Author: Irwin Collier

Categories
Economists Gender Johns Hopkins Pennsylvania

John Hopkins. Economics Ph.D. alumna Peggy Richman née Brewer, later Musgrave. 1962

 

Assortative mating is often observed among the Econ. The last post was dedicated to the Harvard economics Ph.D. alumnus, Richard Abel-Musgrave (1937) and what was good for that gander should be presumed to be good for today’s goose as well, meaning here, the Johns Hopkins economics Ph.D. alumna (1962) and future spouse of Richard Musgrave, Peggy Brewer Musgrave.

The official obituary reproduced in this post comes from the collection of emeriti obituaries at the University of California, Santa Cruz. I casually note that we discover that the young Englishwoman Peggy Brewer worked in the O.S.S. during World War II. I presume if there were more to her service than being a desk jockey in an analytic or clerical capacity, a story would have found its place in the obituary.

Let us note that Peggy Richman née Brewer, later Musgrave, received her Ph.D. at age thirty-eight…Nevertheless she persisted! And she succeeded both personally and professionally.

______________________

Johns Hopkins Dissertation

Peggy (Brewer) Richman. Taxation of Foreign Investment Income: An Economic Analysis. Baltimore: Johns Hopkins Press, 1963. Based on the author’s Ph.D. dissertation, Johns Hopkins University, 1962.

______________________

University of California, Santa Cruz
Obituary

Peggy B. Musgrave
(1924-2017)

Professor Emerita Peggy B. Musgrave has died in New Jersey, at the age of 93. Born in Maldon, England in 1924, Peggy’s parents, Herbert and Blanche Brewer, were of modest means. Her father, however, was a self-taught intellectual; one whose writings had attracted the attention of George Bernard Shaw and Sir Norman Angell, among others. Surrounded, as she was, by his books on science, natural history, and philosophy, it was inevitable that her own intellectual curiosity would lead her to pursue a life of academic research and scholarship; she wasted no time. At the age of eleven, she passed the entrance examination to the local Grammar School, and at eighteen matriculated to Cambridge University, the first student from her school to have done so; in celebration, the school was given a holiday.

Unfortunately in 1944, in the midst of WWII, Peggy’s approaching Cambridge graduation was short-circuited by conscription into war service. Consequently, she served in the American OSS until the end of the war, in London, and it is there that she met and married a fellow OSS officer, and moved to the U.S.

Following a stint at the United Nations Food and Agriculture Organization, Peggy concurrently completed her B.A. and M.A. in economics at American University in Washington D.C., and shortly thereafter an economics PhD. at Johns Hopkins; her thesis was published in book form. Also, during this time she worked as a summer intern at both the Federal Reserve and the International Tax Division of the Treasury Dept.

She began her professional life as a senior research associate at Columbia University and a member of a study group on economic integration in Common Markets headed by Prof. Carl Shoup. The mid-sixties found her teaching international economics at the University of Pennsylvania, where she had been appointed as an assistant professor. It was at this point that Peggy was with her second husband, soul-mate and love of her life, Richard A. Musgrave, who was then teaching at Princeton University. Now together, they moved to Cambridge, MA., where he had taken up the H.H. Burbank Professorship in public economics at Harvard. Peggy then joined the International Tax Program at the Harvard Law School where she produced further publication.

Peggy continued her academic career, first as an associate and then full professor at Northeastern University in Boston; and it was at this point that she and Richard, full-bore academic collaborators, were invited to San Francisco as visiting Ford Research Professors at Berkeley; and while working at Berkeley, the University of California offered the professorship at Santa Cruz. She served at UCSC until 1992, and was heavily involved in both teaching and administration. She was provost of Crown College at UCSC from July 1, 1987-1989.

Her husband, the noted scholar on public finance, then retired from Harvard, also spent two years as an adjunct professor at UCSC. He died in 2007 at the age of 96.

Peggy’s economics scholarship followed from her principal interest in the taxation of foreign investment; a subject concerning which she testified at several Congressional hearings; and about which she wrote a white paper for the Senate Foreign Relations Committee.

She was a member of the American Economic Association, the National Tax Association, and was an Honorary member of the International Institute of Public Finance; as well, an honorary board member of the Center for Economic Studies at the University of Munich. The International Institute of Public Finance (IIPF) created the “Peggy and Richard Musgrave Prize” in 2003 to honor and encourage younger scholars whose work meets the high standards of scientific quality, creativity and relevance that has been a mark of the Musgraves’ contribution to public finance.

Peggy is survived by three children, Pamela Clyne of New Jersey, Roger Richman of Malibu, Ca., and Thomas Richman, of Boulder, Co., four grandchildren, and three great-grandchildren. Her ashes will be buried with those of her husband and his father in Cambridge, MA. The memorial will be private.

Source (and image): From the emeriti obituaries collection at the University of California, Santa Cruz.

Categories
Economists Germany Harvard Johns Hopkins Michigan Princeton Swarthmore

Harvard. Economics Ph.D. alumnus, Richard Abel-Musgrave, 1937

 

The German-born economist Richard Abel-Musgrave was one of many German/Austrian educated economists who came to the United States in the 1930s, much to the enrichment of economics. He was one of the many truly outstanding economists to have left Harvard in the 1930s with an economics Ph.D. Richard Musgrave wrote a principal textbook for the field of public finance.  More biographical information can be found in Hans-Werner Sinn’s lecture “Please Bring Me the New York Times: On the European Roots of Richard Abel Musgrave” (2007).

A Musgrave-artifact posted earlier at Economics in the Rear-view Mirror: 

External examination questions for honors A.B. at Swarthmore College, 1946.

_____________________

Harvard Ph.D.

RICHARD ABEL-Musgrave, DIPLOM-VOLKSWIRT (Univ. of Heidelberg, Germany) 1933, A.M. (Harvard Univ.) 1935.

Subject, Economics. Special Field, Public Finance. Thesis, “The Theory of Public Finance and the Concept of ‘Burden of Taxation.’” Instructor in Economics and Tutor in the Division of History, Government, and Economics.

Source: Harvard University. Report of the President of Harvard College, 1937-38, p. 155.

_____________________

Short Bio from Harvard Law School Yearbook

Richard Musgrave
H. N. Burbank Professor of Political Economy

Born: Königstein, Germany, 1910; Education: Diplom Volkswirt (Economics) U. of Heidelberg 1930, M.A. (Economics) Harvard 1936, Ph.D. (Economics) Harvard 1937; Subsequent Experience; 1941-8 Economist on the Federal Reserve Board, 1948-58 Professor of Economics at the University of Michigan, 1958-62 Professor of Economics at Johns Hopkins, 1962-5 Professor of Economics at Princeton; Married: 1964 to the former Peggy Brewer, one child; Joined the Faculty; 1965; Subjects: Federal Tax Policy, Economics for Lawyers, Taxation and Economic Development; Publications: Fiscal Systems (1969), The Theory of Public Finance (1958), Public Finance in Theory and Practice (1974); Extra-legal Activites: Consultant to the U.S. Treasury, the Council of Economic Advisers, and Foreign Missions; President, Tax Reform Commission for Columbia (1969), director, Fiscal Reform Project, Bolivia; Editor Quarterly Journal of Economics. (1968-75), President, International Seminar in Public Economics.

Source: Harvard Law School Yearbook 1979, p. 63.

_____________________

Obituary from UC Santa Cruz

Musgrave, renowned pioneer of public finance, dies at 96

January 16, 2007
By Jennifer McNulty, Staff Writer

SANTA CRUZ, CA–Richard A. Musgrave, widely regarded as the founder of modern public finance and an adviser on fiscal policy and taxation to governments from Washington to Bogota to Tokyo, died Monday, Jan. 15.

Musgrave, 96, was an adjunct professor of economics at the University of California, Santa Cruz, and professor emeritus of economics at Harvard University. His wife, Peggy Boswell [sic, “Brewer” was her maiden name] Musgrave, said Musgrave died of natural causes.

A staunch believer that government can play a positive and constructive role in society, Musgrave also believed deeply that economists can contribute to making government work well, thereby contributing to a better society. His work on public finance has been described as his “attempt to marry the theory and practice of good government.”

“Richard Musgrave transformed economics in the 1950s and 1960s from a descriptive and institutional subject to one that used the tools of microeconomics and Keynesian macroeconomics to understand the effects of taxes,” says Martin Feldstein, George F. Baker Professor of Economics at Harvard and president of the National Bureau of Economic Research.

“Richard Musgrave was a giant – a towering figure who transformed the field of public economics,” adds David M. Cutler, Otto Eckstein Professor of Applied Economics and dean for the social sciences in Harvard’s Faculty of Arts and Sciences.

An academic economist for the last 60 years, Musgrave mixed his university work with a wide range of public service and consultation. Starting in the 1940s, he advised governments in Colombia, Chile, Myanmar, Japan, Puerto Rico, South Korea, and Taiwan on taxation and fiscal policy, and led tax reform commissions in Colombia and Bolivia.

Similarly, domestic agencies and congressional committees repeatedly sought Musgrave’s advice on public finance policy questions. He worked with or as a consultant to the Board of Governors of the Federal Reserve, the U.S. Treasury, the President’s Council of Economic Advisers, the Department of Housing and Urban Development, and the World Bank.

Musgrave described the setting of tax policy as a delicate orchestration of factors including employment, inflation, economic growth, and the fair distribution of the tax burden – with the latter generally assigned outsize importance, in Musgrave’s view.

“Clearly, tax policy is not simply a matter of raising revenue in an equitable fashion,” he and his wife, then an economist at the University of California, Berkeley, wrote in the Boston Globe in 1978. “The entire performance of the economy must be allowed for as well, though this should be done with least damage to the fairness of the tax system.”

Two of Musgrave’s books became classics in their field: The Theory of Public Finance: A Study in Public Economy (1958) and Public Finance in Theory and Practice, coauthored with Peggy Musgrave (1973).

“Intelligent conduct of government is at the heart of democracy,” Musgrave wrote in the introduction to The Theory of Public Finance. “It requires an understanding of the economic relations involved; and the economist, by aiding in this understanding, may hope to contribute to a better society. This is why the field of public finance has seemed of particular interest to me; and this is why my interest in the field has been motivated by a search for the good society, no less than by scientific curiosity.”

The Theory of Public Finance transformed the study of public finance to a discipline in which questions are analyzed in general equilibrium terms, where changes in tax policy take into account the resulting changes in the economy. Musgrave’s many intellectual contributions included studies on tax incidence, tax progressivity, public goods, fiscal federalism, the effects of taxation on risk taking, and the role of fiscal policy in stabilizing the economy.

Musgrave’s influence endured throughout his lengthy career. In 1998, he was invited by the University of Munich to join his “archrival” in the study of political economy, James M. Buchanan, in a five-day debate. The results were published in 1999 as Public Finance and Public Choice: Two Contrasting Visions of the State. [At the CESifo Mediathek one can find videos from this five day conference. Search “Two visions” or “Buchanan” or “Musgrave”]

“Two towering pillars of 20th-century public economics examine the deep foundations of their own thought and their common subject,” economist Robert M. Solow of the Massachusetts Institute of Technology wrote of the work. “Who could resist the chance to eavesdrop on their reflections? Certainly not anyone who cares about the role of government in modern society.”

Born Dec. 14, 1910, in Koenigstein, Germany, Richard Abel Musgrave studied at the University of Munich, Exeter College, and the University of Heidelberg, where he received his Diplom Volkswirt (the equivalent of a bachelor’s degree) in 1933. He continued his studies at the University of Rochester and at Harvard, where he received an A.M. degree in 1936 and a Ph.D. in 1937.

Musgrave was an instructor in economics at Harvard until 1941, when he became an economist at the Federal Reserve Board of Governors, a position he held until 1947. He taught economics at Swarthmore College from 1947 to 1948, following which he was an economics professor at the University of Michigan from 1948 to 1958; at Johns Hopkins University from 1958 to 1961; and at Princeton University from 1962 to 1965.

In 1965 Musgrave joined Harvard as professor of economics in the Faculty of Arts and Sciences and at Harvard Law School. He was named H. H. Burbank Professor of Economics in 1969, when he also became chair of Harvard’s standing committee on Afro-American studies. In 1981 he was named professor emeritus at Harvard and became an adjunct professor at the University of California, Santa Cruz, remaining affiliated with that campus through 2004.

Among his numerous awards and honors, Musgrave was a Fulbright professor in Germany in 1956 and held a Guggenheim Fellowship in 1959. He was named honorary president of the International Institute of Public Finance in 1978, the same year he was elected a Distinguished Fellow of the American Economics Association. He received the Frank E. Seidman Distinguished Award in Political Economy in 1981. In 1983, 50 years to the day after he received his Diplom Volkswirt, Musgrave was awarded an honorary doctorate by the University of Heidelberg, his alma mater. He was elected to the National Academy of Sciences in 1986, and in 1994, he received the Daniel M. Holland Medal from the National Tax Association.

Musgrave is survived by his wife, Peggy Boswell [sic,  “Brewer” was her maiden name] Musgrave, and three stepchildren: Pamela Clyne of New Jersey, Roger Richmond [sic, “Richman” is correct] of California, and Thomas Richmond [sic, “Richman” is correct] of Colorado. He is also survived by numerous nephews and nieces, including Harry Krause, the Max L. Rowe Professor Emeritus at the University of Illinois College of Law. Details regarding a memorial service have not been finalized.

Source:  UC Santa Cruz. University News. January 16, 2007.

_____________________

Harvard Crimson Obituary

Renowned Economist Musgrave Dead at 96
Former professor ‘transformed’ public sector economics

By Tina Wang, Crimson Staff Writer
January 19, 2007

During the lifetimes of most Harvard undergraduates, Richard A. Musgrave—a founder of modern public sector economics—was in retirement.

Musgrave, who died Monday at age 96, also came from an era preceding current economics faculty. But his ideas about the state’s role in the economy left a lasting impact felt by Harvard faculty and alums today.

Having taught public finance at Harvard for about two decades, Musgrave had been an emeritus professor since 1981.

“The training I received well after he had retired was different because he was around,” said Dean for the Social Sciences David M. Cutler ’87.

Concerned with the government’s equitable and efficient distribution and redistribution of resources through taxation and spending, “he transformed the whole way people thought about public economics,” said one of Musgrave’s former students, James M. Poterba ’80, who now chairs the economics department at MIT.

Born in 1910 in Germany, Musgrave, who received a Ph.D in political economy from Harvard, taught here from 1937 until 1941, when he left for a post at the Federal Reserve.

After various teaching stints, including at Princeton, Musgrave returned to Harvard in 1965 with tenured appointments in the Faculty of Arts and Sciences and at Harvard Law School.

He also took prominent economic advising roles in Washington, as well as with foreign governments, from Colombia to South Korea.

Musgrave died in Santa Cruz, Calif., where he and his wife had moved to teach at the University of California, Santa Cruz.

‘THE MUSGRAVE TRICHOTOMY’

In his senior year of college—and the last year Musgrave taught at Harvard—Poterba audited Musgrave’s graduate course, co-taught with Baker Professor of Economics Martin S. Feldstein ’61.

“He didn’t just study the tax system or government policies in an abstract classroom, or in a theoretical way. He studied these questions because he believed they were incredibly important in making the lives of individual citizens better,” Poterba said.

The ground-breaking “Musgrave trichotomy” identified three separate roles of government—redistributing income, allocating resources, and stabilizing the macroeconomy, Cutler and Poterba said.

“Everything that’s taught in public economics now is completely different than what was taught from before,” said Cutler, who co-teaches Economics 1410, “Public Sector Economics.” “You look at textbooks before him and you wouldn’t even recognize them.”

Cutler said that when he teaches his students to think about questions of efficiency and redistribution in public sector economics separately, “all of that comes from Musgrave.”

“Generations of students who used his textbook [The Theory of Public Finance] think about the world very differently,” Cutler said.

Musgrave strove for much of his life to find ways for the state to play a positive role in the economy, which entailed understanding the trade-offs between allowing the government to provide some goods versus allowing the private sector to provide them.

As a student who came to Harvard in the mid-1930s during the Great Depression, when Keynesian views about the benefits of government intervention in the economy were starting to enter economic discourse, “Musgrave was always very deeply of the view that the government could make things better,” Poterba said.

ECONOMIC OUTLIER

Musgrave’s economic principles, particularly with their focus on social equity, did not always square perfectly with mainstream thinking in his field.

“He was probably a little bit frustrated that the profession has moved as far as it has toward the efficiency direction,” said Cutler. “Although I think it would’ve moved even farther had he not been around.”

An emphasis on equity may have eroded in conventional economics discourse, partially because “it’s really hard to say how equitable should things be,” Cutler said. “You’re saying, ‘gee, what’s the right distribution of income.’”

Contrary to trends in his field, Musgrave “probably moved a bit in the direction of thinking there was an activist role of government,” Poterba said.

The German school of thought— “thinking about the whole community almost as though it was one actor”—was another influence that Musgrave brought to bear on U.S. economic thinking, Poterba said.

“That was a perspective that was somewhat different from what most U.S. economists were using,” Poterba said.

Concerned with questions of how to set up an equitable tax system, Musgrave was a vocal critic of President Reagan’s conservative economic program.

In 1982, Musgrave, with 33 other economists, sent a letter to the White House criticizing Reagan’s economic policy as “extremely regressive in its impact on our society, redistributing wealth and power from the middle-class and poor to the rich,” The Crimson reported.

“One never knows if this will have any effect on the President, but we felt it was important to speak out,” Musgrave told The Crimson at the time.

‘DEEPLY COMMITTED’

Cutler said he first met Musgrave in the early 1990s when Musgrave was on the East Coast and had contacted him, saying he had heard Cutler had joined the Harvard faculty and wanted to meet him.

They met about every other year through much of the 1990s to chat about economics research and the goings-on of the department, according to Cutler, who joined the Harvard economics faculty in 1991.

“Every time after meeting him, I would think, ‘I hope I’m in as good a shape at 40 as he is at 80,’ ” Cutler said.

“Even though Musgrave was in his 80s and 90s at the time, he kept very well up-to-date…not very many people will do that,” he said.

He was still “very interested in the world of economics and how it could be used in policy areas,” he said.

Poterba has fond memories of Musgrave’s energy as well.

In Musgrave’s class, “even at that stage, one of his last years at Harvard, he was incredibly energetic and enthusiastic about the whole study of government and taxation, deeply committed to training students, and maintained long connections and ties to students,” Poterba said.

A stone in Mt. Auburn Cemetery in Cambridge will bear Musgrave’s name, his wife, Peggy Brewer Musgrave, told The Boston Globe.

Source:  Tina Wang. Renowned Economist Musgrave Dead at 96. Harvard Crimson(January 19, 2007).

Image Source: Harvard Law School Yearbook 1970, p. 31.

 

Categories
Columbia Lecture Notes Suggested Reading

Columbia. First semester graduate economic analysis. First weeks’ notes. Hart, 1955.

 

 

Based on what we see of the first few weeks of the content of this first graduate economics theory course at Columbia taught by Albert Gailord Hart (Chicago PhD, 1939) in 1955, it appears that the level of analysis in the course barely attained that of a contemporary average intermediate course in micro- or macroeconomics. Jumping to the end of this post, we find that Hart’s poll of the students in his class revealed that one-third of the aspiring graduate students in economics brought with them no math skills beyond what was taught in high-school (calculus was not taught in high-schools in the US at that time). Only one-third had been economics majors at college. One third had either zero economics or could not even recall the name the textbook that was used in their principles of economics class.

One can imagine the fare of Alfred Marshall, George Stigler and Kenneth Boulding would have been hard to digest for many, if not the majority, of Hart’s first-year graduate students. 

_______________________

Course Announcement

Economics 101-102—Economic Analysis. Professor Hart and Dr. Mosak.

Section 1—2:10-4. Dr. Mosak. 201 Fayerweather.
Section 2—M. W. 12. Professor Hart. 201 Fayerweather.

Detailed analysis of the reactions of producing units (firms) and consuming units (households); determination through the market of resource allocation, outputs, prices, and incomes; capital and interest; theories of general equilibrium (Walrasian and Keynesian); introduction to “dynamics.”

Students who have not completed Economics 101 are admitted to Economics 102 only with the permission of the instructor.

 

Source:  Announcement of the Faculty of Political Science for the Winter and Spring Sessions 1955-1956. From the Columbia University Bulletin of Information. Fifty-fifth Series, No. 25 (June 25, 1955), p. 34.

_______________________

ECONOMICS 101 (Section 2), autumn 1955
AGH 10/3/55
101-1

Role of the course is basic training in theoretical analysis.

  1. This is today’s version (though differently arranged) of the traditional “value and distribution” course – staple of the graduate curriculum, and counterpart of the key section of “Principles” courses.
  2. The two “sections” are independent courses aim to provide this basic training; interchangeable as prerequisites for later work, but not guaranteed interchangeable in January 1956.
  3. Prerequisites for 101 are simply some previous economics (minimum: a “Principles” course) and high-school mathematics.
  4. Because of the wide range of backgrounds, the course opens each topic at an elementary level, and then pushes the topic to a professional level. All questions are welcome.

Books:

  1. Contrary to most fields, theoretical analysis boasts several textbooks that are first-hand jobs by productive men in the field and belong in personal working libraries. Students in the course should own either:
    1. Stigler, THEORY OF PRICE, 2nd ed., or
    2. Boulding, ECONOMIC ANALYSIS, 3rd ed.
      Choice is a matter of temperament.
  2. All economists should own Alfred Marshall, PRINCIPLES OF ECONOMICS (8th ed.) – obsolescent for over 40 years, never superseded.
  3. Stigler & Boulding (eds) READINGS IN PRICE THEORY has several items we will use; so does
  4. American Economic Association, READINGS IN THE THEORY OF DISTRIBUTION.

Plan of the Course will be shaped partly by background of its members; to start:

Introduction, Oct. 3, 5.
Read introductory chapters of Marshall, Boulding Stigler.

Preliminary supply-and-demand analysis, Oct. 10, 12, 17, 19.
Read Marshall, Book V; examine Boulding’s first part as attempt to deal at this level.

Next stage (starting about October 24) we’ll be on the theory of the firm and Marshallian industry (short-run).

Place of theoretical analysis in economics is to my mind central.

  1. Economic theory is a logic of economic quantity-networks.
    1. By general consent, economics is about problems of scarcity.
    2. To mitigate any one scarcity requires substitution – which intensifies some other scarcity. (Example: wartime petroleum.)
    3. Therefore scarcity situations interlock.
    4. Characteristic problems are of the sort represented by simultaneous equations. (Example: oil-rich sheik. [See note below for 10/5/55])
  2. A widespread skepticism about the theoretical tradition must be recognized.
    1. There is very proper skepticism about people who claim to have applicable knowledge a priori–an offense of which theorists can sometimes be convicted. (Example: fish [sic] taxonomy.)
    2. As maybe seen from curricular tendencies in general social science courses, the “basic social science” group aspire to build an adequate social analysis without drawing on our theoretical tradition.” (Background on this at next meeting.)
    3. In many departments, theory is taught as a parlor accomplishment, or at best as a tool on a par with historical or statistical methods.
  3. My claims for theoretical analysis are ambitious:
    1. Proposed substitutes for theory can so far not touch things it can do.
    2. While some economic topics lack historical or statistical angles, none lack scarcity-and-substitution angles.

 

ECONOMICS 101 (Section 2), autumn 1955
AGH 10/5/55
101-2

Economic Theory in Social Science is not such an anomaly as it might seem if you relied on (say) a sociologist’s interpretation.

  1. The basic difficulty is that economic theory is about the inter-relations of economic quantities, while social science is supposed to be about the inter-relations of people.
  2. The economist’s first answer is that one of the most pervasive social relationships is that of markets and division of labor, which cannot be understood without a logic of economic quantities.
  3. At a slightly more fundamental level, the economist must insist on the human content of his economic quantities and his patterns of relationship among them.
    1. The focus of economic analysis is choice (alias decision); in setting up our models, we take account of the psychology of individual and group decisions.
    2. Behind choices lie estimates of future consequences; our models take account of human fallibility, and of the way people learn from experience.
    3. Even such apparently mechanical relations as a “production function” have human content.
      1. We visualize the production function as a table of figures (or an algebraic formula), designed so that if we know the inputs we can look up or calculate the output.
      2. It is tempting to look at such a table or formula as embodying a set of impersonal “natural laws” of physics, chemistry and biology.
      3. But insofar as such “natural laws” come in questions, what counts is not the ultimate truth but the understanding held by the decision-maker; thus the production function for steel has changed from one using charcoal to one using coke.
      4. Many of the quantities involved are intensely human—especially the overwhelmingly important quantity called labor input.
      5. Input-output relations hinge on patterns of cooperation among workers and between workers and management.
    4. Thus the human content is not drained out of economics by adopting the economic-quantity approach.
    5. At the same time, it is worth remembering that economists as such are not expert on many relevant aspects of human relations, and can profit from criticism.

*  *  *  *  *  *  *  *  *  *  *  *

Data on the oil contract with the Arab potentate: The executive negotiating the contract agreed tentatively to deliver 2500 gallons weekly at his oasis. Engineers report that a tank-truck’s round trip requires 0.09 gallons of gasoline per pound of loaded weight at the start, and that the truck will weigh 2½ tons plus 10 pounds for each gallon of capacity.
Then (1) G = 2500 + 0.09W and (2) W = 5000 + 100.

 

ECONOMICS 101 (Section 2), autumn 1955
AGH 10/10/55 (compilation of 5/5/55[possibly “65”]
101-3[?]-c[?]

Demand Data for Fruits and Vegetables

To test the presumption that price and quantity-demanded of individual commodities are negatively related, a promising experiment is to locate an array of price-quantity data where supply is apt to have changed erratically enough to give a variety of experiences, and where price structure, tastes, income and expectations can be supposed similar.

The adjacent years 1951-52 happen to lie close in other characteristics than chronology. Price averages rose about 2%, without great changes in general structure; population rose about 2% real income per capita, after taxes, rose about 1%. The years being adjacent, drastic changes in tastes are unlikely.

A promising body of price-quantity data is the list of 32 types of “truck” and 10 kinds of fruit for which output and price are reported in Statistical Abstract of the United States (1953 volume, pp. 668-669). For the 20 items whose output-change exceeded 10% up or down, data run as follows:

Commodity

% change in output

% change in price

[comment]
Shallots +45% -22%
Artichokes +35% -12%
Broccoli +27% -9%
Eggplant +26% -1% Weak or mildly parallel relation
Mint (for oil) +25% -4%
Corn, sweet +19% +0.5% Weak or mildly parallel relation
Cucumbers +13% +11% Strong failure of inverse relation
Lettuce +10% -8%
Garlic -11% +88%
Beets -12% +11%
Beans (snap) -14% +15%
Tomatoes -16% +12%
Spinach -17% +11%
Apples -18% +31%
Peas, green -20% +1% Weak or mildly parallel relation
Pimientos -20% +8%
Prunes -21% +28%
Brussels sprouts -31% +6%
Plums -40% +64%
Honeyball melons -46% +36%

 

ECONOMICS 101 (Section 2), autumn 1955
AGH 10/12/55
101-4
Topic I

Note on Class’s Background from preliminary tabulation of data slips:

  1. Only about 1/3 were economics majors as undergraduates. In view of the plea in the catalogue to get background rather than over-concentrate, it is my business to see that non-majors are not penalized.
  2. About 1/3 have had no formal economics, or a “weak principles”—meaning that they can’t identify the text, in many cases! Recommended they have one of the stronger elementary texts for review & reference.
  3. Mathematical background of 1/3 includes nothing beyond high school level—distributed rather evenly over economics background. Those who are weak both in previous economics and in math may need extra time for the course.
  4. In view of this state of the class’s background, do not shy off from raising a question that bothers you for fear it is too elementary!

Assignment:

In Stigler: Read chapters 1, 2, and 4 (treating 3 as a reference work).
Work out to your own satisfaction his exercises no’s 2-4 on p. 67.

In Boulding: Read chapters 7-8 (3rd ed.)
Work out to your own satisfaction his exercise no. 1 on pp. 165-166.

Source: Columbia University Archives.  Albert Gailord Hart Collection, Box 62, Folder “TEACHING: Sec. 4 ColUniv 1955/56. Ec 101/2 MICRO”.

Image Source: Albert Gailord hart, Economist, Dead at 88. Columbia University Record. Vol. 23, No. 5 (October 3, 1997).

Categories
Exam Questions Harvard

Harvard. Mid-year exam. Principles of Money and Banking. Hansen and Williams, 1948-49.

 

Syllabi, reading assignments, bibliography and examinations for the Hansen-Williams money and banking course at Harvard have been transcribed and posted earlier for 1947-48; 1949-50. This post helps to fill the gap of course examinations.

____________________________

Enrollment

[Economics] 241 (formerly Economics 141a and 141b). Principles of Money and Banking. Professors Hansen and Williams.

(F) Total 73: 44 Graduates, 18 Public Administration, 1 MIT, 2 Juniors, 6 Radcliffe, 2 Others.
(S) Total 66: 43 Graduates, 15 Public Administration, 1 MIT, 4 Radcliffe, 3 Others.

Source: Harvard University. Report of the President of Harvard College, 1948-49, p. 78.

____________________________

1948-49
HARVARD UNIVERSITY
ECONOMICS 241a
Final Exam. January, 1949

PART I (Required)

Outline and discuss the current problems (relating to monetary and banking policy) disclosed, for example, in the last three Annual Reports of the Board of Governors of the Federal Reserve System. Among other things show why the current problems are different from those of the decades of

(a) the twenties
(b) the thirties.

PART II (Answer ANY THREE questions)

  1. Compare Wicksell and Keynes with respect to their theories of money and prices, showing, among other things, in what respects Keynes draws on the Wicksellian analysis and in what respects Keynes’s contribution is more complete.
  2. Write an essay on the monetary theories of any twoof the following:

(a) Robertson
(b) Hawtrey
(c) Hayek
(d) Fisher
(e) Marshall
(f) Henry Simons
(g) Lerner

  1. Explain by the aid of the modern theory of income determination the conditions under which monetary policy may be

(a) fully effective
(b) a necessary supplement to fiscal policy as means of raising real income and employment.

  1. Explain (by making use of the modern tools of analysis) the role of wages in the theory of price-level determination.

 

Source: Harvard University Archives. Final Examinations, 1853-2001. Box 16, Papers Printed for Final Examinations: History, History of Religions, …,Government, Economics, Anthropology,…, Naval Science. February, 1949.

Image Source: Alvin H. Hansen and John H. Williams in Harvard Class Album 1942.

Categories
Exam Questions Pennsylvania Syllabus

Pennsylvania. Theories of business cycles. Reading assignments and exam. Weintraub, 1954-55.

 

The following list of course reading assignments and final exam come from the first semester of Sidney Weintraub’s course at the University of Pennsylvania during the academic year 1954-55 that surveyed business cycle theories. There are an additional two pages of added readings in Weintraub’s papers but I accidentally missed copying the first page and will need to add that list later. 

I found a copy of the final exam for the second semester of the course, appended below, that reveals the more empirical emphasis of the second semester. Hopefully we will find a copy of the syllabus for the second semester.

_______________________

Brief Bio

Sidney Weintraub (1914-1983) was an American economist and a professor who specialized in the post-Keynesian school of economics. He was best known for his proposal to use the federal income tax to discourage wage and price inflation in a tax-based incomes policy (TIP). Raised in New York, Weintraub studied at the London School of Economics before being forced to return to the United States at the outbreak of World War II. He earned his Ph.D. from New York University in 1941, and began teaching economics at St. John’s University following the war. He joined the Wharton School at the University of Pennsylvania in 1950, where he remained for the rest of his career. Weintraub also founded and co-edited the Journal of Post Keynesian Economics.

Weintraub married Sheila Ellen Weintraub and had two sons, E. Roy and A. Neil Weintraub. E. Roy Weintraub is an economics professor at Duke University.

Source: Preliminary Guide to the Sidney Weintraub Papers. Duke University, David M. Rubenstein Rare Book and Manuscript Library, Economists’ Papers Project.

_______________________

ECONOMICS 612
Theories of Business Cycles
Fall Term 1954-55

Assignment Sheet

The first semester will be devoted to a study of theories of business fluctuations with readings largely confined to original sources. Classroom discussion will center upon the logical structure of the theories. The added references constitute suggestions for further reading on the specific topics but are not a prerequisite for the particular class session.

Session 1. Introduction: Early Cycle Theory.
Session 2. Underconsumption and Overinvestment theories.

a. Underconsumption theories: John Hobson, The Industrial System, pp. 39-54, 284-301;
W. T. Foster and W. Catchings, Profits, pp. 247-282, 398-421.

b. Overinvestment theories: A. Spiethoff, “Business Cycles”, in International Economic Papers(No. 3), pp. 75-81, 147-171;
Gustav Cassel, in Hansen and Clemence [H. and C.], Readings in Business Cycles, pp. 116-128.
Session 3. Psychological Impulse and Cumulative Propagation.

A.C. Pigou, Industrial Fluctuations, pp. 26-35, 72-98;
Albert Aftalion, in H. and C., Readings, pp. 129-138.
Session 4. Wesley Mitchell: Eclecticism and Quantitative Verification.

W. Mitchell, Business Cycles: The Problem and Its Setting, pp. 47-60, 376-378, 451-468 and pp. 150-165 in H. and C., Readings: “What Happens During Business Cycles,” pp. 6-12, 251-255.
Also, A. F. Burns, Frontiers of Economic Knowledge, pp. 187-198.
Read Schumpeter, Vol. I, Ch. 2
Session 5. Monetary Disequilibrium.

Warburton, [“The Misplaced Emphasis in Contemporary Business Fluctuation Theory”, in] Readings in Monetary Theory [1951].
R. G. Hawtrey, “The Trade Cycle”, pp. 330-349 in AEA Readings in Business Cycle Theory.
F. A. Hayek, Monetary Theory and the Trade Cycle, Ch. 3 and Prices and Production (2nded.) pp. 65-88.
Session 6. Swedish Contributions: The Cumulative Process.

K. Wicksell, “The Enigma of Business Cycles”, in International Economic Papers (Vol. 3), pp. 58-74.
J. R. Hicks, Value and Capital, pp. 283-302.
Session 7. Innovations and Investment Irregularity.

J. Schumpeter, pp. 1-19 in AEA Readings in Business Cycle Theory. (Also, Clemence and Doody, The Schumpeterian System, pp. 9-22, 95-101).
D. H. Robertson, pp. 166-174 in H. and C., Readings.
Session 8. Long Waves and Cycles.

N. Kondratieff, pp. 20-42 in AEA, Readings;
G. Garvy, pp. 438-466 in H. and C., Readings.
Session 9. J. M. Keynes: Income Levels and Cycles.

J. M. Keynes, General Theory, Ch. 22.
Session 10-11. Neo-Keynesian Theories.

J. R. Hicks, The Trade Cycle.
Session 12. Econometric Theories.

T. C. Koopmans, “The Econometric Approach to Business Fluctuations” AEA (Proc. May 1949).
Session 13. Economic Trends and Cycles.

S. Kuznets, Economic Change, pp. 125-144.
A. F. Burns, Frontiers, pp. 107-134.
Session 14-15. Contemporary Critiques of Cycle Theory.

R. A. Gordon, “Business Cycles: The Quantitative Historical Approach”, AEA(Proc. May 1949), pp. 47-63.
C. Warburton, “The Theory of Turning Points in Business Fluctuations”, QJE(Nov. 1950); see , [“The Misplaced Emphasis in Contemporary Business Fluctuation Theory”, in]  Readings in Monetary Theory.
A. Knox, “On a Theory of the Trade Cycle”, pp. 267-277 in H. and C., Readings;
N. Kaldor, “Economic Growth and Cyclical Fluctuations”, Economic Journal(Mar. 1954).

Source: Duke University. David M. Rubenstein Rare Book and Manuscript Library. Economists’ Papers Archive. Sidney Weintraub Papers, Box 19, Folder 1a “Miscellany Notes”.

_______________________

Final Examination.
Economics 612.
January 1955

Answer all questions.

  1. In which theories do you find the view that business cycles are chiefly a manifestation of capitalist growth? Explain the individual analyses and differences at some length.
  2. Referring to (1), indicate the theories in which the growth aspect is either ignored or denied, and the reasons for its suppression.
  3. Irving Fisher declared: “I see no reason to believe in “the” business cycle. It is simply the fluctuation about its own mean.” Discuss.
  4. Lloyd Metzler wrote: “Traditional theory usually assumed that the economic system is inherently unstable……” argue, pro and con.
  5. There have been several attempts to place causal emphasis on agriculture as the cycle-maker. Explain the major ones briefly. Prepare the strongest possible argument for the agricultural thesis.
  6. Wesley Mitchell placed substantial stress on the lag of retail prices behind wholesale prices, as well as the failure of wages to move synchronously with finished goods prices. Do you think that these divergent price movements are major cycle factors? Why?

Source: Duke University. David M. Rubenstein Rare Book and Manuscript Library. Economists’ Papers Archive. Sidney Weintraub Papers, Box 15, Folder 16 “Miscellany Notes”.

_______________________

Economics 612
Final Exam
June 3, 1955
11:00-1:30

Answer 3 out of 4

  1. a. Discuss the major conceptual and statistical limitations of the national income and product data published by the U. S. Department of Commerce.
    b. Describe and evaluate the National Bureau of Economic Research approach to the measurement and forecasting of business cycles.
  2. a. Discuss the major factors which might be expected to affect individuals’ saving and the relevant empirical evidence from cross-sectional data.
    b. Describe and appraise the major statistical relationships which have been developed to explain fluctuations or variations in individuals’ saving.
  3. Summarize and evaluate the empirical evidence on the factors determining the demand for (a) plant and equipment and (b) inventories.
    In your answer indicate briefly the economic rationale of the statistical relationships you refer to.
  4. a. Write out a system of equations which on the basis of experience to data you might utilize to forecast economic activity for the next year, indicating both limitations and possible future improvements.
    b. Discuss and evaluate the types of models developed by Lawrence Klein and others.

Source: Duke University. David M. Rubenstein Rare Book and Manuscript Library. Economists’ Papers Archive. Sidney Weintraub Papers, Box 19, Folder 1a “Miscellany Notes”.

Image Source: Gonçalo L. Fonseca’s The History of Economic Thought Website: biography of Sidney Weintraub.

Categories
Funny Business Gender M.I.T.

M.I.T. Rewrite of 1940s blues hit “Why don’t you do right, like some other men do”. Solow.

 

Instead of  all of us running off to our respective rants regarding cultural appropriation and intersectionality after reading the following parody lyrics to the 1940s blues hit “Why Don’t You Do Right?” found in Robert Solow’s papers at the Duke University Economists’ Papers Archive, I strongly urge listening to and/or watching the following performances of the original song. I promise, once in your brain, this melody will lodge itself deep into your memory much as it had for Robert Solow’s generation of (overwhelmingly) male economists. 

1941 (78 rpm record) Lil Green on Bluebird label.

1941 (78 rpm record) Nora Lee King on Decca

1942 (Film) Peggy Lee with the Benny Goodman Orchestra. This version cuts two stanzas but for that we get more Benny Goodman!

1950 (Video)  Peggy Lee with The Dave Barbour Quartet

It is as difficult for me to imagine the following written by anyone else at M.I.T. besides Robert Solow, as it is difficult to imagine that his wife, the economic historian, Barbara Lewis Solow (Bobby) played no role in the following parody. Perhaps she inspired, co-wrote, or  censored edited the lyrics. It is not certain that this was ever actually performed (any eye-witnesses out there?). 

Now that you have learned the tune, you may embark upon deconstruction of the following artifact.

Note: the references to two textbooks by Stanley Fischer and Rudiger Dornbusch would suggest an earliest date of 1983 for this parody. By that time the reference to IBM calling might have been the last of a decade long series of skit-party pokes at Frank Fisher who served as the chief economic witness on behalf of IBM in a thirteen year antitrust case that was finally dropped in 1982.

_____________________

A song to the tune of “Why don’t you do right, like some other men do…Get outta here and get me some money too”

to be sung by somebody’s wife.

Original lyrics Solow
You had plenty money, 1922
But you let other women make a fool of you
Why don’t you do right, like some other men do?
Get out of here and get me some money too		 You could’ve written a terrific text
But you just write that damned dy/dx
Why don’t you do right, like some other men do?
Get out of here and get me some money too
You’re sittin’ down, wonderin’ what it’s all about
If you ain’t got no money, they gonna put you out
Why don’t you do right, like some other men do?
Get out of here and get me some money too		 You know when I picked you it was not for looks
Now Stan and Rudi have those two big books
Why don’t you do right, like some other men do?
Get out of here and get me some money too
If you had prepared twenty years ago
You wouldn’t ‘ve been driftin’ from door-to-door
Why don’t you do right, like some other men do?
Get out of here and get me some money too		 Your career started all right but it got stalled
Where the hell were you when IBM called
Why don’t you do right, like some other men do?
Get out of here and get me some money too
I fell for your jive and I took you in
Now all you got to offer me’s a drink of gin
Why don’t you do right, like some other men do?
Get out of here and get me some money too		 If you want a mama you can hug and squeeze
There ain’t no future teaching Ph.D.s
Why don’t you do right, like some other men do?
Get out of here and get me some money too

Source: Duke University. David M. Rubenstein Rare Book and Manuscript Library. Economists’ Papers Archive. Robert M. Solow Papers, Box 83.

Image Source: Lil Green on Bluebird label file at www.archive.org

Categories
Exam Questions Harvard

Harvard. Core graduate economic theory exams. Schumpeter, 1938

 

This post provides three examinations found for the year-long graduate economic theory course taught by Joseph Schumpeter. Reading lists as well as the examinations for the immediately preceding two years have been posted earlier (see links below).

_________________

Related posts for core graduate economic theory
Reading lists, examinations

1935-36 Schumpeter
1936-37 Schumpeter

_________________

Course Enrollment

[Economics] 101 (formerly 11). Professor Schumpeter.—Economic Theory.

Total 36: 25 Graduates, 4 Seniors, 3 School of Public Administration, 3 Radcliffe, 1 Other.

Source: Harvard University. Report of the President of Harvard College, 1937-38, p. 85.

_________________

Mid-year Examination, 1938.

1937-38
HARVARD UNIVERSITY
ECONOMICS 101

Answer FIVE questions

  1. The Marshallian law of demand states that falling price is associated with increasing quantity demanded. But we often find that, on the contrary, quantity sold increases and decreases with price. How would you explain such cases?
  2. In what sense are decreasing average unit costs incompatible with perfect competition?
  3. What is meant by elasticity of expenditure, and how is this concept related to the ordinary elasticity of demand?
  4. Do you think that monopoly price should be more “rigid” than competitive price? Explain your answer.
  5. To what extent is it true that conditions deviating from perfect competition tend to produce excess capacity?
  6. Is it correct to say that there is one and only one price to every oligopolistic situation because the only rational course for oligopolists to adopt is to combine and thus to set up a simple monopoly?
  7. How are prices determined in the case of a discriminating monopolist selling in two separate markets? In general would you expect output to be larger or smaller under discriminating monopoly than under simple monopoly?

Source: Duke University. David M. Rubenstein Rare Book and Manuscript Library. Economists’ Papers Archive. Papers of Llloyd Appleton Metzler, Box 7, “H. C. S. Easy Clasp File”.

_________________

ECONOMICS 101
Make-up Examination, March 1938

(Answer FIVE questions)

  1. What is the difference between the Marshallian supply curve and the particular expenses curve?
  2. What do we mean by saying that under conditions of perfect competition firms produce “up to the optimal point” while under conditions of the imperfect competition they do not?
  3. Given the indifference map of an individual, how can a demand curve be deduced therefrom? Is this a Marshallian demand curve?
  4. Define bilateral monopoly and indicate conditions under which price is, and conditions under which price is not, determinate.
  5. What is the difference between monopolistic competition and oligopoly?
  6. Discuss the relation between cost curves and supply curves.
  7. Discuss the relation between the elasticity of demand and the elasticity of substitution.

Source:Harvard University Archives. Papers of Joseph Schumpeter. Lecture Notes, Box 10, Folder “Ec 101”.

_________________

Final Examination, 1938.

1937-38
HARVARD UNIVERSITY
ECONOMICS 101

Answer FIVE questions

  1. If the elasticity of substitution of a factor is greater than the elasticity of demand for the product, then the elasticity of demand for that factor will be smaller, the greater is the proportion of that factor to the others. Prove, assuming that there are only two factors.
  2. It has been held that in a socialist society income should consist of two parts: a wage fixed much as it would be under perfectly competitive capitalism, and a “dividend” out of the surplus of the total national product over the sum total of wages. It has also been held that the size of dividends should be proportional to wages received. Do you think that such a policy would secure optimal allocation of resources, assuming free choice of occupations?
  3. Profits have sometimes been defined as a “rent of ability.” Do you think this satisfactory? Why or why not?
  4. “The extent and direction in which the amount of the factor employed in any use differs from the ideal amount varies directly with the divergence between the fraction

\frac{\text{marginal revenue to the individual firm}}{\text{price}}

in the particular use and in the alternative use from which the factor has to be drawn .… The magnitude of the elasticity of demand is an inverse measure of the degree of imperfection of competition. We may conclude that it is socially desirable to expand those industries in which competition is more imperfect than the industry with which they compete for their factors of production and to contract those in which the opposite condition prevails.” Explain.

  1. What would you expect the effective technological change (“invention”) on the rate of interest to be?
  2. How would you measure the loss inflicted on consumers by the imposition of an import duty? Must there necessarily be a loss? Would your conclusions be affected if the commodity were controlled in the exporting country by a monopolist?
  3. “The Marxist’s claim to superiority for his economics is that ‘bourgeois’ economics has utterly failed to explain the fundamental tendencies of the development of the capitalist system.” Do you think this claim is justified in so far as it concerns “bourgeois” economics? How does the Marxist attempt to provide a theoretical explanation of the “fundamental tendencies of the development of the capitalist system?”

 

Source: Duke University. David M. Rubenstein Rare Book and Manuscript Library. Economists’ Papers Archive. Papers of Llloyd Appleton Metzler, Box 7, “H. C. S. Easy Clasp File”.

Image Source: Joseph A. Schumpeter in Harvard Class Album, 1939.

 

 

 

Categories
Chicago Exam Questions Problem Sets

Chicago. Price Theory, Part II. Friedman, Spring 1951

 

Milton Friedman’s price theory reading assignments, problem sets, and final exams from his courses Economics 300A and 300B taught during the academic year 1951-52 at the University of Chicago were transcribed in an earlier post. During the previous academic year, W. Allen Wallis and Lloyd A. Metzler taught the first quarter course, Economics 300A.  Milton Friedman and Lloyd A. Metzler taught the second quarter course, Economics 300B. Problem set and final exam for Friedman’s section have been transcribed for this post.

________________

ECONOMICS 300B
Problems for Reading Period
Spring, 1951

  1. “Productivity” is a catch-word in most general discussions of wage policy, as for example in the following quotation:

“General increases in wage rates exceeding the average growth of productivity raise costs and will ordinarily result in high prices,” from which it is implied that wage rates “ought” to rise by the same percentage as “productivity”. Sometimes, this argument is carried over to particular industries or occupation; and sometimes, the conclusion is drawn that wages “cannot” “on the average” rise by more than “productivity”.

Discuss from the point of view of price theory, with special reference to the meaning of the concepts used and the validity of the inferences drawn. Do not get involved in business cycle, or income and employment theory.

  1. Consider a hypothetical society in which there is no investment, either net or gross. All capital is completely permanent, not subject to change in form but capable of being used for different purposes. There is no selling or buying of capital goods: whoever owns the capital goods is forced by the laws or conventions of society to hold them and is permitted only to read them out (i.e., all capital is subject to the conventions that now govern human capital). Lending or borrowing is prohibited, so that there is no market rate of interest that matters, and all saving takes the form of hoarding of cash. The total amount of money in society is fixed in nominal units (say dollars).
    1. Although this economy is stationary in the aggregate, it is not static. Explain the meaning of the sentence and its bearing on the willingness of people to hold money.
    2. Wages are initially rigid (by law or otherwise) and the society is in the state of Keynesian unemployment equilibrium. Explain. What is it that assures that the aggregate amount actually saved is equal to zero? What is it that assures that the aggregate amount people wish to save is equal to zero?
    3. Wages are now made flexible. Describe the process of adjustment to a new equilibrium position. Does this new position involve unemployment? What is the equilibrium condition on saving? What forces operate to bring about the satisfaction of this condition?
    4. Discuss the factors that determine the rent of capital goods and the wages of labor at equilibrium when both are flexible.
    5. Lending and borrowing is [sic] now introduced, but all other assumptions are retained, so that all loans are in essence “consumption loans”. What determines the equilibrium rate of interest? What effect, if any, would the introduction of lending and borrowing have on the price level?

 

 

Final Examination
Economics 300B
June 12, 1951

  1. “The statement that wages tend to equal the net product of the worker’s labor… is not, as some have thought, an independent theory of wages, but only a particular way of wording the familiar doctrine that the value of everything tends to be equal to its expense of production.” (Marshall)
    1. Explain why “the statement that wages tend to equal the net product of the worker’s labor” is not “an independent [i.e., complete] theory of wages.”
    2. Prove that it is “only a particular way of wording the familiar doctrine…” in doing so, interpret “everything” to mean “final products,” not “labor.”
  2. (a) Discuss the meaning of “profits” in connection with the theory of distribution. Outline briefly “a” theory of “profits.”
    (b) A private enterprise economy is frequently described as motivated by the desire to maximize “profits.” Is the word “profits” in this statement used in the same sense as in the discussion under (a)? Explain any difference.
  3. “Rent is but the leading species of a large genus.” Discuss.
  4. The income of farmers from the sale of their products depends on the prices at which the products sell. The general level of agricultural prices, in turn, depends primarily on the income of the nonfarm population. But the income of the nonfarm population depends on the prices of nonfarm products which, in turn, depends partly on the income of farmers.
    This kind of analysis is often criticized as circular reasoning and hence is incapable of leading to any useful conclusions. Is this criticism valid? Explain your answer.
  5. Beef sold in rural New England is mostly purchased from Chicago. Yet it is said that the retail price of the better cuts of beef is substantially less than in Chicago for the same grade of meat. Assuming that this is in fact the case. How would you explain this phenomenon in strictly economic terms? (I.e., do not give the easy – and probably wrong – explanation of irrationality, gouging, or the like). How would you test the validity of your suggested explanation?
  6. Suppose that legislative hearings were to be held on the following (a) A national bill to make the minimum wage rate very regionally, so it would be lower in the South than in the North; (b) A bill in a particular state to make it legal for manufacturers to enforce a minimum retail price on their products (a so-called “fair-trade” law).
    Indicate what groups you would expect to be testifying for and against each bill, and why you would expect them to do so.

Source:  Hoover Institution Archives. Milton Friedman Papers, Box 76, Folder 10.

Image Source: Milton Friedman (undated). University of Chicago Photographic Archive, apf1-06230, Special Collections Research Center, University of Chicago Library.

Categories
Columbia Economists NBER Swarthmore

Columbia. Economics PhD alumnus, Joseph David Coppock. 1940

 

 

In the previous post several external examiners for the honors B.A. degree at Swarthmore College in the 1940s were identified. That list included several prominent names, such as Paul Samuelson (MIT), Lloyd Metzler (Federal Reserve), Friedrich Lutz (Princeton), but also a repeat examiner was one Joseph David Coppock, considerably less prominent in the great sweep of 20th century economics. Never having heard of Coppock myself, I decided to dedicate this post to the academic and professional career of this Swarthmore alumnus (A.B., 1933) and Columbia University Ph.D. (1940).

His academic arc began with an instructorship in economics at his Swarthmore alma mater while completing his Columbia University doctoral degree and ended at Penn State University. Government service, including work as a civilian in uniform with the Office of Strategic Services during the Second World War, provided years of economic-policy experience. A link to a very interesting oral interview with Coppock at the Truman Presidential Library covering his government experience is included below.

__________________

AEA Biographical Listing, 1969

Coppock, Joseph David, academic, government; b. Peru, Ind., 1909; A.B., Swarthmore Coll., 1933; M.A., Columbia, 1934, Ph.D., 1940. DOC. DIS. Government Agencies of Consumer Installment Credit, 1940. FIELDS 5, 1ab, 2d. PUB. International Economic Instability, 1962; Economics of the Business Firm, 1959; Foreign Trade of the Middle East, 1966. RES. International Economic Relations. Econ. Adv., U.S. Dept. State, 1945-53, 1961-62; prof. econs., Earlham Coll. [Richmond, Indiana], 1953-63, American U. Beirut, 1963-65, Pa. State U. Since 1965.

Source: Biographical Listings of Members [American Economic Association], American Economic Review, Vol. 59, No. 6 (1969). Handbook of the American Economic Association (Jan., 1970), p. 86.

__________________

Joseph David Coppock
Books

Joseph D. Coppock, Government Agencies of Consumer Instalment Credit.  Research Program of the National Bureau of Economic Research. Studies in Consumer Instalment Financing: Number Five (1940), p. xii.

From the author’s acknowledgment to doctoral dissertation published by NBER

Finally, I wish to thank Swarthmore College for granting me a leave of absence to participate in the National Bureau’s investigation of consumer instalment financing.

Joseph D. Coppock
Financial Research Staff
(National Bureau of Economic Research)
and
University of California

_____________, International Economic Instability: The Experience After World War 2(McGraw-Hill, 1962).

_____________, Economics of the Business Firm: Economics of Decision Making in the Business Enterprise(McGraw-Hill, 1959).

_____________, Foreign Trade of the Middle East: Instability and Growth, 1946-1962 (Economic Research Institute, American University of Beirut, 1966).

__________________

From the Finding Aid to the Joseph D. Coppock Papers at the Harry S. Truman Presidential Library and Museum

The papers of Joseph D. Coppock relate primarily to his work with the U. S. Department of State, the Office of Price Administration, the War Production Board, and the National War College. International trade was the main focus of his work at the Department of State and the War Production Board. Most of the documents are memoranda and correspondence involving foreign trade, along with financial records, handwritten notes, reports, speech drafts, and a transcript of a debate. The papers also contain the syllabi used by Coppock during his tenure as a visiting professor at the National War College.

BIOGRAPHICAL SKETCH

1909 (February 10), Born in Peru, Indiana

1933                A.B., Swarthmore College

1940                Ph.D., Columbia University

1941                Economist, U.S. Department of Agriculture

1942                Special Assistant to Vice Chairman, War Production Board

1943                Price Executive, Chemical and Drugs Division, Office of Price Administration

1945-1953      Economic Adviser, Office of International Trade Policy, U.S. Department of State

1946-1952      Member of U.S. delegation to Economic and Social Council of the United Nations: New York, Geneva, and Santiago

1951-1953      Visiting Professor, National War College

1965                Became professor of economics at Penn State University

2000 (July 31) Died in Redmond, Washington

Coppock took a position as a visiting professor at the National War College in 1951. While there, he served as the chairman of the Civilian Faculty. After his term at the National War College, Coppock worked as a visiting professor at the American University of Beirut in Lebanon, and as a professor of economics at Earlham College in Indiana and at Pennsylvania State University.

__________________

Research Tip:
Oral History Interview
Covering Coppock’s extensive experience as an economist in government

Oral History Interview with Joseph D. Coppock (July 29, 1974) by Richard D. McKinzie. Harry S. Truman Presidential Library & Museum (Independence, Missouri).

__________________

Image Source: Swarthmore College yearbook, Halcyon 1940, p. 11.

 

Categories
Exam Questions Swarthmore Undergraduate

Swarthmore. B.A. Honors Examination in Economic Theory. External Examiner, Lloyd Metzler, 1943-45

 

Wolfgang Stolper taught at Swarthmore College from 1941-1949. In his papers at Duke University’s Economists’ Papers Archive one finds copies of  the following economic theory examination questions prepared by Swarthmore’s external examiners:

Jan/May 1942 (James G. Smith)
Jan 1943 (Paul Samuelson)
May 1943 (Paul Samuelson)
October 1943 (Lloyd Metzler) [transcribed below]
Feb 1944 (Joseph D. Coppock)
June 1944 (Friedrich Lutz)
Oct 1944 (Lloyd Metzler) [transcribed below]
Jun 1945 (Joseph D. Coppock)
Jun 1946 (Richard Musgrave)
Jan 1947 (Joseph D. Coppock)
Undated (Lloyd Metzler) [transcribed below]

The above list has led me to an interpolative guess of either February or October 1945 for the undated Metzler honors examination. Links are provided to the previously posted transcriptions of the examinations by Samuelson and Musgrave.

_________________________

Swarthmore College
Division of the Social Sciences
Department of Economics
October 20, 1943

Economic Theory
Honors Examination
Mr. Metzler

ANSWER ONE QUESTION FROM EACH PART

PART I
Write a one-hour essay on one of the following topics:

  1. The relation between cost curves and supply curves, and the conditions of equilibrium in a purely competitive industry, both in the long run and in the short run.
  2. A comparison of monopolistic competition and pure competition, including a contrast of the equilibrium position of the firm and the number of firms in the “industry” under monopolistic competition, with the equilibrium conditions and number of firms under pure competition.
  3. The marginal productivity theory in its original form, and the changes made necessary by the theory of monopolistic competition.
  4. Determinants of the level of employment and income.
  5. A careful analysis of the population problem in the United States, including both regional distribution problems and the problem of the size of the total population.
  6. Monetary versus “real” theories of the rate of interest.

 

Part II

  1. How was the cost controversy related to the development of the theory of monopolistic competition?
  2. A tax of $1 per unit is imposed upon the production of a certain commodity which is produced under conditions of pure competition. Assuming that the industry is initially in equilibrium, show how this tax affects he price, output, profits, and the number of firms in the industry, both in the short run and in the long run.
  3. Discuss the principles of price discrimination in a monopolized industry.
  4. Suppose there are only two firms producing a standardized product. Describe the determination of price and output in this industry, pointing out the difficulties which arise in such a case.

 

Part III

  1. Suppose a particular industry X produces its commodity with only two factors, labor and land, which may be used in variable proportions. An increased supply of this particular type of labor causes the wage rate to decline. Assuming no change in the demand for the product, analyze the effect of the wage reduction on (a) employment of labor, (b) employment of land, (c) price of the product, (d) output of the product, and (e) labor’s relative share in the total distribution.
  2. Describe Malthus’ theory of population. Can you present a more sophisticated version in the light of modern theories of production and distribution?
  3. “The rate of interest is the result of a race between accumulation and invention.” Discuss.
  4. Discuss the relation of the modern corporation to the theory of profits.

 

Part IV

  1. What types of cyclical fluctuation may be found in statistics of employment, income, production, and prices? How do you explain each type of cycle?
  2. What measures would you suggest for the control of employment after the war? Explain each carefully.
  3. In the period of the twenties, economists believed that business cycles could be controlled by monetary measures (i.e., movement of interest rates, bank reserve ratios, etc.). Account for the failure of such measures to control the depression of the thirties.
  4. Explain carefully the relation between investment and the level of employment, relating the analysis to Schumpeter’s “circular flow”.

Source: Duke University. David M. Rubinstein Rare Book and Manuscript Library. Economists’ Papers Archives. Wolfgang F. Stolper Papers, Box 22, Folder 1.

_________________________

Swarthmore College
Division of the Social Sciences
Department of Economics
October 16, 1944

Economic Theory
Honors Examination
Dr. Lloyd A. Metzler
Federal Reserve Board
Washington, D.C.

ANSWER FIVE QUESTIONS, INCLUDING AT LEAST ONE FROM EACH PART.
I

  1. “The conditions which determine the prices charged by a local clothing store are quite unlike those which govern the price of wheat or corn.” Explain carefully.
  2. After the war, expenditures of the federal government will be considerably higher than in the pre-war period. To meet part of these expenditures, two kinds of business taxes are proposed: (1) a tax on corporate profits, similar to our present tax, but with lower rates; (2) taxes on the sales of certain luxury items, such as cigarettes, tobacco, and liquor. It is sometimes said that the first type of tax falls upon the corporations themselves, whereas the second falls upon the consumers of the taxed items. Do you agree or disagree? Why or why not?
  3. “Imperfectly competitive markets involve an inevitable waste. Each firm produces less than its optimum output, and charges a higher price than might otherwise be necessary.” Evaluate this statement. If such wastes exist, how can they be eliminated?
  4. Suppose a particular industry produces a standardized product, such as steel, but there are only four or five producers in the whole industry. What determines the price of the product?
  5. Compare the effects of a tax on output in a perfectly competitive industry with those of a similar tax on a monopolistic output, both in the short run in the long run.

 

II

  1. “In a perfectly competitive industry, every worker gets just what he is worth, but in monopoly industries the workers are always exploited.” Present your own opinion on this subject.
  2. Define “elasticity of substitution” and explain type of problem in which the concept is useful.
  3. An industry in which there is only a single producer is unionized, and a standard wage is set which is higher than the prevailing wage. Analyze the effects of this action upon (a) the number of workers employed, (b) the output of the industry, (c) the price of the product, and (d) the total wage bill.
  4. Answer (3), assuming that the industry is perfectly competitive.

 

III

  1. One frequently encounters two statements about the return to land: (a) “Rent is the difference between the productivity of a given plot of land and the productivity of land which it is just worthwhile to cultivate.”(b) “Rents would exist even if all land were uniformly productive; it is a surplus which arises from the fact that additional units of labour applied to a given plot of land have diminishing productivity.” Are these two statements contradictory? Explain your answer.
  2. “The law of diminishing returns is indispensable to the existence of rent. Unless this law were true, the entire world’s supply of wheat could be grown in a flower pot.” Comment.
  3. “Rent, like the reward of any other factor of production, is determined by conditions of supply and demand. From this point of view, rent differs from wages mainly in respective conditions of supply.” Do you regard this is an important difference? Why or why not? Contrast the long-run effects of a tax on rents with the long-run effects of a tax on wages, assuming that wages initially are near the subsistence level.
  4. “The equilibrium rate of interest is the rate which makes the supply of savings equal to demand. The supply of savings is the schedule of amounts which individuals wish to save at various interest rates, while the demand is the schedule of amounts which business men wish to invest. Thus, when the rate of interest is in equilibrium, savings are equal to investment. But if the rate of interest exceeds the equilibrium rate, investment falls short of savings.” Evaluate this statement.
  5. Compare Böhm-Bawerk’s theory of interest with the monetary theory.
  6. “In the long run, profits of the competitive industry tend toward zero.” Does this mean that the accountant’s reports of the small enterprise owned by a single individual will also attend toward zero? Explain your answer.

 

IV

  1. Present a program for maintaining full employment in the United States after the war.
  2. “Since national income is equal to consumption plus net investment, and savings are simply the difference between income and consumption, it follows that savings for any given period are always equal to investment, by definition. For this reason, a business cycle theory which attributes changes in income and employment to a disparity between savings and investment must be fallacious.” Comment.
  3. Explain carefully how income is related to the level of net investment.
  4. During the first world war, a high interest rate was regarded as one of the important means of curbing inflation. In the present war, on the other hand, a conscious attempt has been made to keep interest rates at a very low level. Explain the relation between interest rates and prices in an economy where full employment prevails. Why do you suppose high interest rates were abandoned as an anti-inflation measure in the present war?
  5. It is sometimes said that unemployment exists because workers are unwilling to accept the wage which corresponds to their productivity. According to this view, if workers were willing to accept a reduction of wage rates, business men would find it profitable to hire more workers and unemployment would thereby be reduced. Do you agree or disagree? Explain your answer.

 

Source: Duke University. David M. Rubinstein Rare Book and Manuscript Library. Economists’ Papers Archives. Wolfgang F. Stolper Papers, Box 22, Folder 1.

_________________________

Swarthmore College
Division of the Social Sciences
Department of Economics
[No date–1945?]

ECONOMIC THEORY
Honors Examination
Dr. Lloyd A. Metzler
Washington, D.C.

ANSWER FOUR QUESTIONS, INCLUDING ONE FROM EACH PART.
I

Write an essay (about one hour) on one of the following topics:

  1. The theory of interest, from Böhm-Bawerk to Keynes.
  2. Monopolistic competition and the theory of distribution.
  3. The theory of discriminating monopoly.
  4. A comparison of perfect competition with monopolistic competition.
  5. Factors which determine the level of employment.
  6. The relation of wage rates to employment.
  7. The theory of the duopoly.
  8. The relation between wates [sic, “wage rates”?] and rent.
  9. The law of variable proportions and theory of distribution.

 

II

  1. As a result of a technological change, the cost of producing a particular commodity, X, is reduced for all firms. Assuming that the industry is perfectly competitive, the effects of this change upon output, price and profits in both the short run in the long run.
  2. Explain the relations between marginal costs, average costs, and supply curves in a perfectly-competitive industry.
  3. “In a perfectly-competitive industry, the tax on sales is always born by consumers, whereas in a monopoly industry, the monopolists bears a part of the added costs.” Evaluate this statement, considering both the short-run in the long-run.
  4. Explain the meaning of “excess capacity” in the theory of monopolistic competition, and show how it is related to other concepts of capacity.

 

III

  1. It is sometimes said that unions can improve the position of workers only to a very limited extent, since wages are governed by productivity, over which unions have little control. Evaluate this statement.
  2. Discuss the relations between inventions, wage rates, and the total wage bill.
  3. Contrast the theory of wages presented by Hicks with that of Ricardo.
  4. Show how Keynes’ monetary theory of interest evolved from Marshall’s “supply and demand” theory.
  5. Economic conditions in a particular country are disturbed by a rise in the propensity to consume. Explain the repercussions upon the rate of interest, assuming that the amount of money remains unchanged.
  6. Compare the theories of profit of Marshall and Schumpeter.

 

IV

  1. Describe the analytical problems which arise in attempting to measure business cycles.
  2. Show how the demand for producers’ goods is related to the demand for consumers’ goods, and explain the relevance of this relationship to business cycle theory.
  3. Present a brief description of the problem of unemployment which will face the United States at the close of the war, and suggest measures for solving this problem.
  4. Compare Schumpeter’s theory of business cycles with the theory of employment developed by Keynes.

 

Source: Duke University. David M. Rubinstein Rare Book and Manuscript Library. Economists’ Papers Archives. Wolfgang F. Stolper Papers, Box 22, Folder 1.

Image Source: “From family album, taken while Lloyd Metzler was a student at Harvard.”
“Lloyd A. Metzler” by Margiemetz – Own work. Licensed under CC BY-SA 3.0 via Commons.