Hayek and Economic History

Abstract

The central contribution to economic science by Friedrich Hayek, co-winner of the 1974 Nobel in economics, is his theoretical understanding of how prices coordinate human decision-making by condensing and communicating the vast knowledge disseminated throughout society (Hayek 1945). Hayek’s contributions to macroeconomics (1931a; 1976) and classical liberalism (1960) follow from this central insight. Most of those who appreciate his largest contributions recognize that he was well-versed in the historiographies of a great number of topics (Boettke 2018). However, his contributions to the field of economic history are, at best, minor. Their full extent is summarized by his edited volume, Capitalism and the Historians (Hayek 1954). Yet he appeared to have had a brief and remote involvement in the embryo of what would become later the cliometric revolution in economics – i.e. the systematic application of economic theory and methods to historical events and processes. In this book chapter, I will attempt to highlight Hayek’s brief flirtation with economic history. I will argue that, had this continued, it could have provided a strong foundation for many of Hayek’s intellectual propositions.

Keywords: Economic History, F.A. Hayek