University of Chicago economist and 1995 Nobel laureate Robert Fogel had a long and productive life before he died Tuesday, so I don’t consider his death to be tragic.
But it is a loss to economic scholarship. As an economic historian, Fogel improved both the history and economics fields. Indeed, when one looks at his work over the past six decades, it seems clear that he did more to improve our understanding of economic aspects of human existence than many of the pure theorists who garner more respect within the discipline.
Fogel’s claim to fame was that he was one of the early contributors to “Cliometrics,” the application of formal econometrics and statistical analysis, with hypothesis testing, to historical questions such as the contributions of railroads to the growth of the U.S. economy or the financial viability of slavery in the decade before the Civil War. (Clio was the Greek muse of history.)
In both cases, his conclusions were controversial because they ran counter to then-accepted wisdom among historians, and because his use of formal statistical methods struck many historians as interdisciplinary imperialism. Despite such controversy, he wrought lasting change in both disciplines.
Take the slavery question. Many historians had argued that slavery was an unprofitable system that was doomed to die a natural death from its own economic inefficiencies. If this was true, if slavery really had been on the verge of self-extinction, then the Civil War was an unnecessary tragedy. Why did men have to die to bring about abolition, which was taking place peacefully in the rest of the hemisphere?
Fogel and Stanley Engerman, a colleague at the University of Rochester in New York, amassed voluminous information from plantation and slave trade records and concluded this view was wrong. They also asserted that, because slaves were such valuable property, they were treated better than is popularly assumed, that the material standard of living of slaves compared well to that of urban laborers in the north and that, over a lifetime, slaves received about 90 percent of the value of what they had produced.
They certainly voiced no moral approval of slavery nor argued that it was just in any way. But their opponents derided them as apologists for slavery, as ultra-conservatives and even as racists. This was ironic since Fogel, a Jew, had married an African-American women during the early phase of his life in which he was a professional organizer for the Communist Party.
Fogel was not infallible. I still don’t buy his argument about the unimportance of railroads. Some of the assertions in “Time on the Cross,” his book with Engerman on slavery, were refuted. But the whole brouhaha moved historical scholarship ahead, both in the substance of the issue at hand, slavery, and in terms of the methods that would have to be used in economic history research from then on.
The third phase of his work was broader in scope, attempting to quantify how much of economic growth came from improvements in nutrition and health. In the past, we often focused on the role of technology in industrialization. The application of water and fossil-fuel power to tasks formerly done with human labor certainly was important. Indeed, it probably was the most important factor in growth of per capita output over the past two or three centuries. But Fogel also found that one-third of the growth in per capita incomes in Britain over the two centuries ending in 1980 came from improvements in nutrition alone.
This has tremendous implications for development policy in poor countries. Early growth policies in these countries emphasized rapid industrialization and importation of financial capital to fund it. Nutrition and health were seen as important “social” programs, but not as tools to spur growth.
Yes, Ted Schultz, Fogel’s ag economist colleague at the University of Chicago, emphasized the importance of investing in “human capital.” But it was Fogel who demonstrated how important it had been even in Europe. Brazil’s “family-grants” that have done so much over the past decade to reduce absolute poverty and improve nutrition for the very poor stem in part from the work done by Fogel and others on the importance of these factors.
More broadly, Fogel’s work reinvigorated the use of insights from history in formulating contemporary economic policies. Yes, many academic historians cringe at the phrase “the lessons of history.” Yet messy as identifying them may be, insights from history often turn out to be more useful than those derived from the “human-beings-make-decisions-rationally,” theorizing that has dominated pure economics for two centuries.
In the era when some historians saw the “Cliometrics” of Engerman, Fogel and of his co-laureate Douglass North, as disciplinary imperialism, there was a grain of truth in it.
Economics was full of hubris. Many economists thought interdisciplinary work should consist of political scientists and others adopting the assumptions and methods of economics. There was little useful knowledge that might flow the other way.
That is no longer true. A new generation of economists works with psychologists to build models based on contemporary research that shows how humans actually make decisions, rather than on how British philosophers of the 1700s assumed they did. Indirectly, Fogel’s work helped move this process along, and for that we owe him gratitude.