Looking Back to the Future: Time Strata and Economic Analysis

Abstract In mainstream economics cultural differences, habits and mind-sets are considered to be reflected in the institutional setting. To reintroduce historical time, we combine the concept of path dependency with the concept of time strata; instead of explaining a fact isolated from its historical conditionality, the perspective moves from a contemporary phenomenon to several paths incorporated in it and questions their time-differentiated interlocking, mutual influence and conditioning. At the same time, the direction of the perspective changes: the path is analysed from today to yesterday. We use this approach to explain the particular current economic situation in Germany: namely, the strength in manufacturing and in global exports. JEL Codes: B5, N0, O1