How to Teach the History of Economic Thought

by Gene Callahan

I was recently asked about a good textbook to use in teaching the history of economic thought. Well, last year I had used William Barber’s book, and found it wholly adequate. But as I was teaching the course, I became somewhat uneasy about the textbook approach. I started to feel I was giving what Michael Oakeshott referred to as a “museum tour” of that history: “Over there, on your left, is Aristotle… he held exchange should take place when values exchanged are equal. There, on the right, is Adam Smith. Do you see the extensive division of labor in his diorama? Just past him is David Ricardo…”

If I were to teach such an introductory course again, I think I would take a different approach. If I had, say, fourteen weeks, I would have three four-week modules with two weeks to transition between them. The first module would cover Smith, and the transition week would touch on the Classical Economists, highlighting Ricardo’s labor theory of value. Which would bridge to Marx. Then the transition week would introduce the marginal revolution and how it served as an answer to Marx for many. Finally, that would bring me to the Keynes versus Hayek debate, where I would note how, whatever their differences, the marginal revolution had succeeded: they were both clearly marginalists.

I believe a plan like the above (of course the major modules might be different!) would allow more time to actually get a grasp of a few major figures’ thoughts, while still allowing students to get an idea of their place in a larger history as well as at least know the names of major figures not getting their own module.

Any thoughts?

30 thoughts on “How to Teach the History of Economic Thought

  1. I do something similar, though I start with Mandeville and distinguish among the marginalists more sharply than, perhaps, you do. It is all original readings in my history of thought class. As far as I can tell it works well pedagogically, and they do give the course good reviews. It works for me, though I sometimes think I should start with Mun and Petty as did in years past.

  2. Hayek’s view was that Keynes was NOT a marginalist & that his “macro” revolution was a throwback to the cost tradition and to the aggregates of Ricardo.

    Hayek’s effort was to complete the Marginalistt revolution into the territory of production goods, money and equilibrium theory across time — this effort ispired Hayek’s own revolution, little understood even by most “Austrians”.

  3. It looks like a good idea to focus on a smaller number of people and some critical transition periods, rather than a Cooks Tour from Aristotle to Samuelson, or someone whose name starts with Z.

    One of the performance indicators for the course should be whether the students get the idea of being their own historians, so they can explain the history and context of their own projects, whatever their field of activity. They should also be able to explain what difference it makes, if it turns out really well!

    You could set an assignment to describe the history and context and rationale for some other project or assignment they are doing this year, not necessarily in economics.

  4. I took Thomas Sowell’s graduate HOT course at UCLA. By this time, I had finsihed not only all my course work but also my prelims (including in HOT). So I wanted to audit. He said he didn’t like auditors. I had to write a paper. That was the agreement.

    My point is that any HOT course should include a paper. That is the real learning experience for the student. I’m not keen on texts.

  5. I found Mario’s idea for a class on Policy Ideas in the HOT interesting. While this is not a classical HOT class, treating certain topics shows the relevance of the ‘old’ readings. And yet one gets a grasp of the HOT. Also it allows you to skip people.

  6. It depends on what conclusions you want them to draw from the history of economic thought.

    But, what you propose, and is a common proposition, sounds a little like “Whig History”.

    It’s Kuhn’s insight that the structure of intellectual revolutions is not the linear ‘Whig History’ that students get when when you teach the Aristotle-to-Samuelson approach. Inventions are as likely to become regressive as progressive: Christianity over greco-roman pragmatism. Or Chinese moral arguments over Chinese bureaucratic pragmatism. Or French rationalism over English empiricism. Or Keynesian quantitative moral philosophy over Samuelson’s empirical exaggeration of it. All progress is not forward. And we should teach skepticism by demonstrating that all progress is not forward.

    Greg is correct on Hayek above. And it’s pretty hard to teach postwar theory as other than an incomplete and as-yet unsuccessful effort whose effects are not yet certain.

    I disagree with Rafe. You cannot ask students to become deductive masters of economic history from the original readings alone. It will reinforce the error of Whig History. I mean, such individual revelation was possible, Rafe wouldn’t spend all his time trying to convince people of of the obvious lessons Popper has tried to teach us. (Or write a paper showing how Mises, Hayek and Parsons failed.) These ideas are anything but easily grasped by the human mind — and the students are surrounded by mathematical rigor that is non-predictive, and we know that simple multiple regression analysis is more predictive than any of the existing models. The best our models do is expose asymmetry of information that we can make use of — which is useful — but they do not predict anything.

    Roger is right that you should use original readings, but I’m not sure original readings don’t reinforce the error of progress: whig history.

    Despite his biases, Rothbard’s books are the best early economic history – if you mean that economics is a social science whose goal is a rational political order, rather than as a craft consisting of a series of tools that are applied in increasingly complex ways. It doesn’t matter if you teach that skepticism from Rothbard’s historical approach, or Hayek’s philosophical approach, or from the simple empirical record of our failures at policy and prediction.

    If you’re teaching people to be economic carpenters I think a whig history is fine – they only need know the evolution of the tool set they must employ to do a yeoman’s labor. If you’re teaching people how economics is a social science, and the importance of that social science, i think it’s an insufficiently skeptical approach. If you’re teaching people to do work that will have policy impact, then economics is a moral science, and they can’t afford (and we cant afford) to continue to pump people into the system that aren’t skeptical of the very craft that they practice.

    Now, there are any number of people who suggest that recent progress in macro is not accounted for by critics. That is an interesting debate in itself. But it certainly appears, at least in the abstract, that Hayek will be right, and Kuhn’s observation will apply to our field, and that Mandelbrot’s insights will replace those of the post Keynesians.

    So, the question is, do you want to be remembered as a professor who reinforced a likely series of errors by propagating whig history, or one who seeds a generation with the skepticism needed to improve the science?

    Maybe that isn’t your original question. But it’s a question worth asking.

  7. Jerry: Yes on writing. I assign a term paper. I also have them write 300-500 words on each thinker *before* we discuss that thinker to ensure that they grapple with it before I, like, “reveal the truth” or something. Besides class discussion, I give the student comments on each of those mini essays.

  8. I understand this is about teaching economic “thought” but suggest that such an approach would be more readily comprehended if supplemented by case studies in economic history. After all, the great writers of economic thought were all influenced by what had already happened around them in the business world. Most of them merely attempted to summarize the economic practices of ordinary traders and merchants.

    Voegelin quite correctly suggests that theories on economic principles, being a step away from actual practice, lose their “experiential roots and are subject to ideological reconstruction.”
    For that reason I have urged the use of case studies, as employed in business and law schools, to illustrate the source of all concepts that economic “thinkers” have advanced.

    For example, there is much written theory on price and demand elasticity, but the subject is better understood by a beginning student when he reads how the Basques in the early 1700’s elbowed their way into the Venezuelan cocoa trade. Breaking the Dutch monopoly caused prices of cocoa to plunge, but no one went bankrupt–the lower prices led to such increases in demand that the expanded market made the trade far more profitable than it had been under Dutch price fixing (See Kurlanksy’s “The Basque History of the World.”) And one can read how the Phoenicians initiated the economies of division of labor a couple thousand years before Adam Smith tried to describe the concept!

    A supplemental reading of even a few pages showing the “experiential roots” for each economic theory can enrich and enliven a course in this subject.

  9. Curt Doolittle: ‘But, what you propose, and is a common proposition, sounds a little like “Whig History”.’

    Well, it isn’t. It simply is history. Where in what I wrote did I suggest anything vaguely resembling the kind of history you go on to critique?

  10. Ha ha! Yes, actually, they pretty much do. Some students do only a fraction of the assignments and their grades suffer accordingly.

  11. Greg –
    Hayek’s view was also that Keynes had an oversized opinion of himself. Hayek’s view was also that Keynes was fickle and would have changed his mind about the GT if he reviewed it (at least this is what Hayek said decades later). Hayek’s view was that Keynes didn’t know much economics outside of Marshall.

    Hayek had a lot of views. Hayek was wrong on occasion.

  12. Gene: Taking me too literally. You posted a short piece. I picked up on the common problem in our field of treating the history of thought as progressing toward the current state rather than evolving through fitful and often fallacious theories that are consequently replaced, and that our current state appears to be fragile in current practice and needed a significant shift.

    This isn’t the question you were asking. I know that. But it’s still a good idea. Because the current paradigm is based upon a concept of aggregates that is insufficient for the problems we’re trying to solve.

    As everyone else here is saying indirectly: students do not necessarily master what we think they do or ask them to. And they are most likely to master economic history as ‘whig history’ rather than attribute to economics the skepticism that should be applied to our existing framework. Without that skepticism, we will continue to create genrations of students who confuse the approximations of convenience for the reality we seek to predict. And it is precisely that fantasy they walk away from the history of ideas carrying. At least, that’s what the evidence shows in practice.

    We all advocate for something. We all have priorities. I’m just advocating for my concerns, because I think it is more likely to result in a solution.

    Thanks for taking the time to reply.


  13. Curt, like you I was pushing my own barrow (in a nutshell), but I don’t know how you got the impression that I wanted students to read texts alone, far from it, the important thing is to see the texts in relation to the issues and assumptions that dominated at the time.

    How much of that can you do in a short time with average students! Apart from the minority with an intellectual vocation, reading original texts is almost useless because they will probably rely on someone’s crib anyway.

    My point is to try to find some connection with the real interests of each student because apart from their own interests, what else matters to the average student? Hence the idea of getting them to write a very short piece to place some project of their own in relation to the issues and dominant assumptions of our time. Good students could get a glimmering of insight into the factors that determine those issues and assumptions, and the extent to which they are problematic and contested, rather than eternal verities.

    Then they could do a similarly short piece pretending that they are Adam Smith, or Marx or someone recent like Samuelson or Friedman.

  14. Rafe:

    RE: “the issues and assumptions that dominated at the time”

    I agree. In fact, the general strategy that we should teach subjects as a statement of the problems in the context of the time is ideal. And I did understand your point.

    RE: …average students…
    Agreed. I’m concerned about the students who end up in grad schools and become practitioners, who simply reinforce the existing paradigm. And that isn’t a problem for average students. So perhaps I’m off base here because I didn’t understand that it’s ‘average’ students Gene was talking about.

    But, that said, if you want average students to walk away with three things from the history of economic thought, what would they be? Because that’s what they’ll actually walk away with – a couple of major themes. And it certainly appears that they are walking away with the assumption of progress as one of them. I am fairly sure I would want them walk away understanding the need for skepticism as one of those three things.

    So again,while leeching off of Gene, like you, I’m pushing my barrow. 🙂 One grain of sand at a time.

    Good to hear from you.


  15. Gene, I always pictured you using Rothbard’s history of thought book, and saying, “Not!” every five minutes…

    I had a lot of grand ideas for my History of Thought classes at Hilldsale. Then I discovered on the first midterm that maybe 3 kids were doing the readings. If I wanted to teach kindergartners, I wouldn’t have gotten that felony conviction.

  16. Gene raises the sensible notion that HET should not be a museum tour. I quite agree. But what, then, should be the purpose of such a course? My answer to that is to select great thinkers who have something to say about the world as we find it and who ideas figure prominently in our understanding of that world. Whether that should principally be geared to the development of technical economics or toward a more general appreciation of economic ideas is, I think audience- and course level-dependent. In the latter category, Larry White’s forthcoming “Clash of Economics Ideas” (chapters available at is a highly useful vehicle for teaching HET from a real world and contemporary perspective.

    The sheer magnitude of the subject matter requires choices in coverage. What I find puzzling is the conventional requirement of spending more than a class on Marxian economics. I think the cost is far too high (given the payoffs) and too often requires demoting guys like Say, Mill, and Cairnes.

    Regrettably, as a field in economics HET has all but vanished from Ph.D. curricula. Part of that has been a consequence of the rise of positivistic methods in economics, but also I think HET instructors have typically offered a product with low market value.

  17. I agree with Bill. I think the history of economic thought should be taught from the perspective of live issues (whether policy or theoretical). Then the students can read various thinkers with regard to what they said on these issues. For example, the role of psychology in economics is currently a live issue. But this is not the first time it has been. Students might be guided through the work of many prominent economists on this issue alone. The danger is that they may not get a good sense of the economists’ entire system.

  18. I had always thought that we study thinkers from others times to attempt to understand how a very different world looked to very different people, and perhaps thereby gain some appreciation as to how we, too, are a product of our own time and place.

    But I stand corrected: we actually should read Aristotle to discover whether or not he would approve of the latest GATT round.

  19. Gene:
    RE: “But I stand corrected: we actually should….”

    Ouch. 🙂 Going to have to save that quote and use it.

    0) Decide wether you are teaching HET as the development of positivistic analysis, the problem of political economy, or as the history of moral philosophy. Or at least, make sure that the students understand the difference, and that HET can be approached from all three positions: scientific, political and personal.
    1) Start with an hypothesis that is relevant to the overall field today (as Mario suggests) – a question for the students, so that they know what three or so ideas to walk away from the class with (our fallibility would be nice, and the limits of our current ability would be better – no sense teaching students it’s ok to play with fiscal matches.)
    2) Show each thinker in context of the problem of his time as you state.
    3) Use source material as you suggest, since textbooks just don’t help you ‘feel the author’s mind’. The art of teaching the history of ideas is to understand how a thinker thinks, not what he wrote.
    4) Provide criticism (as I suggest, because the field needs it.)

    And hope that ‘average’ students walk away with a clue. But sleep well at night that at least you tried to make the world a better place. 🙂

    (…..Aristotle on GATT…. Priceless. I almost forgot that Krugman doesn’t have a monopoly on sarcasm. Thanks. 🙂

  20. I don’t think there is any one right way to teach a given class such as the History of Economic Thought. You gotta do something real and defensible that works for you. You are what you are no matter what “teaching philosophy” you might swear allegiance to. All we can do in the class is give the students a chance to improve. They pretty much learn whatever they damn well please. So what should you do? Be yourself. Do your thing. Be serious about what you’re doing. Care about your students. Try to understand them and reach them. All the rest is filagree. Mario should teach history of thought his way, and Gene should teach it his way. Deirdre McCloskey once told me, “Everything you do as a scholar is preparation for class.” That’s good advice. Be a serious scholar. Care about what you are doing, and care about your students. Everything else will take care of itself.

  21. Yes, there is no single right way to teach the history of economic thought. And certainly Gene is right is thinking that there is much value is learning how economists have responded to the specific circumstances and problems that they faced during their time. For the right kind of students this approach will be engaging. But students today — especially at expensive going-into-big-debt colleges, but also because of the spirit of our age — want to know things that are “relevant” to the world as it appears on tv, the internet, etc. So I have found that with most NYU students this “live issue” approach is the way to go. ON THE OTHER HAND, I must admit that I do it in an incomplete fashion — perhaps I should say half-heartedly. My natural inclination is to think abstractly — to look for interesting intellectual problems regardless of their immediate relevance to today’s world. In fact, I believe I could give a course called “Against Immediate Relevance to the Transient World of Stupidity.” One day…

  22. Mario, not sure if this is relevant, but FYI your students at NYU are really good. (At least they were in the Honors Seminar when I was your TA.) I got to Hillsdale and could really tell the difference. My best student at Hillsdale was better than the best one at NYU, but in general those kids in your class were way more interested in learning and discussing than the business majors who were forced to take my Principles class at Hillsdale.

  23. As a student at St. John’s University in 1970, we used a textbook (green cover) that took a topical – not chronological – approach in the HET, beginning, I believe, with the theory of value. This was supplemented with original readings, such as the calculation debate of the ’30s among Mises, Hayek and Lange.

    The course made quite a lasting impression on me, but I would really appreciate if someone could tell me the name of the textbook author.

  24. I was lucky enough to take two classes in HET: as an undergraduate, in Italy with Stefano Zamagni; at GMU as a grad student, with Karen Vaughn. Zamagni’s was very much the “museum tour” that Gene mentions, but he was good in connecting ideas of the past to recent development in economic theory, and in showing what lines of inquiry ended up in a dead end and why, and why other ideas survived and developed. I LOVED Karen’s class: we read Smith, Ricardo, Marshall and Menger, and she provided brief lectures to cover the development in-between them. Her approach was focused on showing how the thinkers of the past made theory by addressing the economic issues of their day. There was a lot of economic history along with history of economic thought. Not much a Whig approach, and a very useful exercise for students (at least, it was for me) to understand the historical context, and how ideas were built in a manner that was both analytically rigorous and relevant.

  25. Mario, call me naïve, but I don’t think there is a trade-off between interesting intellectual problems and immediate relevancy to today’s world. I like to think that, if it is a genuinely interesting intellectual problem, it is also relevant. But I understand the feelings about the Transient World of Stupidity. (On this front, I am definitely guilty on my own…)

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