Niall Ferguson Interview: Conversations with History; Institute of International Studies, UC Berkeley

Money and Power: Conversation with Niall Ferguson, John Herzog Professor of Financial History, New York University; November 3, 2003 by Harry Kreisler

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History, Theory, and Creativity

How does a theory like this emerge from somebody who is a historian? How do you come upon this set of ideas? How do they come to you, so to speak?

Well, dissatisfaction with what I'm reading, I suppose, would be part one. Part two, I think, and it is important to emphasize that in teaching -- I've spent fifteen years giving tutorials to Oxford and Cambridge undergraduates -- you very often have your own rather complacent views challenged by bright students. So, first, dissatisfaction with the existing literature, then a slap in the face from some bright nineteen-year-old, followed by a kind of back-of-envelope attempt to come up with something better.

I suppose more than many historians, I am drawn irresistibly to theorize. But I'm a historian because I do some serious digging without particularly strong preconceptions before I come up with a theoretical model. Whereas, of course, the conventional mode in the social sciences is to first design the model and then find the data.

I had a very funny discussion ... I spent a year at the Bank of England, and it was a very illuminating year. I wanted to learn some more financial economics. I had a little theory which I had been working on about the way the financial markets had worked in the nineteenth century. I talked to somebody working at the Bank of England who was very expert in the modern bond market; she was a trained economist. So I said, "Here's the stuff I've been gathering, and I'm wondering what you think of this?" Very worried. She said, "Well, before I can look at the stuff, I would first have to construct a model." And I said, "Don't you think it would be better to look at the evidence first and then draw up the model?"

That's a very profound methodological difference. It was something that Ranke understood in the nineteenth century that made history different. We sort of mess around with a lot of rather random data before we hesitantly formulate a hypothesis, and it's, I think, much healthier.

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