Andre Gunder Frank

Review of The Great Wave

This book has been widely acclaimed and has already been reprinted several times. But it is hard to see why, since it only delivers an enormous amount of interesting economic information like buckshot and even then misses its target altogether. The author tells us in his preface that "prices may be studied as clues to the nature of change itself [and] to describe and hopefully to explain the rhythm of change regimes and deep change in price movements during the past eight hundred years." A reviewer should evaluate a book on how well it meets the target the author himself set. By that, that is the author's own, standard, this book does badly. As per its sub-title on "The Rhythm of History," this book does even worse if that is to mean world history or its explanation; and it does so with a more confusing grab-bag of unrelated collateral material at the end than of text in the body of the book.

The main argument if any is set out in the Introduction and the Conclusion. In the former, the author announces that he will find common features among the the four great waves he studies in regard to their sequences of development, pattern of prices, movement of wages, rent and instrest; and especially in their final "world-crisis" declines. He also says that we should learn to let this past guide our present choices for the future. Yet in the preceding paragraph and again at greater length in the Conclusion, Schiller warns us against trying to peer into - and still less guide - the future through his lense. Therein he is surely correct if only because his lense is far too narrow as we will see below. The Conclusion also counsels us to learn to think of the long run and in large contexts, but his book is limitd to 800 yerars in Europe and a bit in America alone. Fischer heralds a half century of progress in economic policy, which would render the lessons from his waves largely irrelevant for today if this progress were true, but it's not. And the last paragraph opens with "everything depends on our political will." Would that it were so, for then it would make it clear that the Fischer waves are but excersizes in futile irrelevance, or is it irrelavant futility? Alas, policy and the political will which to excersize it if any, not to mention their success or failure, are also a function of economic structure and waves, as we can discern even from Fischer's four wave analysis. However, the real world-wide structure and waves go far beyond the all too narrow scope of Fischer's mostly European waves. Therefore, we need a truly WORLD history that also escapes Fischer's limitations.

The intervening chapters examine four long "waves" of price ups and downs in medieval times, the sixteenth/seventeenth centuries, the eighteenth/ nineteenth centuries, and the twentieth century. "A primary purpose of this project is descriptive. One of its organizing assumptions is that a task of empirical description may be undertaken without an appartus of theory" the author informs us on page 312 after having lost himself and the reader in the empirical woods without an adequate theoretical map to guide us. Moreover, this anti-theoretical "assumption" is itself a theory, which is doubly contradicted by the evidence: First the author advances a different theory in the Introduction and then his failure satisfactorily to deal with his own evidence is itself evidence that his "theory" is useless.

The first wave Fischer examines is the medieval one from 1180 to 1350 [although it still continued after that]. Alas the text is limited to "the Western world" with a "World bank" that operated only in Europe and the Mediterranean; and what he writes there is contradicted by his Apendix B in which he indicates that the fourteenth century crisis was world-wide and not just European; and even his text refers to a European balance of trade deficit with Asia. However, the preceding economic expansion, which he neglects completely other than to mention a simultaneous period of global warming. also was Afro-Eurasian. The author pretends to study the rhythm of the European economy, but fails to hint and much less analyze how the same was and would long continue to be almost entirely dependent on those of Asia. For Europe was but a marginal outpost that sought to get in on the Asian action through the Crusades and the Venitian traders whom Fischer mistakenly claims to have dominated East-West trade when they merely stood at the western end if the line.

Fischer's examination of the second wave suffers similarly. Again the text treats it as a purely European phenomenon, but Apendix C claims - falsely - that the seventeenth centrury crisis was world wide, which is belied by Asian evidence. On the other hand, it is true that events in Europe were crucially affected by developments in Asia and the Americas, which Fischer simply disregards other than to say that the sixteenth century price revolution in Europe came [but from Asia which he does not say] before the inflow of silver from the Americas, whose very value and use of this silver was derived from the Asian and particularly Chinese demand for silver. Without the China that was after sought by Colombus and other European mistakenly labled "expansion," no Spanish Empire - and no wave in Europe. Moreover, he attributes the European price revolution primarily to population growth without being aware that in Asia population grew even faster without generating inflation there.

Fischer's treatment of the eighteenth century inflation includes the Americas and political events there, including Independence.. Yet although he refers to short cyclical deflationary recession in the 1760s [and there was one also in 1772-4], he fails to consider the same as causing or even sparking the American Revolution. He devotes more detailed attention to the recession of the 1780s and the French Revolution, but again he shies away from connecting them other than to refer to bad weather and an aggravation of the fiscal crisis, much of which also had its roots in the American war. Fischer does record five other revolutions immediately folowing the French one and several occupations by Napoleon, but the most analysis we get is that "market fluctuations and political events were linked together." How, we may ask, and the why not at other times and places as well? After Napoleon, the "Victorian" nineteenth century in Europe is one of mostly stable prices, interspersed by some recessionary declines.

The twentieth century, examined in the last chapter of the text, has again been marked by rising prices as [suddenly!] "a global event." Monetary factors, Fischer says, played a role; but the main reasons were the increase of demand from accelarating growth of population and standards of living, which also pressed on the supply of limited sources of raw materials "in an increasingly integrated global economy." Of course this "increase" is only a function of the author's myopia, which does not permit him to see that economic integration was already as great or greater one and more centuries ago, and that for much of the world standards of living declined. Then "in 1962, the price-revolution entered a new stage." To his credit, Fischer recognizes as most others still do not, that the post -1973 "oil shock" and rise in other commodity prices "was made possible by fundamental economic forces." These also generated the following three recessions of 1973-75, 1979-82, 1989-92, which bracketed the deflation of th 1980s. Stresses were generated not only by the price [including money and wage price] movements as a whole, but by the disparities among them, he notes. "In the 1980s and 1990s, material tensions approached the breaking point everywhere in the world. Entire systems began to collapse, similar to every other price-revolution since the Middle Ages." Alas, the similarity is obscured by the author's failure adequately to analyze previous ones, but on the present one he does do a better but still not very good job. Although he does mention the effect of "the general crisis" on Eastern Europe, he immediately reverts to the usual practice of blaming events there and in the Soviet Union on the victims of the general world economic crisis, instead of analyzing how this crisis itself generated these "internal" events and their 1990s sequel. The same goes for Fischer's focus on "internal" forces in Japan, the Islamic world, and Latin America. Finally, he hazards no guesstimate of the future after the present break of this wave.

Instead, his conclusion offers empirical generalizations about the past with no likely implication for the future, into which the study of history cannot help us peer, he says. Yet each price revolution developed through five stages of slow beginning, surge, institutionalization, growing imbalance and instabiliuty, and finally crisis. However if monetary factors are really driven by real ones like population growth, what then drives these; and how can Fischer claim that studying prices can reveal the rhythm of [real] change in history? He examines and rejects seven possible classical and neo-classical [Malthusian, Marxian, agriculturalist, ecological, monetarist and other] explanations of these relations before offering his own "autogenous" one, which alledgedly "link[s] material structures, cultural values and individual actions." In fact however, his explanation is contradicted both by the evidence and by his own "theoretical" statements that these are waves and not cycles, that is not endogenously generated movements, and in his last Appendix O on "Economics and History" in which he takes an epistomological know-nothingist position that rejects all theory as either stultifying or altogether useless. Instead Fischer invokes problem centered research as the alternative, which confuses theory as an end in itself that he rightly rejects with that of the use of theory where and when it is useful as a means to approach and solve a research problem. In the author's head, that is the problem; and the problem of his book becomes WHAT is the problem?

The appendices are informative but their information is not incorporated into or even related to the central argument of the text. Appendix A on the ancient world deals with a period two thousand years before that of the text. Others deal with the period of the text, but the author makes no attempt to related them to it. Moreover, several of the appendices are seriously flawed in themselves. Although the fourteenth century is correctly labeled as one of widespread crisis, Fischer relies on a non-sequitur instead of examining any evidence to claim that this proves there were no common climatological factors at work. His Appendix C on an alleged general seventeenth century crisis was already seen to be belied by the evidence , which he also does not examine. His Appendix E on cycles and waves is exclusively bibliographic and makes no statement at all, still less that support his central argument. Appendix N correlates four periods of price revolutions, that is inflation, with increased rates of personal violence, which decline again when prices go down. Although Fisher's evidence is highly selective and mostly English, it does suggest that inflation and generates personal violence and in Appendix M also family disintegration, which decline again when prices also do. Fischer considers four possible explanations for this correlation, but he shies away from the "obvious" social explanation that inflation impoverishes people and generates tensions that result in private violence and family breakups. The 15 appendices in 57 pages are followed by 46 pages of bibliographic and substantive notes plus 140 pages of annotated bibliography, which is often indistinguishable from the notes that precede it. So this interesting material plus the index occupies a total of about 270 pages that in no wise formulate or even strengthen the already all too weak textual argument that itself gets only about 250 pages.

In short, although this book offers a gold mine of useful information if the reader is prepared to mine and refine it for uses that the author himself does not make or even attempt, the book as a whole reflects and offers confusion worse confounded, or in a word makes NOnsense.

Andre Gunder Frank