ECONOMIC HISTORY. It is a truism that each generation must rewrite the history of the past for its own study. This is because each generation views with particular interest those aspects of life and progress in the past which are of greatest present importance. From the 15th to the 18th centuries men were primarily interested in religious questions and the history written during that period was tinged with theological controversy. During the latter part of the 18th and the greater part of the 19th centuries the formation and devel opment of constitutional government claimed chief attention, and history was written over again from this standpoint To-day, especially in the United States, our interests have grown to be preponderantly social and economic, and the result is that emphasis is now being laid upon what is called economic history.
By this is not meant what is generally termed the economic interpretation or the ma terialistic conception of history, which holds that economic factors alone can furnish an ade quate explanation of human development. This doctrine of economic determinism was set forth with great force by Karl Marx and has been generally accepted by other socialists. Accord ing to them economic activity is the fundamen tal condition of all life, and consequently all changes in the development and structure of society, whether intellectual, religious, social or what not, must be traced in the last analysis to purely economic causes. Few writers hold this view and it must not be confused with the re cent development of economic history.
Writers other than the Socialists assign, in deed, a much humbler role to economic his tory than that of such a comprehensive expla nation of all social phenomena. According to some its chief mission seems to be to hunt up illustrations which the economic theorist may then use to illustrate principles which he has deduced without recourse to historical evi dence. Others admit that it is often useful to test the limits of the actual applicability of theoretical economic doctrines. While still an
other group, notably the German historical school of economics, hoped that by the use of historical research they could establish new economic truths of a theoretical character, ar rived at by the inductive method. This last hope bas on the whole proved fallacious and the economic historian to-day is content with a less ambitious program than the complete recon struction of economic science.
What then is economic history? It may be defined as an explanation, as complete as may be, of the economic life of a period. Such an explanation is very difficult and for certain pe riods all but impossible, because of two facts. The first is that the records of the past in so far as they concern economic phenomena— the everyday business of earning and spending one's income—are very meagre; and the sec ond is that the Industrial Revolution (q.v.) so completely changed the course of economic de velopment that even a complete explanation of the past throws little light upon present prob lems. Economic history is more than a narra tive, or an account of an industry or an insti tution; it is an economic analysis and causal explanation of the facts and their interrela tions. Such an explanation is not easy, for economic life is very complex; economic phe nomena are never isolated, but work together. The special task of economic history is thus a reasoned explanation of causes and tendencies.
Callender, G. S., The Posi tion of American Economic History' (In American Historical Review, XIX, 80-97); Cossa, L., An Introduction to the Study of Political Economy> (London 1893, p. 23) • Keynes, J. N., and Method of Political Economy' (London 1891, pp. 252-280) ; Rogers, J. E. T., The Economic Interpretation of History' (London 1888); Seligman, E. R. A., The Economic Interpretation of History' (New York 1902).