Economics and World History: Myths and Paradoxes.

• Author: Cate, Tom

The timing of this work could not be better. With the awarding of the Nobel Prize in Economics to North and Fogel for their work in the area of economic history, this collection of short essays by Bairoch, Professor of Economic History at the University of Geneva, provides additional examples of commonly held myths and, at the same time, supports the movement that students of economics need to be exposed to more applications, not less, of economic theory to important events in economic history. Bairoch employs a very simple yet very elegant three-part methodology. First, state the myth. Second, provide the reader with some brief background notes to the myth. Third, use empirical data and recently published materials to "prove" that the myth is, in fact, an inaccurate representation of the historical event being examined. Two examples may be cited.

The first principal myth is associated with individuals which ". . . could be described (with some exaggeration) as a conservative group that romanticizes the nineteenth century and makes free trade almost into a sacred doctrine".(1) This myth is addressed in Chapters 1-4. Chapter 2 investigates the myth of free trade from the European perspective: "Was there a Golden Era of European Free Trade?". The specific point which Bairoch investigates is the idea that in European economic history during the period of the Pax Britannica, 1815-1914, free trade was the role and protection the exception. After dividing this period into five sub-periods, 1815-1846, 1846-1860, 1860-1879, 1879-1892, and 1892-1914, presenting and evaluating the available evidence, Bairoch draws three conclusions.

First, the idea that "free trade is the rule, protection the exception" is a myth. This idea is valid only for the third sub-period, 1860-1879. For the entire period, 1815-1914, the reality is that protection is the rule and free trade the exception. Second, according to Bairoch, the ability of this myth to cloud people's vision of reality can be traced to the influence which Smith and Ricardo had on the writers of the economic history. Bairoch forces the reader to recall the path taken by Britain: protection of the home market until British firms dominated the industries associated with the First Industrial Revolution. Only then did Britain become an advocate of free trade. Third, outside of Britain, when it came time to make decisions about international trade and protection of the home market, the writings of List, The...