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 Penguin History of Economics? It turned out I hadn’t missed it, but had read it under its other title The Ordinary Business of Life. What’s more, I’d really enjoyed it – just like his Capitalist Revolutionary (with Bradley Bateman).
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 The Worldly Philosophers, say. Equally, it doesn’t go into the same depth about the economics as Sandmo’s Economics Evolving, 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.