ABSTRACT
A new sensitivity to the significance of historical experience has developed since the 2007 financial crisis. There are three possible ways of drawing on the past: as a source of advice on policies, of patterns of past evolution, of multiple possibilities. The best way of thinking about history is as a way of testing conventional hypotheses – particularly when those hypotheses are being used to create market opportunities (by making for false confidence; but also by engendering exaggerated despair).
