Introduction

Academic disciplines have surprisingly different histories, some extending over thousands of years, others only over a few decades. They all have institutional aspects – some disciplines originated in universities, others are rooted in the works of practitioners – but the principal interest almost always concerns the evolution of their contents. Teachers and students wish to know how the present state of knowledge has come about. Like their colleagues in other faculties, academic economists usually take pride in the history of their theory. They regard the analytical history of economics as a history of progress. The actual state of economics provides the measure of importance for earlier ideas, which, directly or indirectly, contributed to the achievement of the present state of the art. The endeavours of the past are interesting, but only to the extent that they help to explain how progress was made (Niehans 1990). The analytical approach is primarily concerned with economic phenomena

which occurred, or could have occurred, in all phases of human history. However, in subsequent approximations even pure theory makes assumptions about the existence of specific institutions which influence economic development such as the status of the worker, the form of the wage contract or the existence of futures markets. A relativist approach emphasizes such differences and tries to relate them to specific stages of economic evolution. Most economists probably are predominantly materialists, in that they ascribe a determining role to the level of technology, and accept only a moderate importance of cultural factors as autonomous forces shaping institutions and affecting behaviour. Marx (1974) was convinced that the perception which members of social strata have and the ideological conceptions used to express them can be derived from the economic context in which they find themselves.1 He even thought that the real scientific task was to show how these conceptions necessarily arise as false appearances, and to confront them with a true picture of actual relationships, for example by proving that exploitation, not abstinence, explained profits. Revealing the inner contradictions of the system would provide insight into the nature of its inevitable future transformations. One opposite view is that

market relationships are more efficient and will prevail, that distribution under capitalism can be fair, and that no major transformation of the fundamental economic structure is to be expected, while it is not denied that such fundamental changes had occurred in the past. All relativists thus admit that the perception of economic phenomena, hence all thinking about them, changes with historical conditions, even if such perceptions differ over causal relations. Progress remains important for the relativist position, in that ideas are considered characteristic of their time. And progress moves on different planes, as practical and theoretical knowledge in institutions and organizations, even as moral progress. One objection to the materialist interpretation of history is that it does not

leave room for the creative power of political, social and religious movements. Is it really possible to look only at the formal economic institutions if we want to understand the difference between, say, early imperial Rome and Medieval Italy, or Medieval North Africa (Maghreb)? Even if the economic historian may have much to say about such differences without discussing paganism, Christianity and Islam, this will be quite impossible for the historian of economic thought. The texts that we encounter here are not very interesting as pieces of rudimentary economic analyses, although in each case we would find evidence that people had understood some economic mechanisms, for instance, advantages of the division of labour. Such texts are also only of limited interest to the economist if they are read as expressions of their times (from the perspective of a relativist) – our perceptions are always limited by what we learn from others, from tradition, and they depend on where we find a field of action. The texts are really interesting only if we recognize a ‘political’ dimension and try to interpret them as expressions of the will to shape, to preserve or to change the world – and even the interpretation of economic and social reality by the philosopher serves that goal. The will to change can mean a wish to maintain an order, or to revert to an older one, and it can also mean what Marx intended: the transformation of the present for the sake of the realization of an ideal (which he regarded as inevitable). Economic texts in particular are written in order to act on reality, or to

make such action possible, or to demonstrate the fruitlessness of such action as planned by others. Often, external constraints are invoked to let a desired course of action appear as inevitable. We understand texts by identifying with the concerns of the authors and their contemporaries. We therefore must be ready to bear the tension between contrasting visions of the world; we must enter the hermeneutical circle of understanding the expressions in the text and recreate their vision, visions for whose realization the texts are written, and in turn the visions are interpreted to provide a better understanding of the expressions. We thus have to use texts and their concepts to reconstruct the meaning of the historical situation; historical research helps us to gain improved understanding of these concepts. There are many examples, but I may mention three which I have found challenging, and which are sufficiently simple for a short exposition.