Categories
Chicago Exam Questions Microeconomics

Chicago. Price Theory Core Examination. Summer 1962

What would your reaction be to the remark in your exam “Remember that you are writing an examination in economic theory”? But, hey, Chicago, you do you.

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Chicago Price Theory
Preliminary/Core Exams

Previously Posted

Summer 1949
Summer 1951
Summer 1952
Winter 1955
Summer 1955
Winter 1957
Winter 1958
Summer 1960
Winter 1961
Winter 1963
Winter 1964
Winter 1965
Winter 1969
Summer 1975

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CORE EXAMINATION
Theory
Summer 1962

Preliminary Examination for the Ph.D. and A. M. Degrees

WRITE THE FOLLOWING INFORMATION ON YOUR EXAMINATION PAPER:

Your Code Number and NOT your name
Name of Examination
Date of Examination

Results of the examination will be sent to you by letter.

Answer all questions. Time: 3 hours. The suggested times for the various questions are guides to their weights in the grading.

  1. (60 minutes) True-False. State very briefly the reason for your answer to each question.
    1. The cross-elasticity of demand of left shoes with respect to the price of right shoes is zero.
    2. A competitive firm buying electrical equipment was not injured by the collusion of the producers (General Electric case) even if the collusion raised prices above the competitive level.
    3. If a consumer’s income rises in the same proportion as a Laspeyres index of his cost of living, his real income is rising.
    4. Duopolists with different costs cannot achieve a monopoly price without transfer payments between the firms.
    5. The marginal utility of income is not constant for a worker who increases his hours of work when the wage rate rises.
    6. If two goods are substitutes in consumption, a 10 cent fall in the price of either good will lead to the same increase in the consumption of the other good.
    7. A minimum wage law may increase the demand for labor by some firms.
    8. A competitive firm will have a more elastic demand function for a factor of production than a monopsonist.
    9. If a firm is operating in the region of falling marginal costs it must be making losses, since marginal cost is then less than average cost.
    10. A multiplant firm will schedule its output so that marginal costs are equal in all plants.
  2. (30 minutes) The stock market break of May 28 elicited many explanations. Comment upon the relevance of each of the following explanations.
    1. Stock prices had previously been too high.
    2. There was a holding back by big buyers.
    3. Inflation was no longer feared.
    4. Sellers became panic-stricken.
    5. The gold outflow, it was feared, would lead to exchange controls.

Remember that you are writing an examination in economic theory.

  1. (30 minutes) Capital formation may be defined as the use of current resources in such a way as to increase future income, and on this definition capital formation includes investments in equipment, human beings, and discovery of new knowledge. Discuss the problem of the meaning of the marginal product of capital, and whether capital as defined is subject to diminishing returns.
  2. (20 minutes) Each firm in an industry is given a license to operate, and no new firms are allowed to enter. The value of a license rises over time — does this prove that firms operate subject to diseconomies of scale?
  3. (40 minutes) It appears that the Federal Communications Commission will be given the power to compel manufacturers of television sets to build them in such a way that they will receive ultra-high frequency broadcasts (at an additional cost of about $25 per set). Then every community can have (say) a dozen channels. Will consumers be benefitted?

Source: Harvard University Archives. Papers of Zvi Griliches. Box 129. Folder “Preliminary Examinations, 1957-1965”.

Image Source: The School of Chicago (1972) as drawn by Roger Vaughan.

Categories
Chicago Columbia Economists Gender

Columbia. Meet an ABD economics alumna. Dorothy Beal Christelow, 1937-1940

The combination of government service during the Second World War and marriage followed by the birth of a daughter and son was probably sufficient to have gotten in the way of Dorothy Beal Christelow completing an economics Ph.D. dissertation at Columbia. 

I stumbled across Dorothy Beal in an economics department request for emergency funding on her behalf in 1938 (transcribed below). This led me to conduct my own background check on her life and career, the results of which are included in this post. Her obituary in the Springfield Reporter provides most of the details. 

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Almost certainly related to
Dorothy Beal’s Family’s
“Financial Catastrophe”

“Henry S. Beal, president of the Sullivan Machinery company since March, 1933, resigned his position Friday at a meeting of the directors in Boston. Preston Upham of Boston, grandson of one of the company’s founders, was named as chairman of the board…Mr. Beal assumed the presidency of the Sullivan Machinery company March 6, 1933.

Source: From the Springfield Reporter (Springfield, VT, 13 October 1938, p. 1.

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Emergency Funding Request
on Behalf of Dorothy Beal

Columbia University
in the City of New York
Faculty of Political Science

September 27, 1938

Committee on Education,
Board of Trustees,
Columbia University.

Gentlemen:

One of our outstanding students in Economics, Miss Dorothy Beal, very suddenly finds herself facing a financial emergency, due to a financial catastrophe which has just struck her family. Instead of having her year’s work financed, as she expected, she finds herself completely without resources. Inasmuch as she is one of the strongest students we have had in the Department from the standpoint of social and scholastic background, as well as in terms of work done with us during the past year, it is my hope that your Committee may find it possible, out of accumulated funds, to make a grant which will relieve her necessities sufficiently to enable her to go on to complete this year’s academic work. I know her personally, and colleagues with whom she has studied confirm my judgment that she is a very exceptional person. At the moment she is engaged on one piece of scientific research which Professor Wolman pronounces so promising that he is eager to have it pushed to successful completion. If an award could be made her which would cover tuition and a meagre allowance for living expenses for about eight months, I am sure that such action would be not only generous but wise. [handwritten insert:] $800 in all.

I might add that if the grant-in-aid fund had not already been exhausted, Miss Beal would unquestionably have received recognition from that quarter.

Yours faithfully,
[signed] Roswell C. McCrea

*  *  *  *  *  *  *  *  *  *  *

Copy of letter

October 8, 1938

Professor Roswell C. McCrea
Department or Economics

Dear Professor McCrea:

Pursuant to the recommendation contained in your recent letter, the Trustees at their meeting today made available for a special award to Miss Dorothy Beal for the current academic year the sum of $800, chargeable to the accumulated income of the Garth Fellowship Fund.

Very truly yours,
[unsigned]
Frank D. Fackenthal

VJ

*  *  *  *  *  *  *  *  *  *  *

Columbia University
in the City of New York
Faculty of Political Science

October 6, 1938

Mr. Philip M. Hayden,
213 Low Memorial Library.

Dear Mr. Hayden:

Thank you for the information that the Trustees had acted favorably on my request that $800 from the accumulated income in the Garth Fellowship be given to Miss Dorothy Beal, candidate for the degree of Ph. D. in the Department of Economics. I now wish formally to nominate Miss Beal for a Special Fellowship from the fund mentioned above.

Will you kindly arrange with the Bursar to have made available to Miss Beal now, at his office, a check for $400, and another check for $400 on Wednesday, February 1st. Miss Beal’s present address is 220 East 73d Street, New York.

With appreciation of your cooperation, I am

Yours faithfully,
[signed] Roswell C. McCrea

Source: Columbia University Archives. Rare Book and Manuscript Library. Central Files 1890-, Box 329, Folder “McCrea, Roswell C., 7/1938 — 5/1942”.

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Cherchez l’homme!

“[Miss Beal] attended Mont Choisi in Lausanne and Wellesley college. She was graduated from the University of Chicago and after graduate work at Columbia university has been on the research staff of a division of the Treasury Department in Washington.” … [Mr. Allan] Christelow studied at the University of Leeds, Oxford university and the University of California, and has been on the teaching staff of Oxford [Tutor in Queens College Oxford in 1939] and of Princeton university [1940]. He is with the British Advisory Council in Washington.”

Source: From the wedding announcement published in the Springfield Reporter (Springfield VT), 14 May 1942, p. 7.

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Background of Dorothy’s husband,
Allan Christelow

b. January 31, 1911, Bradford, Yorkshire, England
d. August 8, 1975, New Canaan, Connecticut
A.B. University of Leeds, 1932.
B. Litt. Oxford University, 1934
Commonwealth Fund Fellow, History.

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Obituary of Dorothy Beal Christelow

HANOVER — Dorothy Beal Christelow, 89, died May 28, 2005, in Hanover.

Mrs. Christelow was an economist with the Federal Reserve Bank of New York in the 1960s, ‘70s and ‘80s. specializing in Japanese economics. She was the author of When Giants Converge: The Role of U.S.-Japan Direct Investment, which was published by M.E. Sharpe in 1995, as well as many articles.

She was born in Springfield. Vt., on March 19, 1916. the oldest of three daughters of Henry Starr Beal and Alice Ada (Colburn) Beal. On graduating from Springfield High School, she began studies at Wellesley College. She received a bachelor’s degree in 1937 from the University of Chicago.

She was accepted into Columbia University’s graduate program in journalism. While in New York City, about to embark on this new stage of her life, a family friend asked her what she was interested in writing about. When she replied “economics,” he recommended that she study economics rather than journalism. She took his advice to heart and entered Columbia’s economics program instead. She was a student there from 1937 to 1940, with the exception of a year of work as a researcher at Fortune magazine. She ultimately completed all of the requirements for a doctorate except for a dissertation.

In 1941, she moved to Washington, D.C., to work as an economist for the U.S. Treasury Department, Division of International Monetary Research. Over the next six years she went on to work for the U.S. Offices of Price Administration and of War Mobilization and Reconversion. During this period. she was introduced by a friend to Allan Christelow, an Englishman who was working in Washington, D.C. for the British Treasury. They were married in 1942, in Westerly, R.I.

In 1953. Mr. Christelow went to work for Standard Vacuum Oil Co. and the family moved to New Canaan, Conn. His work took him to Asia frequently, and the family moved to Japan for a year in 1957. Four years later, with their two children in college and boarding school, they returned to Tokyo. A series of strokes incapacitated Mr. Christelow, leaving him an invalid until his death in 1974 [sic, death was August 8, 1975]. They returned to New Canaan, and Mrs. Christelow to the work force, to the Federal Reserve Bank of New York.

On retirement from the Federal Reserve in 1986, she continued to work for it as a consultant for a time while also embarking on the writing of her book. She was an active member of the Yale China Association, acting as a trustee from 1983 to 1988 and from 1990 to 1995, and traveling to China on a trip organized by that organization. She served on the town of New Canaan’s board of finance from 1976 to 1992.

Mrs. Christelow maintained close ties to Vermont throughout her life. On retirement her parents purchased a farm in Windsor. The family spent a portion of each summer there. In 1996, she moved to Kendal at Hanover, where she continued to be active in fiscal affairs, serving on the community’s finance committee for several years.

Mrs. Christelow is survived by a daughter, Eileen Christelow of East Dummerston, Vt.,  a son, Allan Christelow of Pocatello, Idaho; and two grandchildren.

Source: Valley News (West Lebanon, N.H.), 11 June 2005, p. 4.

Image Source: Picture of Eileen, Dorothy, and Allan Christelow. From the “About Me” page of the website of Eileen Christelow, Picture Book Author & Illustrator. Image mildly enhanced by Economics in the Rear-view Mirror.

Categories
Exam Questions Money and Banking UCLA

UCLA. PhD Qualifying Exam, Money. May 1980

This post adds a fourth Ph.D. qualifying exam for the field of monetary economics at UCLA found in the papers of Robert W. Clower at the Economists’ Papers Archive at Duke University. 

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UCLA Qualifying Exams, Money
Previously posted

May 1971
May 1973
May 1974

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Ph.D. Qualifying Examination
Four Hours

MONEY

Spring Quarter 1980
May 19, 1980

INSTRUCTIONS: Answer all of the following eight questions. Be as specific and concise as possible. There is plenty of writing time to answer all of the questions satisfactorily, so try to spend some time thinking about each question before beginning to write an answer to it. Irrelevant material presented, however correct it may be, will be penalized.

    1. Outline a proof of Patinkin’s proposition that real balances are indeterminate under a classical dichotomy between real and monetary sectors.
    2. Why is the proof inappropriate in a classical money economy, one with competitive banking and convertibility of paper money into a real commodity?
    1. What special problem(s) does a limited horizon create for an inconvertible paper money system in which the money supplier is not committed to retire the issue?
    2. If we assume an unlimited horizon (a positive probability that the economy will last forever) do some problems still remain? If so, could governmental suppliers of money avoid such problems? Could a private money supplier?
    1. What is the statically optimal rate of inflation in a competitive economy with a noninterest-bearing fiat money?
    2. Would you recommend adoption of this rate of inflation as a long-run policy guideline for the U.S. economy? Explain.
  1. In the standard Walrasian model of General Equilibrium an efficient allocation of resources is achieved without the use of any device called “money.” Yet the introduction and use of money is usually presumed to generate economic gains. How would you resolve this apparent conflict? Be specific in defining what you think “money” is and in identifying possible sources of economic gains.
  2. On the basis of arguments by Mickey Mouse and other leading economists, Congress in 1980 terminated all open-market operations by the Federal Reserve System and declared fine tuning through the use of monetary policy to be the moral equivalent of aggravated assault. Discuss the probable implications of this action for
    1. The rate of inflation
    2. Rates of interest
    3. Unemployment
    4. Government expenditure during the decade of the 1980’s.
  3. A few years ago an economist wrote a letter to the Wall Street Journal complaining that much discussion of how to control inflation was based on a neo-quantity theory that emphasized “the quantity of money” but ignored “the quality of credit.” The Federal Reserve System was established, he noted, to regulate commercial bank assets, but current discussion (and policy) concentrated on the liability side of the commercial bank balance sheet and entirely ignored the asset side. The economist maintained that if, for example, commercial banks were forced to limit their lending activity to short-term, self-liquidating business loans, as initially contemplated in the Federal Reserve Act of 1913, inflation would quickly be controlled. Evaluate this argument.
  4. When bank credit cards were initially spreading through the U.S., many people argued that their use would contribute to inflation because retailers would pass on — through higher prices — the charges that they had to pay to banks for credit sales. Some people argued, however, that prices would fall because the use of credit cards would reduce overall transactions costs. Yet others argued that prices might rise or fall, depending upon the precise effects of the use of such cards upon sales volumes and upon the velocity of money. Critically assess each of these arguments.
  5. It is customary for economic theorists to distinguish in their work between “barter” and “monetary” economies, and also between “value theory” and “monetary theory.”
    1. On what basis are these distinctions made (give specific references to the literature if you can)?
    2. Do you believe the distinctions are useful? If so, explain why; if not, explain why not.

Source: Duke University. Economists’ Papers Archive. David M. Rubenstein Rare Book & Manuscript Library. Robert W. Clower papers, Box 4, Folder “Monetary Economics PhD exams. Reading list, exams UCLA 1971-1988”.

 

Categories
Economists Harvard Philosophy

Harvard. Intersection of philosophy and political economy instruction by Benjamin Rand. 19th century

While even economists lacking the slightest interest in the history of economics are aware that Adam Smith lectured and wrote on moral philosophy, few probably appreciate the fact that up through the last quarter of the 19th century political economy was still a relatively minor subfield of academic philosophy. The following account provides a nice sketch of that philosophical backstory to economics instruction at Harvard.  

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Looking back from 1928-1929 at instruction in philosophy at Harvard

…With the opening of the nineteenth century philosophy at Harvard enters upon a period about which information is more available than in the preceding centuries. The annual catalogue superseded the broadside in 1819. With the year 1826 begins the annual report of the President of the University. The deans’ reports date from 1869. Since 1883 a description of the courses [Note: link is for Faculty of Arts and Sciences since 1879-1880] has been published yearly by the philosophical department. From such sources reliable data may be gained of Harvard’s philosophical developments throughout the last century.

Levi Hedge (H.C. [Harvard College] 1792), who had received annual appointment as tutor in philosophy beginning in 1795, was given in the year 1800 the first permanent tutorship ever established in Harvard. For the support of this tutorship authority was obtained from the legislature to transfer to it the income then received by the College from tolls on the West Boston Bridge. The permanent tutor was assigned the same duties as the others, but in the event of marriage twenty per cent was to be added to his salary and a parietal tutor was to be appointed to supply his place within the College walls. In 1810, shortly after the administration of President Kirkland began, Mr. Hedge was promoted to a College Professorship of Logic and Metaphysics. He is therefore the first Professor of Philosophy in Harvard University. After appointment he continued his former duties with such other tasks as the boards constituting the government of the College might assign. He held this College Professorship of Philosophy from 1810 to 1827, when it was abandoned owing to the necessity of retrenchment. He was then given the Alford Professorship of Natural Religion, Moral Philosophy, and Civil Polity made vacant by the death of Mr. [Levi] Frisbie who had become his associate in the department. His academic career as Alford Professor continued until 1832, when he resigned owing to an attack of paralysis. He recovered from this attack and enjoyed the twelve remaining years of his life in quiet retirement with his books and in pleasant intercourse with his friends.

Mr. Hedge taught philosophy in Harvard for the long period of thirty-seven years. His reputation as a scholar has been best established by his excellent textbook in logic. His method of instruction was the customary one at that time of recitation. He was, however, far more punctilious than other teachers in exacting adherence to the language of the book. “Students expected,” says Professor Andrew Preston Peabody, who was his pupil, “to gain his permanent good will and lasting favor by reciting his ‘Logic’ verbatim, and there were myths afloat as to his own laudation of the book: ‘It took me fourteen years, with the assistance of the adult members of my family, to write this book; and I am sure that one cannot do better than to employ the precise words of the author.’ If Dr. Hedge thought well of his ‘Elements of Logic,’ he was entirely in the right. There is not in the whole book a definition, or the statement of a principle, or a rule that would bear abbreviation and that would not lose by being simplified.”

In 1817 Mr. Levi Frisbie (H.C. [Harvard College] 1802) who had previously been a Tutor (1805-11) and Professor (1811-17) of Latin, was elected the first Alford Professor of Natural Religion, Moral Philosophy, and Civil Polity. This new professorship had been made possible through the bequest of John Alford, a wealthy merchant of Charlestown, Massachusetts. This benefactor had died in 1761 leaving a large portion of his estate to “pious and charitable purposes.” His executors selected Harvard College as a proper beneficiary and in 1782 transferred to it somewhat over £1300 on condition that the Corporation retain this sum and add the interest to the principal until the capital should suffice to endow a professorship. They also stipulated at considerable length the functions and duties of this chair, and some of the details which are the product of a past age. Mr. Frisbie, the first incumbent of the professorship thus established in 1817, held it till his death in 1822. His successors have been Professors Hedge, Walker, Bowen, Palmer and Hocking. Both the philosophical and the preceding classical instruction by Mr. Frisbie were attended with a considerable degree of success. “Few men,” says President Quincy, “have left deeper traces of their moral and intellectual excellence in the memories of their contemporaries than Mr. Frisbie. In the collegiate circle in which he moved, he was the object of universal confidence and affection. He united a classic taste with great acuteness of intellect and soundness of judgment; and with a mind highly gifted and highly cultivated, rich in the powers of conversation and research he regulated his life by a standard of moral and religious principle exquisitely pure and cultivated.”

After Professor Frisbie’s death on July 9, 1822, the Alford Chair remained vacant until 1827, when Professor Levi Hedge, as already mentioned, was transferred to it from his College professorship. Accompanying this change instruction in logic was assigned to the Boylston Professor of Rhetoric and Oratory, and the teaching of metaphysics was retained by Dr. Hedge “as not inconsistent with the Alford statutes.” After the resignation of Professor Hedge in 1832, the Alford Professorship was again permitted from considerations of economy to remain vacant until the appointment of the Reverend James Walker to it in 1838. Meanwhile, between 1832 and 1838 instruction in philosophy was given by two tutors. Joseph Giles (H.U. [Harvard University] 1829) was Tutor in Natural, Intellectual, and Moral Philosophy from 1832 to 1834, and Instructor in the same subject from 1834 to 1836. He afterwards became a lawyer in Boston, where he lived until his death in 1882. Francis Bowen was the Tutor and Instructor in Natural and Intellectual Philosophy from 1836 to 1839. Of him we later shall have much more to say.

During the period of Professors Hedge and Frisbie the courses of instruction and the textbooks underwent changes, due to a modernizing tendency. Instruction in logic, ethics, and metaphysics was given wholly by Dr. Hedge from 1795 to 1817. But when the philosophical work was shared with Professor Frisbie from 1817 to 1822, the Alford Professor taught the intellectual philosophy as well as the natural religion. After 1822 Dr. Hedge was again in complete charge of the courses, but, as he became Alford Professor from 1827 to 1832, he surrendered the logic and devoted his attention more particularly to intellectual and moral philosophy.

An examination of the annual catalogues as issued after 1819 reveals both the subjects taught and the textbooks used by the professors. From 1820 to 1827 Professor Hedge taught logic and intellectual philosophy to the Sophomores. He used his own “Logic,” and Locke’s “Essay” as textbooks. To the Juniors he gave instruction in ethics and metaphysics, using as the textbooks Paley’s “Moral Philosophy” and Stewart’s “Philosophy of the Human Mind.” Professor Frisbie gave the course to the Seniors in intellectual philosophy and political economy. For textbooks he employed Brown’s “Lectures on the Philosophy of the Mind” and Gay’s [sic, “Say’s” is correct here] “Political Economy.” [Vol. I; Vol. II] He also taught a course in natural religion to the Juniors, using Paley’s “Evidences of Christianity,” and another to the Seniors, using Butler’s “Analogy of Religion.” These various courses were termed private exercises or recitations.

In addition lectures were given by the Alford Professor upon which the students were frequently or regularly examined.

For the later period of Professor Hedge’s incumbency very complete information about the philosophical department is afforded by the report of the President, who had been asked by the Overseers to include in it annually an account of the state of the departments, the duties of the instructors and the progress of the students. Instruction in the department from 1828 to 1838, it is said, was conducted through study and recitations. The studies commenced in the Junior year with Stewart’s “Elements of the Philosophy of Mind,” and concluded with Paley’s “Moral Philosophy.” Recitations were heard six days in the week from the class in two divisions. About two thirds of each division were questioned at every recitation. The Juniors also had a forensic exercise under the instruction of the philosophical professor every other Friday. In the Senior year the study of philosophy was continued with Brown’s “Treatise on the Mind.” When both volumes of this work were completed, the class entered upon the study of Gay’s [sic, “Say’s” is correct] “Political Economy,” and concluded with Levi Hedge’s “Elements of Logic.”

During the first term recitations were heard for two hours in the afternoon five days in the week, and during the second and third terms for one hour every day. On all the books used in this department twelve pages constituted the average length of the lessons assigned. Besides the preceding work two lectures were delivered every week during the second term on Civil Polity and Locke’s “Essay on the Human Understanding.”

With the advent of Mr. Giles as Instructor in 1833-34, Locke’s “Essay” was substituted for Brown’s “Philosophy of the Mind.” He also required of the students a written analysis, upon which commentary was made by the Instructor “exhibiting the opinions of other philosophers on controversial questions.” This is the first mention of direct instruction akin to the history of philosophy. The only new feature during the term of Mr. Bowen as Instructor (1836-39) is the statement in the President’s Reports that his method included “familiar lectures.” In this direction great changes were later to be effected.

In addition to the instruction given in the philosophical department, logic, as already stated, had been transferred in 1827 to the Boylston Professor of Rhetoric at the time Professor Hedge became Alford Professor of Natural Religion. It was taught to the Sophomores during the third term by Professor Edward Channing, who at first used Hedge’s “Logic,” but in 1833 introduced Whately’s “Logic.” This work was long employed by the department of rhetoric.

It is evident from this detailed review of the courses of instruction and of the textbooks between 1800 and 1840 that the introduction of the Scottish philosophy chiefly characterized the progress of philosophical thought at Harvard during the first half of the nineteenth century. The devotion of Professor Hedge to the Scotch school is particularly revealed by the fact that he made an abridgment of Brown’s “Philosophy of the Mind” for the use of his students. The philosophy of Stewart and Reid, moreover, was prescribed throughout this period. English philosophy, however, maintained a foothold in the continuance of the study of Locke. In ethics Paley’s “Morals,” which was used at this period, offered a splendid presentation of the utilitarianism of the eighteenth century for study. The supernatural sanction added by its author to the principles of Bentham, as evidenced by his well-known definition of virtue, would also tend to make the doctrine more acceptable in New England. But Paley is a wonderful expositor and has seldom been surpassed in this respect as a writer of textbooks. Doubtless, too, this was an important factor which commended his work for use in the curriculum of instruction at Harvard. As regards the general method of instruction in the subjects here described, the change from the close adherence to textbooks by Professor Hedge to the written exercises under Mr. Giles and to the “familiar lectures” of Mr. Bowen is also an advance which occurred during the early portion of the nineteenth century.

[…]

Francis Bowen accepted the chair of Alford Professor as successor to President Walker in 1853. He was born in Charlestown in 1811 and was graduated from Harvard in the Class of 1833, that later became famous in academic circles for such members as Professors Lovering, Torrey, and Wyman. From 1833 to 1839 he had been instructor, as already mentioned, in intellectual philosophy at Harvard. From 1843 to 1854 he was editor and proprietor of the North American Review. The Alford professorship was held by him for the long period of thirty-six years, extending from 1853 to his resignation in 1889. To ascertain the influences which moulded his thought and later entered into his philosophical instruction, one must revert briefly to various papers written by him during the period when he was instructor. These are to be found in his “Critical Essays” and concern the history and existing condition of speculative philosophy. In 1837 he wrote an article upon “Locke and the Transcendentalists.” Its purport was to prove that while the transcendentalists decry Locke, he had diffused a juster mode of thinking and a clearer knowledge of the human intellect than they possessed and that his work in consequence has been of incomparable value to philosophy. “The new philosophy,” he writes, “of transcendentalism comes from Germany, and is one of the first fruits of a diseased admiration of everything from that source, which has been rapidly gaining ground of late till in many individuals it amounts to sheer midsummer madness. In the literary history of the last half-century there is nothing more striking than the various exhibitions of this German mania. The peculiarities of the German mind are too striking to grace any other people than themselves.” But for the German language, literature, and philosophy Bowen had real admiration. He perceived that the study of philosophy by the Germans was a national passion. They had produced a race of metaphysicians after Kant, while among the countrymen of Locke, Berkeley, and Hume the taste for metaphysical speculation had declined.

It is thus not surprising that Bowen turned his attention at an early date to the understanding of Kant. The first fruits of this attempt was an article on Kant and his philosophy which appeared in the North American Review in 1839. This paper consists of a review of the translation of the “Critique of Pure Reason” which had appeared in London in 1838 and in it he gives a comprehensive outline of the system of this Copernicus of philosophy. It is, so far as I am aware, the first direct presentation of the critical philosophy in America. Kant, Bowen believed, needed an interpreter, rather than a translator, and Cousin he regarded as the best qualified for this task. Nevertheless, Bowen’s own interpretations of various philosophical systems always possessed the lucidity of the French. The presentation he made of the Kantian philosophy did not lead him to become an adherent of it. A system that coupled the refutation of idealism with the denial of space and time he viewed as certainly original; but it could scarcely be expected that such a doctrine would find acceptance by a follower of the common-sense philosophy.

Both the German successors of Kant and the French philosophers were likewise studied during the period of Bowen’s instructorship. In 1841, shortly after he became an editor, his familiarity with them is revealed in two reviews, one on “Fichte’s Exposition of Kant” in the Christian Examiner (1841) and the other on “The Philosophy of Cousin” in the North American Review (1841). The latter paper consists of a detailed criticism of Cousin’s “Elements of Psychology: included in a Critical Examination of Locke’s Essay on Human Understanding,” which had recently been translated from the French by Rev. C. S. Henry. It is to Cousin rather than to Jouffroy, as attested by the translations of this work and by the use of his textbook, that the French School is indebted for the influence which it then began to acquire in England and America. Cousin’s “Elements of Psychology,” which was reviewed by Bowen, was used at Harvard in 1845–46, and became a favorite textbook in a number of other American universities. The fact that Bowen had gained a thorough acquaintance of French and German philosophy while instructor from 1836 to 1839 must be kept in mind, as it was many years after he became a professor before these subjects found a large place in his courses of instruction.

There are two distinct and separate periods both in the method and in the character of instruction given by Bowen as successor to President Walker in the Alford professorship. The first period was from 1853 to 1870, during which he employed the customary method of recitations and adhered to the prevailing Scottish philosophy. The second period lasted from 1870 to his resignation in 1889, in which he gradually adopted the method of lectures as in harmony with the elective system, and introduced the Harvard students for the first time through regular instruction to the domain of German philosophy.

The instruction during the first period of his incumbency from 1853 to 1870 was mainly based upon Reid’s “Intellectual Powers of Man,” Stewart’s “Active and Moral Powers,” Bowen’s “Ethics and Metaphysics,” Hamilton’s “Metaphysics,” edited by Bowen, and Bowen’s “Logic.” From 1853 to 1856 during the first term the junior class recited three times a week in Reid’s “Intellectual Powers of Man” and the seniors three times a week in Stewart’s “Active and Moral Powers.” During the second term the juniors recited three times a week in Bowen’s “Ethics and Metaphysics” while the seniors studied political economy and constitutional law. From 1856 to 1857 the seniors only were taught philosophy. During the first academic term throughout the year this class recited four times a week from Bowen’s “Ethics and Metaphysics,” and likewise from 1860 to 1867 in Hamilton’s “Metaphysics.” During the second term the same class recited four times a week mainly on logic, using in successive years the logic of Mill, of Hamilton, and of Bowen. From 1867 to 1870 the sophomores and juniors were again included with the seniors in the study of philosophy. The sophomores recited at this time during one term, twice a week, in Stewart’s “Metaphysics” and the juniors in Bowen’s “Logic” and Hamilton’s “Metaphysics.” The senior class recited the first term three times a week in Bowen’s “Logic[”] and [“]Political Economy,” and the second term in Hamilton’s “Metaphysics” and Bowen’s “Ethics and Metaphysics.” Forensics were also read in alternate weeks throughout the year by the juniors and seniors. From this survey of the textbooks during the first period of Bowen’s teaching, between 1853 and 1870, it is evident that the Scottish philosophy still predominated in the philosophical instruction at Harvard.

[…]

In 1869, Charles W. Eliot became President of Harvard University. Almost immediately a radical change was effected in the entire method of instruction by the permanent adoption of the elective system. Bowen proved equal to the new demands in the philosophical department. He abandoned in large measure the method of recitation and gradually adopted the lecture system. The range of his textbooks was greatly enlarged. He broadened the entire scope of instruction in philosophy and between 1870 and 1874 introduced no less than five new courses. In 1870-71 he offered a course on formal logic, using doubtless De Morgan’s “Formal Logic,” in conjunction with Bowen’s “Ethics” and Mansel’s “Metaphysics.” He also founded a course in the same year which later was the first to receive in the curriculum the formal designation of “Psychology.” The textbooks used in it were Porter “On the Human Intellect,” Locke’s “Essay,” Cousin “On Locke,” and Mill’s “Examination of Sir William Hamilton.” This course was given for five years from 1870 to 1876. A course was also given for one year (1872-73) in ancient philosophy in which the textbooks studied were by Renouvier, Ueberweg, and Bouillier.

In the development of Bowen’s instruction during the second period, two courses in the history of philosophy are of greatest importance. In 1868 to 1870 a course had been introduced in the general history of philosophy with the use of Schwegler and Kant; and in 1870–71 this course became permanently established as part of the curriculum under the title of “French and German Philosophy.” It continued to be included in Bowen’s teaching for nineteen years, until his resignation in 1889. The textbooks used in it were Bouillier’s “Historie de la philosophie cartésienne” and Kant’s “Critique of Pure Reason” for the entire period; Schwegler’s “History of Philosophy” from 1870 to 1879; and Bowen’s “Modern Philosophy” from 1879 to 1889. In this course, in addition to Kant, the study of the later German metaphysicians was pursued by him with the aid in 1870 of his own excellently written sketches on the “History of Modern Philosophy.” The other course by Bowen mentioned as of significance in his philosophical instruction was one in modern German philosophy. It was first offered in 1873-74 and was given until 1889 throughout the remaining period of his academic instruction. In it German textbooks were for the first time used in the study of philosophy at Harvard. The authors and the works studied were Hartmann’s “Philosophie des Unbewussten” and Schopenhauer’s “Die Welt als Wille und Vorstellung.” These works were translated by the students in the classroom and their philosophical doctrines discussed. To Bowen thus fairly belongs the credit during this period of introducing the study of German philosophy into Harvard. He also laid thereby broad foundations for the future development of the entire field of the history of philosophy in the University.

Bowen’s resignation as Alford Professor of Natural Religion, Moral Philosophy, and Civil Polity took place at the close of the College year, 1888-89. In the annual Report, dated January 16, 1890, President Eliot wrote of him: “Mr. Bowen had been forty years in the service, four years as tutor (1835–39) and thirty-six years as Alford Professor (1853-89). In the earlier part of his service as Alford Professor he gave instruction in all the great subjects mentioned in the title of his chair: in the later years the Plummer Professor and the Professor of Political Economy had relieved him of large portions of the work assigned by its founder to the Alford Professorship. As teacher and author Professor Bowen was always learned, clear, positive, and incisive; as a member of the Faculty he was punctual in attendance, usually, but not uniformly conservative in his action, and courteous though strenuous in debate. In recognition of his long, faithful, and distinguished service he has been elected, since the beginning of the current year, Alford Professor Emeritus.”

Bowen lived only six months after his resignation. His death occurred January 21, 1870. Of him a writer at the time said: “The late Professor Bowen was in some respects a more remarkable man than the comments upon him since his death would indicate. He had not an original mind, but, like Mr. John Fiske, who has given a new popular rendering to American history, he had the faculty of using the knowledge accumulated or the results reached by others in a remarkable degree. He accumulated what was going in economics, politics, literary criticism, philosophical investigation and religious thought, as if in each department he were a specialist and his long list of works shows his versatility in this respect to have been, perhaps, more remarkable than that of any American of his time.”

An innovation in academic instruction occurred during the period of Bowen’s teaching by the addition to the regular curriculum of courses of university lectures. These were given by eminent men in different domains who received annual appointment. Only a few lectures were delivered by any one individual; so that in a course given throughout a single year six lecturers were employed. The system failed as a scheme for giving advanced instruction. The treatment of subjects was too disconnected. Students in the higher branches demanded more continuous and systematic training. The system, therefore, disappeared in 1871-72 after a trial of nine years. The best results, however, according to the President’s Report were attained by it in the year 1869–70 from the courses through the year in modern languages and philosophy. The success of the course in philosophy was undoubtedly due to the brilliant array of lecturers appointed in that year. The list included Ralph Waldo Emerson of Concord, J. Elliot Cabot of Brookline, George P. Fisher of Yale College, Charles S. Pierce and John Fiske of Cambridge. In 1870-71, which was the last year of this University lecture course in philosophy, R. W. Emerson lectured “On the Natural History of the Intellect”; J. E. Cabot on “Kant”; Chauncy Wright of Cambridge on “Psychology” C. S. Pierce on “Logic”; and John Fiske “On the Positive Philosophy.”

III

The development of religious and moral instruction in the University has always been closely associated with the philosophical department. Natural religion and moral philosophy were among the subjects specifically assigned to the Alford Chair. They likewise formed a part of the instruction given by the Hollis Professor of Divinity. Upon the appointment of Professor Bowen in 1853 the teaching of the religious and practical aspects of these subjects, as already mentioned, was transferred to President Walker, although he continued to give a course in “Religious Instruction,” as these branches were then designated, from 1853 to 1855. In 1855, however, a new professorship of “Christian Morals” was established through the will of Caroline Plummer. The full title of the incumbent was at first “Preacher to the University” and “Plummer Professor of Christian Works”; but in 1886 it was changed to “Plummer Professor of Christian Morals.” The course in religious instruction and Christian ethics which had been given by the President was then assigned to the Plummer Professor. The first incumbent of the new chair of Christian Morals was Frederic Dan Huntington (A.B. Amherst 1839), who held it from 1855 to 1860. Instruction was given by him to the freshman class in Whately’s “Lessons in Christian Morals,” and in Paley’s “Evidences of Christianity.” He also heard recitations from the seniors in Butler’s “Analogy.” In 1860 Professor Huntington resigned to become President of Saint Andrew’s Divinity School at Syracuse, New York. Later he became “Episcopal Bishop of Central New York,” an office he held until his death in 1904.

Professor Andrew Preston Peabody (H.U. [Harvard University] 1826) received in 1860 the second appointment made to the chair of Christian Morals. He retained this professorship for the long period of twenty-one years. From 1860 to 1875 he gave instruction twice a week both to the freshman and the senior classes; but from 1875 to 1881 his work was limited mainly to the senior class. With the freshmen he used from 1862 to 1873 Champlin’s “First Principles of Ethics,” which was an elementary textbook devoted chiefly to practical ethics. In 1873 Professor Peabody published a “Manual of Moral Philosophy,” which he had prepared for the special use of his freshman class. This work contained, in addition to a discussion of the motives of action and of the various virtues, an excellent outline of the history of moral philosophy. The textbook prescribed by him for the senior class was changed nearly every year. He used in turn Hopkins’s “Lectures on Moral Science,” Peabody’s “Lowell Lectures on Christian Doctrine,” Bulfinch’s “Evidences of Christianity,” Peabody’s “Christianity, the Religion of Nature,” Fleming’s “Manual of Moral Philosophy,” Stewart’s “Philosophy of the Active and Moral Powers of Man,” Calderwood’s “Handbook of Ethics,” Jouffrey’s “Ethics,” Upham’s “Elements of Mental Philosophy,” Hodgson’s “Theory of Practice on Ethical Inquiry,” Grote’s “Treatise on the Moral Ideals,” Janet’s “Ethics,” and Plutarch’s “Morals.” No better evidence than this list of works need be offered of the wide range of his knowledge and of the character of his instruction in Christian ethics. Upon his resignation in 1884, he was appointed Professor Emeritus. Thereafter he was engaged in constant literary activity, of which one result was the publication of his “Moral Philosophy” in 1887. His death occurred on the 10th of March, 1893. It was the personality of Professor Peabody, even more than the instruction he gave, which proved an inspiration to successive generations of students. He was a modern saint, and, as is said upon his memorial tablet in Appleton Chapel, “Wist not that his face shone ?”

In the foregoing description of the progress of philosophical instruction at Harvard during the eighteenth and nineteenth centuries, we have dealt with the work of successive professors each of whom was responsible for teaching almost all the courses in philosophy. The system of instruction, moreover, during this period was organized to correspond with the four successive years of the college course. A new era was inaugurated with the adoption of the elective system. The classification of courses based upon college classes now gave place to a grouping according to subjects from the elementary to the most advanced. The gradual growth of the elective system resulted in 1879-80 in the entire disappearance of prescribed work in philosophy. Political economy had for many years been taught as part of the work of the Alford Professor of Civil Polity and was included in the department of philosophy even after a special instructor was appointed for the subject. In 1879-80, however, a separate department of political economy was formed. From a very early date forensics also had been regarded the peculiar work of the teacher of philosophy and Professor Palmer had charge of them after his appointment, until they too, in 1879-80, ceased to be required. Henceforward the work of the philosophical department was limited to its own peculiar sphere and the changes which take place therein are those due to development within its own domain. Philosophical instruction under the elective system now devolved upon a staff of teachers each of whom became responsible in large degree for special subjects or branches of philosophy.

Prior even to the adoption of the elective system a beginning had been made towards the enlargement of the philosophical staff. In 1866, Ephraim Gurney was appointed Assistant Professor of Intellectual Philosophy and as an associate of Professor Bowen taught for two years the course given in Bowen’s “Logic” and Hamilton’s “Metaphysics” to the junior class. He had as his immediate successors, who taught the same course, William Wells Newell, Instructor in Philosophy for the year 1868-69, and Ellis Peterson, Assistant Professor of Philosophy for the years 1870-72. But with the transition to the elective system and the consequent formation of a philosophical department, in the early history of which, as already described, Professors Bowen and Peabody had shared, there was made in successive years a series of appointments to the philosophical staff of younger men who were to assume the large responsibilities of the successful development of this important division under the newly adopted elective method of instruction.

[…]

In 1880, Francis Greenwood Peabody (H.U. [Harvard University] 1869) was appointed Parkman Professor in the Harvard Divinity School, where he taught homiletics, ethics, and the philosophy of religion. In 1882-83 he added to the scope of the philosophical instruction by offering two courses in the philosophical department of the College. One of these courses was upon the philosophy of religion and the other upon ethics in relation to religion. In the latter course, he used Spencer’s “Data of Ethics” and Maurice’s “Social Morality.” The social aspects of moral questions here discussed proved significant of the future development of his work. In 1883-84 he offered a course on ethical theories and the social problem, in which he treated the topics of charity, divorce, labor, Indians, prisons, and temperance. Thereafter, in a course designated “The Ethics of the Social Questions,” he discussed the practical ethics of modern society and required of students personal investigation of various institutions of charity or reform. In 1886 he was transferred from the Parkman professorship to the Plummer professorship of Christian Morals as successor to Professor Andrew Preston Peabody and thereby maintained the prestige of an honored name in the department. The work of social ethics developed under him to such proportions as to be formed in 1905 into a separate department of the philosophical division. This department, thoroughly equipped with a library and museum of social ethics, found permanent quarters for social research in 1905 in Emerson Hall.

[…]

A systematic course in which ethical theory was applied to the social problems owed its founding at Harvard, as already stated, to Professor Francis Greenwood Peabody. It was first given by him under the designation of “Social Ethics” in 1884, having been preceded by his course on “ethics in relation to religion” from 1882 to 1884. Religious instruction, Christian ethics, and Social ethics has thus been the progressive terminology applied to their courses of instruction by the three successive Plummer Professors of Christian Morals. In the course on social ethics emphasis was laid by Professor Peabody upon the moral aspects of the social questions as well as the philosophy of society involved. The ethics of the family, of poor relief, of the labor question, and of the drink question, were studied. In addition, students made personal investigations of various institutions for the amelioration of society. Dr. Benjamin Rand was associated with Professor Peabody in the successful development of this course from 1894 to 1902. The staff for the practical study of social problems was further enlarged by the appointments of Professor David Camp Rogers and Professor Jeffrey Richardson Brackett. Through the efforts of Professor Peabody a finely equipped department for instruction in social ethics was made possible by the wise gifts of Mr. Alfred Tredway White, toward the construction and endowment of it in Emerson Hall.

Source:  Benjamin Rand. Philosophical Instruction in Harvard University from 1636-1906. pp. 14-19, 23-25, 28-33, 35-36, 41-42. Reprinted from The Harvard Graduates’ Magazine, Vol. XXXVII, 1928-1929.

Categories
Agricultural Economics Exam Questions Harvard

Harvard. Final Exam for Economics of Agriculture. Carver, 1908-1909

 

In 1911 Harvard economics professor Thomas Nixon Carver published a textbook Principles of Rural Economics  that undoubtedly encompassed the content of his course on agricutural economics first taught in 1903-04. Carver’s book is prefaced with an eight page bibliography.

The eight question final exam for this semester course from 1908-09 is found below.

________________________

Earlier material

ca. 1904 Problem set
1903-04 Final exam
1905-06 Final exam

________________________

Course Enrollment
1908-09

Economics 23 2hf. Professor Carver. — Economics of Agriculture, with special reference to American conditions.

Total 25: 2 Graduates, 10 Seniors, 7 Juniors, 4 Sophomores, 2 Others.

Source: Harvard University. Report of the President of Harvard College, 1908-1909, p. 68.

________________________

Course Description
1908-09

[Economics]23 2hf. Economics of Agriculture, with special reference to American conditions. Half-course (second half-year). Tu., Th., at 2.30. Professor Carver.

A study of the relation of agriculture to the whole industrial system, the relative importance of rural and urban economics, the conditions of rural life in different parts of the United States, the forms of land tenure and methods of rent payment, the comparative merits of large and small holdings, the status and wages of farm labor, the influence of farm machinery, farmers’ organizations, the marketing and distribution of farm products, agricultural credit, the policy of the government toward agriculture, and the probable future of American agriculture.

Source: Official Register of Harvard University, Vol. V, No. 19
(1 June 1908). History and Political Science Comprising the Departments of History and Government, and Economics, 1908-09, p. 56.

________________________

ECONOMICS 23
Year-end Examination, 1908-09

  1. Into what periods would you divide the agricultural history of the United States, and what are the leading characteristics of each period?
  2. What are the chief reasons for the fact that the urban population of the United States is growing more rapidly than the rural population?
  3. Does the law of diminishing returns as applied to agriculture give rise to national problems different from those to which it gives rise in manufacturing? Explain.
  4. Discuss the question: Is further immigration desirable in the interests of American agriculture? State clearly the point of view from which you approach the question.
  5. What agricultural improvements do you associate with the following names: Townsend, Bakewell, Robert Colling, Benjamin Tompkins, Jethro Wood.
  6. What are the chief difficulties in the way of the organization of farmers and farming interests?
  7. What, in your opinion, are the most important things now being done for agriculture by the Federal Government of the United States?
  8. State briefly the chief advantages of large-scale farming; also of small-scale farming.

Source: Harvard University Archives. Harvard University, Examination Papers, 1873-1915. Box 8, Bound vol. Examination Papers 1908-09; Papers Set for Final Examinations in History, Government, Economics,…,Music in Harvard College (June, 1909), p. 51.

Image Source: “Picking cranberries.” Card. [ca. 1850–2001]. Digital Commonwealth, https://ark.digitalcommonwealth.org/ark:/50959/fx71c322q  (accessed June 02, 2025).

Categories
Exam Questions Harvard Theory

Harvard. Graduate Economic Theory Exam. April 1962

These posts are unlikely to threaten the popularity of Wordle, but letting graduate prelim exams in economics of yore test one’s wits or perhaps amuse by their presumption is possibly a better use of time for anyone from wannabe economist to crusty old emerita/us in the field.

So with little ado, Economics in the Rear-view Mirror adds Harvard’s April 1962 graduate exam in economic theory to its collection of artifacts. 

_____________________________

Other Harvard Written Exams
in Economic Theory

April 11, 1961
November 13, 1962
April 8, 1963

_____________________________

PLEASE HAND IN THE EXAMINATION TEXT WITH YOUR BLUEBOOK
HARVARD UNIVERSITY
Department of Economics
WRITE LEGIBLY

Written Examination
in Economic Theory
April 10, 1962

All students must answer Part I; choose four questions from Part II.

Part I (one hour)

State whether each of FOUR of the following statements is true or false, justifying your answer in each case:

  1. The principle that a firm is maximizing its profits when marginal cost equals marginal revenue does not apply to oligopolistic firms.
  2. If a firm’s average cost curve in always decreasing, that firm will lose money if it sets its price equal to its marginal cost.
  3. If the price of a commodity rises, the demand for that commodity may rise too and the quantity offered for sale may fall.
  4. If production of the purely competitive firm is subject to constant returns to scale, a firm will not be minimizing cost unless it is producing in the range where every factor is subject to non-increasing returns.
  5. If a monopolist sells in two separated markets with different demand curves, in order to maximize his profits he must charge a lower price in the market where the elasticity of demand is lower in absolute value.

Part II (three hours)

  1. Keynes stated that from a policy viewpoint everything that can be done by money wage cuts can be done more effectively through monetary policy.
    1. Is this statement compatible with the theoretical framework of the General Theory?
    2. If a Haberler-Pigou-Patinkin real balances effect was of significant quantitative importance, would this change your conclusions about the two policies?
  2. Discuss the relative merits of financing a new superhighway by tolls or by gasoline taxes.
  3. “The theory of the competitive market system’s pricing of all products, allocation of resources, and distribution of income through payments for the factors of production, seemed to many nineteenth-century economists the main part of all economic theory, because it seemed to best demonstrate the desirability of the liberal, competitive regime.”
    Discuss the implications and validity of the statement, and support your points by considering as cases any two (your own choices) of the “many” theorists presumably referred to.
  4. Using a two commodity model, show that, with independence of utilities and an assumption of diminishing marginal utility for each good, there can be no “inferior” good.
  5. In different contexts the Stockholm school, exemplified by Ohlin, and post-war economists like Harrod have proposed theories of the dynamic instability of economies. Sketch these two types of theory with particular emphasis on the differences between them.
  6. Would there be time preference or waiting in a static state? A “marginal productivity” of capital? Liquidity preference? Interest? Discuss the issues in each case. Be sure your own answers are consistent with each other.
  7. The possibility of “excess capacity” under monopolistic competition has been vigorously defended and categorically denied. State and defend your own views, with some discussion of both sides of the question.

Source: Duke University. Economists’ Papers Archive. David M. Rubenstein Rare Book & Manuscript Library. Edward H. Chamberlin Papers, Box 17, Folder “Economics Department 1960-62”.

Source: Harvard University. From the cover of the Class Album 1946.

Categories
Chicago Economists M.I.T.

Chicago. Caricature of Stanley Fischer by Roger Vaughan, 1973

Yesterday (May 31, 2025) I learned that another of my professors, Stanley Fischer, passed away. Many cohorts of the graduate program in economics at M.I.T. learned their macroeconomics as well as advanced monetary theory from him. My personal debt to Stan is that I finally “got” an understanding and intuition of macroeconomics from his courses. He was a phenomenal lecturer and we can all look forward to the coming testimonies from the legions of thesis advisees. With this post the fine line drawing of the young Stanley Fischer seen above enters the internet record for the first time.

The 1973 caricature of Stanley Fischer was drawn by the University of Chicago graduate student in economics Roger Vaughan and published in his series Great Moments in Economics. Roger Vaughan’s monumental work “The School of Chicago” can be viewed in an earlier post. Biographical information about the artist can be found at that link as well.

Source: Harvard University Archives. Papers of Zvi Griliches. Box 129, Folder “Posters, ca 1960s-1970s”.

 

Categories
Economists Pennsylvania Teaching

Pennsylvania. Sketch of origins of economics instruction. Plummer, 1925

This 1925 memo was written in response to an inquiry by Edwin R. A. Seligman regarding the historical chronology of economics instruction at the University of Pennsylvania. It wandered into Joseph Dorfman’s papers where one finds a subset of Seligman’s papers. 

_________________________

Sampler of University of Pennsylvania
Documents

Circular of Information relating to the Wharton School of Finance and Economy, 1893

Circular of Information relating to the Wharton School of Finance and Economy, 1894-95

Catalogue of the University of Pennsylvania at HathiTrust
(Full-views 1848/49 through 1928/29).

Emory Richard Johnson, The Wharton School: Its First Fifty Years, 1881-1931.

Chapter 8  of Edgar Potts Cheyney’s History of the University of Pennsylvania 1740-1940

_________________________

UNIVERSITY OF PENNSYLVANIA
PHILADELPHIA

Wharton School of
Finance and Commerce

October 29th, 1925.

Professor Edwin R. Seligman
Columbia University
New York, N. Y.

My dear Professor Seligman:

About two weeks ago you wrote to Professor [Emory Richard] Johnson asking about the early teaching of Economics at the University of Pennsylvania and I informed you that I would look into the matter and let you have anything I could. Dr. W. C. [Wilbur Clayton] Plummer, an instructor in Economics, who has considerable ability as an historian, looked into the situation for me. Just how much of what he has prepared will be of use to you I am not sure, but I am enclosing you the copy of his material exactly in the form in which he submitted it to me.

If I can be of further help, will you kindly let me know!

With personal regards.
Very cordially,
[signed] Ernest M. Patterson

EMP/MH

THE EARLY TEACHING OF ECONOMICS
AT
THE UNIVERSITY OF PENNSYLVANIA.

The catalogues of the University of Pennsylvania beginning with the one for the year 1824 are preserved in the office of the Secretary of the University, and the descriptions of courses in these catalogues clearly indicate that the subject of Economics was not taught between the years 1824 and 1855. However, beginning with the scholastic year, 1855-56, lectures on the subject of Political Economy were given by Dr. Henry Vethake, Provost of the University and Professor of Intellectual and Moral Philosophy. In addition to the lectures on Political Economy, Dr. Vethake gave Instruction in “Intellectual Philosophy, Ethics, the Evidences of Natural and Revealed Religion, Logic, the Elements of Natural, International and Constitutional Law, and History in connection with Chronology and Political Geography. (1)

(1) University Catalogue, 1855-56, page 13.

All students in the Senior Class of the Department of Arts were required to attend the lectures on Political Economy and to take examinations in the subject. The public was admitted to these lectures upon presentation of tickets which were procured from the Professor in charge of the course. (2)

(2) Pamphlet, Report of the Committee appointed on the 2nd of January, 1855, proposing certain additions and alterations in the existing Laws for the Government of the Collegiate Department, page 3.

Former Provost Edgar Fahs Smith believes that none of the catalogues prior to 1824 is extant. In the absence of this reliable source, we cannot speak definitely of the period prior to 1824, except to say that if the subject of Political Economy or National Economy had ever been introduced into the curriculum during the period prior to 1824 it was also dropped from the curriculum during this same early period.

In 1749, Benjamin Franklin, in his proposals for a “compleat education of youth,” published when he was organizing the Academy which later developed into the University, proposed a course which resembles very much a modern course in Economic History. He thought that information on the History of Commerce, on the Invention of Arts, on the Rise of Manufactures, on the Progress of Trade, and the Change of Its Seats, with the Reasons, Causes, etc., should be given. (3) It may be said that he was proposing the teaching of History and not Economics but we believe it proper to mention this suggestion of the illustrious founder for it certainly refers to a great deal of subject matter which was later to be treated in Political Economy and the present Economics.

(3) Montgomery, T. H., a History of the University of Pennsylvania from Its Foundation to 1770, page 500.

An advertisement in the Pennsylvania Gazette of December 11, 1750 [sic, not found in that issue, but see below], shows that the course of study included “Merchants’ Accounts.” We also mention this fact at the risk of introducing irrelevant material into this paper. However, used in its broadest sense, the Economics of the present time includes Accounting, and we felt justified in making reference to the course in “Merchants’ Accounts,” given in the University in 1750.

The Pennsylvania Gazette (Friday, 18 December 1750), p. 3.

As stated above, the first course in Political Economy, as far as we have been able to determine, was given during the year 1855-56 by the Professor of Intellectual and Moral Philosophy. In 1868 the course was given by the Professor of English. In 1869, no course in Political Economy was given, but a course in Social Science was substituted for the course in Political Economy. The new course in Social Science undoubtedly included Political Economy as Carey was used as a text [see below]. In 1875, the course was changed again and given under the title “Social Science and National Economy.” The teacher at this time was Rev. Robert Ellis Thompson, who was appointed Assistant Professor of Social Science in 1874. The course was given in the Towne Scientific School as well as in the Department of Arts.

*  *  *  *  *  *  *  *  *

Carey, Henry Charles.
Principles of Political Economy.

Part the First: of the Laws of the Production and Distribution of Wealth. Philadelphia:1837.

Part the Second: of the Causes which Retard Increase in the Production of Wealth, and Improvement in the Physical and Moral Condition of Man. Philadelphia: 1837.

Part the Third and Part the Fourth: Of the Causes which Retard Increase in the Numbers of Mankind; Of the causes which Retard Improvement in the Political Condition of Man. Philadelphia: 1840.

*  *  *  *  *  *  *  *  *

The year 1881 was an outstanding year in the history of the University as far as the teaching of Economics is concerned. In that year the Wharton School of Finance and Economy, as it was then called, was founded. There was no Department of Political Economy but the course of study given under the Department of Social Science indicates the great emphasis placed upon the teaching of Economics in all its phases.

In the Senior year, the Economic studies were carried still further and the course of study included:

Lectures on Living Issues (Land, Labor, Monetary Questions in their popular aspects, Socialism and Communism, Free Trade and Protection, Charity Organization, Popular and Industrial Education);
Mulford’s Nation was studied, and
Original Research in the Theory and History of Economical Questions was made under direction of the Professor. (4)

(4) University Catalogue, 1881-82.

In the same year that the Wharton School was founded the University catalogue announced that “the University possesses what is believed to be the largest and most complete library of works on economic science that is to be found in any educational institution of the world. The foundation was laid by the great collection of the late Stephen Colwell, comprising between seven and eight thousand volumes, and including nearly every important book in this science in the English, French and Italian languages, besides many in German. This has been supplemented (1) by the gift from Mr. McCalmont of London, of a collection of some three thousand English pamphlets, covering the period from the close of the seventeenth century till our own time, and bound in chronological order; (2) by the bequest of the library of the late Henry C. Carey, including many works and pamphlets which appeared since Mr. Colwell’s death, and especially rich in statistical literature, European Governmental reports, and the like.” (5)

(5) University Catalogue, 1881-82, page 39.

The first Professorship of Political Economy in the University was established in 1888 and was held by Simon Nelson Patten. (6) Previous to the establishing of this professorship and the appointment of Professor Patten, Edmund Janes James, who had been appointed Professor of Finance and Administration in 1883 was one of the principal teachers of the various Economic subjects.

(6) Catalogue of Matriculates of the College, 1749-1893, prepared by a Committee of the Society of the Alumni, page XXIV.

Source: Columbia University Libraries Manuscript Collections. Joseph Dorfman Collection. Box 52 (Seligman, E.R.A.), Folder “E.R.A. Seligman, Correspondence”.

Image Source: University of Pennsylvania, PennLibraries. University Archives & Records Center website. “Henry Vethake, 1790-1866”.

Categories
Columbia Regulations Teaching

Columbia. List of suggestions for improving graduate education in economics. 1939

This post provides a 1939 students’ eye view of the graduate program in economics at the Columbia University Faculty of Political Science. Milton Friedman’s course on neo-classical economic theory gets very favorable mention and statistical methods are completely overlooked (the German proverb “The farmer only eats what the farmer knows“ probably captures the sentiment).

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All four students became professors

WYLLIS BANDLER: b. July 3, 1916 in White Plains, N.Y.; d. December 22, 1995 in Tallahassee, Florida.
B.A. (1937), M.A.(1938) in economics from Columbia. Ph.D. (1962) in mathematics from the University of Zurich. Professor of Computer Science at Florida State University, 1984-1995.

DICKSON RECK: b. April 13, 1904 in Rockford, Illinois; d. April 10, 1955 in Berkeley, California.
B.A. (1927) University of Illinois, Ph.D. (1951) in economics from Columbia University. Associate Professor of Business Administration, University of California (Berkeley), 1954-55.

VAN DUSEN KENNEDY: b. October 4 in Darjeeling, India; d. May 28 2015 in Santa Cruz, California.
B.A. (1935) Swarthmore College. Ph.D. (1945) in economics from Columbia University. Assistant Professor to Professor of industrial relations at the University of California (Berkeley), 1947-1977.

FRANK COOK PIERSON: b. November 4, 1911 in Denver, Colorado; d. November 30, 1995 in Haverford Township, Pennsylvania.
B.A. (1934) Swarthmore College. Ph.D. (1942) in economics from Columbia University. On the Swarthmore College faculty from 1940 to 1979.

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Cover letter to Dean McCrea
from the students

Columbia University
May 9, 1939

Dean R. C. McCrea,
Columbia University,
New York City.

Dear Dean [Roswell Cheney] McCrea:

As we agreed at luncheon with you and Professor [Frederick Cecil] Mills the other day, we are sending you the typed notes of student suggestions to the Department of Economics. We believe that these represent the concurrence of general student opinion, plus the thought we have given these matters.

Hoping that the notes will prove useful to you,

Sincerely yours,

WYLLIS BANDLER
DICKSON RECK
VAN DUSEN KENNEDY
FRANK PIERSON

________________________

Notes on some student suggestions
for the operation
of the Department of Economics, Columbia Graduate Faculty.
5/7/39.

The suggestions concern chiefly gaps that are felt to exist in the offering of the department. There are also a few notes on the method of conducting various types of courses, and on the requirements placed on students, and on the allotment of credits.

1) History of Economic Thought. Intrinsic interest in this subject is amplified by a) Oral requirement, and b) the fact that many students feel that they will some day be called upon to teach it. Some feel that the subject is already overemphasized. In any case, there is the feeling that students should not be held responsible for so large a topic unless it is offered.

Various treatments are possible. a) A mere recital of doctrines. b) A tracing of current ideas. c) A combination with Economic History, concerned with the influence of the times on the theories, and vice versa. Treatment (c) is that followed by Professor [Wesley Clair] Mitchell in his former course, and in the extremely useful Lecture Notes made from it.

Student feeling la against being held for “all the doctrines, man by man, and all the men, doctrine by doctrine”. A combination of (b) and (c) above would probably be well received.

2) Economic theory. Statements in the first paragraph under (1) above hold here. This topic is understood to include (a) Systematic presentation of current schools of thought, and (b) in particular, the structure of Neo-Classical (and derivative) Theory. The material under (b) is very well handled by Milton Friedman’s Extension course. Convenience would be served by bringing this into the Graduate Catalogue, so that it would count, without special action, for the 15 central points for Master’s candidates.

Further particular large branches include c) Socialist Theory and d) Institutionalism. Student objection to the existing offering of Socialist Theory falls under two heads. First. It is claimed that the subject matter is not covered adequately in class, that the treatment is diffuse, incomplete and wandering. Second, it is protested that the treatment is not either so fair or so sympathetic as that given, say, Neo-Classical Doctrine.

Institutionalism is handsomely handled by Dr. [Joseph] Dorfman. There is some feeling that the materiel might be expanded to cover modern Institutionalists and their work and problems more intensively.

3) Economic History. Dr. [Louis Morton] Hacker’s treatment of American Economic History is very popular, as is Professor  [Arthur Robert] Burns’s course in modern capitalism. A course in Modern European Economic History, from the breakdown of Feudalism, would be very well received in addition, although the Burns course could be expanded to fill this need.

There is dissatisfaction with the existing Seminar. Auspices that would concentrate more closely on the material are rather widely held to be desirable. Professor [Archibald Herbert] Stockder’s seminar might fill this gap were it admitted to graduate economics standing. A suggestion for procedure should this prove impossible is included under “Catalog” below.

4) Labor. This may be discussed under two heads, a) Offering for the student specializing elsewhere, and b) Specialization in Labor Economics.

a) A General Survey Course in Labor Economics under capable, sympathetic auspices will be subject to very wide demand. Students whose major interest is elsewhere seem to feel quite generally that so important a branch of economics should not be left blank in their education. A large demand will also be forthcoming from first-year students who have not previously studied labor, either at all or adequately, whether or not they intend to specialize here. Such a course is of necessity a large lecture type, and requires in its instructor the specific technique relevant.

A counter-suggestion by the Faculty is that Professor [Leo] Wolman expand the subject-matter of his course. A very wide and almost unopposed sector of student feeling would prefer bringing in an outsider more cordial to the material and more tolerant of the viewpoints and questions of the members of the class.

b) A Seminar in Labor Relations for the specialist would find many applicants. Student desires as to the auspices are in agreement with the above comments. No university adequately specializes in training labor economists, and it is suggested that Columbia might consider filling this more than local gap.

5) Public Economic Policy. It is safe to day that no subject arouses wider interest among students. At present, public policy is dealt with piecemeal among the several courses, with by no means all the most important aspects being covered at all. (The most thoroughly considered section is monetary policy, both existing and proposed.) It is submitted that this is an important need which Columbia is well fitted to meet without much extra trouble.

Suggestions on this score represent the fusion of two streams of thought; a) The proposal of a joint seminar to explore specific areas of planning and policy, and to be conducted by academic experts in the various fields ([James Waterhouse] Angell, [James Cummings] Bonbright, [Arthur David] Gayer, [John Ewing] Orchard, [Arthur Whittier] Macmahon, [Robert Staughton] Lynd, etc.); b) The feeling that contact with people actually engaged in forming and executing public policy would provide a realistic knowledge of problems actually faced (economically, politically, administratively, etc.), as well  as valuable personal relations. The suggestion under (b) would involve the invitation to Columbia for one, several, or all meetings of the seminar such men as [Adolf Augustus, Jr.] Berle, [Mordecai] Ezekiel, [Lauchlin] Currie, [Rexford Guy] Tugwell, [Lewis?] Mumford, [Schuyler Crawford?] Wallace, etc. etc.

Experience with the more importation of outside lecturers, as is an instance in the Public Law Department, seems to show that a course so built lacks continuity and depth in grappling with such problems would be considered under (a) above.

Yet to define the benefits of (b) to the membership of a seminar of manageable size would be wasteful and otherwise undesirable. Two solutions have been advanced, which are not mutually exclusive. The first involves the holding of “public” and “private” meetings in the manner of the Banking Seminar. This could be assisted by co-operation with the Economics Club, that is, the visitors could partially be drained off into luncheon meetings. This solution suffers from several difficulties including the discontinuity of having each outsider only once. The second solution is embodied in the suggestion for Panel Seminars below.

Students would greatly like to co-operate in the organization of this seminar.

6) Agricultural Economics. While this is already a subject of inter-university [sic, “intra-university” is almost certainly meant here] specialization, a survey course is part of a rounded general offering.

7) Population. Students do not feel that this is ably handled. The suggestion has been made that Professor [Carter] Goodrich’s course in Internal Migration could be expanded to cover this, and also Regionalism (see under (8) below).

8) Economic Geography. The offering in the School of Business is excellent, and needs only to be given graduate economic status. See also under (7) above and “Catalogue” below.

9) Method and Techniques of Research. This includes a thousand little troublesome maters that each professor assumes that the student learns elsewhere. What are the Journals in economics and related fields? How do we keep up with current developments in economics? What are the basic sources in various branches? Where are all these things scattered in the library? How do we begin the investigation of a new topic? How do we prepare a bibliography? And many others.

The suggestions here fell under three heads. First, it is felt that a booklet answering the above and related questions would prove extremely helpful. Second, instructors should keep this need in mind, and clarify the portions of techniques and bibliography that fall in their sphere. Third, careful bibliographies already existing for various courses, and others that may arise, could be assembled and sold at cost.

10) Panel Seminar. This refers to a method of conducting seminars that shows promise of solving the dilemma of the unwieldiness of large numbers on the one hand, and the wastes of exclusiveness on the other. The discussion is conducted by a panel, consisting of one or more instructors and visitors and a carefully selected small group of students. Where student reports are to be presented, the selection is keyed to guaranteeing excellence and pointedness. An “audience” of students interested in the topic may ask occasional questions from the floor, but does not act to lower the tone of the discussion nor to encumber its progress. The “audience” may be regularly enrolled, receiving attendance credit, or may vary with the particular meeting’s content. Large and varying “audiences” are probably too much for this structure to carry.

It is felt that this method would meet the need in several situations. It should operate to raise the quality of the reports, doing away with the boredom and consequent loss of enthusiasm and tempo that so often assails large seminars now. But at the same time, it would avoid the narrow exclusiveness that operates to keep interested students from an organized study of subjects offered only in seminars.

The seating arrangements suggested by the above description seen rather stiff and stilted and disruptive. In point of fact, they are not a necessary corollary of this division of labor. Ordinary seminar seating can be used, the only requirement being that there is a staff of students who are considered capable, intelligible and interesting, and who do the reporting.

The panel seminar method is especially suggested for the discussion of public economic policy advocated in (5) above, where it le felt that side student interest would be aroused and should be encouraged.

11) Doctor’s Oral Examinations. Under existing conditions, orals engender a period of rather heavy strain in most students. This period is of the order of two weeks or so, and is not related to the quantity of work being done, but rather to the crisis quality of the examinations. No useful purpose is served by this strain, in fact it is generally considered a hindrance to efficiency.

The remedy seems to be a removal of some of the critical focus upon orals. This may be accomplished, with no loss of academic standards or relevant rigor, by the process of having the true examination take place informally with each of the professors involved before the formal oral is taken. The formal assembled examination then assumes the character of a more official formality, in which passing is nearly certain barring a strong reason to the contrary. This division between the investigation of proficiency and ability on the one hand, and the ceremonial opportunity to forbid the banns on the other, should not only relieve most of the strain on the candidate, but also afford the faculty a more intensive chance to satisfy itself as to the student’s competence.

There are some indications that the present situation approximates this suggestion more closely than appears on the surface. Insofar as this is true, all that is necessary is to let this true state of affairs become clear to the candidates. In any event, more could be done along these lines with benefit and relief to all concerned.

12) Training for Careers. It is Important periodically to review the types of career for which students in economics at Columbia are acquiring training, and at the same time to survey the curriculum with respect to the kind of training it chiefly affords. The student body is divided in proportions unknown at present [Footnote: One of the questions on this year’s questionnaire will be directed to this problem.] mainly among those preparing for teaching for research, and for government service. The curriculum is skewed in the direction of training research workers. This fundamental educational divergence is worth noting, and worth investigating in its effects upon the value of the Economics offering to the students.

Many of the curricular suggestions above are directed as much to the problem “what kind of work” as to the problem “research in what field”, and are worthy of reconsideration in this light.

13) Catalog. The arrangement of the catalog, and the standing given by it to various courses, can prove a powerful aid in broadening the area of endeavor for which preparation may be secured here, as well as filling many of the lesser holes mentioned above.

In regard to the standing given courses in other departments, particularly in the School of Business, the effort has been made above to mention fields in which benefit would accrue to Master’s candidates if Graduate Economics Standing were given to certain courses. Particularly does this apply to the offerings of [Paul Frederick] Brissenden, [Archibald Herbert] Stockder, perhaps Morgen, and to the advanced courses in Economic Geography. Where this is not feasible, something can be done by way of the advisory committee, see below.

Positive encouragement rather than permission can be given to students to broaden the scope of their studies if the catalog, or if necessary a separate printed or mimeographed announcement, would list as fully as possible all courses in related fields, or isolated courses of interest, that would be profitable to economists. In this way many gaps that the Economics Department cannot hope to fill itself would be plugged, and the benefits of intra-University division of labor would be received.

14) Advisory Committee. This has proved itself useful this year, and should certainly be continued. Its mention here is in connection with the potentialities of cooperation between it and the administration and faculty.

Many of the suggestions in these notes that may prove impossible of fulfillment, particularly those which come together under “Catalog”, may be aided by the unofficial action of the Advisory Committee. If the committee is in possession of information concerning related courses, for instance, then even in the absence of official action the broadening of courses of study can be advanced. In this and many similar cases, the worthwhileness of the Department to new students can be increased.

Source: Columbia University Libraries Manuscript Collections, Columbiana. Department of Economics Collection, Box 1, Folder “Committee on Instruction”.

Image Source: Alma Mater, Columbia University. Columbia College Today, Winter 2017-18.

Categories
Chicago Exam Questions Microeconomics

Chicago. Preliminary Graduate Examination in Economic Theory. Winter Quarter, 1961

Two things perhaps worth noting for this post. (1) The winter 1961 examination is for Economic Theory. The title of the prelim exam only morphs to Price Theory in the 1962-63 academic year, coinciding with the publication of Milton Friedman’s text “Price Theory: A Provisional Text”; (2) this exam has one, and only one, equation:

q = 100 – p.

Sputnik was lauched less than four years before these questions were written. While economic theory had not yet attained the status of “rocket-science” in 1961, let’s not fool ourselves, this is an exam designed to make or break character!

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Chicago Price Theory
Preliminary/Core Exams

Previously Posted

Summer 1949
Summer 1951
Summer 1952
Winter 1955
Summer 1955
Winter 1957
Winter 1958
Summer 1960
Winter 1963
Winter 1964
Winter 1965
Winter 1969
Summer 1975

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CORE EXAMINATION
ECONOMIC THEORY
Winter 1961

Preliminary Examination for the Ph. D. and A.M. Degrees

WRITE THE FOLLOWING INFORMATION ON YOUR EXAMINATION PAPER:

Your Code Number and NOT your name
Name of Examination
Date of Examination

Results of the examination will be sent to you by letter.

Answer all questions. Time 3 hours.

  1. (1 hour) Answer each question “true” or “false” and explain your answer very briefly.
    1. It is a tautology that the average costs of all firms are equal in equilibrium in a competitive industry.
    2. A cartel which allows its members to buy and sell output quotas will have a larger net profit for all firms combined than one which does not.
    3. Since all firms in a competitive industry have the same marginal costs, it is meaningless to speak of more and less efficient firms.
    4. A fall in the price of houses will increase the sales of doorbells; a fall in the price of doorbells will not increase the sales of houses; therefore Slutsky’s equation is wrong.
    5. The average size of farm has risen in recent decades in the United States and Canada. This shows that the farm enterprise is typically subject to increasing returns to scale.
    6. A specialized machine has a life of 5 years. Total returns to it in periods of less than 5 years are quasi-rents.
    7. Assume that the world demand elasticity for tin is -2, and that Bolivia produces 1/3 of the world’s tin. Therefore, the elasticity of demand for Bolivia tin is at most -6. 0.
    8. If factors of production are used in absolutely fixed proportion in the production of a particular product, the demand for each of the factors by the producers of the product will be completely inelastic with respect to price.
    9. A supply curve is a curve displaying the quantities which will be supplied at all possible prices. It follows that there is no supply curve under monopoly.
    10. If a firm is operating in the region of falling marginal costs, it must be making losses because marginal cost is then less than average cost.
  1. (40 minutes)
    1. The long run demand function for a commodity is
      q = 100 – p. The price has been $30 for several years; it now drops to $20. Half the consumers react to the new price immediately; the other half (due to habit, etc.) do not adapt until a year later. Calculate the elasticity of demand at a price of $20 (1) the first year, and (2) the second year after the price reduction.
    2. A consumer assures you that his indifference curves intersect each other. You have an unlimited number of observations on his purchases at various incomes and prices. What tests can you make of the alleged intersections?

III. (40 minutes)

    1. It has often been suggested that the demand for a durable good could be increased if “something were done about the large number of used items on the market” The practical suggestions usually are (1) a government regulation forbidding the use of items older than some specified age, e.g. declaring all pre-1950 cars as “unsafe” and withholding license plates from them or (2) “the manufacturers should buy up the used items and destroy them or export them at a loss. [sic, closing quotation marks missing in original] Discuss the consequences of these two types of policies on (a) the demand for new durable equipment and (b) the profitability to the industry of the two policies.

IV. (40 minutes)

    1. “The first impact of this policy (tight money) is the higher interest rate. Plainly the impact of this will be very different on a firm that has control over its prices and hence can pass along this higher cost as compared with the firm whose prices are given and which, accordingly, must bear the cost itself. The point need not be labored.
      “The U.S. Steel Corporation justified its price increase of 2 weeks ago by the contention that its cost had risen. In doing so it not only conceded its ability to pass higher costs, including higher interest charges, to the consumer but based its policy on the need to do so. But no such opportunity is open to the farmer or to the smaller businessman. They cannot raise their prices, for they are market-determined. They shoulder themselves the costs of this policy.”
      Analyze and evaluate this statement. Disregard the peculiar problems of monetary policy. Treat it as a question about the differential impact of a change in any factor price on a competitive firm or industry as against the impact on a monopolistic firm. Does a change in factor cost “hurt” less in one case than in the other? What do you understand by “passing the cost on to the consumer” and how does the distinction between a monopoly and a competitive industry affect this? Assume the same cost curves and the same shifts in both cases.

Source: Harvard University Archives. Papers of Zvi Griliches. Box 129, Folder “Preliminary Examinations, 1957-1965.”

Image Source: Roger Vaughan’s classic drawing “The School of Chicago 1972”.