Category: M.I.T.

Categories
M.I.T. Suggested Reading Syllabus

M.I.T. Capital theory. Course outline, suggested readings. Solow, 1975

 

Capital theory à la Solow. Posted earlier: material from Robert Solow’s 1965 capital theory course; material from Paul Samuelson’s 1975 core economic theory course.

________________________

14.459 THEORY OF CAPITAL
Spring 1975
Robert M. Solow

OUTLINE

  1. One-commodity models
    1. No labor, stationary equilibrium, differentiable technology. A complete model
    2. Add labor, steady growth equilibrium
    3. More complicated demand conditions, e.g., class structure
    4. Linear model: one good, one activity and labor
    5. Many activities; continuum of activities
  2. Many capital goods
    1. Simple Leontief Model (i.e., constant returns to scale, no joint production, one primary factor, no possibility of substitution in production)
    2. Generalized Leontief Model (substitute activities)
    3. Non-substitution theorem
    4. Extension to model with production lag
    5. Dynamic non-substitution theorem, factor-price frontier
    6. Examples of a complete equilibrium model in this set-up
  3. Reswitching and “perversity”
  4. What “the Controversy” is all about, if anything

 

SUGGESTED READING

C.C. von Weizsäcker: Steady State Capital Theory, pp. 4-22

E. Burmeister & R. Dobell: Mathematical Models of Economic Growth, Ch. 8

P. A. Samuelson: “The Rate of Interest under Ideal Conditions” QJE, Feb 1939, 286-97; also in Collected Papers, Vol. I, 189-200

P. Garengnani: “Heterogeneous Capital, the Production Function and the Theory of Distribution,” Review of Economic Studies, July 1970

L. Spaventa: “Rate of Profit, Rate of Growth and Capital Intensity in a Simple Production Model,” Oxford Economic Papers, July 1970

B. Rowthorn: “Neo-Classicism, Neo-Ricardianism and Marxism,” New Left Review, No. 86, July/August 1974, 63-87

J. Stiglitz: “The Cambridge-Cambridge Controversy in the Theory of Capital, A View from New Haven,” JPE, July/August 1974, 893-903

K. Sato: “The Neoclassical Postulate and the Technology Frontier in Capital Theory,” QJE, August, 353-384.

 

Source: Duke University. David M. Rubenstein Rare Book & Manuscript Library. Economists’ Papers Archive. Papers of Robert M. Solow, Box 68, Folder without a label.

Image Source: Robert Solow pictures at the MIT Museum website.

Categories
Fields M.I.T. Syllabus

M.I.T. International Economics Syllabus for General Exam. Bhagwati and Dornbusch, 1977

 

 

In 1976 there was a graduate-student-faculty discussion concerning a reform of procedures for the general examinations at MIT’s department of economics. I have only been able to locate the field syllabus for international economics of the three fields mentioned in my classmate’s report:

“As a compromise intended to make everyone feel better without rocking the boat, a syllabus will be made up in each of three fields. The syllabus is intended to give some guidance as to what topics might show up on a general. The three fields chosen for the experiment are econometrics, industrial organization, and international trade.”

Source:  Massachusetts Institute of Technology. Institute Archives. MIT Department of Economics Records (AC 394). Box 2; Folder “Gen Exams”. Dick Startz, “Final Report on Generals’ Reform”, November 21, 1976.

__________________________

January 1977
Bhagwati & Dornbusch

INTERNATIONAL ECONOMICS
Syllabus

This syllabus is designed to provide some guidance in regard to the field requirements in international economics. It is not exhaustive but does indicate the broad areas in which the students will be required to be knowledgeable.

The syllabus is divided into the traditional areas of international monetary theory and policy, on the one hand, and the pure theory of trade, on the other. However, most public policy issues, with which the students will be expected to be familiar, require a skillful adaptation of both strands of analysis (as should be obvious from the writings of the best trade economists on policy matters such as the effect of the oil price increases). Thus, the students will be expected to integrate the two sets of insights as appropriate, in addressing themselves to policy questions. In this regard, the students will also be expected to have reasonable familiarity with the central issues of current concern, e.g. SDRs, GATT rules, the New International Economic Order problems, etc. Acquaintance with earlier historical writings, chiefly in the 1930s, should also prove to be rewarding since it emphasizes the integration of policy and theory. Here, the writings of economists such as Haberler, Ohlin, Iversen and Hawtrey are particularly recommended.

A. INTERNATIONAL MONETARY THEORY AND POLICY

International Macroeconomic Issues:

  1. National Income Accounting in the Open Economy. Balance of Payments Accounting. Reform of Balance of Payments Accounting in the US.
  2. Keynesian Macroeconomics in the Open Economy and the Current Account: The foreign trade multiplier, multipliers with repercussions. The transfer problem and income adjustment.
  3. Keynesian macroeconomics under capital mobility: Monetary and fiscal policy. The policy mix. Financing versus adjustment.
  4. Price and output adjustment in a Keynesian framework.
  5. Exchange rates and the current account: Elasticity, absorption and monetary approaches.
  6. Internal and external balance: The role of home goods.
  7. Flexible exchange rates: The income adjustment process. The terms of trade and saving.
  8. Flexible rates and capital mobility: Asset market theories of exchange rate determination. The role of expectations. The transmission of disturbances.
  9. Purchasing power parity.
  10. Portfolio balance theories of macroeconomics in the open economy: Capital flows and the structure of the balance of payments.
  11. The social cost of foreign exchange.
  12. Stabilization policy, the budget and trade policy.

International Financial Issues

  1. International monetary standards and international reserves.
  2. The Euro-dollar market.
  3. Interest arbitrage and forward markets.
  4. Intermediation, the pattern of world payments and lending, and the balance of payments.
  5. International Investment.

B. THE PURE THEORY OF TRADE

  1. General equilibrium analysis of the traditional value-theoretical model of trade theory, involving two primary, non-traded factors producing two traded commodities; theories of comparative advantage: Ricardo and Heckscher-Ohlin; empirical verification; new directions in explaining comparative advantage.
  2. Tariff analysis: effects of tariffs on internal and external terms of trade; equivalence of tariffs and quotas; transfer problem; growth and trade.
  3. Trade and welfare; trade vs. autarky; optimality of free trade; restricted trade vs. autarky; distortions and ranking of policy interventions; measurement of gains and losses from alternative policies; theory of non-economic objectives; preferential tariff reductions and customs union theory.
  4. Extension of the positive and welfare analysis of alternative models: (1) models involving use of imported factors of production; (2) models with non-traded goods; (3) models with putty-clay characteristics.
  5. Comparative advantage and uncertainty; analysis of illicit trade in general equilibrium; project analysis and trade theory.

 

Source: Massachusetts Institute of Technology. Institute Archives. MIT Department of Economics Records (AC 394). Box 2; Folder “Gen Exams”.

Image Source:  Jagdish Bhagwati (left), Rudiger Dornbusch (right). MIT Museum legacy website.

Categories
Berkeley Columbia Economist Market Economists Harvard M.I.T. Yale

Columbia. Instructors for Economics in Columbia College. Considering Okun et al., 1951

 

This following 1951 memo by the head of the economics department at Columbia, Jamew W. Angell, to his colleagues about the relatively mundane matter of identifying potential candidates for an instructor vacancy in the undergraduate economics program in Columbia College, caught my attention with a paragraph describing the up-and-coming graduate student Arthur Okun. Five current instructors were identified by name together with three ranked potential candidates. I figured this would be as good a time as any, to see what sort of career information I’d be able to gather on the other seven names that I did not recognize. 

I was least successful with Mr. George F. Dimmler whose Google traces would indicate that he had gone on to teach briefly at Wharton and then worked as an economist at  the Commercial Investment Trust (CIT) Financial Corporation. But for the other six economists (as well as Okun) it was relatively easy to find obituaries!

While Arthur Okun was clearly the leading candidate considered for the position, the instructorship instead went to the Fellner student from Berkeley, Jacob Weissman. As of this post I do not know whether this means that Okun was not offered the job, or had been offered the instructorship but had a better opportunity.

___________________

MEMO REGARDING POTENTIAL INSTRUCTORS FOR UNDERGRADUATE ECONOMICS AT COLUMBIA COLLEGE

CONFIDENTIAL

May 8, 1951

To Professors Bergson, Bonbright, A. F. Burns, A. R. Burns, Clark, Dorfman, Goodrich, Haig, Hart, Mills, Nurkse, Shoup, Stigler, Wolman

From James W. Angell

Because of the prospective shrinkage of the enrollment and the greater exercise of professional option by students of Columbia College, it will probably be necessary to reduce the number of appointments as Instructor of Economics in College from the present five to two for next year. The problem is further complicated by the fact that the College is adopting a general policy of not renewing appointments to instructor ships beyond a total term of five years. None of the present instructors will be dismissed, but all of them are being encouraged and helped to find new positions. Two of them, [George F.] Dimmler and [Daniel M.] Holland,  [see below]  have already made other arrangements for next year; and the other three, [Lawrence] Abbott [from Prabook], [Frank W.] Schiff [see below] and [Nian-Tzu] Wang [see below, have definite possibilities for other employment. It is improbable that we will lose all five of these men, but there is a definite possibility that one new instructor will be needed, and a rather remote possibility that we will need two.

Since definite action may not be required until the summer, when most of us will be away, I am now calling the situation to your attention. Horace Taylor, as Chairman of the Departmental Committee in the College, has proposed for consideration three men whom he regards as the most promising candidates known to him for appointment as Instructor, should a vacancy develop. I give below summaries of the records of these men, based largely or wholly on material which Taylor provided (entirely so in the case of Weissman). They are listed in Taylor’s order.

OKUN, Arthur. [Brookings Memorial] A. B. From Columbia College, 1949, with honors and special distinction in Economics; first in his class of over five hundred in the College; Green Memorial Prize; Phi Beta Kappa. Entered our Graduate Department in 1949, University Scholar, 1949-50, and University Fellow, 1950-51. Has A’s in all courses he took in the Graduate School. Passed the Qualifying Examination with A on the Essay, two A’s and 3 B’s on the Specific questions. Has passed language examinations in German and in Mathematics; certified in Statistics and in General Economic History. Will take the orals this spring, offering Economic Theory, Monetary Economics, Public Utility and Public Finance. Taylor writes: “He is regarded by everyone in the College staff as one of the most gifted students we ever have had, and I believe he is well known to members of the graduate faculty. My recollection is that he made the highest score ever made on the graduate record examination. Some of his teachers in graduate school have spoken of him as the ablest of the current group of students there. He has no teaching experience, but it is going to conduct some discussion sections of Robert Carey’s course in elementary economics next Summer Session. Okun was No. 1 man in his class of over 500 in Columbia College.”

WEISSMAN, Jacob. [see below] Taylor writes: “A more mature man than Okun. Has had business and industrial experience, in the sense that he was General Manager of a steel company in which his family is interested. He resigned this $20,000 job to take up graduate study of economics at the University of California. Messrs. Davisson, Fellner, and Gordon of of U. of C. have written letters recommending him in the highest terms. One or two of them even said that Weissman is the ablest graduate student of economics at the U. of C. in some years. He is now at Cambridge, Massachusetts, to be in touch with Mr. Fellner, who is directing Weissman’s dissertation. I had Weissman to lunch when he passed through New York last summer, and was greatly impressed with his good mind, excellent training, and modesty. He is eager for a job here.”

AHEARN, Daniel. [see below]  A.B. from Columbia College, 1949; Phi Beta Kappa; graduate fellowship from Columbia College for 1949-50. Entered our Graduate Department in 1949; Kazanjian Scholar, 1950-51; Master’s thesis on the business cycle fluctuation in 1932-34, now in process with Professor Hart. Passed Qualifying Examination in 1950, with a B average. Seven A’s and one B in graduate courses. Has passed the German examination and has certified in Statistics and American Economic History. Will take orals this spring, offering Economic Theory, Monetary Economics, Business Cycles and Industrial Organization. Taylor writes: “Now in graduate school, and probably well-known to most staff members. He was a classmate of Okun, and ranked third in the class in which Okun was first. A man of unusual ability, excellent personal qualities, is highly regarded by the College staff.”

There are doubtless also other men whom you would like to suggest for consideration. I shall greatly appreciate receiving such suggestions promptly, together with as much information about them as you can provide; and also your own judgment and comparative rating of the men discussed above.

Source: Columbia University Libraries, Manuscript Collections. Robert M. Haig Papers, Box 107, Folder: Haig Correspondence A, 1949-1952”.

___________________

Jacob Weissman’s initial appointment, 1951-52.

He replaced Daniel M. Holland. Appointed July 1, 1951 for one year, annual salary $3600.

Source:  Columbia University Libraries Manuscript Collections. Columbiana. Department of Economics Collection, Box 4, Budget, 1945/1946-1954/1955, Folder “Budget 1951-52”.

___________________

Weissman appointment extended to a fifth year

Jacob Weissman will have served four years as instructor, but we seek his reappointment for a fifth year at his present salary [$3,800], and that permission for this be sought from the President of the University under section 60 of the Statutes. The ground for this request are that Weissman expects to submit his dissertation on “The Law of Oligopoly: A Study of the Relationship between Legal and Economic Theory” at the University of California in the Spring of 1955, when we expect to be in a better position to assess his worth. Also, Weissman has done and is doing much for the College, and it seems fair to him to let him get his degree before seeking a position elsewhere, if we have eventually to let him go.”

Source: Report of College Committee on Economics to the Executive Officer, Department of Economics (November 15, 1954) by Harold Barger, Chairman of the College Committee, Department of Economics”

___________________

Jacob I. Weissman
Obituary
(July 13, 2006)

Jacob I. Weissman, a lawyer, inveterate storyteller and Phi Beta Kappa scholar who chaired the economics department at Hofstra University before retiring to Martha’s Vineyard, died peacefully July 11 at Henrietta Brewer House surrounded by family and friends. He was 92.

Professor Weissman would often tell friends that he disagreed with the general description of economics as a dismal science and that had coined his own term: the trivial science.

He explained: “Economists don’t deal sufficiently with aspirations, and ambitions of people or other variables.”

According to his wife, Nikki Langer Weissman, this quote summarized his world view. “Despite his considerable academic achievements,” she said, “Jacob was a man who never lost sight of the fact that human beings come before statistics and that human behavior defies predictive models.” Professor Weissman was born and raised in Detroit. In 1935, he graduated from the University of Michigan Phi Beta Kappa with a degree in economics.

After graduation, he enrolled in the University of Michigan Law School, completing his J.D. degree and graduating first in class and was also editor of the Michigan Law Review. Following law school, he spent a year traveling to Japan, China, southeast Asia, the Middle East and Europe.

Prior to graduation from law school, he had been invited to work as clerk to the chief justice of the supreme court of Michigan. However, due to his father’s illness, he felt obliged to decline, as he was needed to run the family business, where he remained as president for 12 years.

After this detour, Professor Weissman decided to return to the world he loved – academia. In 1947, he enrolled at the University of California at Berkeley for a Ph.D. in economics. While completing his dissertation, he taught at Columbia University in New York until 1956, when he received his doctorate in economics. He was hired by the University of Chicago as a research associate in law and economics at the law school and later associate professor of law and economics at the University of Chicago’s Graduate School of Business.

He often attributed his love of academics to his teaching experience at Columbia “because the university used many of its faculty to teach not only in their own disciplines, but in a wonderful general education program.”

“I became very enriched by that teaching and my vision of an ideal academic life was fulfilled,” he once told a reporter. “An element of chance was involved in this path I chose, but it suited me well.”

In 1963, he was invited to join the faculty at Hofstra University in New York as professor of economics and chairman of the economics department. He also served as speaker of faculty, a post he held for two years. In 1982, he was appointed interim dean of Hofstra University’s School of Business.

At Hofstra, he met and married Shirley (Nikki) Langer, who was associate professor of psychology. They remained at Hofstra University until his retirement in 1983.

In 1969, impressed by the vitality and community spirit on the Vineyard, they became homeowners in Chilmark.Professor Weissman gave generously of his time and talents on the Vineyard.

He served on the board of directors of the Martha’s Vineyard Hospital and as chairman of its ethics committee. He was a board member and treasurer of Howes House (West Tisbury Council on Aging). He and his wife gave lessons at the various senior centers on creativity, aging and other topics.

His publications on law and economics were included in The American Economic Review, The Journal of Political Economy and The University of Chicago’s Journal of Business.

In addition to his wife, Nikki Langer Weissman of Chilmark; his son, Stephen Weissman of London; his sister, Helen Rosenman of San Francisco; his stepson, Kenneth Langer of Takoma Park, Md.; his stepdaughter, Elizabeth Langer of Washington, D.C.; six grandchildren, Max Weissman and Maisie Weissman, Ben Langer Chused, Sam Langer, Nora Langer and Amelia Langer; and two great-grandchildren, Kate and Toby Weissman.

Source: Vineyard Gazette, July 13, 2006.

___________________

Daniel S. Ahearn
Obituary
(April 6, 2016)

AHEARN, Daniel S., Ph.D. 90, of Winchester, March 30, 2016. Beloved husband of Louise (Freeman) Ahearn. Loving father of Barbara Ahearn of Arlington and the late Kathleen and JoAnne Ahearn. Born in New York City, Daniel was the son of the late Daniel and Margaret (Walter) Ahearn. A World War II veteran, he served in the 399th Infantry 100th Division from 1943 to 1946 in France and Germany. He received his bachelor’s degree from Columbia College in 1949 and his Ph.D. in economics from Columbia University in 1961. His book “Federal Reserve Policy Reappraised 1951-1959” was based on his Ph.D. thesis. Daniel spent his roughly 65-year working life in positions involving economics, investments and monetary and fiscal policy. From 1961 to 1995, he was at Wellington Management Company with positions including senior vice president, partner and chairman of the investment policy group. In 1963 he left Wellington to serve as Assistant Secretary of the Treasury for Debt Management until 1965. He also advised the Treasury Dept. for about 25 years as a member of the Government and Federal Agencies Securities Committee of the Public Securities Assoc. After leaving Wellington, Daniel formed Capital Markets Strategies where he continued advisory work. In Winchester, where he was a resident for 47 years, Daniel was an Investment Trustee of Winchester Hospital from 1974-2012. He is widely remembered for his reports on investments to the annual meeting of the Winchester Hospital board.

Source: Boston Globe obituary from Legacy.com.

___________________

Frank W. Schiff
Obituary
(August 28, 2006)

Frank W. Schiff, 85, who served as vice president and chief economist of the Committee for Economic Development from 1969 to 1986, died Aug. 17 at Inova Mount Vernon Hospital of complications from a back injury.

At the Committee for Economic Development, an independent organization of business executives and university administrators, Mr. Schiff coordinated statements and monographs on a wide range of national and international economic policy issues. His efforts involved tax reform, budget deficits, the federal budget process, energy independence, job training, public-private partnerships and the international monetary system.

He played a key role in the creation of local Private Industry Councils under the federal Job Training Partnership Act. He had a special interest in flexible work arrangements, such as greater use of “flexiplace” and work sharing as an alternative to layoffs or women leaving the workforce.

He said in 1983 that in situations where flexiplace — working at home or other places other than the office — had been tried, productivity improved in most cases 10 to 20 percent and sometimes substantially more.

Mr. Schiff was born in Greisswald, Germany, and fled the Nazis in 1936. He was 15 when he and his family arrived in New York, where he finished high school in New Rochelle and graduated Phi Beta Kappa from Columbia University. He also did graduate work in economics at Columbia.

From 1943 to 1945, he served in the Army in the 35th Infantry Division in France. After the war, he was an economics instructor at Columbia.

Beginning in 1951, Mr. Schiff held several positions with the Federal Reserve Bank of New York. Among them was head of the Latin American unit and assistant vice president of research.

He went to Vietnam in the early 1960s to advise the government on creation of a central bank.

As senior staff economist with the Council of Economic Advisers from 1964 to 1968, Mr. Schiff had responsibility for international finance, coordination of international economic policies and domestic monetary policy. He regularly represented the council at international monetary policy meetings in Paris.

He served as deputy undersecretary of the Treasury for monetary affairs from 1968 to 1969 and was involved in domestic economic policy and international monetary policy formulation and negotiations, debt management and relations with the Federal Reserve.

Mr. Schiff lived in Washington from 1964 to 1983, when he moved to Alexandria. He retired in 1986.

He was a member of the Council on Foreign Relations and the Conference of Business Economists and served as president and chairman of the National Economists Club.

In 1990, Mr. Schiff returned to his childhood home in Germany on a trip with Sen. Rudy Boschwitz (R-Minn.). Vivid memories flooded his mind as he stood in the 1915 art deco apartment building where he grew up in what became a West Berlin residential area. “It was very pleasant here before the Hitler period,” he said.

Survivors include his wife, Erika Deussen Schiff, whom he married in 1974, of Alexandria; and a brother.

Source: Washington Post.August 28, 2006.

___________________

Daniel M. Holland
Obituary
(January 8, 1992)

Daniel M. Holland, professor emeritus of finance at the Sloan School of Management and a widely known expert on taxation and public finance, died December 15 at Beth Israel Hospital, Boston, while under treatment for a heart condition. Professor Holland, a Lexington resident, was 71.

A memorial service is being planned for some time in February at the MIT Chapel.

Professor Holland was an MIT faculty member from 1958 until his retirement in 1986, when he became an emeritus professor and senior lecturer. He also served as an assistant to the provost from 1986 to 1990.

He was a consultant over the years to government agencies, including the US Treasury, foreign governments and private companies.

He was editor of the National Tax Journal for more than 20 years, served as president of the National Tax Association in 1988-89, and was the author of several books on taxation and numerous articles both in professional journals and other publications. His books included Dividends Under the Income Tax and Private Pension Funds: Projected Growth, for which he received the Elizur Wright Award of the American Risk and Insurance Association.

Professor Abraham J. Siegel, former dean of the Sloan School, said, “Dan was a great colleague and friend, broadly gauged in his knowledge and interests. Those of us who have known him for over 30 years, as well as his younger colleagues, will miss him enormously.”

Professor Holland, who was born in New York City, received AB and PhD degrees from Columbia University, in 1941 and 1951, respectively.

He served three years in the Navy during World War II, mostly aboard a destroyer escort in the Pacific theater.

He was a member of the research staff of the National Bureau of Economic Research before becoming an associate professor of economics at New York University in 1957, the year before he came to MIT, also as an associate professor. He was promoted to full professor at MIT in 1962.

His professional groups included the American Economic Association, American Finance Association, Royal Economic Society, International Institute of Public Finance and the International Fiscal Association.

He leaves his wife, Jeanne A. (Ormont) Holland; two children, Andy of New York City, a scenic artist, and Laura Roeper of Amherst, Mass., a writer; two grandchildren and four nephews.

Source:  MIT News, January 8, 1992.

___________________

Nian-Tzu Wang
Obituary
The New York Times (Aug. 29 to Aug. 30, 2004)

WANG-Nian-Tzu, N.T., of Larchmont, NY, died of cancer, on August 26, 2004. Loving husband of Mabel U, devoted father of June, Kay (Leighton Chen), Cynthia (Daniel Sedlis), Geraldine, and Newton, and proud grandfather of Christine, Stephanie and Lucy. In his autobiography, “My Nine Lives”, NT wrote of his lives as number one son, traditional scholar, foreign student, public servant, instructor, international servant, advisor, academician, and immigrant. NT was born in Shanghai on July 25, 1917. Initially trained to be a Confucian scholar, he received a classical education at home, where he was tutored in Chinese poetry, painting, the Classics and other literati skills. Math, science, and languages were introduced later by his father, Pai Yuan (PY) Wang, a sophisticated banker when he decided to school his four sons in Western ways when they were teenagers. In 1937, NT went abroad to study at the London School of Economics and Germany. He transferred to Columbia where he graduated Phi Beta Kappa with honors in economics in 1941, and went on to receive an M.A. and PhD in economics from Harvard. NT will be remembered throughout the international community for his dedicated efforts in advising businesses and governments around the world on ecomonic development. He made many contributions to his homeland of China, the U.S., his home since 1939, and to countless countries which he helped through his work at the U.N. Economic and Social Council. After retiring from a 28 year career at the United Nations, as the Director of the Centre on Transnational Corporations, he returned to Columbia Univ. to teach at the School of Business and the School of International and Public Affairs. He thoroughly enjoyed his time with his students, organizing seminars, creating training programs for Chinese academic and business leaders, and working tirelessly as the Director of the China-International Business Project. In his final days, he was polishing his keynote speech as part of Columbia University’s 250th anniversary celebration. He was an honorary professor of ten universities, a fellow of the International Academy of Management, and a recipient of many awards, including the New York Governor’s Award for Outstanding Asian American. In addition to his many professional achievements, his passions included dancing with his life partner of 62 years, Mabel, and playing tennis. NT exhausted his daughter Kay playing two and a half hours of tennis after celebrating his 87th birthday just one month ago. Throughout his life, he took time to compose classical Chinese poems, which his family will compile as the tenth chapter in his life, ‘The Poet’. A memorial service will be announced later. Contributions may be made to Community Funds Inc. for the N.T. and Mabel Wang Charitable Fund, which will continue the mission of the China-International Business Project he established at Columbia University, c/o Community Funds Inc., 2 Park Avenue, NY, NY 10016.

Source: Legacy.com obituaries.

Image Source: Arthur Okun. Yale Memorial Webpage.

Categories
Economists Harvard M.I.T. Yale

Yale. Transportation economist and railroad expert. Prof. Kent T. Healy (1902-1985)

 

Personal backstory to this post.

During my freshman year at Yale (1969-70) I took a double-credit seminar course “Early Concentration Economics”. The idea, I suppose, was to give me an accelerated start into an economics major. At least that is why I enrolled in the course. The first semester covered microeconomics and was taught by Professor Merton J. (“Joe”) Peck and a visiting graduate student from Harvard (Ph.D., 1971), Joseph Persky (now a distinguished historian of economics). We used the intermediate price theory textbook by Richard H. Leftwich and we were assigned the “Simple Analytics of Welfare Maximization” by Francis Bator. I loved the course. It also led to Joe Peck becoming one of my mentors in economics.

The second semester was not so successful. Now, with nearly a half-century of university life behind me, it is pretty obvious what the problem with that course was. Basically, a double-credit course is going to be incredibly hard to staff, I mean what professor is going to let himself/herself be tied down to double sessions with first year students? I believe Kent T. Healy (in his last year of teaching)  allowed himself to be drafted into covering the macroeconomics semester for us early concentrators. As you will see from the biographical and career information below, Professor Healy was a railroad expert from the old school of transportation economics. I vaguely recall an anecdote or two having to do with him travelling in a caboose.

Complicating matters, the second semester of 1969-70 was marked by academic strikes and disruption (the Black Panther Bobby Seale was on trial in New Haven, there were the Kent State shootings etc.) so that many course meetings were canceled and academic credit was fudged all around. We were assigned two of the short volumes in Otto Eckstein’s Prentice-Hall series “Foundations of Modern Economics” (Charles Schultze’s National Income Analysis and Eckstein’s own Public Finance).  I recall Myrdal’s Asian Drama was part of the original course plan, but I don’t think we did much with it.  

I do want to give Healy some credit, he took on the burden of teaching far outside his lane during the last semester of his service. It’s what a loyal, long-time colleague in a department does (yeah, right). Still, there was no infectious enthusiasm for macroeconomics coming from him during the Spring of 1970 and I feel Yale should have been held liable for charging tuition but only providing academic day-care with that course.

Besides being something of an academic anachronism as far as the discipline of economics goes, Healy was also one of the few people I have encountered who attained the rank of professor without having a Ph.D. degree. From the career information provided below, we see that Kent Tenney Healy lived a very rich and active life that combined elements of business and engineering experience, public policy, teaching, and public service. I have also been told by Gustav Ranis that Healy was a kind, thoughtful man. I do regret never having met the man in his true realm of distinction. 

______________________

Biographical Note

Kent Tenney Healy was born in Chicago, Illinois on February 2, 1902, the son of William and Mary Sylvia (Tenney) Healy. He received an A.B. [cum laude, in Physics] from Harvard College in 1921 and a B.S. in electrical engineering from the Massachusetts Institute of Technology in 1923. From 1923 to 1924, he was a student at the Harvard Law School.

On November 3, 1928, he married Ruth Emily Allen. His four children were Ruth Tenney, William Kent, Kent Allen and Sylvia Kent.

Associated with transportation and economics all his life, he began as a switchboard operator on the New York, New Haven and Hartford Railroad in 1922. From 1924 to 1925, he was an inspector and from 1925 to 1926, a cost engineer.

After studying transportation in Europe during the years of 1926 and 1927, he became an assistant professor of transportation at Yale University. From 1934 to 1940, he was an assistant professor of economics, becoming an associate professor in 1940. In 1945, he received an M.A., and was appointed as the T. Dewitt Cuyler Professor of transportation, a position he held until 1970.

As a recognized expert in transportation economics, he served as member or consultant with many United States Government agencies from 1940 to 1945, participated in local government planning and financial management in Killingworth, Connecticut, circa 1957 to 1970, and was a director of the New York, New Haven and Hartford Railroad Company (1947-1948) and the Connecticut Company (1947-1964).

He died on January 9, 1985 at the age of 82 [in West Haven, Conn.].

Source: Connecticut State Library. Healy (Kent T.) Papers, 1935-1963. Inventory. Additions from obituary in the New York Times, January 12, 1985.

______________________

Books by Kent T. Healy

  • Electrification of steam railroads.New York: McGraw-Hill, 1929.
  • Cases on railroad economics, supplemented by selected statistics, (1938).
  • The Economics of Transportation in America: The Dynamic Forces in Development, Organization, Functioning and Regulation. New York: Ronald Press, 1946.
  • Performance of the U.S. railroads since World War II: A quarter century of private operation. New York: Vantage Press, 1985.

______________________

Yale Career from the Yale Archives.

Kent T. Healy was born in Chicago on February 2, 1902. He received his B.A. from Harvard in 1921, and his B.S. in Electrical Engineering from M.I.T. in 1923. Healey was an assistant professor of transportation at Yale from 1928-1937, an assistant professor of political economy from 1937-1938, an assistant professor of economics from 1938-1940, an associate professor from 1940-1945, and the Thomas DeWitt Cuyler Professor of Transportation from 1945-1970.

Source: Yale University Archives. Kent Tenney Healy papers.

______________________

Extra-academic career

Kent Tenney Healy was born in Chicago, IL on February 2, 1902. A recognized expert in transportation economics, he taught at Yale University from 1934-1970. Due to his expertise, he often served as a consultant to many United States government agencies or as a member of various commissions from 1940-45. He also participated in state and local government planning and financial management especially in Killingworth, CT. Mr. Healy served as a director of the New York, New Haven and Hartford Railroad Co., 1947-48 and the Connecticut Co., 1947-64.

Commission on Reorganization of State Departments, 1935-1937. Special Act No. 242 of 1935 established a five member commission appointed by the Governor, with the advice and consent of the General Assembly to study the “organization, powers and duties, personnel and expenditures” of each agency and prepare recommendations and propose legislation. The commission held its first meeting in Governor Wilber Cross’ office on June 21, 1935. Col. Thomas Hewes served as chairman. The commission appointed Benjamin P. Whitaker, Research Director, on July 1, 1935. A small staff and a number of expert consultants prepared the report, approved by the commission, for submittal to the governor on January 25, 1937. The General Assembly extended the commission authorization to March 30, 1937. Even after that date, the commission members and the Research Director provided advice and assistance to the governor and the General Assembly.

State Planning Board. Advisory Committee on Transportation, ?-1936. The State Planning Board adopted a policy of appointing advisory committees to assist the board and its staff in developing research studies. The Transportation Committee consisted of the Highway Commissioner, the Motor Vehicle Commissioner, and a member of the Public Utilities Commissioner. The committee was to make the state’s transportation program more definite and practical, review past accomplishments, draw up plans for further work and prepare and interpret a report for the State Planning Board. On April 10, 1935, the committee issued “Transportation in Connecticut. Part I: Passenger Transportation.” There is no evidence that it issued any other parts.

Highway Advisory Committee, 1943-1945. Special Act 456 of 1943 directed the governor to appoint a five member committee to study and advise the highway commissioner concerning post-World War II highway improvements, the problem of just and equitable distribution of highway funds for cities and towns, problems with the system, the departments procedures and practices and existing laws to determine what is desirable for an efficient highway program. Highway Commissioner William J. Cox, first mentioned such a committee in his biennial report to the governor for 1939-1940. He again recommended the committee to Governor Baldwin in December 1942. Baldwin put the recommendations into his inaugural speech and saw it through the General Assembly. After hearing testimony from the Highway, Motor Vehicle and State Police departments and inspecting the new Fairfield County route (I-95) to replace Route 1, the committee submitted its report to the governor in December 1944.

Savings Banks’ Railroad Investment Committee, 1945-1963. The General Assembly created a six member committee to certify railroad company bonds as eligible for investment by savings banks for the banking commissioner. The governor appointed members to three-year terms from nominations given him by the Executive Committee of the Savings Banks’ Association of Connecticut, the Banking Commissioner, the Executive Committee of the Connecticut Bankers Association, and the Executive Committee of the Savings Banks’ Deposit Guaranty Fund of Connecticut. A nominee had to be either a bank officer or director or trustee of one of the above organizations or its members. The statute allowed reimbursement of travel expenses only to be paid by the Savings Banks’ Association. In 1961, the General Assembly changed the committee’s name to the Railroad Legal Investment Commission. In 1963, it disbanded the committee and placed its responsibilities solely with the banking commissioner.

Source: Social Networks and Archival Context website.

______________________

Report to the 25th Reunion of the Harvard Class of 1922

KENT TENNEY HEALY

HOME ADDRESS: 245 Lawrence St., New Haven 11, Conn.

OFFICE ADDRESS: Strathcona Hall, Yale University, New Haven, Conn.

BORN: Feb. 2, 1902, Chicago, Ill. PARENTS: William Healy, ‘97, Mary Sylvia Tenney.

PREPARED AT: Evanston Academy, Evanston, Ill.; Browne and Nichols School, Cambridge, Mass.; Wellesley High School, Wellesley, Mass.

YEARS IN COLLEGE: 1918-1921. DEGREES: A.B. cum laude, 1922 (21); S.B. (Massachusetts Inst. of Technology), 1923; A.M. hon. (Yale Univ.), 1945.

MARRIED: Ruth Emily Allen, Nov. 3, 1928, Cheshire, Conn. CHILDREN: Ruth Tenney, Aug. 4, 1929; William Kent, July 5, 1930; Kent Allen, Sept. 30, 1932; Sylvia Kent, Dec. 3, 1941.

OCCUPATION: T. DeWitt Cuyler Professor of Transportation; chairman, Economics Department; chairman, Committee on Transportation, Yale University.

WARTIME GOVERNMENT POSTS: Transportation consultant, Bituminous Coal Division, Department of Interior, Office of Defense Transportation, Administrator of Lend Lease and Office of Strategic Services.

OFFICES HELD: Public utility consultant, Commission of Reorganization of State Departments, Connecticut, 1935-36; member, Connecticut Highway Advisory Commission, 1943-45, New Haven Traffic Commission, since 1946; chairman, Savings Bank Railroad Investment Committee, since 1945; president, Family Service of New Haven, since 1944; treasurer, The Foote School Association, Incorporated, 1937-46.

MEMBER OF: Graduate Club; Delta Psi.

PUBLICATIONS: Steam Railroad Electrification, McGraw-Hill, 1929; Cases on Railroad Economics (private), 1938; The Economics of Transportation in America, Ronald, 1940; numerous articles.

 

THE twenty-five years since graduation have slipped by awfully fast and I don’t feel a day older than I did when I left Cambridge. Certainly the years have been full of interest and enjoyment.

One of the things that has made the years particularly challenging has been that I have consciously changed my course on several occasions. Starting out with a career of electrical engineer in the public-utility field, I fairly quickly shifted over to transportation and joined the Operating Department of the New Haven Railroad. If anybody had told me at this point that I was going to become a teacher, I would have been thoroughly dismayed. But when I left the New Haven to broaden myself by studying transportation operation in Europe, I started a sequence which was to lead to the doors of good old Eli.

If one writes a book, it apparently can easily lead to a college post. My first one, built around what I learned in Europe, led to an appointment in transportation at Yale. The teaching part of this job has been a continuous challenge because every year has given me a chance to introduce new ideas and methods. Further, the satisfaction of helping to develop the intellectual process of a loyal group of students cannot be matched by anything else. Along with the teaching has been research and consulting, which are some of the ways in which one can sharpen one’s thinking. help the world at large, and also keep abreast of the practicalities of life.

Along with all this, I was fortunate enough to team up with the ideal girl, and together we’ve gone through all the pains and pleasures of bringing up four children.

When the war came along, I naturally put what talents I have to work for the country, starting with the Bituminous Coal Division of the Department of Interior on coal transportation problems, working with the O.S.S. particularly on the North African problem, and with Lend Lease and the Office of Defense Transportation. Not the least interesting part of all this was the chance to compare the different government agencies in war time as well as contrast them with the peace-time agencies I had seen something of before.

In the meantime my work at Yale was shifting from just transportation to a combination of that and economics. Finally, by the end of the war, I found myself chairman of the Economics Department as well as head of the transportation group. I am not so sure that the administrative responsibilities, challenging though they are, are quite as worth while as the teaching and research.

Along with all this, I have always felt that one should play a part in the local community in which one lives, and I have for a goodly number of years maintained an association with various social agencies. More recently my contribution has been as president of the largest family casework agency in New Haven. At the same time I have done my stint in both state and city government, ranging from being a member of the State Highway Advisory Commission to now being chairman of the State Savings Bank Railroad Investment Committee and a member of the City Traffic Commission (trying to solve the unsolvable in this latter).

This all adds up to a full and happy existence and, I hope, a useful one.

 

Source: Harvard Class of 1922. Twenty-fifth Anniversary Report (Cambridge, Mass.: 1947), pp. 427-429.

Image Source:Kent T. Healy (1922 and 1947). Harvard Class of 1922. Twenty-fifth Anniversary Report, Portraits of the Class (Cambridge, Mass.: 1947), p. 97.

 

Categories
M.I.T. Teaching

M.I.T. Student survey regarding Domar’s core macro theory course, 1960

 

The previous post provided the course syllabus and reading list for the core graduate macroeconomics course taught at M.I.T. by Evsey Domar during the first term of the 1960-61 academic year. He took the job seriously enough to try surveying his students to gauge his pedagogic success. I post a transcription of the mimeographed survey questions that were distributed to the students and have inserted totals from a handwritten summary of results. The strongest signals to come out of this exercise were (i) that mixing graduate economics with graduate business students is probably unwise and (ii) that a heavy dose of national income and product accounting is bitter medicine to new graduate students.

An earlier post  presents the results of a survey of Domar’s course for several later cohorts (1967-69).

______________________

QUESTIONNAIRE ON THE THEORY OF NATIONAL INCOME AND EMPLOYMENT (14.451)
E. D. Domar
Fall term 1960-61

Because the course is given to students of widely different backgrounds I am not sure whether it is taught on the proper level and in the proper manner. The size of the class precludes personal interviews on the subject. You can do a great service to future students and to myself by filling out this questionnaire in the most thoughtful and honest manner.

  1. Do not write your name, but give the following information:
    1. Your major (such as Course XIV, XV, etc.)
    2. Concentration within your major, if you know it.
    3. Year of graduate work
    4. Was your undergraduate training in the U.S. or Canada? (Yes or No)
  2. The general level of the course was (check one):
too elementary about right too advanced
The course XIV: 1
XV: 0		 XIV: 17
XV: 7		 XIV: 0
XV: 1
I. National Income and Related Items XIV: 4
XV: 1		 XIV: 19
XV: 12		 XIV: 1
XV: 1
II. General Aggregative System XIV: 4
XV: 0		 XIV: 17
XV: 9		 XIV: 1
XV: 5
III. Theory of Interest XIV: 4
XV: 0		 XIV: 17
XV: 9		 XIV: 1
XV: 4
IV. Consumption Function XIV: 2
XV: 0		 XIV: 20
XV: 10		 XIV: 0
XV: 4
V. Multiplier and Accelerator XIV: 3
XV: 0		 XIV: 16
XV: 8		 XIV: 3
XV: 6
VI. Investment Decisions XIV: 3
XV: 0		 XIV: 17
XV: 12		 XIV: 2
XV: 2
VII. Price Flexibility XIV: 1
XV: 0		 XIV: 16
XV: 8		 XIV: 0
XV: 2
[column totals] XIV: 22
XV: 1		 XIV: 139
XV: 75		 XIV: 8
XV: 25
  1. Mathematics was used in the course (encircle one) not enough [XIV, 6; XV, 3], about right [XIV, 15; XV, 8], too much [XIV, 3; XV, 3].Specific examples, if any.[For course XIV the course is a bit too elementary (totals, 22:8). For course XV the course is too advanced (totals, 1:25). For all students, it is about right.
    Math should be used somewhat more.
    The scope is a bit too broad.
    So, the course should be made tighter, more advanced, and a bit more mathematical, particularly without course XV students.]
  2. The scope of the course was (encircle one) too narrow [XIV, 0; XV, 0], about right [XIV, 13; XV, 10], too broad [XIV, 3; XV, 3].Topics to be added are:
    Topics to be given greater attention are:
    Topics to be condensed are:
    Topics to be eliminated are:
    Other suggestions regarding the scope of the course
Expand Condense Eliminate
I. National Income and Related Items XIV: 1
XV: 1		 XIV: 13
XV: 3		 XIV: 1
XV: 0
II. General Aggregative System XIV: 8
XV: 5		 XIV: 0
XV: 0		 XIV: 0
XV: 0
III. Theory of Interest XIV: 10
XV: 1		 XIV: 3
XV: 0		 XIV: 0
XV: 0
IV. Consumption Function XIV: 2
XV: 0		 XIV: 1
XV: 1		 XIV: 0
XV: 0
V. Multiplier and Accelerator XIV: 2
XV: 1		 XIV: 4
XV: 2		 XIV: 0
XV: 0
VI. Investment Decisions XIV: 5
XV:2		 XIV: 2
XV: 1		 XIV: 0
XV: 0
VII. Price Flexibility XIV: 6
XV: 3		 XIV: 2
XV: 0		 XIV: 0
XV: 0
  1. Required reading material was (encircle one) too broad [XIV, 9; XV, 9], about right [XIV, 12; XV, 2], too concentrated [XIV, 0; XV, 1].
    Would you prefer a smaller number of required readings but with a more intensive study of each? [Yes: XIV, 13; XV, 10], [No: XIV, 5; XV, 1] Comment.Should the readings be discussed in class more thoroughly and often?
    [Yes: XIV, 7; XV, 6], [No: XIV, 7; XV, 5]How adequately did the Reserve shelf serve your needs? [Enough: XIV, 1; XV, 0], [Not enough: XIV, 3; XV, 2] Did you have difficulties in obtaining the readings?Suggestions for improvement[Course XIV would keep the breadth of the reading as now, possibly somewhat narrower. But XV definitely wants more narrow.
    Both would prefer a smaller number of readings, particularly XV
    Evenly divided on discussing readings in class.]
  2. Because of the size of the class, lectures usually took the place of discussions. Would you prefer more discussions? [Yes: XIV, 5; XV, 5], [No: XIV, 13; XV, 7]Would a smaller class materially improve the course? [Yes: XIV, 11; XV, 9], [No: XIV, 5; XV, 3]Any other suggestions?[No great demand for more discussion in the large class, but a clear demand for a smaller class.]
  3. Grade the instruction in the course (A, B, C and F) for the following qualities (as compared with other courses at M.I.T. and elsewhere).Clarity of exposition
    Intellectual stimulation
    Usefulness of information
    Enjoyment of the course
    General performance
Grades A+ A A/B B B/C C Below
C
Clarity XIV: 18
XV: 8		 XIV: 0
XV: 1		 XIV: 4
XV: 3		 XIV: 0
XV: 1		 XIV: 0
XV: 1
Stimulation XIV: 15
XV: 7		 XIV: 0
XV: 2		 XIV: 4
XV: 4		 XIV: 2
XV: 0		 XIV: 0
XV: 1
Usefulness XIV: 9
XV: 4		 XIV: 1
XV: 1		 XIV: 7
XV: 6		 XIV: 1
XV: 2		 XIV: 0
XV: 1
Enjoyment XIV: 1
XV: 0		 XIV: 16
XV: 5		 XIV: 0
XV: 1		 XIV: 3
XV: 6		 XIV: 2
XV: 1		 XIV: 0
XV: 1
General XIV: 12
XV: 7		 XIV: 3
XV: 2		 XIV: 5
XV: 2		 XIV: 0
XV: 2		 XIV: 0
XV: 1

[Course XIV feels much better about the course than does XV. Clarity, stimulation and enjoyment get high marks. Usefulness—much less.]

  1. As you know, a third of the final examination is devoted to a substitute for a term paper. Would you prefer a usual term paper instead? [Yes: XIV, 11; XV, 2], [No: XIV, 10; XV, 7] Neither?
    [Existing exam—Yes: XIV, 5; XV, 7], [No: XIV, 4; XV, 2]
    [More exams—Yes: XIV, 5; XV, 1], [No: XIV, 0; XV, 0]

Comment on this.

[Course XIV prefer (slightly) a term paper and a midterm exam. Course XV don’t want a term paper.]

  1. Any other comments, suggestions, complaints, wishes, etc.[Useful comments
    Require Patinkin. Course XV find it too hard.
    Suggest the more important readings.
    People in the back couldn’t hear well.
    No seating assignment
    A midterm exam is frequently asked, otherwise, they don’t work on this course hard enough.
    A time schedule of the course.
    Better reading list.]

 

Source: Duke University. David M. Rubenstein Rare Book and Manuscript Library. Economists’ Papers Archive. Papers of Evsey D. Domar, Box 17, Folder “Macroeconomics. Questionnaire on the Theory of national Income & Employment (14.451)”.

Image Source: The M.I.T. mascot beaver on the cover of its yearbook, Technique 1949.

Categories
Exam Questions M.I.T. Suggested Reading Syllabus

M.I.T. National Income and Employment Theory. Readings and Final Exam. Domar, 1960-61

 

 

For this post I have transcribed Evsey Domar’s graduate core macroeconomics course outline/reading list along with the questions for the final examination from the first term of the 1960-61 academic year at M.I.T. Students from both course XIV (economics) and XV (management) took this course.

Note: Evsey Domar distributed a questionnaire to the students to obtain feedback on his course.  The next post provides the results from that survey. It is fairly apparent that Domar did not cover the last topic on the course reading list (economic growth).

Final exam grade distribution (50 exams)

A 16%
A- 12%
B+ 10%
B 20%
B- 14%
C 18%
D 8%
F 2%

Fun Fact. Among the students enrolled in the course and who took the final examination: Michael D. Intriligator, Peter A. Diamond, Ann Fetter Friedlaender, and Stephen Goldfeld.

The much expanded course reading list/bibliography and  both the midterm and final examinations from the 1965-66 academic year have been posted earlier.

_________________________

MASSACHUSETTS INSTITUTE OF TECHNOLOGY

THEORY OF NATIONAL INCOME AND EMPLOYMENT
14.451 Reading List
E. D. Domar Fall Term 1960-61

The purpose of this list is to suggest to the student the sources in which the more important topics of the course are discussed from several points of view. His objectives should be the understanding of these topics and not the memorization of opinions and details.

Items marked with an * are strongly recommended. (I don’t like to use the expression “required” in a graduate reading list.)

No term paper will be required, but each student is expected, in addition to his general reading, to choose one of the eight major divisions of the course (except that Part VIII should not be taken without prior consultation with the instructor) as a field of concentration. A part of the final examination will be designed to test his broader knowledge of the chosen field.

 

I. NATIONAL INCOME AND RELATED ITEMS

*Kuznets, S., National Income and Its Composition, (New York, 1941), particularly Vol. 1, Chapter 1

*Jaszi, G., “The Statistical Foundations of the GNP,” Review of Economics and Statistics, Vol. 38, 1956)
Ruggles, R. and N., National Income Accounts and Income Analysis (New York, 1956)

*U.S. Department of Commerce, U. S. Income and Output, A Supplement to the Survey of Current Business, 1958

*National Bureau of Economic Research, The National Economic Accounts of the United States, Review, Appraisal and Recommendations, General Series 64, Washington, 1958

Ruggles, “The U.S. National Accounts,” American Economic Review, March, 1959
Organization for European Economic Co-operation, A Standardised System of National Accounts, Paris, 1952

Gilbert, M. and I. B. Kravis, An International Comparison of National Products and the Purchasing Power of Currencies, A Study of the United States, the United Kingdom, France, Germany and Italy, Organization for European Economic Cooperation, Paris, 1954

Nove, A., “The United States National Income A La Russe,” Economica, Vol. 23, 1956

Gilbert, M., Comparative National Products and Price Levels, A Study of Western Europe and the United States, Organization of European Economic Cooperation, Paris, 1958

*Leontief, W. W., “Output, Employment, Consumption and Investment,” Quarterly Journal of Economics, Feb., 1944

Leontief, W. W. The Structure of American Economy (New York, 1951)

*Dorfman, R., “The Nature and Significance of Input-Output,” Review of Economics and Statistics, Vol. 36, 1954

Stewart, I. G., “The Practical Uses of Input-Output Analysis,” Scottish Journal of Political Economy, Vol. 5, (Feb. 1958)

Dosser, D. and A. T. Peacock, “Input-Output Analysis in an Under-Developed Country: A Case Study,” Review of Economic Studies, Vol. 25, Oct. 1957

*Sigel, S. J., “A Comparison of the Structures of Three Social Accounting Systems,” National Bureau of Economic Research, Input-Output Analysis: An Appraisal, The Conference on Research in Income and Wealth, Studies in Income and Wealth, Vol. 18, pp. 253-89

Board of Governors of the Federal Reserve System, Flow of Funds in the United States 1939-53 (Washington, D. C., 1955)

 

II. GENERAL AGGREGATIVE SYSTEM

Students without prior training in this field are advised to study D. Dillard, The Economics of John Maynard Keynes (New York, 1948), A. H. Hansen, A Guide to Keynes (New York, 1953), or K. Kurihara, Introduction to Keynesian Dynamics (New York, 1956).

*Keynes, J. M., The General Theory of Employment, Interest and Money (New York, 1936)

*American Economic Association, Readings in Business Cycle Theory (Philadelphia, 1944), Essays 5, 7

Harris, S. E., The New Economics (New York, 1947), essays 8-19, 31-33, 38-46.

*Lerner, A. P., Economics of Control (New York, 1944), chapters 21-23, 25

*Kurihara, K. K., Post Keynesian Economics (New Brunswick, N. J., 1954), essays 1, 11*

*American Economic Association, Readings in the Theory of Income Distribution (Philadelphia, 1946), essay 24

Klein, L. R., The Keynesian Revolution, (New York, 1947), chapters 3-5.

Ellis, H. S., A Survey of Contemporary Economics (Philadelphia, 1948), Vol. 1, chapter 2

*Income, Employment and Public Policy, Essays in Honor of Alvin H. Hansen (New York, 1948), essay I

*Burns, A. F., “Economic Research and the Keynesian Thinking of Our Times,” in his The Frontiers of Economic Knowledge, (Princeton, 1954), or in the Twenty-Sixth Annual Report of the National Bureau of Economic Research, Inc. (New York, 1946). See also the discussion by Hansen and Burns in the Review of Economic Statistics, November, 1947

Dillard, D., “The Influence of Keynesian Economics on Contemporary Thought,” American Economic Review, Papers and Proceedings, 1957

Patinkin, D., Money, Interest, and Prices (Evanston, Ill., 1956).

 

III. THEORY OF INTEREST

Readings in the Theory of Income Distribution, essays 22, 23, 26

*Hicks, J. R., Value and Capital (Oxford, 1957), Chapters 11-12

Readings in Monetary Theory, essays 6, 11, 15

*Gurley, J. G., and E. S. Shaw, “Financial Aspects of Economic Development,” American Economic Review, September, 1955)

Hart, A. G., Money, Debt and Economic Activity, Second Ed., (New York, 1953)

Patinkin, D., “Liquidity Preference and Loanable Funds: Stock and Flow Analysis,” Economica, Vol. 25, November, 1958

Patinkin, D., Money, Interest, and Prices (Evanston, Ill., 1956).

*Lydall, H., “Income, Assets, and the Demand for Money,” Review of Economics and Statistics, Vol. 40, Feb. 1958

Lutz, F. A., “The Interest Rate and Investment in a Dynamic Economy,” American Economic Review, Dec. 1945

See also Section VI — INVESTMENT DECISIONS

 

IV. CONSUMPTION FUNCTION

*Duesenberry, J. S., Income, Saving, and the Theory of Consumer Behavior (Cambridge, Massachusetts, 1949)

Haley, B. F., A Survey of Contemporary Economics (Homewood, Illinois, 1952), Vol. II, essay 2

Davis, T. E., “The Consumption Function as a Tool of Prediction,” The Review of Economics and Statistics, August 1952

Heller, W. W., Boddy, F. M., and C. L. Nelson, Savings in the Modern Economy, a Symposium (Minneapolis, 1953)

*Friend, I., and S. Schor, “Who Saves?,” The Review of Economics and Statistics, Vol. 41, May, 1959, Part 2

*Friend, I., and I. B. Kravis, “Entrepreneurial Income, Saving and Investment,”American Economic Review, June, 1957, pp. 269-301

Zellner, Arnold, “The Short-Run Consumption Function,” Econometrica, (Oct. 1957

*Ferber, R., “The Accuracy of Aggregate Savings Functions in the Post-War Years,” Review of Economics and Statistics, Vol. 37, May, 1955

*Tobin, J., “On the Predictive Value of Consumer Intentions and Attitudes,” The Review of Economics and Statistics, Vol. 41, Feb., 1959

Dennison, E. F., “A Note on Private Saving,” Review of Economics and Statistics, August, 1958
Post-Keynesian Economics, essay 15

Friedman, M., A Theory of the Consumption Function (Princeton, N. J., 1957)

Friedman, M., and G. Becker, “A Statistical Illusion in Judging Keynesian Models,” Journal of Political Economy, Vol. 65, Feb., 1957

Klein, L. R., “The Friedman-Becker Illusion,” Journal of Political Economy, Vol. 66, Dec., 1958

Morgan, J. N., Consumer Economics (New York, 1955)

Katona, G., and E. Mueller, Consumer Expectations 1953-56 (Ann Arbor, Michigan, 1956)

Klein, L. R., ed., Contributions of Survey Methods to Economics (New York, 1954)

 

V. MULTIPLIER AND ACCELERATOR

*Kahn, R. F., “The Relation of Home Investment to Unemployment,” Economic Journal, 1931. Republished in Hansen and Clemence, Readings in Business Cycles and National Income (New York, 1953), essay 15

*Readings in Business Cycle Theory, essays 11-12

*Haavelmo, T., “Multiplier Effects of a Balanced Budget,” Econometrica, 1945; reprinted in Readings in Fiscal Policy, pp. 335-343

*Salant, William A., “Taxes, Income Determination, and the Balanced Budget Theorem,” The Review of Economics and Statistics, May, 1957

Peston, M. H., “Generalizing the Balanced Budget Multiplier,” and “Comment” by W. A. Salant, The Review of Economics and Statistics, August, 1958

Bowen, W. G., “The Balanced-Budget Multiplier: A Suggestion for a More General Formulation,” The Review of Economics and Statistics, May, 1957

*Kuznets, S., “Relation Between Capital Goods and Finished Products in the Business Cycle,” in Economic Essays in Honor of Wesley Clair Mitchell, (New York, 1935)

*Knox, A. D. “The Acceleration Principle and the Theory of Investment: A Survey,” Economica, Vol. 19, 1952

*Tsiang, S. C., “Accelerator, Theory of the Firm, and the Business Cycle,” Quarterly Journal of Economics, Vol. 65, 1951

*Tinbergen, “Statistical Evidence on the Acceleration Principle,” Economica, Vol. 5, 1938

Harrod, R. F., Towards a Dynamic Economics (London, 1948)

Hicks, J. R., A Contribution to the Theory of the Trade Cycle (Oxford, 1950)

Goodwin, R. M., “Problems of Trend and Cycle,” Yorkshire Bulletin, Vol. 5, August, 1953

Ott, A. E., “The Relation Between the Accelerator and the Capital Output Ratio,” Review of Economic Studies, Vol. 25, June, 1958

Minsky, H., “Monetary Systems and Accelerator Models,” American Economic Review, Vol. 47, 1957

See also VI — INVESTMENT DECISIONS.

 

VI. INVESTMENT DECISIONS

Lutz, F. A., and V., The Theory of Investment of the Firm (Princeton, 1951)

*Heller, W. W., “The Anatomy of Investment Decisions,” Harvard Business Review, March, 1951, pp. 95-103

*Pitchford, J. D. and A. J. Hagger, “A Note on the Marginal Efficiency of Capital,” The Economic Journal, Vol. 48, 1958

*Meade, J. E., and P. W. S. Andrews, “Summary of Replies to Questions on Effects of Interest Rates,” and “Further Inquiry into the Effects of Rates of Interest,” Oxford Economic Papers, No. 1, 1938 and No. 3, 1940

*Ebersole, J. F., “The Influence of Interest Rates,” Harvard Business Review, Vol. 17, 1938, pp. 35-39

*Henderson, H. D., “The Significance of the Rate of Interest,” Oxford Economic Papers, October, 1938, pp. 1-13

Andrews, P. W. S., “Further Inquiry into the Effects of Rates of Interest,” Oxford Economic Papers, Feb., 1940, pp. 32-73

Sayers, R. S., “Business Men and the Terms of Borrowing,” Oxford Economic Papers, Feb., 1940, pp. 23-31

*White, W. H., “Interest Inelasticity of Investment Demand—The Case from Business Attitude Surveys Re-examined,” American Economic Review, Sept. 1956, pp. 565-587

Brockie, M. D., and A. L. Gray, “The Marginal Efficiency of Capital and Investment Programming,” Economic Journal, Vol. 46, December, 1956

White, W. H., “The Rate of Interest, the Marginal Efficiency of Capital, and Investment Programming,” Economic Journal, Vol. 48, March, 1958

Grey, A. L., and M. D. Brockie, “The Rate of Interest, Marginal Efficiency of Capital and Net Investment Programming: A Rejoinder,” Economic Journal, June, 1959

Spiro, A., “Empirical Research and the Rate of Interest,” Review of Economics and Statistics, Vol. 40 (February, 1958).

*Duesenberry, J., Business Cycles and Economic Growth (New York, 1958), Chapters 1-8

Meyer, John R., and Edwin Kuh, The Investment Decision (Cambridge, Mass., 1957)

Cunningham, N. J., “Business Investment and the Marginal Cost of Funds,” Metroeconomica, Vol. 10, August, 1958

Cunningham, N. J., “Business Investment and the Marginal Cost of Funds,” Part II, Metroeconomica, Dec., 1958

Wilson, T., “Cyclical and Autonomous Inducements to Invest,” Oxford Economic Papers, Vol. 5, 1953

Hirschleifer, J., “On the Theory of Optimal Investment Decision,” The Journal of Political Economy, Vol. 66, Aug., 1958

Lydall, H. F., “The Impact of the Credit Squeeze on Small and Medium Sized Manufacturing Firms,” Economic Journal, Vol. 47, Sept., 1957

*Penrose, E., “Limits to the Growth and Size of Firms,” American Economic Review Papers and Proceedings, May 1955, pp. 531-43

Friend, I., and J. Bronfenbrenner, “Business Investment Programs and Their Realization,” Survey of Current Business, December, 1950

*Foss, M. F., and V. Natrella, “Ten Years’ Experience with Business Investment Anticipations,” Survey of Current Business, January, 1957

*Foss, M. F., and V. Natrella, “Investment Plans and Realizations—Reasons for Differences in Individual Cases,” Survey of Current Business, June, 1957

See also III—THEORY OF INTEREST and V—MULTIPLIER AND ACCELERATOR

 

VII. PRICE FLEXIBILITY AND EMPLOYMENT

*Pigou, A. C., “The Classical Stationary State,” Economic Journal, Dec., 1943

*Lange, O., Price Flexibility and Employment (Bloomington, Indiana, 1944)

*Friedman, M., “Lange on Price Flexibility and Employment,” American Economic Review, Sept., 1946

Readings in Monetary Theory, Essay 13

Schelling, T. C., “The Dynamics of Price Flexibility,” American Economic Review, Sept. 1949

Patinkin, D., Money, Interest, and Prices (Evanston, Illinois, 1956)

Hicks, J. R., “A Rehabilitation of ‘Classical Economics’,” Economic Journal, Vol. 47, June, 1957

*Power, J. H., “Price Expectations, Money Illusion and the Real Balance Effect,” Journal of Political Economy, Vol. 67, April, 1959

*Mayer, T., “The Empirical Significance of the Real Balance Effect,” Quarterly Journal of Economics, Vol. 73, May, 1959

 

VIII. THEORY OF GROWTH

*Domar, E. D., Essays in the Theory of Economic Growth (New York, 1957), Foreword, Essays I, III-V

Fellner, W., Trends and Cycles I Economic Activity, (New York,1956)

Hansen, A. H., Fiscal Policy and Business Cycles (New York, 1941)

*Harrod, R. F., Towards a Dynamic Economics (London, 1948), Part III

Leontief, W. W., Studies in the Structure of the American Economy, (New York, 1953)

Robinson, J., The Accumulation of Capital, (London, 1956)

*Kuznets, Simon, “Towards a Theory of Economic Growth,” R. Leckachman, ed., National Policy for Economic Welfare at Home and Abroad, (New York, 1955)

*Solow, R. M., “A Contribution to the Theory of Economic Growth,” Quarterly Journal of Economics, Feb. 1956, pp. 65-94

*Solow, R. M., “Technical Change and the Aggregate Production Function,” Review of Economics and Statistics, August, 1957, pp. 312-320

 

Source:  Duke University, David M. Rubenstein Library. Economists’ Papers Archives. Papers of Evsey D. Domar, Box 15, Folder “Macroeconomics, Old Reading Lists”.

 

_________________________

Economics 14-451
E. D. Domar

FINAL EXAMINATION—Three Hours
January 24, 1961

Please use a separate book for each question.

 

Part I—One Hour

Write an essay in the field of your concentration as instructed in class. Please be specific.

 

Part II—Two Hours

Answer the THREE questions which are furthest removed from the topic discussed in Part I. They carry equal weights.

  1. “Thus the rate of interest is what it is because it is expected to become other than it is: if it is not expected to become other than it is, there is nothing left to tell us what it is…”
    1. Can you identify the author of this famous statement?
    2. Can you recognize whose interest theory he referred to?
    3. Explain and evaluate that theory critically.
    4. Present your own (original or otherwise) theory of interest.
  2. Write an essay on the subject of “The treatment of intermediate products in:
    1. National Income and Product Accounting
    2. Input-output method
    3. Flow-of Funds system
    4. Federal reserve Index of Industrial Production.” (Don’t panic if you can’t do (d), but if you can you’ll get a premium.
      Hint: there is more in this question, and particularly in part (a) than meets the eye. Consider the whole rationale of the methods.
  3. Write a comprehensive essay on the subject of “The Rationale of Investment Decisions.” Consider as many cases as you can, but in each case specify clearly the assumptions made. (Don’t forget to include an undeveloped country case.) Can you generalize?
  4. Write a comprehensive and critical essay on the subject of “Price Flexibility and Employment.” Survey the relevant literature beginning with Keynes’ General Theory, and indicate clearly the nature of the assumptions, the definition of the concepts (hint: money), and the essence of the conclusions. What practical recommendations follow from your discussion?

 

Source: Duke University, David M. Rubenstein Library. Economists’ Papers Archives. Papers of Evsey D. Domar, Box 16, Folder “Macroeconomics, Final Exams”.

Image Source: Evsey D. Domar photo at the M.I.T. Museum website.

Categories
Funny Business Gender M.I.T.

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

 

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

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

1941 (78 rpm record) Nora Lee King on Decca

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

1950 (Video)  Peggy Lee with The Dave Barbour Quartet

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

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

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

_____________________

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

to be sung by somebody’s wife.

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

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

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

Categories
M.I.T. Suggested Reading Syllabus

M.I.T. Monetary economics, reading lists. Ando and Modigliani, 1960-61

 

 

Franco Modigliani first came to M.I.T. as a visiting professor in 1960-61 from the Carnegie Institute of Technology before returning in 1962 after only one year at Northwestern. His former Carnegie Tech student Albert K. Ando was already on the M.I.T. faculty and the partial reading lists for their jointly taught courses can be found in Modigliani’s papers at Duke’s Economists’ Papers Archive. 

Readings and final exam from the monetary theory course taught by Modigliani at Northwestern in 1961 have been posted earlier.

Note: I have inserted part of the reading list on monetary policy from Modigliani’s course at Carnegie Tech in the term immediately preceding his visiting professorship at M.I.T. This insertion is motivated by last sentence in the course description in the M.I.T. catalogue that includes the topic “the role of money in policy”.

_____________________

Monetary Economics course enrollments
1960-61

Fall 1960.  14.461 Monetary Economics, A. K. Ando. 14 students.

Spring 1961.  14.192 Economics Seminar—Monetary Economics. Ando/Modigliani. 7 students.

Source: M.I.T. Archives. Department of Economics, Records. Box 3, Folder “Teaching Responsibility”.

_____________________

Course Announcement
Fall, 1960

14.461 Monetary Economics

Prereq.: 14.451 [Theory of Income and Employment]
Year: G(1)

Review of theory of income determination, with explicit attention to monetary parts of the model. Examination of sources and determinants of supply of money with attention to role of commercial banks, Federal Reserve System, and the Treasury. Exploration of both theory and fact about demand for money for transactions and for speculative purposes. Discussion of general equilibrium theory of money, interest, prices and output, and role of money in policy.

Ando, Modigliani

Source:   Massachusetts Institute of Technology Bulletin, 1960-61, p. 243.

_____________________

Modigliani
Ando
Fall, 1960

Monetary Economics
14.461

We assume that students are familiar with the elementary price theory and income theory, i.e., that they have taken 14.121, 14.122, 14.451, and 14.452. We also assume that students have some material ordinarily covered in the elementary course in Money and Banking. Those who feel that they need to refresh their memory of the latter may consult:

Steiner, Shapiro, Solomon, Money and Banking, Parts I, II, and III.

Day and Beza, Money and Income, Parts I and III.

Hart, Money, Debt, and Economic Activity, 2nd edition, Part I.

Chandler, The Economics of Money and Banking, 3rd edition.

  1. The nature of money and the position of money in the balance sheet for the United States: An Introduction

Tobin, J., Manuscript, Chs. 1 and 2.

Robertson, D. H., Money, Chs. 1 to 3.

Meade, J. E., “The Amount of Money and the Banking System,” Readings in Monetary Theory.

The Federal Reserve System—Purposes and Functions, Chs. I to VIII and XIII.

Modigliani, F., Lecture Notes No. 1-3.

Federal Reserve Bulletin, August, 1959, “A Quarterly Presentation of Flow of Funds, Saving, and Investment.”

Roosa, R. V. Federal Reserve Operations with Money and Government Securities Market.

  1. Demand for Money

This year, we shall postpone the discussion of the demand for money arising from various forms of uncertainty until later in the course, and confine ourselves in this section to dealing with the demand for money due to the existence of the cost of transaction.

    1. Why is demand for money different from demands for consumption goods?

Samuelson, P. A., Foundations, pp. 117-124

Marschak, J., “The Rationale of the Demand for Money and of ‘Money Illusion’,” Metroeconomica, August, 1950, Sections 1 and 2.

    1. Classical theory (Equation of Exchange and Cambridge Equation).

Fisher, I., The Purchasing Power of Money, Chs. 1 to 6 and 8.

Robertson, D. H., Money, Chs. 4 to 6.

Marshall, A., Official Papers, pp. 32-54.

Keynes, J. M., A Treatise on Money, Chs. 9-19.

Wicksell, K., Interest and Prices, Chs. 3 and 5 to 8.

Gregory, T. E., The Gold Standard and Its Future, Chs. 1 and 2.

Hicks, J. R., “A Suggestion for Simplifying the Theory of Money,” Readings in Monetary Theory.

Keynes, J. M., The General Theory of Employment, Interest, and Money, Ch. 15.

Pigou, A. C., “The Value of Money,” AEA Readings in Monetary Theory, pp. 162-185.

Friedman, M., “The Restatement of the Quantity Theory of Money,” in Studies in the Quantity Theory of Money.

    1. More modern theory of transaction demand for money.

Tobin, J., Manuscript, Chapter 4, Sections 1 and 2, Appendix to Chapter 4.

Tobin, J., “The Interest Elasticity of Transaction Demand for Cash,” Review of Economics and Statistics, August, 1956, pp. 241-47.

Baumol, W. J., “The Transaction Demand for Cash,” Quarterly Journal of Economics, November, 1952.

Lecture notes, 3-6, 9 and 10.

    1. Some empirical evidence.

Bresciani-Turroni, The Economics of Inflation, Chs. 2, 4, and 5 (see also J. Robinson’s review in Economic Journal, September, 1938).

League of Nations, The Course and Control of Inflation, Part I.

Cagan, P., “The Monetary Dynamics of Hyper-Inflation,” in Studies in the Quantity Theory of Money, (M. Friedman, ed.)

Kisselgoff, A., “Liquidity Preference of Large Manufacturing Corporations,” Econometrica, October, 1945.

Latane, H. A., “Cash Balances and the Interest Rate,” Review of Economics and Statistics, 1954, pp. 456-460.

Polak, J. and White, W. H., “The Effect of Income Expansion on the Quantity of Money,” in IMF Staff Papers, August, 1956.

Stedry, A.C., “A Note on Interest Rates and the Demand for Money,” RENS August, 1959.

Those who are not familiar with the elementary theory of inventory management should consult any one of the following:

Whitin, T., Theory of Inventory Management, Chapters 2 and 3.

Arrow, K. J., Karlin, and Scarf, Studies in the Mathematical Theory of Inventory and Production, Chapters 1 and 2.

Arrow, K. J., Harris, and Marschak, “Optimal Inventory Policy,” Econometrica, July 1951.

  1. Analysis of the place of money in the economy—general equilibrium theory of money, prices, and employment.
    1. Neo-classical theory: the case of flexible prices and perfect markets.

Marschak, J., “The Rationale of the Demand for Money and Money Illusion,” Metroeconomica, 1950, pp. 71-160.

Modigliani, F., Preliminary Notes on the Theory of Money and Interest, Part I, II, and III, Section A to D (2).

Patinkin, D., Money, Interest, and Prices, An Integration of Monetary and Value Theory.

Patinkin, D., “A Reconsideration of the General Equilibrium Theory of Money,” Review of Economic Studies, Vol. 18, 1950-51.

De Scitovsky, T., “Capital Accumulation, Employment, and Price Rigidity,” Review of Economic Studies, Vol. 8, pp. 69-88.

Pigou, A. C., “Economic Progress in a Stable Environment,” Readings in Monetary Theory.

Metzler, L., “Wealth, Saving, and the Rate of Interest,” JPE, April, 1951.

Archibald, G. C., and Lipsey, R.G., “Monetary and Value Theory: A Critique of Lange and Patinkin,” Review of Economic Studies, October, 1958.

    1. Keynesian theory: the effects of rigid prices.

Keynes, J. M., The General Theory of Employment, Interest, and Money, Chs. 2, 6, 10, 11, 18, 19, 21 including appendix.

Hicks, J. R., “Mr. Keynes and the Classics,” Readings in the Theory of Income Distribution.

Modigliani, F., “Liquidity Preference and the Theory of Interest and Money,” Readings in Monetary Theory

Modigliani, Preliminary Notes, Part IV.

Pigou, A. C., Employment and Equilibrium.

Tobin, J., Manuscript, Chs. 5-6.

(To be continued)

Source: Duke University. David M. Rubenstein Rare Book and Manuscript Library. Economists’ Papers Archives. Franco Modigliani Papers. Box T6, Folder “Economic Fluctuation and Growth, 1961”.

_____________________

From: Course outline and major references, GI-583—Advance Economics III (Monetary Theory and Macro-Economic Analysis), Carnegie Institute of Technology, Spring Term 1960.

[Applications of the model to Economic Analysis and Policy]

  1. a) The causes of unemployment

(i) “Monetary” causes

(ii) Effective demand and the limits of monetary policy—Fiscal policy.

(iii) Real wage rigidity, market structures and the limits of monetary and fiscal policy

b) Creeping inflation and its causes—Cost push and demand pull

c) Implications for economic policy

Modigliani, Preliminary notes, Part IV section A.6 and C.6

Hart, A. G., Money, Debt and Economic Activity, Part V

Timlin, P., A MODEL OF THE CURRENT INFLATION—B.A. Thesis, Swarthmore College (Mimeographed) Ch. I

Joint Economic Committee, U.S. Congress—THE RELATIONSHIP OF PRICES TO ECONOMIC STABILITY AND GROWTH—COMPENDIUM March, 1958

(See especially: A. P. Lerner, “Inflationary Depression and the Regulation of Administered prices”) and G. Ackley, “A Third Approach to the Analysis and Control of Inflation”)

Selden, R., Cost Push versus Demand Pull, JPE Feb. 1959

WAGES, PRICES, PROFITS AND PRODUCTIVITY—The American Assembly, Columbia University

Schultze, C. THE RECENT INFLATION IN THE UNITED STATES. Joint Economic Committee, 1959

 

Source: Duke University. David M. Rubenstein Rare Book and Manuscript Library. Economists’ Papers Archives. Franco Modigliani Papers. Box T6, Folder “Economic Fluctuation and Growth, 1961”.

_____________________

List of Suggested Books
for Review in 14.461

Pigou, A. C., Employment and Equilibrium

Friedman, M., A Program for Monetary Stability

Hansen, B., Theory of Inflation

Hansen, B., Economic Theory of Fiscal Policy

Gurley, J. G., and Shaw, E., Money in a Theory of Finance

Faxen, K. O., Monetary and Fiscal Policy under Uncertainty

Botha, D. J., A Study in the Theory of Monetary Equilibrium

Hall, C. A., Fiscal Policy for Stable Growth

Buchanan, J. M., Public Principles of Public Debt

Musgrave, R. A., The Theory of Public Finance

Patinkin, D., Money, Interest, and Prices

Robinson, J., Accumulation of Capital

Sraffa, P., Production of Commodities by Means of Commodities

Source: Duke University. David M. Rubenstein Rare Book and Manuscript Library. Economists’ Papers Archives. Franco Modigliani Papers. Box T6, Folder “Economic Fluctuation and Growth, 1961”.

_____________________

Course Announcement

14.192 Economics Seminar

Prereq.: 14.121 [Economic Analysis (first term)]
Year: G(1)

Special social problems or economic problems of particular industries. (Open to graduate students only.)

Source: Massachusetts Institute of Technology Bulletin, 1960-61,  p. 242.

_____________________

Spring Term, 1961
Franco Modigliani
Albert Ando

14.192
Monetary Economics

  1. Preliminary Discussion of the Theory of Decision Making Under Uncertainty

Friedman, M., “Choice, Chance, and Personal Distribution of Income,” Journal of Political Economy, 1953, pp. 277-290.

Friedman, M., and Savage, L. J., “The Utility Analysis of Choices involving Risk,” JPE, 1948, pp. 279-304, reprinted in AEA Readings in Price Theory.

Dreze, J., and Modigliani, F., Consumer’s Behavior under Uncertaintydittoed notes.

Tobin, J., “Liquidity Preference as Behavior Toward Risk,” The Review of Economic Studies, February, 1958

Tobin, J., Manuscript, Ch. 3

Markowitz, H. M., Portfolio Selection

Hirschleifer—“Risk, the Discount Rate and Investment Decisions”—AER, Vol LI, No. 2 May 1961, pp. 112-120

Those who are not familiar with the standard theory of decision making under uncertainty should consult the following:

Luce, R. D., and Raiffa, H., Games and Decisions: Introduction and Critical Survey, Chs. 2, 13, and 14

Raiffa, H., and Schlaifer, R. O.,Applied Statistical Decision Theory, Preface and Introduction, Ch. 1.

 

Source: Duke University. David M. Rubenstein Rare Book and Manuscript Library. Economists’ Papers Archives. Franco Modigliani Papers. Box T6, Folder “Economic Fluctuation and Growth, 1961”.

Image Source: Albert K. Ando from the MIT Museum, People Records. Franco Modigliani from Gonçalo L. Fonseca’s History of Economic Thought website.

 

Categories
Exam Questions History of Economics M.I.T. Suggested Reading Syllabus

M.I.T. History of Economic Thought. Misc. Readings and exams. Samuelson, 1973-78

 

Scattered across several folders in the Paul Samuelson Papers at Duke are course materials from the graduate history of economic course regularly offered by Samuelson in the 1970s. Not included below are a few class lecture handouts and class lists also in the folders. Instead I have just transcribed the suggested reading lists or Dewey library course reserve lists and two final exams found in the folders. 

I did not take this course, once having sat in on a Marxian economics lecture that consisted of Paul Samuelson commenting on his textbook’s appendix “Rudiments of Marxian Economics”. Perhaps the arrogance of my youth got the better of me, but I thought there were other courses that were going to teach me something that I had not already learned so I am now condemned to trying to reconstruct his course content from such scraps as these we find in his archival record. Maybe a visitor to this page of Economics in the Rear-view Mirror has saved notes from the course?

_________________

14.132 FALL 1973
HISTORY OF ECONOMIC THOUGHT
P. SAMUELSON

SUGGESTED READINGS

1. FOR BACKGROUND

T. Kuhn
THE STRUCTURE OF SCIENTIFIC REVOLUTION

and parts or all of any sample of secondary sources, such as those by Roll, Gray, Gide-Rist, brief Schumpeter (1912), Heilbroner.

FOR BIOGRAPHY

Keynes
ESSAYS IN BIOGRAPHY

Schumpeter
TEN ECONOMISTS

H. Spiegel
GREAT ECONOMISTS ON GREAT ECONOMISTS

2. BASIC BACKGROUND REFERENCE

Perhaps the basic background reference is the posthumous, uneven classic:
J. S. Schumpeter
HISTORY OF ECONOMIC ANALYSIS

A valuable, MIT-graduate-school kind of reference is
Marc Blaug
ECONOMIC THEORY IN RETROSPECT

3. ON RICARDO, you should at least sample

Sraffa edition
PRINCIPLES

Useful readings are:

Blaug

Baumol
ch 2 in ECONOMIC DYNAMICS

Stigler in
HISTORY OF ECONOMICS

Sraffa
his introduction to the PRINCIPLES

Kaldor
his brief section in 1954 RES “Alternative Theories of Distribution”

Models of Ricardo-like systems

Pasinetti
Samuelson
Edelberg

Source: Duke University. David M. Rubenstein Rare Book and Manuscript Library. Economists’ Papers Archive. Paul Samuelson Papers, Box 33, Folder “14.132 Fall 1973”.

_________________

14.132 FALL 1974
HISTORY OF ECONOMIC THOUGHT
P. SAMUELSON E 52-394

SUGGESTED READINGS

1. FOR BACKGROUND

T. Kuhn
THE STRUCTURE OF SCIENTIFIC REVOLUTION

and parts or all of any sample of secondary sources, such as those by Roll, Gray, Gide-Rist, brief Schumpeter (1912), Heilbroner, Cannan, Recktenwald’s POLITICAL ECONOMY: A HISTORICAL PERSPECTIVE

FOR BIOGRAPHY

Keynes
ESSAYS IN BIOGRAPHY

Schumpeter
TEN ECONOMISTS

H. Spiegel
GREAT ECONOMISTS ON GREAT ECONOMISTS

2. BASIC BACKGROUND REFERENCE

Perhaps the basic background reference is the posthumous, uneven classic:
J. S. Schumpeter
HISTORY OF ECONOMIC ANALYSIS

A valuable, MIT-graduate-school kind of reference is
Marc Blaug
ECONOMIC THEORY IN RETROSPECT

3. First Topic of land and the interest rate: Turgot, Böhm-Bawerk and Keynes-Modigliani

Böhm-Bawerk, Vol I, Ch. 4
„Land and the Rate of Interest“: also Samuelson (1958, 1968, 1974)
Modigliani (1954, 1974)
Diamond (1965)

Source: Duke University. David M. Rubenstein Rare Book and Manuscript Library. Economists’ Papers Archive. Paul Samuelson Papers, Box 33, Folder “14.132 Fall 1973”.

_________________

14.132 Fall 1975
STORY OF ECONOMIC THOUGHT
P. A. SAMUELSON E52-394
FRIDAY 1:30-3:30

SUGGESTED READINGS

1. FOR BACKGROUND

Kuhn, The Structure of Scientific Revolution
and parts or all of any sample of secondary sources, such as those by Roll, Gray, Gide-Rist, brief Schupeter (1912), Heilbroner, Cannan’s Review of Economic Theory, Recktenwald’s Political Economy: A Historical Perspective.

FOR BIOGRAPHY

Keynes, Essays in Biography

Schumpeter, Ten Economists

H. Spiegel, Great Economists on Great Economists [not in Dewey Library]

2. BASIC BACKGROUND REFERENCE

Perhaps the basic background reference is the posthumous, uneven classic:
J. A. Schumpeter, History of Economic Analysis

A valuable, MIT-graduate-school kind of reference is
Mark Blaug, Economic Theory in Retrospect

For fruits of Marx’s hours in the British Museum, see
K. Marx, Theories of Surplus Value (many volumes, and sometimes called Vol. IV of Das Kapital)

Readable and scholarly essays are collected in
G. J. Stigler, Essays in the History of Economics

3. First topic of Quesnay’s Tableau Economique:

Any text like Gray, Peter Newman, Roll, Schumpeter;
Meek on Physiocracy, and edited volume;
A. Phillips, QJE, 1955;
S. Maital, QJE, 1972.

4. Topic of land and the interest rate: Turgot, Böhm-Bawerk and Keynes-Modigliani

Böhm-Bawerk, Vol I, Ch. 4, “Land and the Rate of Interest,” also,
Samuelson (1958, 1968, 1974)
Modigliani (1954, 1974)
Diamond (1965)

5. Modern model of Ricardo

6. Transformation problem of Marx

7. Smith, Adam

8. ….

Source: Duke University. David M. Rubenstein Rare Book and Manuscript Library. Economists’ Papers Archive. Paul Samuelson Papers, Box 33, Folder “14.132 Fall 1975”.

_________________

Samuelson
To be placed on reserve for 14.132

Mass. Inst. Tech.
FEB 14 1977
DEWEY RESERVE

McLellan. Karl Marx: His Life and Thought

Luxemburg. Accumulation of Capital

Sweezy. Theory of Capitalist Development

Robinson. An Essay on Marxian Economics

Dobbs. History of Theories of Distribution [sic, Theories of Value and Distribution since Adam Smith: Ideology and Economic Theory]

Morishima. On Marxian Economics [sic, Marx’s Economics]

Schumpeter. History of Economic Analysis

Roll. History of Economic Thought 

Alexander Gray. The Development of Economic Doctrine

[Metzler Lloyd] Festschrift. (Trade, Stability and Macroeconomics) edited by G. Horowitz and P. Samuelson.

Reprints

Samuelson

Samuelson’s “Reply on Marxian Matters”

Insight and Detour in the Theory of Exploitation: A Reply to Baumol

Understanding the Marxian Notion of Exploitation: A Summary of the So-Called Transformation Problem Between Marxian Values and Competitive Prices

Marx as a Mathematical Economist

 

Journals

Review of Economic Studies, Vol. 2, 1934-35

American Economic Review, March 1938.

 

[Appendix: Rudiments of Marxian Economics (from Samuelson Economics, pp. 858-)]

Source: Duke University. David M. Rubenstein Rare Book and Manuscript Library. Economists’ Papers Archive. Paul Samuelson Papers, Box 33, Folder “14.132 Spring 1977”.

_________________

14.132 Final Exam
History of Economic Thought
P. A. Samuelson
May 20, 1977

ANSWER (1) OR (2) QUESTIONS.

  1. Describe any aspects of the classical economists’ system that primarily interests you.
  2. Describe the doctrines of some one historical economist or school in which you have an interest.
  3. Analyze any aspects of Marxian economics that you think are of relevance to economic history and policy.

Source: Duke University. David M. Rubenstein Rare Book and Manuscript Library. Economists’ Papers Archive. Paul Samuelson Papers, Box 33, Folder “14.132 Spring 1977”.

_________________

Reserve List, MIT Libraries
14.132 History of Economic Thought
Spring 1978

D. L. Thomson, Adam Smith’s Daughters, Exposition Press, 1973.

L. Robbins. An Essay on the Nature and Significance of Economic Science. Macmillan, 1935 and 1962.

M. Blaug, Economic Theory in Retrospect. Richard D. Irwin, 1962.

I. H. Rima. Development of Economic Analysis. Irwin, 1972.

H. W. Spiegel,The Growth of Economic Thought. Prentice-Hall, 1971.

Alexander Gray, Development of Economic Doctrines. Longman, Green and Co. 1934.

T. W. Hutchinson, A Review of Economic Doctrines, 1870-1929. Oxford, Clarendon Press, 1953.

Thomas Sowell, Classical Economics Reconsidered, Princeton U. Press, 1974.

Eric Roll, A History of Economic Thought. Faber and Faber, 1973.

Eric Roll, The World After Keynes, Praeger, 1968.

J. A. Schumpeter, History of Economic Analysis. Oxford U. Press, 1954.

G. L. S. Shackle. The Nature of Economic Thought. Cambridge U Press, 1966.

J. A. Schumpeter, Ten Great Economists. Oxford, 1965.

R. L. Meek. Precursors of Adam Smith. Dear (London), 1973.

Source: Duke University. David M. Rubenstein Rare Book and Manuscript Library. Economists’ Papers Archive. Paul Samuelson Papers, Box 33, Folder “14.132 Spring 1978”.

_________________

14.132 Take-Home Exam
Spring 1978

Answer any one of these questions or any two or all three.

  1. Describe some topic covered in this course that you find to be of interest. Discuss its broad significance; or concentrate in depth on any aspect of the problem that you believe to be worth exploring. Do not hesitate to let your imagination soar.
  2. Describe some aspect or aspects of what we call neoclassical economics. If you wish, compare and contrast it with earlier classical economics; or with later Keynesian economics; or with the Marx-inspired economics that developed around the same time.
  3. Thomas Kuhn attempted to throw light on how the natural sciences tend to develop. If any part of his paradigms seems to you useful in any part of the history of economic thought, describe the use. If you have criticisms to make of the Kuhnian methodology, feel free to enlarge on them.

Source: Duke University. David M. Rubenstein Rare Book and Manuscript Library. Economists’ Papers Archive. Paul Samuelson Papers, Box 33, Folder “14.132 Spring 1977”.

Image Source:  Capture of the photos page from the Paul Samuelson memorial webpages at the MIT economics department (date of Wayback Machine capture May 22, 2011)

Categories
Exam Questions M.I.T. Suggested Reading Syllabus

M.I.T. Core Economic Growth and Dynamics. Readings and Final Exam. Solow, 1968

 

The reading list and examination questions for the “Economic Growth and Short-run Fluctuations” course taught by Robert Solow in the core graduate macro sequence has been posted earlier for 1966. There were many changes in the readings chosen between 1966 and 1968.

Solow’s 1973 course material for a later revised version (Growth and Capital Theory), that was moved to be the final course in the core macro sequence has also been posted.

Here a glimpse at what students thought about this course (as well as the other courses and instructors in the core theory courses, both micro and macro).

________________________

R.M. Solow
Spring 1968

READING LIST
14.452

As a background text you should have a copy of R.G.D. Allen, Macro-Economic Theory (Macmillan, 1967). For review, read Chapters 1, 3, 7, 8.

ECONOMIC GROWTH

  1. Factual Basis

Kendrick & Sato, “Factor Prices, Productivity and Growth”, American Economic Review, December 1963.
Bureau of the Census, Long-Term Economic Growth, 1860-1965  (This is an excellent compendium of time series. You should spend a few hours with it, and might like to buy a copy from Supt. of Documents, Government Printing Office, Washington, D.C. 20402, $2.75)
Thurow & Taylor, “The Interaction between the Actual and Potential Rates of Growth,” Review of Economics and Statistics, November, 1966.

  1. One-Sector Real Theory

Allen, Chaps. 11, 14.
Hahn & Matthews, “The Theory of Economic Growth: A Survey”, Economic Journal, December 1964, Parts I, II except pp. 812-21.
Modigliani, “Comment” in Behavior of Income Shares (NBER), pp. 39-50.
(Optional: Johnson, “The Neo-Classical One-Sector Growth Model…,” Economica, August, 1966, pp. 265-79 only).

  1. Technical Progress

Allen, Chaps. 13, 15.
Solow et al., “Neoclassical Growth with Fixed Factor Proportions,” Review of Economic Studies, April 1966, pp. 27-89 only).

  1. One-Sector Monetary Theory

Tobin, “Money and Economic Growth”, Econometrica, October 1965.
Sidrauski, “Inflation and Economic Growth,” J.P.E., December, 1967.
Johnson, pp. 279-87 in article cited above.
See also Tobin-Johnson exchange in Economica, February, 1967.

  1. The Golden Rule and Optimal Growth

Marty, “The Neoclassical Theorem”, A.E.R., December 1964.
Diamond, “National Debt in a Neoclassical Growth Model”, A.E.R., December 1965, esp. pp. 1126-1135.
Koopmans, “Objectives, Constraints, and Outcomes in Optimal Growth Models,” Econometrica, January, 1967.

  1. Two (or more) Sector Real Theory

Hahn & Matthews, pp. 812-21.
Allen, Ch. 12.
(Optional: Shell & Stiglitz, “Allocation of Investment in a Dynamic Economy,” Quarterly Journal of Economics, November, 1967).

  1. Income Flows in Long-Run

Thurow, “A Policy Planning Model of the American Economy,” dittoed.

SHORT-RUN FLUCTUATIONS

  1. Cyclical Mechanisms

Samuelson, “Interaction between Multiplier Analysis and the Principle of Acceleration”, Review of Economics and Statistics, 1939, reprinted in A.E.A., Readings in Business Cycle Theory.
Metzler, “The Nature and Stability of Inventory Cycles”, Review of Economics and Statistics, 1941.
Kaldor, “A Model of the Trade Cycle”, Economic Journal, 1940, reprinted in Hansen and Clemence, Readings in Business Cycles and National Income and in Kaldor, Essays on Economic Stability and Growth.

  1. Income Analysis Models

Klein, “The Econometrics of the General Theroy,” Ch. IX in The Keynesian Revolution, SECOND edition.
Okun, “Measuring the Impact of the 1964 Tax Reduction,” xerox.
Surte, “Forecasting and Analysis with an Econometric Model,” A.E.R., March, 1962.
De Leeuw & Gramlich, “The Federal-Reserve-MIT Econometric Model,” Federal Reserve Bulletin, January, 1968.

  1. Inflation

Johnson, “A Survey of Theories of Inflation,” in Essays in Monetary Economics.
Solow, “Recent Controversies in the Theory of Inflation,” dittoed.
Solow & Stiglitz, “Output, Employment and Wages in the Short Run,” dittoed.

________________________

FINAL EXAMINATION
14.452
May 23, 1968

Please answer each question in a separate examination booklet. Indicate on the front page of each booklet whether you are seeking only a grade in 14.452 or a grade in the general examination in economic theory. Those who seek only a grade in 14.452 should answer two questions in Part I and two questions in Part II. Those who are taking the general examination and economic theory should answer two questions in Part II and two in Part III.

Part I

  1. Construct a difference-equation model embodying the following assumptions:
    1. Consumption is a linear function of disposable income lagged one time-unit;
    2. Tax revenue is proportional to national product;
    3. Investment is the sum of a component proportional to the current change in consumption and the component proportional to national product lagged one time-unit;
    4. Imports are proportional to national product lagged one time-unit; exports constant;
    5. Government purchases are constant.

Write down formally the conditions for and an oscillatory response of the model to disturbance. When are the oscillations damped? How do variations in the tax rate affect these conditions? Suppose part of government purchases were made negatively proportional to the last observed change in national product?

  1. Why is technical progress an important part of the usual model of economic growth? Could increasing returns to scale play the same role? What is the special role of purely labor-augmenting (i.e. Harrod-neutral) technical progress?
  2. Imagine a planned economy choosing among steady states in the one-sector model, without technical progress. The planner values both consumption per head and capital per head (as a measure of national strength, say) and his preferences can be expressed by a system of conventionally-shaped indifference curves in consumption per head and capital per head.

Use this indifference map and the requirements for a steady state to show how the optimal steady-state is chosen. Prove that the optimal capital per head will exceed the “Golden-Rule” (maximal consumption per head) level. Show what happens to the optimal position if the rate of population growth increases. Discuss briefly the case of a one-time upward shift in the production function.

 

Part II

  1. In the generalized multiplier-accelerator model, the equation \frac{dK}{dt}=I\left( Y,K \right) means that “investment decisions are always carried out”, so that when I\left( Y,K \right)\ne S\left( Y \right) “unintended consumption or saving” occurs. Replace the above equation with \frac{dK}{dt}=S\left( Y \right), and interpret and analyze the resulting model. Compare its behavior with this with the case analyzed in class.
  2. Suppose I =I(Y,K) and S= S(Y) are the schedules of desired investment and saving. In what sense is (I-S) a measure of excess demand in the aggregate commodity market?
    How is it that no specific supply variables (labor force, for example) appear in this measure? Under what circumstances is it natural to suppose that \frac{dY}{dt} responds to (I-S)? (Y = real output, P = commodity price level). Under what circumstances is it natural to suppose that \frac{dP}{dt} responds to (I-S)?
  3. Consider it a one-sector non-monetary model of growth under the following assumptions:
    1. The production function in intensive form is q= Akb;
    2. The wages equal to the marginal product of labor;
    3. Investment demand is such that the after-tax return on capital is always at a target level r*;
    4. There is a tax on profits at rate t in the government spends all its revenue on consumption;
    5. The savings rates from wages and after-tax profits are both equal to a constant s.

Find the tax rate that will permit a steady-state at full employment. When will it be between zero and one? How does it change if this changes? Interpret.

  1. Considered a one-sector growth model, with two factors of production (capital and labor), constant returns to scale, and no technical progress. Suppose that the propensity to save out of profits and capital gains is equal to one, and the propensity to save out of wages and transfer payments (taxes = negative transfers) is zero.

Money, which is non-interest-bearing government debt, is the only alternative asset to capital. The desired money-capital ratio is of the form \frac{m}{k}=L\left( {f}'\left( k \right)+{{\left( {{\dot{p}}}/{p}\; \right)}^{e}} \right) where m is the real per capita stock of money,k is the capital-labor ratio, and {{\left( {{\dot{p}}}/{p}\; \right)}^{e}} is the expected rate of inflation which is equal to the actual rate \left( {{\dot{p}}}/{p}\; \right) in the steady-state.

  1. Government purchases are zero and the budget deficit, which is equal to the excess of transfers over taxes, is financed by issuing money.
    1. Describe the steady-state characteristics of the model.
    2. Find the rate of inflation that maximizes steady-state consumption per head.
    3. Suppose that {{\left( {{\dot{p}}}/{p}\; \right)}_{0}} is the rate of inflation in (b) that maximizes steady state consumption per head. Would a higher rate of inflation lead to a higher or lower long-run capital-labor ratio?

 

Part III

  1. Write a comprehensive essay on the subject of “The Problem of Weights in National Income and Index-Number Construction”.
    Explain the criteria which are used, should be used (for what purpose?) and why.
  2. Discuss the economic effects of an increase in the stock of money. Include an evaluation of the positions of several (not less than two) prominent economists familiar to you. How would you test the correctness of their positions?
  3. Discuss the effects of inflation on the level of real investment.

 

Source: Duke University, David M. Rubenstein Library. Economists’ Papers Archives. Papers of Robert M. Solow, Box 67, Folder “Exams”.

Image Source:  Robert Solow (right) from MIT Museum website.