Should history replace economic analysis?

The following article argues for historical analysis and not economic analysis to become the prime method of deciding on policy and the next step when responding to events.

There’s a problem with this argument: It presupposes that historical events lead economic events (or any other) and not the other way round. A detailed study of various events, that have resulted in a tremendous upheaval, in history show that that was not always the case.

For example, a look at the events of the French Revolution will show that for an observer stuck at that moment of time and armed with as complete information as required to provide a prognosis would have resulted in a rather poor prediction when evaluating using only historical analysis. Why? I’m no expert on history, but I cannot recall any revolution that was based on a new set of ideals (of the European Enlightenment) to replace, by force if necessary, the previous governance structure of social order (the “Ancien Régime” in this case).

Consider the Russian Revolution, spanning almost 20 years before the Bolsheviks seized power which saw the birth of communism. Could the events there have been predicted by simple historical analysis itself?

Could historical analysis have predicted the outcomes of either one of the world changing events?

It seems unlikely. It is in hindsight that anyone is able to analyse the historical events and point to particular occurrences that together can be defined as that historical event. In other words, it is the individual events themselves, the economic, social, even technological or scientific events, that build up to the historical events and not historical events that can be precisely pinpointed as the source of these changes.

If this sounds too “theoretical” for you, then consider it in the following manner.

Assume there are two regions – A and B. Both regions have their own police – PA and PB. Externally, both forces are designed to be the same. They both are to apprehend criminals and protect what is legally allowed. They have the same functions and also the same administrative structure. There are commissioners, assistant commissioners, other ranked officers and finally constables.

Assume that everything is the same between the two forces. The administrative supports, the laws to be implemented, the strengths of forces, the cases to be handled, etc. The difference is that in region A crime cases are solved and the criminals punished but the same is not entirely true of region B. If the laws, regulations and the arrangement of the forces are the same in both places, then it is unlikely that the problem lies with the “structure” but more with what “fills up the structure”, i.e. the police personnel here.

Similarly, history itself is the structure that is molded by the events that make up history. The economic events, societal changes, the technological breakthroughs, the scientific findings, even natural calamities, shape history.

So it is not that “history” needs to replace any other form of analysis, it is that the remaining analyses need to be put in the framework of history so that events can be properly explained and better prognoses made.

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