Tag: Rees

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Chicago Exam Questions Theory

Chicago. First quarter price theory exams. Rees, 1960

Happy to add another round of first quarter price theory exams from the University of Chicago to the collection. Always nice to have a picture from the early professional years of the economists featured here. Distinguished old farts were once rising stars after all. (A general wisecrack made with the qualification, “present company excluded”.)

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Posted earlier

Reading list and exams from the Autumn quarter of 1962.

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Economics 300
Mr. Albert Rees

Midterm Examination
Autumn 1960

  1. (16 points) State whether each of the following statements about the U. S. economy is true, false, or uncertain, and explain your answers briefly.
    1. Consumers decide what will be produced.
    2. All consumers participate equally in determining what will be produced.
    3. The government influences the composition of output in the private consumer goods sector.
    4. The government determines the level of investment for the economy as a whole.
  1. (10 points) Comment briefly on the following statement:
    “When equilibrium prices in competitive markets are disturbed, they tend to be re-established. Thus the first effect of an increased supply of eggs is to lower the price. At this lower price, consumption is increased, and the increase in demand tends to drive the price back up again.”
  2. (16 points) Increased costs cause manufacturers to reduce the size of 5 cent chocolate bars from 2-1/2 ounces to 2 ounces. Because the bars are smaller, people eat more of them and consumption rises from 10, 000 bars a week to 11,000.
    1. Can these events be shown on an ordinary supply and demand diagram? If so, show them. If not, explain why.
    2. Can the elasticity of demand for chocolate be computed? If so, compute it. If not, explain.
  1. (24 Points) The following table gives hypothetical prices of pork and beef per pound in two years, and quantities consumed in a certain town.

 Price per pound Pounds consumed
1959 1960 1959

1960

Pork

 40 cents 50 cents 1000 800
Beef 60 cents 60 cents 1000

1200
    1. Compute the elasticity of demand for pork and the cross-elasticity of demand for beef in terms of the price of pork.
    2. Compute the Laspeyres price index for the price of meat from 1959 to 1960 (assuming that pork and beef are the only kinds of meat).
    3. Draw an indifference map for pork and beef for a typical consumer and illustrate the changes shown in the table on his indifference map. Derive two points on his demand curve for pork.
    4. Assume that the consumer’s money income is increased by an amount equal to his original income times the Laspeyres price index computed in (b). Demonstrate that he has been overcompensated for the price rise. Under what condition if any would this increase in income fail to overcompensate him?
  2. (16 points) Jones lives in a rented house for which he pays $150 a month. He has the opportunity of buying an identical house for $25,000, of which $15,000 will be paid in cash and $10,000 can be borrowed on a mortgage. He has figured that his monthly expenses would be $100 if he bought: $50 for interest on the mortgage, $20 for local taxes, and $30 for maintenance and depreciation. His income tax and expenses for fuel and utilities will not be affected by the purchase. He argues that it will cost him less to live if he buy the house; his wife argues that it will not.
    1. Under what conditions is Jones right? Under what conditions is Mrs. Jones right?
    2. Is there any divergence between the “right answer” to this problem from the private standpoint of the Jones family and from the standpoint of society? Explain.
  1. (18 points) The GJS corporation, manufacturers of gadgets, have determined that for every 10 per cent increase in the capacity of a gadget factory, minimum short-run average total cost falls by 1 per cent throughout the relevant range of capacities.
    1. What can you say about the production function for gadgets over the relevant range?
    2. Suppose that the company hires two factors of production, labor and capital, and pays each its marginal product. Will anything be left over for the owners of the company who contribute no services? Explain.
    3. Suppose that the company wants to build a plant to produce 10,000 gadget per week. What can you say about the size of the plant that will produce these most efficiently?

Economics 300
Mr. Rees
Fall. 1960

Final Examination
December 14, 1960

  1. (21 points) Show each of the following events on an indifference map:
    1. The change in the consumption of margarine following an increase in income (axes: butter and margarine. Assume that the income elasticity of demand is positive for butter and negative for margarine.)
    2. The change in the consumption of bread following a rise in its price. (axes: bread and all other commodities.) Identify the income and substitution effects of the price change.
    3. Do part (b) over using Friedman’s “Marshallian demand curve” concept and explain the difference between the diagrams for (b) and (c).
  2. (19 points) In the United States, about one-fifth to one-fourth of all income is property income. State briefly (a) the advantages of having private income from property in our economy (b) the costs or disadvantages. You may judge these according to any values you care to use, making the values as explicit as possible.
  3. (20 points) In a certain isolated area there are 50 farms of each of two types, A farms and B farms (100 farms in all). Within each type, all farms are identical. All farms are worked by identical workers. The marginal product schedules of one farm of each type are given below, in bushels of wheat per year.

 A Farm

B Farm

No. of workers
1 100

95

2

 90 84
3 80

73

4

 70 62
5 60

51
  1. If there are 260 workers in the area, how many will be employed on each kind of farm? What is the total product of each kind of farm? The rent of each kind of farm? The wages of workers on each type of farm in bushels per year? (Assume that farmers compete freely for labor, and labor can move within the area.)
  2. By means of an irrigation project, the owners of twenty B farms transform them into A farms. Recompute the answers to (a), counting the transformed farms as A farms. Who gained and who lost from the project, and why?
    1. (20 points) By means of appropriate diagrams and/or explanations, show the short-run effect of each of the following taxes on the output and profits of a monopolist.
    2. An excise tax of 10 cents per unit of product.
    3. An excise tax of 10 percent of the price of the product.
    4. A corporate profit tax equal to 50 percent of net profits.
  1. (20 points) The Edgeworth Box Company is the only employer in the town of Yarmouth. Its supply schedule of labor is given by W = 40 + 1/4 q, where W is the wage in cents per hour and q is the number of manhours supplied per week. The company sells boxes in a competitive market. The value of the marginal product of labor is given by
    V = 100 – 1/2 q for values of q greater than zero.
  2. How many man-hours of labor will the company employ, and at what wage?
  3. Show diagramatically for part (a) first, the wage bill and second, the sum of monopoly profits and the return to factors of production other than labor.
  4. What will be the effect on employment of a legal minimum wage of 60 cents an hour? of 80 cents an hour?

This problem may be solved algebraically or graphically. The following table gives numerically some points on the schedules whose equations are given above:

Supply

Marginal Product

q (Man-hours)

 W (cents) q (man-hours) W (cents)
1 40.25 1

99.5

2

 40.50 2 99.0
3 40.75 3

98.5

4

 41.00 4 98.0
etc.

etc.

Source: Duke University. David M. Rubenstein Rare Book & Manuscript Library. Economists’ Papers Archive. Albert Rees Papers, Box 1, Folder “Economics 300”.

Image Source: University of Chicago Photographic Archive, apf1-07002, Hanna Holborn Gray Special Collections Research Center, University of Chicago Library. Colorized by Economics in the Rear-View Mirror.

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Chicago Columbia Economist Market Economists

Chicago. Harry Johnson opposes major appointment to be offered to Gary Becker, 1964

HarryJohnsonGaryBecker

From the perspective of today it is rather difficult to imagine that the idea of bringing favorite son Gary Becker back to the University of Chicago from Columbia could have faced any, much less, serious resistance from within the economics department. But as the following letters from Zvi Griliches’ papers in the Harvard archives show, Harry Johnson’s displeasure with this prospect was a force taken most seriously by several of his colleagues, at least in the Spring of 1964. Perhaps more was at play than Johnson’s principle objection to a Becker hire:

“…his accomplishments consist mainly in doing more competently what various members of the department already do, and have been doing for a long time, and not in doing well what the department does not do and ought to be doing if it expects to attract good students and maintain its leadership among the graduate schools of the continent, I think that it would be a grave error of strategy in the development of the department to go after him.”

Johnson offered another interesting claim with regard to 1964 Chicago faculty expectations for a Ph.D. thesis:

“I have noticed among some of the graduate students the notion that the Ph.D. thesis is to be completed with the minimum of intellectual input and a few single-equation regressions. This is contrary to the intention of the Ph.D. regulations (‘the quality and length of a good journal article’)…”

Perhaps the birth of the concept of a job-market-paper?

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THE UNIVERSITY OF CHICAGO
CHICAGO 37 • ILLINOIS
DEPARTMENT OF ECONOMICS

May 20, 1964

To: Al Harberger, Zvi Griliches

From: Al Rees

Re: Gary Becker

The question of an appointment for Gary will be discussed at a Department Meeting on June 4. I enclose a copy of a confidential memo from Harry in which he opposes the appointment. Harry will be in Italy on June 4 and cannot present his views in person. I would very much like to have your reaction before the meeting.

You should also know that appointments are being offered this week to Jimmy Savage and to Hans Theil, both at high salaries and both joint with the School of Business. There seems to be a very high probability that both will be accepted.

I am somewhat concerned about the number of tenure posts the Administration will let us have; in particular, I do not want to do anything that might “freeze out” Larry Sjaastad, for whom I have very high hopes.

Another consideration is the effect on Harry of making a senior appointment that he opposes. He seems to feel somehow outnumbered and is still actively considering a move to London.

Gregg has already put to you the case for Gary; in any case you know his stengths too well to need to be reminded of them.

[signed] Al

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 UNIVERSITY OF CHICAGO

Date May 19, 1964

CONFIDENTIAL

To: A. Rees
From: H.G. Johnson
In re: [Economics] Department Meeting, June 4th

As I will not be at the departmental meeting on June 4th, I am taking the unusual course of putting on paper my views about certain matters due for discussion, on which I would have spoken.

I. A. (1) The thesis prospectus seminar on Choudhri was dissatisfied with the prospectus; it considered making him prepare a new prospectus, but decided instead to make him get agreement from the three members of his Committee on a new draft. Earl Hamilton was in favor of another prospectus seminar, but was overruled. I have had second thoughts, and believe that the matter should be reconsidered, for the following reasons:

(a) next year’s money workshop will be in different hands than this year’s; I am worried that, in the rush to get students past their prospectus seminar, we will land next year’s workshop with a batch of poorly thought out prospectuses that will have to be patched up with great labor.

(b) Choudhri has an excellent record; he should be able to do much better, and we should make him do better–if we let him get by with low-quality work, we are doing his future career a disservice.

(c) I have noticed among some of the graduate students the notion that the Ph.D. thesis is to be completed with the minimum of intellectual input and a few single-equation regressions. This is contrary to the intention of the Ph.D. regulations (“the quality and length of a good journal article’), bad for student morale, and inimical to good teaching. An example in this case would be salutary, and it would do Choudhri himsèlf little harm and probably some good.

I. A. (1) I would like to recommend strongly that we go after R. A. Mundell for the Ford Fellowship for 1965-66. Mundell is one of the most original and elegant moentary theorists going: he has contributed to the theory of economic policy under fixed and floating exchange rates, and started off the analysis of optimum currency areas, and he has made a number of contributions to the price theory of money and of inflation. He is also a first-class international trade and general value theorist, and a man who is always ready for an intelligent argument. Apart from our mathematical economists, we have no-one here with Mundell’s interest in pure monetary and value theory; and we have no-one with his practical experience at the IMF. I should add that I have suggested Mundell partly because I have talked with him, and he would like to spend 1965-66 in this area.

I. B. (2) Just as strongly, I feel that the department should not pursue the proposal to offer a tenure appointment to Gary Becker. I have a high respect for Becker’s theoretical abilities; but as his accomplishments consist mainly in doing more competently what various members of the department already do, and have been doing for a long time, and not in doing well what the department does not do and ought to be doing if it expects to attract good students and maintain its leadership among the graduate schools of the continent, I think that it would be a grave error of strategy in the development of the department to go after him. 

In addition, I would point out that Becker is probably the most distinguished graduate this department had had in recent years, and that going after him would be a repetition of the cannibalization-of-the-young policy that in my judgment has seriously weakened this department in the past decade or so. Unless we get our good graduates established in good departments in other Universities, we are going to have to live with the present image of the Chicago School in the profession at large, and we are not going to have representatives in other good universities steering good students towards us. If we persistently try to bring our own best back, we will defeat ourselves in the long run in two ways: we will not get the students; and we will not get the top-quality men we should get either, because we are bound to miss out on some of our own, and the fact that a new non-Chicagoan will necessarily be one of a minority outgroup will make the place unattractive to such men.

I am also fairly sure that Becker would not come, because he is intelligent enough to know that he should not come and begause he is well entrenched at Columbia, where a number of senior men are due to be replaced and will be replaced by men of his own

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THE UNIVERSITY OF CHICAGO
CHICAGO 37 • ILLINOIS
DEPARTMENT OF ECONOMICS

June 15, 1964

Professor Zvi Griliches

The Maurice Falk Institute for
Economic Research in Israel
17, Keren Hayesod Street
Jerusalem, Israel

Dear Zvi:

I have your letter of June 7.

At the Department Meeting a week ago last Friday, we took no action on Richard Moorsteen other than agreeing to invite him to come to Chicago for a visit next fall. We agreed to invite Bob Mundell to join our faculty for the year 1965-66 on the Ford Foundation Professorship.

The Department took no action on my proposal to offer a major appointment to Gary Becker. It is likely that the question will come up again next fall and you will be here then to state your own point of view.

It is quite clear now that Theil is not going to give us his decision until after his return to the Netherlands. At the moment I am fairly optimistic that when he makes his decision, it will be favorable. Theil has been offered a quite good package, I think, and I judge from conversations with him that he feels he also has a good package.

Furthermore, Judy got the impression that Laura Theil would be favorable to coming here.

You ask in the postscript to your letter whether I got a raise. I presume that what was in your mind was the question: Will I get a raise if the chairmanship is offered to me and I accept it?

I can’t answer your  question for sure since the chairmanship has not been offered to me. Indeed, I have taken steps at this end to try to insure that it won’t be offered to me. If it is offered to me, it is very unlikely I will accept it. Indeed, I can’t imagine that the terms on which it would be offered would be sufficiently attractive to induce me to accept.

Sincerely,

[signed] Gregg

H.G. Lewis

HGL/agm

Source: Harvard University Archives, Papers of Zvi Griliches, Box 129, Folder „Correspondence, 1960-1969“.

Image Sources: Harry Johnson (Archives of two giants of economics donated to the U Chicago Library. U Chicago News, October 25, 2018); Gary Becker (University of Chicago Booth School Nobel Laureate Page for Gary Becker).

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Chicago Economics Programs Faculty Regulations

Chicago. Economics A.M. requirements amended to become “Consolation Prize”. Lewis and Schultz, 1950

 

In 1950 the Chicago economics department voted to convert its master’s degree into an award for the successful partial completion of its Ph.D. program. It was to serve as a “consolation prize” for good graduate students but those found not to have the right “Ph.D. stuff” (H. Gregg Lewis’ words in his memo of Sept. 29, 1950 to chairman T. W. Schultz, transcribed below). I have also included the relevant portion of the distributional and examination requirements for the Ph.D. that had already formed part of the so-called “alternate departmental master’s degree”. H. Gregg Lewis’ proposal was largely accepted by the department (minutes from the meeting of November 2, 1950 transcribed below), thereby eliminating distinct tracks for its A.M. and Ph.D. degree programs, respectively.

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ALTERNATIVE DEPARTMENTAL MASTER’S DEGREE
[1950-51 regulations]

Upon request the Department will consider recommending for the Master’s degree candidates who have satisfied the distribution requirement for the Ph.D. degree and have passed with satisfactory standing the three written field examinations for the Ph.D. degree. One modern foreign language is required. In place of a thesis such candidates may present an acceptable paper or report on a problem approved by the Department.

[…]

Distributional requirement [Ph.D.]. The candidate is expected to have familiarity with the subject matter equivalent to that covered in at least one course (200 or 300 level of reasonable comprehensivenss in each of ten fields (five required and five elected), satisfactory evidence of which can be provided by course credit or by passing a special examination. The required fields are: (a) economic theory, (b) accounting, (c) statistics, (d) economic history, and (e) money, banking, and monetary policy. The fields from which five may be elected are: (f) consumption economics, (g) industrial relations, (h) monopoly and public utilities, (i) agricultural economics, (j) government finance, (k) international economic relations, and (l) substitute fields, but not in excess of two, proposed by the candidate and approved by the Departmental counselor or the Department. One or both of these substitute fields may be outside the Department of Economics, and in general some work outside the Department is recommended with a view to rounding out a program appropriate for the individual student. In case of students transferring from other institutions, adequate training in general history may be substituted for economic history upon the written recommendation of the Departmental counselor.

Preliminary written field examinations [Ph.D.]. In each of three fields of specialization, in addition to presenting course credit or special examinations to show satisfactory preparation, the candidate will be required to pass a written examination.

The candidate is expected to select the three fields of specialization—a primary field and two secondary fields—for intensive graduate work. The primary field is that in which the [Ph.D.] thesis will be written. One of the three fields (primary or secondary) must be that of economic theory, including monetary theory. The fields from which selection is to be made are listed above under the heading “Distributional Requirement,” except that accounting may not be chosen as a field without approval of the Department. One secondary field of specialization may be a field named by the candidate outside the list above, and this may be in a department other than Economics. A secondary field may also be developed under one of the interdepartmental committees of specialization International Relations, Human Development, Planning or Social Thought. The program of work proposed, which ordinarily will include four to five courses, must be approved by the Department. No other secondary field may replace the required field in economic theory.* Students should consult with the Departmental counselor with respect to appropriate programs of work in preparation for the field examinations. The field examinations are given by the Department in the sixth and seventh weeks of the Winter and summer quarters. Application for any field examination should be made not later than the end of the first week of the quarter in which the examination is to be taken.

*Students who take the field examination in money, banking, and monetary policy will not be required to write the monetary theory part of the economic theory examination.

 

Source: University of Chicago, Announcements. The Division of the Social Sciences, Sessions of 1950-1951, Vol. L, Number 9 (July 20, 1950), pp. 25-26.

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ECONOMIC COURSES LISTED IN THE LEWIS MEMO (29 Sept 1950) AND INCLUDED IN THE DEPARTMENTAL MINUTES (2 Nov 1950)

209. Intermediate Economic Theory. (Procter Thomson/Harold Gregg Lewis) Designed for students majoring in economics. Deals with factors controlling production, value and relative prices, and distribution.

211. Introduction to Statistics. (Harold Gregg Lewis) Elementary principles of statistics. Main topics: frequency distributions, averages, dispersion, index numbers, elements of the theory of statistical inference.

220. Economic History of the United States. (Earl J. Hamilton) Facts and factors in American’s economic growth from the Colonial period to World War II, including the development of agriculture, industry, commerce, finance, and transportation; economic effects of wars; role of the entrepreneur; rise in living standards; unrest and utopias in periods of stagnation; commercial crises and economic basis of cultural progress.

222. The Rise of Industrial Civilization in Europe. (John Ulrich Nef) Economic development in its relation to religious, political, intellectual and artistic history since the seventeenth century.

230. Introduction to Money and Banking. (Milton Friedman/Lloyd Wynn Mints) Factors which determine the value of money in the short and in the long run; and operation of the commercial banking system and in relation to the price level and general business activity.

240. Introduction to Industrial Relations. (Albert E. Rees) The nature of the labor market; government regulation of wages; social security; the history, structure, and functions of American labor unions; and collective bargaining. Special attention is given to current problems of public policy.

255. Introduction to Agricultural Economics. (D. Gale Johnson). Nature of resources used in agriculture. Prices, production, resource allocation, and income distribution. Analysis of government programs, subsidies, storages, crop control, soil conservation, food-stamp plan.

260. Introduction to Government Finance. (Richard B. Goode) Survey of institutions and theories of government finance. Effects of public expenditures; functions of public revenue; forms of taxation; tax criteria; determination of tax policy; public borrowing; debt management; fiscal policy.

270. International Economics. (Bert F. Hoselitz) The nature of international payments and receipts; foreign trade and banking system. The gold standard in the interwar period. The breakdown of the gold standard and the period of fluctuating exchange rates. Exchange controls, clearing agreements and payments agreements. The second world war and the foreign exchange markets. The position of the International Monetary Fund and the International Bank for Reconstruction and Development in the present world economy.

271. Economic Aspects of International Politics. (Bert F. Hoselitz) An introductory survey, with particular reference to the United States, of the economic policies and activities of governments. Topics: international specialization of production and the distribution of world resources, structure of international exchanges and the mechanism of international transfer of goods and services; tariffs and other regulatory measures; trade agreements and the most-favored nation clause; international flow of capital and investment; the position of the ITO, the IMF, the ECA and other official agencies in international trade and exchange.

300A, 300B. Price Theory. (W. Allen Wallis 300A/Lloyd A. Metzler 300B/Milton Friedman 300B) A systematic study of the pricing of final products and factors of production under essentially stationary conditions. Covers both perfect competition and such imperfectly competitive conditions as monopolistic competition, oligopoly, and monopoly. 300A deals primarily with the pricing of final products; 300B, with the pricing of factors of production.

Source: University of Chicago, Announcements. The Division of the Social Sciences, Sessions of 1950-1951, Vol. L, Number 9 (July 20, 1950), pp. 27-28.

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THE UNIVERSITY OF CHICAGO

September 29, 1950

To        T. W. Schultz

From   H.G. Lewis

In Re: Requirements for the Master’s Degree

This is an elaboration of comments made to you this summer concerning the Master’s degree.

I should like to recommend the following changes in our requirements for the A.M. degree:

  1. That the distinction between the “regular” A.M. and the “alternative” A.M. be abolished.
  2. That the departmental requirements for the A.M degree consist of the following alteration of the present alternative A.M. requirements:
    1. A distribution requirement covering five (rather than the present eight) fields of economics of which theory, statistics, and money and banking shall be mandatory. Students who do not hold the traditional A.B. degree must meet the requirement by passing satisfactorily a qualifying examination coving the subject matter of Economics 209, 211 (unless the student has passed the Divisional qualifying examination), 230, and two courses chose from 220, 222, 240, 255, 260, 270, 271.1/ Students holding the traditional A.B. may meet the requirement by showing equivalent course credit.
    2. The passing of two Ph.D. field examinations (with Part I of the Theory exam counting as a full exam) at a satisfactory level (that is, at either the Ph.D. level or at a level somewhat lower but not so low as not to warrant blessing the candidate with a Master’s degree).2/
    3. A showing of competence in economic principles; made either by passing (at the A.M. level or higher) Part I of the Theory examination, by course credits or course examinations in Economics 300A and 300B, or by equivalent course credit.

I would recommend that the changes in requirements become effective as of the beginning of the Summer Quarter, 1951 for students entering the Department in that and later quarters.

1/ This qualifying examination is now offered every quarter. This is an extravagant use of faculty. I should like to see the exam offered only once a year. Furthermore, I should like to permit students to substitute course grades for all or part of the exam provided the course grades are for courses taken here and provided they are not at a level lower than B.

2/ There would be therefore no special examinations for A.M.’s, but the examinations would be graded into three levels: passing for the Ph.D. and A.M. degrees, passing for the A.M. degree but not for the Ph.D., failing for both.

I would urge students to give requirement (b) high priority in preparing their programs of study.

Since the ends sought by these changes can be reached in other ways, I specify below what these ends are.

I view our principal instructional purpose as that of training high-level (Ph.D. and beyond) professional economists. I think we ought to view our training of “junior” economists and the awarding of the A.M. degree only as an incident arising from the fact that at the time a student applies for admission to the department, we cannot predict accurately either his calibre as a student or his academic goals.

It seems to me that the requirements for the Master’s degree should meet these tests:

  1. They should include no requirements which the Department would not make for the Ph.D. degree. Otherwise both student and faculty time will be spent in activities extraneous to the training of high-level economists. The present alternative A.M. meets this test but the regular A.M. does not.
  2. The requirements should be at a level high enough to be respected by the academic world. Both present degrees meet this test, I believe.
  3. But the standards for the degree should not be so high that potentially able Ph.D. candidates will be deterred from entering because of the considerable risk that if they fail to meet Ph.D. standards they will also fail to meet A.M. standards. If we set standards for the A.M. that are almost as likely not to be met as the Ph.D. standards we hold out no “consolation prize” to those good students who are fearful of not being able to meet Ph.D. standards. The present alternative A.M. requirements do not meet this test.

One of the ways by which we can raise the calibre of our Ph.D. candidates without reducing our enrollment is to increase the number of students who are given an opportunity to show at close hand their potentialities to us and to screen out at an earlier date those who are not of Ph.D. stuff. I am confident that quite accurate screening can take place ordinarily by the end of the first year of graduate residence. I contemplate our using the A.M. requirements as a screening device; the present alternative A.M. is not satisfactory from that point of view since it postpones too long the screening decision.

Source: University of Chicago Archives. Department of Economics Records. Box 41, Folder “41.8”.

_______________________

MINUTES
Meeting of the Department

Time and Place: Thursday, November 2, 1950, at 1:00 p.m. in Room 424, Social Science Research Building.

Present: T. W. Schultz (chairman), H. G. Lewis, A. Rees, R. Goode, G. Tolley, D. G. Johnson, F. H. Harbison, J. Marschak, C. Hildreth, F. Knight, L. Metzler.

  1. Handling of Student Business
    It was agreed that all bona fide applications for admission to candidacy filed this quarter would be considered as falling under present degree requirements even though Departmental action does not take place until Winter quarter.
  2. Ford Foundation
    Schultz stated that as a Department we have an obligation to ourselves, to the University, and to the community more largely to think through carefully the problem of making the best use of the Ford Foundation’s present grant of $300,000 to the University as well as possible later grants. There was a brief general discussion of the problem.
  3. Departmental Rules Governing Residence and Availability to Students
    Schultz pointed out that in the current year we have been able for the first time to reduce direct teaching loads for most of our members to four courses per year or less. This reduction, he pointed out, makes it desirable that the Department impose upon itself rules governing residence and availability to students and others in the university community lest they be imposed upon us from outside. The problem of rules for residence involves not only a rule stipulating in some way minimum residence, but also the question of whether “free” quarters out of residence should be considered a matter of a right accruing to an individual from his residence or a privilege dependent upon ad hoc decisions made by the Department chairman and the Dean. Schultz expressed himself as being in favor of a rule somewhat similar to the rules for accumulating sabbatical leave under a 3Q contract. In addition there is the problem of insuring, perhaps by rule, “availability” when in residence. The formulation of appropriate rules is to come before the Department for its consideration in the Winter quarter.
  4. The Department considered Lewis’ recommendations for changes in the A.M. requirements. (See attached memo. [above]) the following amendment of Lewis’ recommendation was passed:
    1. That the distinction between the regular A.M. and the “alternative” A.M. degrees be abolished.
    2. That the Departmental requirements for the A.M. degree consist of the following:
      1. A distribution requirement to be met by passing a “Qualifying” examination covering the subject matter of Economics 209, 211 (unless the student has passed the Divisional qualifying examination) 220 or 222, 230 and two courses chosen from 240, 255, 260, 270, and 271. Students holding the traditional A.B. may satisfy the requirement by equivalent course credit.
      2. The passing of two Ph.D. field examinations (with Part I of the Theory examination counting as an examination) at a satisfactory level of A.M. candidates.
      3. A showing of competence in economic principles; made either by (at the A.M. level or higher) Part I of the Theory examination, by course credits or examinations in Economics 300A and 300B, or by equivalent course credit.
      4. An acceptable paper or report on a problem approved by the Department. The paper will be read by two members of the Department of which the course instructor will be one in the event the student submits a term paper prepared for a course.

The above changes in requirements are to become effective as of the beginning of the Summer quarter, 1951 for students entering the Department in that and later quarters.

It was understood that the above motion in no way changes present preliminary examinations or other requirements for the Ph.D. degree. Professor Knight asked the minutes to show his objection to dropping Economics 210 (Accounting) from the requirements for the A.M. degree.

  1. Student Business
    1. Petitions

Lawrence Bostow’s petition for approval of French and Russian as languages for the Ph.D. was approved.

Mr. H. M. Herlihy’s petition for the field of “Social Organization” (Sociology Department) as his third field for the Ph.D. degree was approved.

Mr. John Holsen’s petition for a third Ph.D. field in Planning (Planning Department) was approved. Mr. Johnson, his counselor, was asked to inform Mr. Holsen, however, that this approval does not entitle Holsen to shorten his total program in Economics for the Ph.D.

Mr. Edward Mishan’s petition for approval of Spanish as a Ph.D. language was denied.

    1. Admission to Candidacy

Mr. Howard Ammerman’s application for admission and for approval of a thesis topic was moved to the bottom of the list of applications.

Mr. Rondo E. Cameron’s application for admission to candidacy for the Ph.D. degree was recommended to the Division for approval, contingent upon his passing the Theory examination (written Summer, 1950) and his proposed thesis topic, “French Foreign Investment, 1815-1870,” was approved. Thesis committee: E. J. Hamilton, chairman, L. Metzler, P. Thomson.

After some discussion, Mr. Clifford Clark’s application was moved down the list. Lewis was instructed to advise Clark to consult with Hamilton concerning the latter’s misgivings about the proposed thesis topic, and in addition to confer with Hayek, Knight, and other members of the Department concerning the thesis topic.

Mr. George P. Coutsoumaris’ application for admission to candidacy for the Ph.D. degree was recommended to the Division for approval, contingent on his passing the Theory examination (written Summer, 1950), and his proposed thesis topic, “Possibilities of Increasing Economic Efficiency in Greek Agriculture,” was given qualified approval, the Department suggesting that he limit the topic somewhat preferably to a topic approximately the same as that covered in the sections (VII and VIII) of his outline dealing with capital in Greek agriculture. Thesis committee: D. G. Johnson, chairman, C. Harris, J. Margolis (planning).

Mr. David Fand’s proposed thesis topic, “Monetary Theory of the Federal Reserve Board,” was discussed. It was agreed to come back to it at the next meeting after several more of the members of the Department had an opportunity to discuss the topic with Fand.

The meeting was adjourned at 3:05 p.m.

Source: University of Chicago Archives. Department of Economics Records. Box 41, Folder “41.8”.

Images:  University of Chicago Photographic Archive, H. Gregg Lewis [apf1-03861] and T. W. Schultz [apf1-07479], Hanna Holborn Gray Special Collections Research Center, University of Chicago Library.

Categories
Chicago Economics Programs Economists Fields

Chicago. Schedule of the preliminary economics exams for the Ph.D. and A.M., Summer 1951

 

The following schedule for preliminary examinations in economics at the University of Chicago from the summer quarter of 1951 comes from Milton Friedman’s papers at the Hoover Institution Archives. We see that he was on the two economic theory examination committees along with Lloyd Metzler and Frank Knight. Besides providing the names of the faculty members serving on the nine committees, the schedule also provides the names of the sixty students registered for the examinations during that quarter.

____________________

DEPARTMENT OF ECONOMICS

SCHEDULE FOR PRELIMINARY EXAMINATIONS
FOR THE PH.D. AND FOR THE A.M.

Summer Quarter, 1951

The schedule below shows the examinations requested for the current quarter. Will the chairman of each committee please be responsible for turning in the complete examination at least one week before the date on which it is to be given?

 

Date

 Examination Committee

Students Registered

Thurs., Aug. 2
8:30
Law Court

Agricultural Economics

 D.G. Johnson, chr.
C. Hildreth
T.W. Schultz		 Dunsing, Marilyn (A.M.)
Fox, Kirk (Ph.D)
Hughes, Rufus (Ph.D.)
Taylor, Maurice (Ph.D.)

Tues., July 31
8:30
Law Court

Economic Theory I

 L. Metzler, chr.
M. Friedman
F. Knight		 Baskind, Irwin (Ph.D.) in abs.
Bassett, Marjorie (Ph.D.-A.M.)
Blumberg, Lionel (Ph.D.-A.M.)
Chen, Ho-Mei (Ph.D.)
Chen, Sze-te (Ph.D.-A.M.)
Chien, Chih Chien (Ph.D.)
Cleaver, George (Ph.D.)
Dunsing, Marilyn (A.M.)
Emmer, Robert (Ph.D.)
Fox, Kirk (Ph.D.)
Frank, Andrew (Ph.D.-A.M.) in abs
Gustus, Warren (Ph.D.)
Heizer, Raymond (Ph.D.)
Herlihy, Murray (Ph.D.)
Hoch, Irving (Ph.D.)
Hughes, Rufus (Ph.D.)
Krawczyk, Richard (Ph.D.-A.M.) in abs
Lerner, Eugene (Ph.D.)
Liang, Wei K. Liang (Ph.D.)
Lininger, Charles (Ph.D.)
Lurie, Melvin (Ph.D.)
McGuire, Charles (Ph.D.)
Malhotra, Man Mohan (Ph.D.)
Malone, John (Ph.D.)
Mitcham, Clinton (Ph.D.-A.M.)
Morrison, George (Ph.D.-A.M.)
Sonley, Lorne (Ph.D.)
Taylor, Maurice (Ph.D.)
Terrell, James (Ph.D.-A.M.)
Toscano, Peter (Ph.D.)
Traeger, Gordon (Ph.D.-A.M.)
Viscasillas, Felipe (Ph.D.)
Waldorf, William (Ph.D.)
Weir, Thomas (Ph.D.)
Weiss, Roger (Ph.D.-A.M.)
Zelder, Raymond (Ph.D.)

Tues., Aug. 7
8:30
Law Court

Economic Theory II

 L. Metzler, chr.
M. Friedman
F. Knight		 Chen, Ho-Mei (Ph.D.)
Herlihy, Murray (Ph.D.)
Hoch, Irving (Ph.D.)
Toscano, Peter (Ph.D.)
Weir, Thomas (Ph.D.)

Thurs., Aug. 9
8:30
Law Court

Government Finance

 P. Thomson, chr.
J. Marschak
D.G. Johnson		 Frank, Andrew (Ph.D.-A.M.) in abs
Haskell, Max (Ph.D.) in abs
Henry, Edward L. (Ph.D.)
Horwitz, Bertrand (Ph.D.-A.M.)
Lininger, Charles (Ph.D.)
Selden, Richard (Ph.D.)

Thurs., Aug. 9
8:30
Law Court

Industrial Relations

 F. Harbison, chr.
E. Hamilton
H.G. Lewis		 Barghout, Saad (Ph.D.)
Bechtolt, Richard (Ph.D.)
Hoch, Irving (Ph.D.)
Liang, Wei K. (Ph.D.)
Mullady, Philomena (Ph.D.)
Ness, David (Ph.D.)

Thurs., Aug. 2
8:30
Law Court

International Economics

 L. Metzler, chr.
B. Hoselitz
A. Rees		 Alberts, William (Ph.D.)
Anderson, Edwin (Ph.D.) in abs
Chen, Sze-te (Ph.D.-A.M.)
Chien, Chih Chien (Ph.D.)
Cleaver, George (Ph.D.)
Frank, Andrew (Ph.D.-A.M.)
Glick, Milton (Ph.D.-A.M.)
Gustus, Warren (Ph.D.)
Lukomski, Jesse (Ph.D.-A.M.)
Mitcham, Clinton (Ph.D.-A.M.)
Morey, Donald J. (Ph.D.-A.M.)

Tues., Aug. 7
8:30
Law Court

Money, Banking, and Monetary Policy

 L. Mints, chr.
E. Hamilton
J. Marschak		 Alberts, William (Ph.D.)
Bauer, Milton (Ph.D.)
Blumberg, Lionel (Ph.D.-A.M.)
Chen, Sze-te (Ph.D.-A.M.)
Chien, Chih Chien (Ph.D.)
Cleaver, George (Ph.D.)
Conomikes, George (Ph.D.-A.M.)
Davis, George (Ph.D.) in abs
Emmer, Robert (Ph.D.)
Heizer, Raymond (Ph.D.)
Horwitz, Bertrand (Ph.D.-A.M.)
Hughes, Rufus (Ph.D.)
Krawczyk, Richard (Ph.D.-A.M.) in abs
Lerner, Eugene (Ph.D.)
Liang, Wei K. (Ph.D.)
Lukomski, Jesse (Ph.D.-A.M.)
Meckling, William (Ph.D.)
Mitcham, Clinton (Ph.D.-A.M.)
Morey, Donald (Ph.D.-A.M.)
Ogawa, George (Ph.D.)
Smulekoff, Suzanne (Ph.D.-A.M.)
Sonley, Lorne (Ph.D.)
Taylor, Maurice (Ph.D.)
Terrell, James (Ph.D.-A.M.)
Traeger, Gordon (Ph.D.-A.M.)
Zelder, Raymond (Ph.D.)
Zingarelli, Carla (Ph.D.-A.M.)
Rayack, Elton  (Ph.D.) in abs

Thurs., Aug. 2
8:30
Law Court

Statistics

 T. Koopmans, chr.
C. Hildreth
H.G. Lewis		 Cagan, Phillip (Ph.D.)
Hogan, Lloyd (Ph.D.)
Katzman, Irwin (Ph.D.)
Malhotra, Man Hohan (Ph.D.)
Waldorf, William (Ph.D.)

Thurs., Aug. 2
8:30
Law Court

Economic History

 E. Hamilton Mullady, Philomena (Ph.D.)
Toscano, Peter (Ph.D.)

Source: Hoover Institution Archives. Papers of Milton Friedman. Box 76, Folder “University of Chicago ‘Economic Theory’”.

Categories
Chicago Funny Business

Chicago. A Mikado parody number. Probably 1949.

 

Among the papers of Alfred Rees at the Economists’ Papers Archive at Duke and of Milton Friedman at the Hoover Institution Archives, one finds stapled copies of a skit written by graduate students at the University of Chicago with the title “Alice in Stationary State”. The cover page includes a list of 18 contributors to the skit either as librettist and/or as a performing member of the cast/chorus. Carl Christ who was to leave Chicago and join the faculty of the Department of Political Economy at Johns Hopkins University in 1950 was named as a member of the cast/chorus. The mimeographed manuscript bears no date, but in Christ’s paper “The Cowles Commission’s Contributions to Econometrics at the University of Chicago, 1939-1955 (Journal of Economic Literature, Vol. XXXII, March 1994, pp. 30-59) two songs from the manuscript are quoted by Christ, one to the tune of “The American Patrol“. Since he dates the skit to about 1949 and we know his whereabouts for 1950, I think it is safe to trust his memory as to the 1949 date he mentions. Note the slight discrepancies with presumably a later, recycled version of the lyrics.

Other parodies of Gilbert and Sullivan that have been transcribed for Economics in the Rear-View Mirror include:  “When I was a Lad“, “The Major General’s Song” and “I’m Called Little Buttercup” . Non-Gilbert-Sullivan material  transcribed from the skit are the Song for an Entrepreneur (to the tune of “Jingle Bells”) and “First Epistle unto the entering students” .

Here is a link to a YouTube clip from the Mikado for those of us whose familiarity with Gilbert and Sullivan lyrics is not quite up to mid-20th century Chicago levels.

_____________________

DECONTROL SONG
(to the tune of “My Object all Sublime from Patience (sic*))

*Actually from Gilbert and Sullivan’s Mikado.

A more humane economist never
Did in Chicago exist;
To nobody second,
He’s certainly reckoned,
A true philanthropist.
‘Tis his most human endeavor
To make to some extent
Each individual
Tenant pay the
Equilibrium rent.		 A more humane Mikado never
Did in Japan exist,
To nobody second,
I’m certainly reckoned
A true philanthropist.
It is my very humane endeavor
To make, to some extent,
Each evil liver
A running river
Of harmless merriment.
CHORUS:

His object all sublime
He might achieve in time,
Convict the planners of their crime,
The planners of their crime.
Make those of Leftist bent
Unwillingly represent
A source of innocent merriment, of innocent merriment.

 CHORUS:

My object all sublime
I shall achieve in time —
To let the punishment fit the crime —
The punishment fit the crime;
And make each prisoner pent
Unwillingly represent
A source of innocent merriment!
Of innocent merriment!
The addle-pated
Who aggregate the unrelated data
And find instead of
The alpha they seek
A beta even greater.
The Keynesians and all their ilk
Who seek to find
Nirvana…He’ll fix them all,
He’ll fix them all,
He’ll ship them to Urbana!		 All prosy dull society sinners,
Who chatter and bleat and bore,
Are sent to hear sermons
From mystical Germans
Who preach from ten till four.
The amateur tenor, whose vocal villainies
All desire to shirk,
Shall, during off-hours,
Exhibit his powers
To Madame Tussaud’s waxwork.
CHORUS:

His object all sublime
He might achieve in time,
Convict the planners of their crime,
The planners of their crime.
Make those of Leftist bent
Unwillingly represent
A source of innocent merriment, of innocent merriment.

 CHORUS:

My object all sublime
I shall achieve in time —
To let the punishment fit the crime —
The punishment fit the crime;
And make each prisoner pent
Unwillingly represent
A source of innocent merriment!
Of innocent merriment!

Source: Duke University. David M. Rubenstein Rare Book & Manuscript Library, Economists’ Papers Archive. Albert Rees Papers, Box 1, Folder “Personal”. Identical copy also found at The Hoover Institution Archives, Milton Friedman Papers, Box 79, Folder 6 “University of Chicago Miscellaneous.”

_____________________

Second, revised version

MEMBER OF THE FACULTY:
(to the tune of “My object all sublime” from the MIKADO)

A more humane economist never
In Chicago did exist;
To nobody second,
I’m certainly reckoned,
A true philanthropist.
It is my most human endeavor
To make to some extent
Each individual
Tenant pay the
Equilibrium rent.		 A more humane Mikado never
Did in Japan exist,
To nobody second,
I’m certainly reckoned
A true philanthropist.
It is my very humane endeavor
To make, to some extent,
Each evil liver
A running river
Of harmless merriment.
My object all sublime
I might achieve in time,
Convince the planners of their crime,
The planners of their crime.
Make those of Leftist bent
Unwillingly represent
A source of innocent merriment
Of innocent merriment.		 My object all sublime
I shall achieve in time —
To let the punishment fit the crime —
The punishment fit the crime;
And make each prisoner pent
Unwillingly represent
A source of innocent merriment!
Of innocent merriment!
The addle-pated
Who aggregated unrelated data
And found instead of
The alpha they sought
A beta even greata.
The Keynesians and all their ilk
Who seek to find
Nirvana…I’ll fix them all,
I’ll fix them all,
I’ll ship them to Urbana!		 All prosy dull society sinners,
Who chatter and bleat and bore,
Are sent to hear sermons
From mystical Germans
Who preach from ten till four.
The amateur tenor, whose vocal villainies
All desire to shirk,
Shall, during off-hours,
Exhibit his powers
To Madame Tussaud’s waxwork.

Source: The Hoover Institution Archives. Milton Friedman Papers, Box 79, Folder 6 “University of Chicago Miscellaneous.”

Categories
Amherst Chicago Economists Harvard M.I.T. Placement

Chicago. Zvi Griliches asking Frank Fisher for junior appointment leads, 1961

 

In a 1961 memo Zvi Griliches reported to his Chicago colleagues some scouting results regarding a possible junior appointment in economics. He spoke econometrician-to-econometrician with his colleague Frank Fisher at M.I.T. about the most interesting graduate students in the Cambridge area on the job market that year. Four names were mentioned, two unsurprising enough were the names of economists “unable” to be drawn from the gravitational pull of Cambridge. 

Griliches ended his memo with the remark “This year Domar happens to be MIT’s ‘placement officer’ and this is likely to put us at some competitive disadvantage.” Does this mean that Griliches thought the monopsonist Evsey Domar would deliberately discriminate against the University of Chicago?

_______________

Four graduate students discussed by Zvi Griliches and Frank Fisher

Beals, Ralph E. Dept. of Econs. Amherst College, Amherst, MA 01002. Birth Yr: 1936.  Degrees: B.S., U. of Kentucky, 1958; M.A., Northwestern U., 1959; Ph.D., Mass. Institute of Technol., 1970. Prin. Cur. Position: Clarence Francis Prof. of Econs., Amherst Coll., 1966.  Concurrent/Past Positions: Assoc., Harvard Institute for Int’l. Develop., 1973.  Research: Int’l. trade, commercial policy & industrialization in Indonesia.

[According to the Prabook website: Ralph E. Beals was Assistant professor economics, Amherst (Massachusetts) College, 1962-1963; associate professor, Amherst (Massachusetts) College, 1966-1971. ]

Hohenberg, Paul M. RPI, Dept of Econ, Troy, NY 12180. Birth Yr: 1933.  Degrees: B.Ch.E., Cornell U., 1956; M.A., Tufts U., 1959; Ph.D., Mass. Institute of Technol., 1963. Prin. Cur. Position: Prof. of Econs., Rensselaer Poly. Institute, 1977.  Concurrent/Past Positions: Vis. Assoc. Prof., Sir George Williams U., Montreal, 1972-74; Assoc. Prof., Cornell U., 1968-73.  Research: Urbanization & econ. change in Europe and U.S.

Marglin, Stephen A.  Birth Yr: 1938.  Degrees: A.B., Harvard U., 1959; Ph.D., Harvard U., 1965. Prin. Cur. Position: Prof. of Econs., Harvard U.

Temin, Peter. Mass Inst of Tech, Dept of Econ, Cambridge, MA 02139. Birth Yr: 1937.  Degrees: B.A., Swarthmore Coll., 1959; Ph.D., Mass. Institute of Technol., 1964. Prin. Cur. Position: Prof. of Econs., Mass. Institute of Technol., 1970.  Concurrent/Past Positions: Assoc. Prof., Mass. Institute of Technol., 1967-70; Asst. Prof., Mass. Institute of Technol., 1965-67. Research: Econ. history; telecommunications policy.

 

Source:  Biographical Listing of Members. The American Economic Review, Vol. 83, No. 6 (Dec., 1993).

_______________

Memo on possible appointments written by Zvi Griliches

November 8, 1961

[To:] A. Rees
[From:] Z. Griliches
[Re:] The possible appointments.

I had a long telephone conversation with Frank Fisher last week about “whom we should look at.” It is his opinion that the single best young man coming up now in the Cambridge area is:

Stephen A. Marglin—He is a mathematical theorist, with several papers to his credit. He has spent a year at Cambridge, England and is currently in his second year of a three year Junior Fellowship at Harvard. I had already invited him to give a talk to the workshop and he will be here on January 16 to talk on “The Social Rate of Discount and the Opportunity Costs of Public Investment.” Frank thinks that we would have a very hard time getting him, in particular for next year, but that he is clearly the best.

The best current MIT student that will be coming to the market is, in Fisher’s opinion:

Ralph Beals—who is a third year graduate student specializing in the fields of monetary policy and econometrics. He has been working with Solow and Albert Ando and his interests in the monetary area have appartently been stimulated by Solow’s and Ando’s involvement in the Monetary Commission stuff.

In addition, Fisher mentioned that there are also two ver good “economic historian types” finishing there this year:

Peter Pemin[sic, “Temin”]—who is working with Gerschenkron at Harvard, and
Paul Hohenberg—who is working withKindelberger on the sources of the econonmic development of France in the 19thcentury.

This year Domar happens to be MIT’s “placement officer” and this is likely to put us at some competitive disadvantage.

cc:       H. Johnson, M. Friedman, T. Schultz✓, G. Stigler, W. Wallis.

Source:  University of Chicago Archives. Department of Economics Records, Box 42, Folder 3.

Image Source:  Zvi Griliches from the University of Chicago Photographic Archive, apf1-06565, Special Collections Research Center, University of Chicago Library.

 

Categories
Chicago Economics Programs Fields

Chicago. Memo to Dean from Chair of Economics. Strengths & Weaknesses, 1955

 

What I found particularly striking in the following memo, written by the chairman of the Chicago department of economics in 1955, is the number of fields in which the department saw itself weak or at least in need of support: labor, international, mathematical economics and econometrics, development, and industrial organization. Perhaps this was just a matter of administrative strategy, beg for assistance for five fields and hope to actually get assistance for three. That said, Schultz does not appear to be engaging in three-dimensional chess here. Will be interested in hearing what other people think about the this memo.

_______________________

Carbon Copy of Strengths and Weaknesses Memo
T.W. Schultz to Dean Chancy D. Harris

September 22, 1955

[To:] Dean Chancy D. Harris
[From:] Theodore W. Schultz
[Re:] Department of Economics

 

It may be helpful to have me briefly state the major elements of strength and, also, of weaknesses which I see in economics, in the hope that these notes may serve you as you prepare your presentation for the trustees.

Elements of Strength

  1. A comparatively young faculty strongly committed to research and graduate instruction.
  2. Research and related seminars are effectively organized as small scale enterprises:
    1. Workshop on Money
    2. Workshop on Public Finance
    3. Resources Research Enterprise
    4. Technical Assistance Studies
    5. Studies of Russia Agriculture
    6. Inventory Studies
  3. Satisfactory foundation support for some of the workshops and research enterprises now underway:
    1. Rockefeller Foundation supporting the money and public finance workshops.
    2. Resources for the Future supporting the resources research.
    3. Ford Foundation supporting the technical assistance studies.
    4. Also, for individual research, the Rockefeller Foundation support of economic history of Professor Hamilton.
  4. U. S. Government contracts and grants are proving satisfactory in financing some research:
    1. The inventory studies
    2. Russian agriculture work
  5. Financial support for competent advanced graduate students doing research is available from the several small scale research enterprises and, also, from SSRC (Griliches this year); from Earhart funds (Nerlove); and from corporations (Oi)
  6. Our new Ph.D. theses procedure is proving most effective in bringing student and faculty resources to bear on productive research.
  7. The new Economic Research Center of the Department is now proving important and necessary overhead facilities and services required by faculty and students working in the several small scale research enterprises.
  8. The new arrangements with the University Press to publish our Studies in Economics represents a major advance.
  9. The Journal of Political Economy continues strong as Prof. Rees and Miss Bassett take over.
  10. While we are not satisfied with the “quality” of many of our graduate students, we appear to be holding our own in a period when many averse factors are at work in lowering the quality of students in most branches, and also in economics generally as it appears.

 

Elements of Weakness

  1. Too many of the faculty are now in junior roles and there are too few major staff members on indefinite tenure in view of the fields of specialization in economics, the range and number of advanced graduate students, and the research work that is underway.
  2. With Professor Harbisons’s leaving and the non-functioning of the Industrial Relations Center in economics, our work in labor economics needs to be reorganized and strengthened. This replanning is now underway. Research resources are required: about $20,000 a year would be optimum.
  3. We are not prepared to serve adequately most of the many (representing about 30% of our graduate students) foreign students working in economics:
    1. Many of them should be in a modified Master’s program.
    2. Relevant research should concentrate on “developmental” problems.
    3. More effort is required to guide their work.
  4. The Department is now weak in International Economics because of the illness of Professor Metzler.
  5. The work in consumption economics has not been made as effective as it should be in bringing major graduate students into play in research.
  6. The reorganization and staffing of work in Mathematical Economics and Econometrics, with the Cowles Commission leaving, is unfinished business:
    1. Professor Hans [a.k.a., “Henri”] Theil is here this year as visiting Professor.
    2. Plans beyond this year await action.
    3. No research support at present for advanced students or for complementary staff in this important area.
  7. The broad area of Economic Development requires major attention and it should be placed high on our agenda as we develop plans and staff during the next few years:
    1. This area is needed to serve especially graduate students from foreign countries.
    2. The economic problems are important to the U.S. scene also.
    3. The Research Center for Economic Development and Cultural Change and importantly the “Journal” it has established need to be drawn into this new effort.
    4. Major new research resources are required.
  8. The long neglected field of Industrial Organization.

 

Some Concrete Steps

  1. To establish the work in Mathematical Economics about $20,000 a year will be required for a “professor” to head this work, for complementary staff, and related research.
  2. To establish the new enterprise now contemplated in Economic Development about $50,000 a year appears essential.
    In this area, a professorship, a visiting professor for each of the next several years, complementary staff, student research in a workshop and support for the Journal “Economic Development and Cultural Change.”
  3. Also in Labor Economics we need to move to a professorship and research support of about $20,000 a year.
  4. How to strengthen the work in International Economics must await developments affecting Professor Metzler’s recovery.
  5. There remains then the long neglected area usually referred to as Industrial Organization. Since no major individual has emerged here or elsewhere, we are compelled to “invest” in a younger person in breaking into this area.

 

Source:   University of Chicago Archives. Department of Economics Records. Box 42, Folder 8.

Image Source:  T. W. Schultz, University of Chicago Photographic Archive, apf1-07484, Special Collections Research Center, University of Chicago Library.

Categories
Chicago Exam Questions Suggested Reading

Chicago. Price Theory Exams. Albert Rees (Chicago PhD Alum 1950), 1962

 

 

Albert Rees (1921-1992) received his B.A. from Oberlin College (1943), M.A. (1947) and Ph.D. (1950) from the University of Chicago. He worked himself up the ranks at the University of Chicago (Assistant Professor, 1948-54; Associate Professor, 1954-61; Professor, 1961-66), serving as chair from 1962-1966. He moved on to chairing the economics at Princeton where he was professor (1966-79). He also served as a staff economist at the President’s Council of Economic Advisers and headed President Gerald Ford’s Council on Wage and Price Stability, 1974-75.  Besides once serving as Provost of Princeton University, Albert Rees also served as the President of the Sloan Foundation.

See The Elgar Companion to the Chicago School of Economics, Ross B. Emmett (ed.), Chapter 12 “Albert Rees” by Orley Ashenfelter and John Pencavel. [Downloadable as working paper.]

___________________________

PRICE THEORY
Economics 300
Autumn, 1962
Mr. Rees

Chapter assignments will be given in class.

American Economic Association, Readings in Price Theory. Irwin, 1952.

Friedman, Milton, Essays in Positive Economics. University of Chicago Press, 1953.

Leftwich, Richard H., The Price System and Resource Allocation, revised edition. Holt, Rinehart and Winston, 1961.

Marshall, Alfred, Principles of Economics, 8th edition, Macmillan, 1922.

Stigler, George, The Theory of Price, revised edition. Macmillan, 1952.

___________________________

Economics 300
Midterm Examination

November 7, 1962
A. Rees

  1. (50 points) Answer the following True, False, or Uncertain and explain your answer briefly. Your score depends on your explanation.
    1. In a free market economy, all consumers participate equally in determining what will be produced.
    2. A free market economy gives ample incentives to conserve natural resources provided that it is clear who owns each unit of the resources.
    3. The cross-elasticity of demand between substitutes is positive.
    4. If two linear demand curves each intersect the price axis, (q =0) the one that has the higher intercept is more elastic at this quantity.
    5. An increase in the price of beef will increase the demand for pork and decrease the demand for beef.
    6. If the market for eggs is in equilibrium an increase in supply will cause only a small change in price.
    7. The elasticity of demand for oranges is greater in absolute value than the elasticity of demand for fruit.
  2. (25 points)
    1. Show by means of an indifference map (axes: oranges and grapefruit) the effect on the consumption of oranges of an increase in their price, the price of grapefruit remaining unchanged. Distinguish the income and the substitution effects. State whether you have used the Hicks or the Slutsky method.
    2. How would your map have differed if the axes had been bread and meat? If they had been bread and butter?
  3. (25 points) Increased costs cause manufacturers to reduce the size of 5 cent chocolate bars from 2-1/2 ounces to 2 ounces. Because the bars are smaller, people eat more of them and consumption rises from 10,000 bars a week to 11,000.
    1. Can these events be shown on an ordinary supply and demand diagram? If so, show them. If not, explain why.
    2. Can the elasticity of demand for chocolate be computed? If so, compute it. If not, explain.

___________________________

FINAL EXAMINATION

Economics 300
December 12, 1962
A. Rees

  1. (50 points) Answer each of the following “true,” “false,” or “uncertain” and explain your answer briefly. Your score will depend heavily on your explanation.
    1. If two linear demand curves have the same slope at the same price, then at that price the one for which quantity is largest is least elastic.
    2. An important difference between an indifference map and an isoquant map is that indifference curves never cross.
    3. An important difference between the utility functions depicted by usual indifference maps and production functions is that distances in utility space can be ordered but not measured.
    4. The following conditions are necessary and sufficient for the short-run maximization of monopoly profits: (a) Marginal revenue is equal to marginal cost; (b) price is greater than average variable cost.
    5. An increase in fixed cost caused by an increase in the rate of interest on long run term debt will increase long-run marginal cost but not short-run marginal cost.
    6. An effective legal minimum wage above the prevailing wage will increase the employment of a firm that is a monopsonist in the labor market.
    7. The costs of owner-operated businesses are generally understated because the owners do not pay themselves wages. If they did, the accounting costs would be equal to the economic costs.
    8. The way to produce a given output in the long run at lowest cost is to construct the plant whose short-run average costs are at a minimum at that output.
    9. If a monopolist maximizes profit in the short-run and operates where total revenue is at a maximum, he has no variable costs.
    10. A production function shows constant returns to scale if an increase of 10 per cent in the input of one factor will increase output by 10 per cent.
  2. (20 points) The New York, Ridgewood, and Exurban Railroad operates a commuter passenger service. Two kinds of reduced fares are offered: (1) children under 12 years of age ride at half-fare at all times. (b) on Wednesdays there are special half-fare tickets for adults good on trains leaving after 10:00 a.m. and returning before 4:30 p.m. The railroad has been accused by the New Jersey Commerce Commission of being a discriminating monopolist. Can you defend it against this charge with respect to either or both of its half-fare arrangements? If it is in fact a discriminating monopolist with respect to either arrangement, is it promoting an inefficient use of resources by its pricing practices?
  3. (15 points) (a) Draw the short-run cost curves, demand curve, and marginal revenue curve of a monopolist who is suffering a short-run loss and is minimizing this loss. Indicate the amount of the loss on your diagram. (b) Show the same situation by means of short-run total cost and total revenue curves.
  4. (15 points) A farmer has two plots of land on which he grows corn, plot A and plot B. The following table shows the amount of corn he can produce on each plot with varying applications of fertilizer of a given quality.

Fertilizer Used

 Plot A Plot B
(pounds)

(output in bushels)

0

 10

8

1

 14 13
2 16

17

3

 17 20
4 18

21

5

 17

20

If the price of fertilizer is $1.50 per pound and the price of corn is $1.00 per bushel, how much fertilizer will he use on each plot? (The figures are not intended to be realistic.) Under what circumstances would he use four pounds on each plot?

 

Source: Duke University. David M. Rubenstein Rare Book & Manuscript Library. Economists’ Papers Archive. Albert Rees Papers, Box 1, Folder “Economics 300”.

Image Source: Duke University. David M. Rubenstein Rare Book & Manuscript Library. Economists’ Papers Archive. Albert Rees Papers, Box 1, Folder “Rees Personal”.

Categories
Chicago Economists

Chicago. Economics Department on Possible Candidate for Permanent Employment, 1950

 

How big was the split within the department of economics in 1950 at the University of Chicago? Judging from the decision by chairman T. W. Schultz to essentially table the matter of approaching the central university administration with a candidate for a permanent position, there was a departmental deadlock.

The half-dozen economists discussed were: George Stigler, Abba Lerner, Kenneth Boulding, Leonid Hurwicz, Kenneth Arrow, and Lawrence Klein. Contemplate those names for a moment and then read aloud the following two sentences:

Several members of the Department stated that none of these men had all of the qualities sought: a good mind reaching out fruitfully in new directions in economics. It was agreed, however, that there were no likely candidates possessing these qualities in a high degree.   

We can only speculate which alpha economists happened to lock horns in those three meetings.

_________________________

From the MINUTES, Meeting of the Department,
May 24, 1950.

Present: T. W. Schultz, T. Koopmans, A. Rees, H. G. Lewis, D. G. Johnson, E. J. Hamilton, R. Burns, J. Marschak, F. H. Harbinson, F. H. Knight, M. Friedman, B. Hoselitz, L. Metzler

[…]

II. Appointments

Schultz informed the Department that Hildreth’s position has been renegotiated for a term of three years. The Department approved a motion authorizing for Hildreth the courtesy rank of Associate Professor for a three year term.

The Department then considered the appointment problem raised by the leaving of Blough (probably initially on a one year leave of absence) and Brownlee. Schultz suggested that the Department had two alternatives open to it: a temporary replacement (construed broadly) and a permanent appointment of a top ranking person.

The Department considered first possible candidates for permanent appointment. Attention centered on George Stigler, Abba Lerner, Kenneth Boulding, Leonid Hurwicz, Kenneth Arrow, and Lawrence Klein. For a temporary appointment Schultz suggested Gunnar Myrdal.

[Meeting began at 3:30 pm and ended 5:45 p.m.]

_________________________

From the MINUTES, Meeting of the Department,
May 30, 1950.

Present: T. W. Schultz, R. Burns, D. G. Johnson, E. J. Hamilton, F. H. Knight, L. Metzler, R. Blough, F. H. Harbinson, A. Rees, H. G. Lewis, T. Koopmans, J. Marschak, M. Friedman.

Appointments

The discussion of appointments continued from the previous meeting. Schultz expressed the conviction that the time was propitious for a new permanent appointment. On Metzler’s suggestion, the Department returned to discussion of the following candidates for a permanent appointment: Stigler, Hurwicz, Boulding, Klein, Lerner, Arrow.

Several members of the Department stated that none of these men had all of the qualities sought: a good mind reaching out fruitfully in new directions in economics. It was agreed, however, that there were no likely candidates possessing these qualities in a high degree.

The chairman then polled those present with respect to their first choice (or ties for first) for a permanent appointment. As a result of the poll the list of candidates was narrowed to Hurwicz, Stigler, and Lerner. The chairman then polled those present on their position toward permanent appointment of each of these men.

The poll showed that of those present

4 would favor and 5 oppose the permanent appointment of Hurwicz
4 would favor and 5 oppose the permanent appointment of Lerner
6 would favor and 6 oppose the permanent appointment of Stigler

A motion was passed instructing the chairman to poll the absent members of the Department in the same way on the appointment of Hurwicz, Lerner, and Stigler and to report back to the Department for further discussion.

[Meeting began at 3:30 pm and ended 6:15 p.m.]

_________________________

From the MINUTES, Meeting of the Department,
June 8, 1950.

Present: T. W. Schultz, H. G. Lewis, D. G. Johnson, J. Marschak, H. Kyrk, P. Thomson, M. Friedman, T. Koopmans, A. Rees, E. J. Hamilton, F. H. Knight, R. Blough.

Appointments

Schultz reported that he had polled Kyrk, Thomson, Mints, and Nef (but had not heard from Goode) on the matter of a permanent appointment for Stigler or Hurwicz or Lerner. The upshot of the poll was that the Department, the Chairman not voting, was evidently divided in its rating of Stigler for a permanent appointment; both permanent members and temporary members of the faculty showed an even division. The Chairman explained that he would abstain from voting on the belief that the Department was not now prepared to advance, with a strong meeting of minds, a strong case to the Central Administration for a permanent appointment. Schultz proposed that we investigate a slate of names for a one-year appointment.

A motion was passed authorizing the Chairman to put Gunnar Myrdal in the first position on the slate for a one-year appointment.

Successive motions passed by the Department added the following names to the slate:

Nicholas Kaldor   Simon Kuznets
Arthur F. Burns
H. M. Henderson
W. Vickrey
A. Hart
H. Stein

The Department then, following the system of ranking used in fellowship appointments, ranked these seven persons. The rank order follows:

1. Kaldor
2. Burns
3. Henderson
4. Kuznets
5½. Vickrey
5½. Hart
7. Stein

[Meeting began at 3:30 pm and ended 6:00 p.m.]

Source: University of Chicago Archives, Department of Economics Records, Box 41, Folder 12.

Image Source: Social Science Research Building.  University of Chicago Photographic Archive, apf2-07466, Special Collections Research Center, University of Chicago Library.

 

Categories
Chicago Funny Business

Chicago. Gilbert and Sullivan Parody Songs. About Classical and Keynesian Economics.

 

 

__________________________

Every so often the tiny cultural studies scholar inside my economist body says it is time to post another artifact from the social life of an economics department. Annual Christmas parties, skit parties and picnics (less so) are occasions when economists attempt to write comedy and some popular or familiar song or text gets reworked into a bit of burlesque humor.

Transcriptions of such masterpieces previously posted in Economics in the Rear-view Mirror include: FIRST EPISTLE UNTO NEW STUDENTS, WHEN I WAS A LAD, COWLES COMMISSION SONG, and SONG FOR AN ENTREPRENEUR.

This evening I thought I would treat myself to a quick-and-easy posting of the lyrics of two songs taken from the nine pages stapled together of University of Chicago skits that I found in Albert Rees’ papers at Duke. In an act of unpremeditated scholarship I glanced at what I had believed to be identical copies of the same stuff in Milton Friedman’s papers. Then to my horror (I really wanted this to be a quick-and-easy posting), I discovered that the two versions are not quite identical (recycling!). The only honorable thing to do was to post both versions side-by-side and highlight their differences. The versions found in Milton Friedman’s papers seem to me to read better than those found in Albert Rees’ papers which leads me to conclude that the versions from the Friedman papers are of more recent vintage.

Authorship is unknown, but there can be no doubt that we are dealing with lyrics composed, performed, and (first) enjoyed by economists at the University of Chicago sometime in the first two decades after WWII (when Rees was at the University of Chicago).

My personal favorite line: “In economic theory we’re wed to ceteris paribus./We find it nicer living where the air is rather raribus.”

__________________________

Parody of  Gilbert and Sullivan’s “I am the very model of a modern Major General”

To enjoy the original work being parodied:

English National Opera: Major-General’s Song from The Pirates of Penzance – live and with lyrics!

I AM THE VERY MODEL OF A CLASSICAL ECONOMIST

(To the tune of “I am the very model of a modern Major General” from THE PIRATES OF PENZANCE)

I AM THE VERY MODEL OF A U OF C ECONOMIST

(To the tune of “I am the very model of a modern Major General” from THE PIRATES OF PENZANCE)
I am the very model of a classical economist.
A Marshall, Smith, Pigou and Mill
Comprise my total reading list
For policy, you must insist
On having as your analyst
A U of C example of a classical economist.		 I am the very model of a classical economist.
A Marshall, Smith, Pigou and Mill
Comprise my total reading list
For policy, you must insist
On having as your analyst
A U of C example of a classical economist.
Our tools are based on static equilibrium analyses.
The economy we study is afflicted with paralyses.
But, if you want an analyst,
For quality you must insist
On a U of C example of a classical economist.		 Our tools are based on static equilibrium analyses.
The economy we study is afflicted with paralyses.
But, if you want an analyst,
For quality you must enlist
A U of C example of a classical economist.
Competitive adjustment is the true course for all laborers.
A freely fluctuating wage, all long-run benefits confers,
So, unions, if you must persist
Remember, that an analyst
Does not come any finer than a classical economist.		 Competitive adjustment is the true course for all laborers.
A freely fluctuating wage, all long-run benefits confers,
So, unions, if you must persist
Remember, that an analyst
Does not come any finer than a classical economist.
In economic theory we’re committed to ceteris paribus.
We find it easier living where the air is rather raribus.
So, if you want an analyst
For purity you must insist
On a U of C example of a classical economist.		 In economic theory we’re wed to ceteris paribus.
We find it nicer living where the air is rather raribus.
So, if you want an analyst
For purity you must enlist
A U of C example of a classical economist.
The chastity of this our land we manifestly must preserve.
The banking system should be based on 100% reserve.
So obvious, so simple this
Why does the FRB exist?
Replace it with a very special U of C economist.		 The chastity of this our land we manifestly must preserve.
The banking system should be based on 100% reserve.
So obvious, so simple this
Why does the FRB exist?
Replace it with a very special U of C economist.
Our little coterie extends from here across to Manchester.
But government advisers seldom here or there with us concur.
We must ask a psychiatrist
Why our advice they all resist.
But we’ll keep the tradition of the classical economist.		 Our little coterie extends from here across to Manchester.
But government advisers seldom here or there with us concur.
We’ll ask a good psychiatrist
Why our advice they all resist.
But we will bear the standard of the classical economist.
Source: Duke University. David M. Rubenstein Rare Book & Manuscript Library. Economists’ Papers Archive. Papers of Albert Rees. Box 1, Folder “Rees—Personal”. Source: Hoover Institution Archives, Papers of Milton Friedman, Box 79, Folder 6 “University of Chicago Miscellaneous”.

__________________________

Parody of  Gilbert and Sullivan’s “I’m Called Little Buttercup”

To enjoy the original work being parodied:

Lyric Theatre of San Jose performing “I’m Called Little Buttercup” from H.M.S. Pinafore.  Song starts at 0:45.

KEYNESIAN SONG

(To the tune “They call me Little Buttercup” from H.M.S. Pinafore)

THEY CALL ME A KEYNESIAN

(to the tune of Buttercup from PINAFORE)
They call me a Keynesian, a Keynesian Economist
And that I can never deny
For I’m a heretic, a classicist critic—
Bold little Keynesian, I.		 They call me a Keynesian, a Keynesian economist
And that I cannot deny.
For I’m a heretic, a classicist critic,
Bold little Keynesian, I.
I’ve equations and functions, and marginal assumptions
All here in my little kit bag.
I have tricky proposals for income disposals
All lest the economy sag.		 I’ve equations and functions, and marg’nal assumptions
All here in my little kit bag.
I’ve tricky proposals for income disposals
Lest the economy sag.
To deficit spending and government lending
I give a hearty “Huzzah”.
I distrust automaticity despite its simplicity—
I doubt if it would work at all.		 To deficit spending and government lending
I give a hearty huzzah.
I shun automaticity despite its simplicity;
I doubt if it would work at all.
For I am a Keynesian, a Keynesian economist
And that I can never deny
For I’m a heretic, a classicist critic—
Bold little Keynesian, I.		 They call me a Keynesian, a Keynesian economist
And that I can cannot deny.
For I’m a heretic, a classicist critic,
Bold little Keynesian, I.
When faced with deflation or misallocation
I feel that the former is worse
I abominate waste with Ricardian distaste
But still first things always come first.		 When faced with deflation or misallocation
I feel that the former is worse.
I abominate waste with Ricardian distaste,
But still first things always come first.
And yet they deplore me, criticize and abhor me
For I am the standard straw man
But blows I don’t heed—Oh, I’ll stick to my credo
That a plan is a plan is a plan.		 And yet they deplore me, criticize and abhor me,
For I am the standard straw man.
But blows I don’t heedo, I’ll stick to my credo,
That a plan is a plan is a plan.
For I am a Keynesian, a Keynesian economist
And that I can never deny
For I’m a heretic, a classicist critic—
Bold little Keynesian, I.
Source: Duke University. David M. Rubenstein Rare Book & Manuscript Library. Economists’ Papers Archive. Papers of Albert Rees. Box 1, Folder “Rees—Personal”. Source: Hoover Institution Archives, Papers of Milton Friedman, Box 79, Folder 6 “University of Chicago Miscellaneous”.

Image Source:   Monty Python’s silly walks.  Quora website:   What are examples of Low Comedy?