To understand why I wrote Defending the History of Economic Thought (2013) you have to understand that it was written with a specific purpose in mind. And the reason it was written was to alert the scholarly community who study the history of economic thought (HET) to something virtually none among them know, that there had been attempts, first by the Australian Bureau of Statistics in Australia in 2007, and then by the European Research Council (ERC) in Europe in 2011, to remove the study of the history of economic thought from within the economics classification and place it into a different category vaguely related to the history and philosophy of science. In Australia, this shift into a category to be called “History, Archaeology, Religion and Philosophy” was stopped at the very last moment. In Europe, the move of the history of economic thought into a category called “The Study of the Human Past: Archaeology, History and Memory” was actually made. The effort required in Europe was therefore to convince the ERC to reverse a decision that had already come into effect. For a number of reasons, I was closely involved in both decisions. It was because of that experience the book was written. It is to explain, first, how close the history of economic thought came to being extinguished as a branch of economic theory in a process that has still not come to an end; and then, second, to discuss not only how to preserve HET as part of the study of economics, but also why it must be done.
Most of the book therefore explains how important it is to both economists and economic theory to retain HET within economics. But the book also discusses how I think the history of economic thought should be taught and, beyond that, why I believe HET should become the crossroads of the profession, where the various schools of economic thought come together to debate their different perspectives.
In setting out my own agenda in what follows below, I have focused on the issues raised by Marcel Boumans (Reference Boumans2015) and have used quotations from his review as section headings in this response. I think his was a fair-minded review but from someone who thinks about these matters in a very different way. There are thus two contrasting visions of what HET is and should be. This is mine.
“Former Lobbyist and Now Historian of Economics”
In discussing these issues, I would not normally have wanted to focus on my own role in any of this. However, my experience in dealing with these proposed shifts was to discover that whatever skills an academic may or may not have, political lobbying is not among them. I, on the other hand, had for twenty-four years been the economist for the largest business association in Australia, so understanding what was required in dealing with political decisions was by then second nature. In Australia, I set out a list of steps that had to be taken (2013, pp. 109–111) if we were to prevent this decision to remove HET from the economics classification from coming into effect. In Europe, my advice to treat the proposed shift as a five-alarm fire was not followed, and the ERC made the transfer. I discuss my close involvement in having the decision reversed as a template for the kinds of actions required (pp. 117–127). The last pages of the book (pp. 128–132) provide a twelve-step program for maintaining the history of economic thought within the study of economics, since the dangers have by no means passed.
This is a genuine problem. Most academics are political partisans and many have been on various government bodies. But lobbying is different from observing or even working for governments, and it was this expertise that I brought to this issue. There are vested interests in every area but so far as the preservation of the history of economics was concerned, each of the bodies that had to be persuaded was as disinterested as one could possibly have wished. Their only desire was to do what was right.
But to effect an outcome, you must know what decision you want and be able to explain why it is the right decision. And while most discussions of the importance of HET are directed at other economists, where the aim is to convince them to teach or study the history of economic thought, in this instance the argument was directed at decision-making bodies to try to convince them that the history of economics is an important and integral part of the study of economics and should remain within the economics classification. A large part of the book is therefore about the kinds of lobbying and political involvement that may be required to preserve the role of HET within economic theory.
“The History of Economics Is a ‘Necessary Part of Economics Itself’”
We now often teach economists in ways that more than underscore a belief that studying the history of economics is not just optional but virtually of no value. It is taught in some places and not in others. But where it is absent, there is seldom a visibly deep regret that a course in HET cannot be fit into the syllabus. The book therefore provides a dot-point list of the role of HET within economics (discussed by Boumans Reference Boumans2015). Denis O’Brien (2007, ch 2, passim) has provided his own series of points similar to my own, but, rather than repeat what he wrote, let me here merely endorse his conclusion: “Some knowledge of the history of economic thought is thus highly desirable to prevent not just bad scholarship but also bad economics” (p. 19). If this is so, and I believe it is, the onus should be on those who do not teach the history of economic thought to explain why they do not.
All of this dovetails into my larger point, which was to explain why economics as a subject must incorporate the history of the subject as an integral part of its very nature. I do not argue there are no other valid and scholarly uses for the history of economic thought; HET does have uses for those who study the history and philosophy of science. But for all that, it is still a secondary matter, a positive externality, and not part of the fundamental reason for the existence of HET. Moreover, as discussed in the book, Margaret Schabas, one of the leading advocates of the transfer to the history and philosophy of science, could not detect much of an interest in the history of economics among historians of sciences.
As undergraduates, most historians of science either bypassed a study of economics altogether or were exposed to it in only its most rudimentary form. As a result, many are unfamiliar with the explanatory breadth and conceptual coherence of neoclassical economics and tend to display the same disdain for economics as do their counterparts in the hard sciences. (Schabas Reference Schabas1992, p. 195, quoted in Kates 2011, p. 48; my italics)
To say the least, this does not appear to me an environment in which HET is likely to thrive, but even so, I find this beside the point. The history of economic thought developed among economists because it has a direct relevance to the study of economics. It was not developed as an instance in a wider discussion of the theory of knowledge. The history of economics was developed by economists for economists because it helped economists understand more clearly the theories they have developed and provided a deeper basis for policy formation. By widening the scope of what is considered HET, and watering down the discussion of basic economic issues within journals and as part of conferences, this core purpose will be eroded to the point where studying the history of economics will have little more relevance to the actual development of economics than does the history of physics in the development of physics.
Those who have not studied economics—and in this I include both historians and philosophers—cannot discuss economic issues other than in the most superficial way. Nothing they might say on the theory of money, to take just one example, would be of the slightest value other than as a curiosity. Every page of an economics text is the result of some long and continuing conversation among individuals who had a deep interest in whatever topic is being discussed. Only an economist would be likely even to understand the textbook gloss in its proper context, never mind the entire history of the debate that led to the particular textbook treatment. It is people who can do this kind of analysis that we economists must wish to cultivate. These are the people from whom other economists can learn.
Economics as a subject is weakened by the absence of a strong presence of the history of economic thought among economists. It would be a catastrophe for economics to allow the study of its own history to be shifted into the humanities, attach itself to the history and philosophy of science, and lose its historic connection to the study of economic theory. If HET were officially removed from the economics classification, fewer economists would pursue such studies, whatever scholarship there was would more than ever be seen as irrelevant, and the process of renewal and regeneration assisted by studying HET would fade even more deeply into the background. These are crucially important matters. Such change should be resisted by anyone who cares for economic theory and its future.
“The Hostility of the ‘Mainstream’ is a Fact of Academic Life”
The diminishing interest in HET among economists has been evident since the 1950s (see Lodewijks Reference Lodewijks, Samuels, Biddle and Davis2003). There are a number of reasons for this, made up of some combination of indifference, the opportunity cost of time, the lack of career possibilities in studying HET, the increasingly mathematical nature of academic economics, and the wish to suppress alternative theories. Certainly, if one is thinking about an academic career today, studying HET is of almost no value. Tenure-track appointments in the history of economics are rare. Academics who are either interested in, or capable of, teaching HET are also becoming rare. There is a downward spiral that will be difficult to reverse.
And yet, were knowledge of the history of economic thought a free good, few would think it of no use to an economist. A literature review is, in most instances, a detailed study into the history of some specific area, and is crucial in orienting a doctoral thesis. The history of economics would be seen in a similar way in general, as long as that history was a form of Whig history that showed that all that came before was prelude to the present. I was particularly taken by this statement from Roy Weintraub, which I think in many ways gets to the heart of the issue: “If most economists understand the history of economics as an attack on mainstream economics, they will be hostile to the subdiscipline and its claims on common resources of faculty positions and student time” (Weintraub 2002, p. 6, quoted in Kates Reference Kates2013, p. 44).
Steve Medema’s statement in the midst of the HET discussion thread stated the current approach perfectly:
Too often history of economic thought takes the form of trying to use the past to show contemporary economists they are wrong. That is perfectly legitimate as a form of scholarship, but I question whether it is scholarship in the history of economic thought. It USES the history of economic thought, but it does not necessarily contribute to (and often does not contribute to) our understanding of the history of economic thought. (quoted in Kates Reference Kates2013, p. 58)
Medema and others find the use of HET to engage with and criticize mainstream theory outside the bounds of the proper academic study of history of economic thought. This is where the hostility of the mainstream not only arises, but also helps explain why many historians of economics support the shift into the history and philosophy of science. This is where the core of the current debate is found.
Boumans suggests I have misrepresented those with whom I disagree. I am characterized as an enemy of the history of economic thought—“with such a friend of the history of economics, who needs enemies?”—when all that happened as a result of my efforts was that the status quo was preserved. Yet, as best as I can tell, he and others see this shift out of economics and into the history and philosophy of science as not just benign but as a step forward. I, on the other hand, believe such a shift would see a rapid demise of HET as an integral component of the study of economics, and would therefore be harmful to economics itself. If others believe a shift of HET into “The Study of the Human Past: Archaeology, History and Memory,” or as a component of “History, Archaeology, Religion and Philosophy,” would be a net benefit, they need to make that case. And if that is not what they wish, and I have misrepresented their position, it is easy enough to point it out.
Whatever may have been the reason, there really were attempts to shift HET from the economics classification within the social sciences and place it into history and philosophy of science as part of the humanities. Would they support or oppose such a move? That is the question that matters. Only if they are opposed to such a shift would I accept I may have misrepresented their views.
“History Is Shaped to Legitimize One’s Own Account”
My own vision of HET is almost entirely the opposite of the polite, disengaged, academic discourse on fringe issues of no consequence to economists, which others seem to favor. Economics is, was, and always will be a battle zone of competing ideas. There will always be a mainstream and there will always be a substantial number of economists who do not subscribe to those mainstream views. It is possible that most economists most of the time do not accept at least some aspects of the mainstream.
It is why I have argued that the history of economic thought should become a center for critiques of mainstream theory. It should become part of the HET mission statement to use the past to show contemporary economists they may be mistaken. Rather than reject this approach, it should be explicitly adopted. Controversy based on the historical record should become a feature within HET conferences and in our journals. None of this would exclude anything currently being published, but would add a dimension that has been suppressed.
And the reason it should be undertaken within HET is because there is nowhere else it could be done. Only scholars in the history of economics are in a position to assess these contrary views to determine whether the history or the economics are sound as a first hurdle to cross in understanding whether the theory is sound.
“To Rock the Mainstream Boat”
Related to this, but different, would be the history of economic thought as a meeting place for discussion of the “heterodox” traditions within economics, many of which predate the neo-classical mainstream. The various heterodox traditions have one thing in common. Each has an interest in its own historical development. These are live traditions with a written and oral history in which not just the words but the spirit of each set of theories have been passed onto succeeding generations. And each has had to demonstrate the validity of its own perspectives over many different sets of shifting economic fortune in a wide variety of economic environments. But what is significant is that most of the various traditions have descended from earlier economists who are each regarded as pioneers in the development of mainstream economics. And each represents a different way of understanding the nature of economic structures and their operation.
What I have proposed is that HET should become the main center for the exchange of ideas. Critics of mainstream theory would be encouraged to discuss their critiques as part of HET, where their contrasting views are based on the economic theories found in the different economic traditions. I stand here with John Stuart Mill, where he wrote of the importance of “seeing that no scattered particles of important truth are buried and lost in the ruins of exploded error” (Mill Reference Mill2009, p. 48).
This investigation of what is “exploded error” to some but not to others ought to be an important part of the work of historians of economic thought. Not only would such debates be of value to the future of economic theory, but they would also make the history of economic thought the most interesting area within the entire discipline. Rather than ushering in its demise, this would restore HET to the very center of economic debate.
“If HET Is Not History of Science, What Is It?”
The history of economic thought is not history and philosophy of science. The history and philosophy of science looks at the sciences to reach conclusions about the nature of knowledge and the formalities of proof. Nowhere is such a study intended, other than peripherally, to investigate the subject matter itself or answer questions the subject has been formulated to explain. The following is the notice from the University of Melbourne advertising its History and Philosophy of Science course:
The aim of History and Philosophy of Science is to understand science: how it works, its historical development and its function in modern society.
History and Philosophy of Science thus integrates philosophical, historical and sociological approaches to the study of science. It provides you with an insight into scientific methods and objectives without actually having to do science. (2014; my italics)
“To understand science” is not to understand economics. Boumans believes I have helped to kill HET. I, on the other hand, more than ever believe I did both economic theory and historians of economics a large favor in helping to convince those who were about to shift HET into the history and philosophy of science not to make the change. More than ever, I see how catastrophic this shift would have been. Had the shift been made, HET’s historic purpose, to deepen our understanding of economic theory, would almost certainly have been lost.
This is a shift that economists must do everything they can to prevent. The book discusses why there are those who wish to turn the history of economics into the history and philosophy of science. Indeed, the review by Boumans should make clear there are still many, even within the upper reaches of the HET community, who would like to see this shift made. I encourage you to read the book. It sets out the nature of the problem, but, more importantly, provides a program to ensure this shift does not occur.
