The Great Wave

The great waves are different in that respect. They appear on the surface of the evidence. To observe them no filtering or detrending of the data is required.

Each of these approaches has taught us something useful about their common subject. All are flourishing today. The differences between them rise in large part from their assumptions about what prices are, and what the world is made of. They are theoretical constructions, but all of them also make strong empirical claims that can be tested against h

Before we begin to study these relationships, a caveat is necessary. It should be understood clearly that the movements we are studying are waves—not cycles. To repeat: not cycles, but waves.

To that end, this history begins more than seven centuries ago, on a market day in a medieval cathedral-town. The date was September 8, 1224. The place was Chartres.

The second task is to explore the question of cause. Braudel himself believed that these great waves were the strongest secular pattern in modern economic history, but he thought that the task of explaining them was the “most neglected” problem in historiography, and “impossible” to solve.

Even so, price historians in Europe have suggested seven causal explanations, which might be called the monetarist, Malthusian, Marxist, neoclassical, agrarian, environmental, and historicist models. Monetarists

The third assignment is consider the consequences of price-movements, or more precisely the consequences of movements that prices represent. These

Otherwise, the author has found that price-revolutions in general are (with some exceptions) entirely unknown to most economists, political leaders, social planners, business executives, and individual investors, even as they struggle to deal with one price-revolution in particular.5

The fourth wave commenced in the year 1896, and has continued since, with a short intermission in some nations during the 1920s and early 1930s. It is the price-revolution of the twentieth century.