Economic History
Chris Godden, University of Manchester, Manchester, UK
Ó 2015 Elsevier Ltd. All rights reserved.
This article is a revision of the previous edition article by E. Aerts, H. Van der Wee, volume 6, pp. 4102–4108, Ó 2001, Elsevier Ltd.
Abstract
Economic activity is human activity, and economic history is the historical study of the economic aspects of human existence.
This article presents an overview of the aims and methods of economic history, discusses its position between the social
sciences and the humanities, and highlights some current research agendas. The primary focus of the piece is on the historical
and theoretical traditions of the discipline, and the lasting impact of methodological changes that occurred in the mid-
twentieth century associated with the ‘new economic history.’
Defining Economic History
Economic history is neither a branch of mainstream economics
nor a branch of intellectual history relating to the history of
economic thought. In basic terms, economic history (histoire
économique in French, Wirtschaftsgeschichte in German, jinji shi in
Chinese, kaizái shi in Japanese) is the historical study of the
economic aspects of human existence. The broad intellectual
range of the discipline enables it to extend beyond purely
economic themes (such as the organization of production and
distribution, the relation of state and industry, aspects of trade
and commerce) and so consider, among other things,
inequality, living standards, welfare, social transformation,
science, technology, and education. With its focus on
mankind’s existence in a world of innovation, growth, and
development, economic history is a discipline whose core
principles possess a powerful human dimension.
This is a short article on a large topic relating to the aims and
methods of economic history. Central to this discussion is the
social scientific formalization of economic history in the mid-
twentieth century. This marked the transition of the disci-
pline from traditional economic history to the ‘new’ economic
history, and so rooted the discipline in the methodology of
economic science. In doing so, it ignited lasting ‘creative
tensions’ between scholars trained in historical method and
those trained in economic theory.
Origins and Development
The origins of economic history can be traced to the work of the
early practitioners of political economy and social science:
writers such as Smith, Marx, and Weber all employed historical
evidence in their study of economic practices, social phenom-
enon, and the capitalist system. As a distinct academic discipline,
the origins of economic history lie in late nineteenth-century
German, British, and American scholarship and the construc-
tion of a methodology with strong links to established themes of
general history (i.e., political, ecclesiastic, and legal histories), the
work of the German historical school (dismissive of abstract
economic theory and focused on the impact of variation in
economic development), and the institutional economics asso-
ciated with Thorstein Veblen. Its position as a subject of scholarly
International Encyclopedia of the Social & Behavioral Sciences, 2nd edition, Volume 7
enquiry and academic teaching expanded steadily in the
nineteenth century and was firmly consolidated by the early
twentieth century with the creation of specific academic posts
and later specialized journals – the Economic History Review (first
published in Britain in 1927), the Annales d’histoire économique at
sociale (first published in France in 1929), and the Journal of
Economic History (first published in the United States in 1941).
During this period, the interests of economic historians focused
on comparative historical research to investigate the broad issues
of economic life. Such studies incorporated some quantitative
analysis, but little attention was given to employing explicit
economic theory in analyzing past economic events or processes.
As a consequence of these developments, economic history by
the mid-twentieth century had developed as a discipline largely
separate from economics.
The Emergence of the New Economic History
The key developments and refinements of economics theory
that emerged by the end of the Second World War were fueled
by new approaches to the study of the aggregate economy,
growing interest to the mechanisms of economic growth, and
the better availability of long-run economic data. By the 1950s,
new attention to the subject of modern economic growth led
many economists, particularly in the United States, to explore
the long-held assumptions and conclusions associated with the
older generation of economic historians. The conclusions of
these younger, economics-trained scholars were damning: the
quality of early economic history research had been under-
mined by largely descriptive, illustrative, and institutional
approaches; quantitative analysis lacking rigor; and little
attention had been paid to the application of economic theory
to historical data.
It is here that we find the principles that propelled the
cliometric revolution (from the Latin: Clio, the ancient Greek
muse of history; metrics meaning measurement), so leading to
the social scientific formalization of economic history between
the 1950s and the 1970s. Cliometrics – otherwise known as the
‘new economic history’ or ‘econometric history’ – provided an
innovative methodology that emphasized (1) a strong focus on
the precision and formalism of scientific method in order to
elevate the discipline of economic history to a scientific level,
http://dx.doi.org/10.1016/B978-0-08-097086-8.62109-8 51
52 Economic History
and (2) the systematic application of mathematically formal-
ized economic models and quantitative techniques to the study
of historical economic phenomenon. Belief in the potential of
these methodological developments, most notably in evalu-
ating and challenging existing historical interpretations and
scholarship, is palpable in the following quote by the American
economic historian, Douglass C. North, published in the
early 1960s:
A revolution is taking place in economic history in the United States.
It is being initiated by a new generation of economic historians who
are both sceptical of traditional interpretations of U.S. economic
history and convinced that a new economic history must be firmly
grounded in sound statistical data. Even a cursory examination of
accepted ‘truths’ of U.S. economic history suggests that many of
them are inconsistent with elementary economic analysis and have
never been subject to – and would not survive – testing with statis-
tical data.
North (1963): 128–129
The speedy acceptance of this new form of economic
history among economists owed much to its focus on math-
ematical methods and rigorous quantitative techniques.
Institutional structures reinforced the distinct character of this
intellectual movement, famously through a special gathering
held in Massachusetts in the autumn of 1957 and conferences
and seminars at Purdue University in West Lafayette, Indiana.
From these emerged the style, tone, and research agenda –
primarily related to American economic history – that came
to define the ‘new economic history’ for many years. Notable
examples of this early work included Alfred H. Conrad and
John R. Meyer’s groundbreaking study of the profitability of
slavery in the ante-bellum South (Conrad and Meyer, 1958),
and Robert Fogel’s (controversial) use of counterfactual
analysis to explore the contribution made by the railways to
American economic development in the nineteenth century
(Fogel, 1964).
The overall impact of this new research agenda marked, as
William Sewell Jr. has noted, “a move from economic history as
the study of the forms of economic life to economic history
as the historical study of the determinants of national
economic growth” (Sewell, 2010: 152). It was now economic
historians trained as economists, utilizing statistical techniques
and mathematical models, who seized the commanding posi-
tion in the discipline with their attention focused on invest-
ment, technological development, total factor productivity
growth, historical national accounts, and long-term patterns of
economic change.
It should come as no surprise that this new, quantitative-
analytical study of economic history attracted numerous criti-
cisms. By far, the most famous example of this came with the
publication of Robert Fogel and Stanley Engerman’s dramatic
reinterpretation of the viability of American slavery in Time on
the Cross: The Economics of American Negro Slavery (Fogel and
Engerman, 1974).
The standard critique of the ‘new economic history,’ which
emerged in the 1960s and continues to this day, concentrated
on the degree of abstraction applied by cliomatricians and
the construction of historical narratives that correspond to
the conceptual framework of conventional (neoclassical)
economics. Critics argued that this tendency to view history
purely through the prism of abstract models raised numerous
methodological questions, ranging from the ease by which
investigators could select independent variables in order to
condition the results of regression analysis through to the
dangers inherent in counterfactual propositions.
A distinctive feature of the ‘new economic history’ was the
employment of the counterfactual hypothesis method. The
basic principle here was simple: in order to establish the impact
of a particular factor, it was necessary to consider what the
situation would have been in the absence of that factor. Such
questions could be asked through the use of economics theory,
with the specification and criteria of the economic model
serving to construct counter-to-fact conditions. Yet the end
result, in the eyes of many, was to produce mere ‘fictions’ rather
than detailed historical interpretations. As an example of this,
we may note Fritz Redlich’s criticisms of Fogel’s use of coun-
terfactual analysis in exploring the impact of the railways on
American economic growth (Redlich, 1965).
The Search for Balance
From the 1970s onward, criticism and dissatisfaction from
within the ranks of scholars associated with the ‘new economic
history’ began to suggest a new way forward. Here the criticism
was that while of the systematic application of static neo-
classical analysis had destroyed the explanations of an older
generation of economic historians, it provided limited answers
and failed to construct clearer explanations of long-run
economic change. To quote Douglass C. North:
It is the systematic use of standard neo-classical economic theory
which has both provided the incisive new insights into man’s
economic past and also serves to limit the range of enquiry.
North (1974): 1
There was now the realization for the need to provide
a deeper examination of the structure of economies, the intri-
cate interactions of economic and social forces, and the formal
and informal rules that governed the ways people had lived
their lives. In searching for balance, economic historians were
therefore prompted to construct a broader analytical approach
in order to evaluate the importance of factors such as entre-
preneurship, cultural heritage, the evolution and impact of
institutions, property rights, contract law, and government.
Thus, by the 1980s, it has been recognized that the study of
economic history could not be practiced by rigid adherence to
a methodological apparatus focused purely on quantitative
techniques and standard economic analysis. Yet a more holistic
form of the discipline – operating through a renewed frame-
work that embedded economic development in the social,
cultural, and political environment – clearly echoed themes
that had been prominent within traditional economic history
before being systematically ignored in the wake of the clio-
metric revolution. It was that move to enrich the study
economic history from the 1980s onward, through the reinte-
gration of a more traditional historical methodology, that
has led one critic to identify the rise of cliometric economic

history as, ultimately, a “revolution that bit its own tail”
(Drukker, 2006).
Historical Economics
The extreme application of the new methodology associated
with the ‘new economic history’ led to the emergence of what
may best be described as ‘historical economics.’ This is a variant
of economic history as practiced by economic-trained
economic historians whose objective is to use history to
either illustrate theory or test hypothesis derived from theory.
This fundamentalist form of cliometric/econometric history,
with its research program derived from, and conforming to, the
standards and practices of modern economics, suggests to its
practitioners that the discipline continues to develop a rich
understanding of modern economic growth. The reality,
however, is that this formulation of economic history – with its
focus on the utilization of historical time series as a means of
testing sophisticated theoretical models – serves as a very poor
basis on which to study the economic aspects of human exis-
tence. Indeed, ‘historical economics’ ultimately diminishes the
richness of economic history by relegating it to little more than
a branch of applied economics. Yet it must be recognized that
‘historical economics,’ although practiced by some scholars, is
far from being the standard form of economic history that
exists in the twentieth-first century.
The Future of Economic History
Where does economic history stand today? It is clear that, since
the end of the Second World War, economic history has wit-
nessed the dominance of economics-trained/based economic
historians over history-trained/based economic historians. This
is impossible to deny – the modern form of economic history is
supported by the application of economic theory and quanti-
tative techniques, and the majority of economic historians are
to be found in leading PhD-producing economics departments.
Although never achieving the same degree of dominance
among European economic historians compared with their
American counterparts, the successes of the ‘new economic
history’ were formally recognized in 1993 with the awarding of
the Nobel Memorial Prize in Economics to Robert Fogel and
Douglass C. North.
It is certainly true the current status and character of
economic history holds a very lowly position within the
humanities. In briefly examining this issue we may note two
key themes. The first concerns the activities of the early clio-
matricians (in the 1960s and 1970s) who oversold their new
methodology to historians by reinterpreting established inter-
pretations through a blinding barrage of esoteric economic and
quantitative methods. A second theme concerns recognition of
important developments within the study of history since the
1980s, including the rejection of economic determinism asso-
ciated with Marxist analysis, the compartmentalization of
history into subdisciplines focusing on specific themes and case
studies, and the impetus of the ‘cultural turn’ that emphasized
literary and linguistic analysis over quantitative analysis. Thus,
whereas economic history deals with the (dirty) world of trade,
Economic History 53
commerce, industrialization, and growth, the research agendas
of social and cultural historians from the 1980s onward have
increasingly focused on topics such as race, gender, identity,
consciousness, and public memory. Both of the above themes –
lasting reactions to the attitudes of the early practitioners of the
‘new economic history,’ and developments in the methodology
of history since the 1980s – have made historians antipathetic
to the study of economic history. From the perspective of the
modern (cultural) historian, researchers in the area of
economic history are easily dismissed for employing an inap-
propriate, narrow methodological framework that strips
humanity from the historical narrative! Irrespective of the fact
that economic history has moved beyond the strict methodo-
logical principle associated with the ‘new economic history’
(and so focusing on the relations between past economic
events, institutions, social structures, and cultural change), the
subject – indeed, it could be argued, anything connected
with economic issues! – remains heavily tainted in the eyes of
many historians.
Yet set within the context of the social sciences, economic
history remains a rich and active field of investigation and
it cannot be denied that the twenty-first century form of
the discipline encompasses a variety of methodological
approaches. While it is impossible to predict the future direc-
tion of research programs, it is evident that current practitioners
are consciously working to strike a balance between formal
theory (drawn from disciplines across the social sciences, and
not just economics), quantitative methods, and historical
techniques. The geographic range of current research now
extends beyond the traditional areas of North America and
Western Europe to include
l the history of economic development across medieval, early
modern, and modern time periods;
l the history of debt, taxation, and credit relations;
l the causes and impact of financial crises within capitalist
societies (clearly a growing area of interest since the global
crisis of 2008);
l detailed case studies of different sectors and processes,
including agriculture, demographic change, transport
and communications, labor markets, education, and
urbanization;
l the study of national economies/societies within the wider
framework of global economic development and debates
surrounding economic globalization;
l the Great Divergence of living standards between Asia and
Western Europe (and, by extension, the emergence of Asian
economic history as major area of research);
l quantitative analysis of the relationship between economic
development, living standards, and biological well-being
(otherwise known as anthropometric history); and
l debates connecting economic growth with environmental
degradation (and hence the growing attention to environ-
mental history).
Even the most cursory examination of these topics will
show that the modern focus of economic history is definitely
not concerned with the simplistic application of econometric
methods to historical data!
It was noted in the introduction to this article that economic
history possesses a powerful human dimension. Economic
54 Economic History
activity is human activity, and it is this core principle that, as
Patrick O’Brien has highlighted, makes economic history “too
fundamental to be virtually ignored by historians and too
complex to be left to economists with their shortcuts into cross-
country multiple-regression” (Lyons et al., 2008: 443). Similar
themes are reflected in comments by Pat Hudson, who has
argued that economic historians today are presented with
opportunities to “critique the narrow purview of much
contemporary economic theory” as well as “ambush the many
cultural historians who appear to have forgotten what the
economy is” (Hudson, 2010: 249). The great opportunities
available to economic historians stem, therefore, from the
position of the discipline between the cultures of the social
sciences and the humanities, and hence the continuing
importance their contributions can make to the historical study
of economic life.
See also: Business History; Capitalism: The History of the
Concept; Econometrics, History of; Economic History,
Quantitative: United States; Financial Crises, History of; Global
History: Universal and World; History and the Social Sciences;
Industrialization, Typologies and History of; Quantification in
History; Slaves and Slavery, History of; Social History.
Bibliography
Boldizzoni, F., 2011. The Poverty of Clio: Resurrecting Economic History. Princeton
University Press.
Cain, L.P., Whaples, R., 2013. Economic history and cliometrics. In: Whaples, R.,
Parker, R.E. (Eds.), Routledge Handbook of Modern Economic History. Routledge,
pp. 3–13.
Cipolla, C.M., 1991. Between History and Economics: An Introduction to Economic
History. Basil Blackwell.
Coats, A.W., 1980. The historical context of the ‘new’ economic history. Journal of
Economic History 9, 185–207.
Coleman, D.C., 1987. History and the Economic Past: An Account of the Rise and
Decline of Economic History in Britain. Oxford.
Coleman, D.C., 1995. History, economic history and the numbers game. Historical
Journal 38, 635–646.
Conrad, A., Meyer, J., 1958. The economics of slavery in the ante bellum South.
Journal of Political Economy 66, 95–130.
Crafts, N.F.R., 1987. Cliometrics 1971–86. Journal of Applied Econometrics 2,
171–192.
Drukker, J.W., 2006. The Revolution That Bit Its Own Tail. How Economic History
Changed Our Ideas on Economic Growth. Aksant Academic Publishers.
Fogel, R., 1964. Railroads and American Economic Growth: Essays in Econometric
History. John Hopkins University Press.
Fogel, R., Engerman, S., 1974. Time on the Cross: The Economics of American Negro
Slavery. Little, Brown & Co.
Goldin, C., 1995. Cliometrics and the Nobel. Journal of Economic Perspectives 9,
191–208.
Greif, A., 1997. Cliometrics after 40 Years. American Economic Review 87,
400–403.
Habakkuk, J., 1971. Economic history and economic theory. Daedalus 100,
305–322.
Hicks, J.R., 1969. A Theory of Economic History. Oxford University Press.
Hodgson, G.M., 2001. How Economics Forgot History: The Problem of Historical
Specificity in Social Science. Routledge.
Hudson, P., 2010. Economic history. In: Berger, Stefan, et al. (Eds.), Writing History:
Theory and Practice. Bloomsbury Academic, pp. 248–267.
Jones, G., van Leeuwen, M., Broadberry, S., 2012. The future of economic, business,
and social history. Scandinavian Economic History Review 60, 225–253.
Kadish, A., 1989. Historians, Economists, and Economic History. Routledge.
Lyons, J.S., Cain, L.P., Williamson, S.H. (Eds.), 2008. Reflections in the Cliometrics
Revolution: Conversations with Economic Historians. Routledge.
Mathias, P., 2010. On economic history: the progress of a discipline living with its
neighbours. In: Harlaftis, Gelina, et al. (Eds.), The New Ways of History: Devel-
opments in Historiography. I.B. Tauris Publishers, pp. 125–142.
McCloskey, D.N., 1987. Econometric History. Macmillan.
North, D.C., 1963. Quantitative research in American economic history. American
Economic Review 53, 128–130.
North, D.C., 1974. Beyond the new economic history. Journal of Economic History 34,
1–7.
Rawski, T. (Ed.), 1996. Economics and the Historian. University of California Press.
Redlich, F., 1965. “New” and traditional approaches to economic history and their
interdependence. Journal of Economic History 25, 480–495.
de Rouvray, C., 2004. ‘Old’ economic history in the United States: 1939–1954.
Journal of the History of Economic Thought 26, 221–239.
Sewell, W.H., 2010. A strange career: the historical study of economic life. History and
Theory 49, 146–166.
Solow, R., 1985. Economic history and economics. American Economic Review 75,
328–331.
Tuma, E.H., 1971. Economic History and the Social Sciences: Problems of Method-
ology. University of California Press.
Tuma, E.H., 1974. New approaches in economic history and related social sciences.
Journal of European Economic History 3, 169–187.
Vries, P., 2011. Global economic history: a survey. In: Schneider, A., Woolf, D. (Eds.),
The Oxford History of Historical Writing, Historical Writing since 1945, vol. 5.
Oxford University Press, pp. 113–135.
Whaples, R., 1991. A quantitative history of the Journal of Economic History and the
cliometric revolution. Journal of Economic History 51, 289–301.