Does the Past Have Useful Economics?

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Recommended: merits and demerits of micro and macro economics

The article written by Donald N. McCloskey has dramatically changed my attitude to the usefulness of knowledge from the field of economic history. The phrase from the article: “History is a stimulus to the economic imagination, defining and stretching the limits of economic craft...” took my thoughts away from everyday casual duties and made me to spend several hours thinking about it. I have reminded myself several historical events, the details of which I know from the course of economic history, I tried to apply micro and macro based theories to these events, interestingly, history supports economic ideas...or, should I state the other way round?

The article starts by mentioning well-known Adam Smith, Marx, Marshall, Keynes, Schumpeter and others, those economists based their theories and policies on stylised facts from economic history and were deeply historical in their studies. Unfortunately, nowadays thinking of majority contemporary economists is based only on micro-, macroeconomics, econometrics and statistics. The majority of contemporary economists form their studies only by observing resent events, trying to forecast the future only from analytical and mathematical bases. It was written that almost all contemporary economists undervalue the history of both high and low income countries, however these information can make a seminal contribution to explaining, understanding and predicting. Further this essay is going to state why past is important for economics.

Being frank, it is true that the majority of modern economists do not believe into the power of past economic history... this idea is supported by the author of the article who provides examples of contemporary economic schools of England, Germany and America, ...

... middle of paper ...

...hat some of the best minds in economics recognise the importance of economic history... Probably, the time has come for me to recognise the importance of the influence of past events for predicting and understanding economics deeper. After reading the article, I have realised and approved for myself that economic history as well as history is not only about the past, it is about the present and the future. I had realised that one of purposes of economic history is not only about telling who we are, what we have gone through but also it is about broadening our conception of the possible.” From this moment and forever my personal answer to the question stated at the beginning of the article would definitely be “YES”! Our past has usefulness not only to the economics, but also to politics, international relations and to the personal life of each member of the society.

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