Economic History

Economic theory and economic history have increasingly had to deal with new intellectual currents in economics, principally feminist economics, environmental economics, and the new institutional economics. Feminist economists have sought to liberate neoclassical economics from its positivist Cartesian trap, to broaden its analytical and thematic scope from a preoccupation with the rational choices of individual economic man, and to study how humans, both men and women, in interaction with each other and the environment, provide for their own needs and survival. They have tried to infuse gender in both macroeconomics and microeconomics, to strip neoclassical economics of its universalism and timelessness, as well as its normative and prescriptive certainties, to challenge stylized facts and dichotomies, and to make women and gender relations in all economic activities visible, by grounding economic analysis in concrete societies and histories that are invariably marked by inequalities, discrimination, exploitation, and struggle inscribed by the social and spatial constructions and hierarchies of gender, class, and place.

Environmental economics evolved out of diverse intellectual and ideological roots in the 1970s and 1980s in the context of growing concerns for sustainable development. Environmental economists seek to analyze the impact of economic activity on the environment and the influence of the environment on economic activity and human welfare by reformulating familiar neoclassical concepts, and occasionally inventing new, "greener" ones. And so they talk of the need to internalize externalities, that is, to account for the environmental effects of economic activity, to incorporate environmental factors in social cost–benefit analysis. They see environmental "resources" and "services" as "commodities" with consumptive, nonconsumptive, existence and bequest values, and discuss the preservation of natural environments in terms of their value as collective or public goods, and their expected utility or option value for future generations. A series of sophisticated methods and techniques has been devised to give monetary values to the environmental "commodities" and to measure the costs of environmental damage and degradation, and the impacts of market and policy failures and of investment projects and programs.

A key premise of the new institutional economics is that institutions matter, that economic change and development are products of both the institutional environment and the institutional arrangement. Studies inspired by the institutional perspective range from those that focus on the broad range of factors that have shaped the institutional environment, including the state, culture, and ideology, to those that concentrate on specific institutional arrangements, such as how changing regimes of property rights and transaction costs affect each other and economic performance. There is a lively debate on what constitutes an institution. Institutions are said to exist as a means to reduce transaction and information costs so that markets can operate efficiently, and markets themselves are regarded as institutions that interact with other social, political, and cultural institutions in the process of economic growth and change.

These new approaches offered opportunities for economic history to gain new analytical models and insights. They were welcomed by economic historians who believe that historical economic phenomena and processes are inseparable from cultural, political, social institutions, and the physical environments in which they occur, and the hierarchies and struggles inscribed by gender, class, and other social markers. Thus, economic history became increasingly more interdisciplinary.

Interdisciplinarity had long characterized economic history in the global South thanks to the paucity of statistical data and the pressing demands of development. According to Anthony Hopkins, a renowned economic historian of West Africa, African economic historians have always had a generous definition of economic history, one which embraces anthropology and political history as well as economics, which can be attributed to the youthfulness of the subject, the fortunate failure of any one school of thought to impose its dominance, and the diversity of evidence.

Economic historians of other regions appear to be moving in this direction. Readings on European economic history suggest growing interest in reconnecting economic, social, and political history. Before econometric history spread from the United States in the 1960s and specialization led to fragmentation of the discipline, one writer recalls, "few people then doubted that economic history included social history." (Barker, p. 25). Now the discipline seems to be returning to some of its roots and using new sources, including oral sources, which "can fill many gaps and much enrich our understanding of ordinary folk's social conditions and personal priorities" (Barker, p. 27).

The winds of change seem to be blowing even to the United States, as several commentators have noted. In a major intervention on the development of the American economy during the late nineteenth century, when corporate capitalism rose to prominence, James Livingston makes a compelling argument for bringing social analysis into American economic history:

At a higher level of argument it … follows that economic events are explicable only by reference to the social relations within which they appear—by reference, that is, to historically specific contexts of production and exchange.… We can see that the social and cultural context of economic change is not what the new economic historians have assumed it to be—an "exogenous factor" that can safely be ignored in building quantitative models of economic behavior and growth. (p.71)

Similar trends are apparent in Asian economic historiography. In China, for example, social and economic historians have been developing new paradigms, divorced from Western neoclassical models and communist models, both of which were based on simplistic dualisms and shared a vision of the benefits of commercialization (Huang, pp. 335–336).

A survey of the Eleventh International Economic History Congress held in 1994 confirms these developments toward the broadening of economic history. It shows that only one session was devoted to cliometrics and that the new economic history papers altogether accounted for about 20 percent of the whole congress program and were mainly given by North American scholars. Most of the papers took into account the role played by noneconomic factors and reflected "the influence of other kinds of histories, in particular social history, and other social sciences such as sociology, management and organization studies, and political science" (Subacchi, p. 607).