Contemporary Development and Economic History: How do we Know what Matters?

“Development” involves increases in human and physical capital, plus institutional changes, that are characteristic of whole societies, not just particular sectors. Such changes are not necessarily well-reflected in GDP figures at the time that these changes are occurring – even assuming that we can measure GDP in historical societies with sufficient accuracy. Consequently, types of largely narrative long-run history focused on one or a few case studies are a vital supplement to more econometric and formally-modeled studies. They are particularly useful as correctives to historical work that aims at finding a single variable or event separating cases of developmental “success” and “failure.” However, the claims that emerge from such case studies are quite hard to verify. The article uses examples drawn from East Asia at certain moments a possible example of “failure,” but more recently assumed to be an example of “success” – to both identify historical findings that might have implications for contemporary development choices and to explore why such inferences are necessarily very fragile.