266 And All That
Paul Krugman, NYT
Ah, some of the comments on my post about cynical lack of realism happen to illustrate a favorite observation of mine: the extent to which people who demand that we learn the lessons of history tend to rely on historical episodes in which we have very little idea of what really happened.
Thus, they’ll tell us to ignore the extensive evidence from the past century that fiat currencies needn’t lead to runaway inflation — instead, look at how currency debasement led to the fall of Rome!
Or, maybe, how the fall of Rome led to currency debasement?
The thing is, we have no data and not even that much informal evidence on the economy of ancient Rome. We do have informed speculation: Peter Temin had a lovely paper in the JEP (and a book I haven’t read yet) on the prosperity of the Augustan empire, which he estimates was comparable to late 17th-century Europe. All of that fell apart in the third century:
(More here.)
Ah, some of the comments on my post about cynical lack of realism happen to illustrate a favorite observation of mine: the extent to which people who demand that we learn the lessons of history tend to rely on historical episodes in which we have very little idea of what really happened.
Thus, they’ll tell us to ignore the extensive evidence from the past century that fiat currencies needn’t lead to runaway inflation — instead, look at how currency debasement led to the fall of Rome!
Or, maybe, how the fall of Rome led to currency debasement?
The thing is, we have no data and not even that much informal evidence on the economy of ancient Rome. We do have informed speculation: Peter Temin had a lovely paper in the JEP (and a book I haven’t read yet) on the prosperity of the Augustan empire, which he estimates was comparable to late 17th-century Europe. All of that fell apart in the third century:
(More here.)
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