Sandmo’s [amazon_link id=”B008N3G6A4″ target=”_blank” ]Economics Evolving[/amazon_link], which covers a narrower range of history and economists. This is not to say that Backhouse’s book gets the worst of both worlds. On the contrary, I think it’s a really useful book which sets economic thinking in the context of the relevant intellectual and cultural world, and one all economics students should read.

I’d forgotten lots of details, especially from the earlier chapters. That St Augustine had pointed out that private property is the creation of the state, and had argued that the state therefore had the right to take it away. That scholastic writings on economics had their origin as handbooks for priests hearing confessions, who needed to advise people on ethical business practices. I was reminded about the economic modelling done by engineers (Navier, Minard, Dupuit) at the Ecole des Ponts et Chaussées in the early 1800s.

So how much ought economists know about the history of the subject? The answer is certainly some (compared to none now in many cases), and at least as much as in this book. But it did not persuade me that extensive knowledge of the classical economists – Ricardo or Marx – is useful. I know economists I greatly respect including Ian Preston (see this) and my University of Manchester colleague & current office mate Terry Peach will disagree with me about this. It’s obviously good to know that questions of class struggle and distribution, or technical change and growth dynamics, exercised earlier economists and have a general idea what they said – Ian’s Storify is a tremendous public service. But Ricardo’s specific models, or Marx’s dense accounts of surplus value and the declining rate of profit? I’m not convinced.

The more recent the history, the more important to understand the development of the way economists have thought, of course. Given that our starting point today is that economists and economics students know (I’m about to generalise) almost nothing about the intellectual history of their subject, learning some is better than learning none.

7 thoughts on “Some history of thought is better than none”

  1. Pingback: Some history of thought is better than none | Homines Economici

  2. Have you read Andrew Kliman’s Failure of Capitalist Production? He suggests that Marx’s theory of the declining profit rate is relevant today. (It’s quite close to the theory of secular stagnation.)
    Terry Peach supervised my masters’ dissertation way back in 1987. He’s a top bloke.

    • I haven’t, although am more likely to read it than I am to tackle Das Kapital….. call me lightweight! I’ll say hello to Terry from you, am sharing his office now.

  4. Yeah, it’s better to know each classical economist *shallowly*. But not too shallowly, either… make sure you read the somewhat obscure works, but feel free to skim over stuff where it’s clear there are errors. As Joan Robinson has advised in relation to Marx.

    Now, go read some Veblen — it’s more relevant than anything else to the present day.

  5. Thanks for the generous words about the 1815 storification. I doubt that our opinions differ much on this at all. I certainly don’t think everyone needs to read Ricardo. I do think there is something disappointing about the incuriosity of typical economics courses about the historical foundations of the ideas dealt with. The modern optimisation-arbitrage-equilibrium framework of economic analysis emerged from nineteenth century attempts to understand the political economy issues of the time and took root decades before informative data or the statistical techniques required to analyse that data became available. Studying the context in which these ideas arose and the arguments which led to them being accepted helps in appreciating their contingency, their persuasiveness and also the collective intellectual achievement behind them and therefore encourages healthy scepticism about economic ideas at the same time as discouraging naive rejection of them.​

  6. I taught my boys economics by getting them to play World of Warcraft. All of economics is there, including Ricardo and comparative advantage.

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