Douglass C. North's 'Understanding the Process of Economic Change'. Analytical Perspectives and Historical Narratives

The paper introduces the discussion in the Book Symposium on D.C. North's 'Understanding the Process of Economic Change' published in the journal 'Structural Change and Economic Dynamics' (SCED). It is emphasized that the relationship between economic theory and economic history calls attention to a number of fundamental issues in the epistemology of economics. First, purely analytical principles (that is, statements inferentially derived from general – but often highly arbitrary- assumptions) lead to indeterminate and inconclusive propositions (multiple equilibria and the like) once we move away from abstract spaces of possibilities and consider historically specific set of circumstances. Second, the relevance of any analytical account of historical experience presupposes consideration of an open theoretical framework, that is, of a framework allowing for manifold overlapping spaces of causation and a complex ‘matrix’ of possibilities. Third, interpretation of historical contexts cannot be left to implicit theorizing but requires detailed identification and discussion of the conceptual maps and connections suitable to the situation (or process) in view. Theory is central to this endeavour but in a qualified and methodologically sophisticated way. This point of view is remarkably close to the emerging consensus in epistemological research that a too narrow assessment of causality should be avoided, that context should be assigned a central role in the identification of which causes (and theories) may be relevant under alternative constellations of invariant parameters and that the relationship between agents’ intervention in causal processes and causal attribution should be given centre stage (manipulative view of causality).