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Exam Questions Harvard Principles Suggested Reading Syllabus

Harvard. Reading Lists and Semester Exams for Principles of Economics. Dunlop, Gill and Sanberg. 1965-1966

Richard T. Gill directed the Harvard economics department’s Juggernaut course Economics 1 (Principles of Economics) for eight years (1958/59-1966/67). He was followed in turn by Otto Eckstein, a.k.a. “Otto Ec-10” (1967/68-1983/84), Martin Feldstein (1984/85-2004/05), and Gregory Mankiw (2005/06-2018/19).

I suspect that the reason for Richard T. Gill’s giving the first six lectures in the Economics 1 (which was taught for the most part in smaller sections) was that an overview of economic history and the history of economics was better provided as a series of briefings than as socratic dialogues. Also few graduate students and junior faculty would have had even minimal exposure and/or interest in those subjects. 

In this post we provide some background to Economics 1 à la Gill and a sketch of the stations of his eclectic career which are followed by the semester readings and exams for the Principles of Economics as taught in the Harvard economics department in 1965-66.

Bonus material: Joseph Shore & Richard T. Gill, Rigoletto — Quel vecchio maledivami & Pari Siamo (1979 recording). Joseph Shore wrote “Richard T Gill was the greatest Sparafucile I ever sang with and this is the best duet I sang in all my Rigoletto shows.” 

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Ec 1: A Monster Becomes an Institution Everything About Ec 1 Pleases Gill Now Except Gen Ed Status

By Richard R. Edmonds
April 12, 1967

Economics 1 has never been unknockable. Students always moan a little about the ultra-general final exam questions and the obscurities of Dorfman’s price theory text. And all but the most even-tempered freshmen at times grow resentful of the inevitable calculus wonk who loudly corrects mistakes in his section man’s graphs. These are minor irritants though. The vast majority of students (95 per cent according to a 1962 Economics Department survey) end up satisfied with Ec 1 and the course hardly seemed a target for radical discontent.

So the prospect of a critique of Economics 1 by the Harvard-Radcliffe Young People’s Socialist League was a bit startling both to those who run the course and those who take it. The eight-page document, released last month, was an anti-climax. Though well-researched and well-written, it blunted the edge of its militancy with too much scholarly prose, and too little focus on how the course should change.

The critique drew mixed reviews. Arthur Smithies, Nathaniel Ropes Professor of Political Economy, thought it raised economic issues that deserved to be considered seriously. Several Ec 1 sectionmen and former sectionmen said they agreed completely with its criticisms of the course. But Richard T. Gill ’48, lecturer in Economics and administrative head of Ec 1 since 1959, didn’t like the critique at all, and his opinion was crucial.

Unruffled

Gill wasn’t ruffled by the sight of a pair of students telling him in print how the course should be run. And though he found the eight pages full of faulty economics, he wasn’t worried about the effect of these errors. What bothered him was what he considered the narrowness of the critique’s “new left” view of economics. The public “dialogue” its authors insistently demanded was just what Gill wanted to avoid. This is Gill’s final year as head of the course and he understandably does not want to leave it in a blaze of artificial controversy over issues he considers trivial.

A month after the critique was issued, it appears to have failed as an instrument of radical reform. At a March 6 Ec 1 staff meeting Gill asked if there was any sentiment for revising the course substantially; only a couple of hands went up. Several of the section men who liked the critique best didn’t even bother to attend. Whether the critique succeeded in exposing serious deficiencies in Economics 1 is still an open question.

Curiously the critique is more a reactionary than a radical document. Though the critique’s author Stephen Kelman ’70 and his confederates would deplore the suggestion that they wanted a return to the good old days, it is ironic that instituting all the practical changes their criticisms implied would make the course much as it was in the late 50’s.

Before Gill took over the course in the spring of 1959, he and three others in the Department submitted a massive plan for revising Ec 1 (their outline for the revised course was more than 20 pages long). Gill acted, he says, because “Economics 1 had settled into a rut; the focus was too much on the system in the United States here and now parts of the course got bogged down in diagramatics so that students were learning tools and not much else.”

During the late ’50’s both the number of students taking Ec 1 and the number concentrating in Economics were declining. Since Gill took over course enrollment has soared from 550 to this year’s all-time high of 829.

Gill made three big changes in Ec 1’s content. He added the section on British industrialism and the classical economists that now fills the first month of the course, as well as the chunk on the Soviet economy (being taught this week and next) and the exhaustive treatment of underdeveloped countries that occupies the rest of the spring.

To make room for the new material, three weeks on distribution (which the critique says is now inadequately treated by a few sentences in Dorfman) were trimmed and the material reinserted in other parts of the course. The other major casualty was a three week section on “alternatives to capitalism” that used to come during reading period, right after the course had developed micro-economic theory and applied it to American capitalism. (It was the critique’s final and most specific charge that socialism receives only “confusing attention” now in Ec 1.)

The history of economic theory is Gill’s special interest, but he says that “personal predilections” only partly explain how Ricardo and Arkwright found their way into an introductory economics course. The first month of Ec 1 is designed, says Gill, “to convey the relativity of present economic conditions to institutions and ideas of the past, to relate economics to the rest of the social sciences.”

The value may be here, but it escapes many students. A survey the Economics Department took in 1962 asked those who took the course whether there should be more or less on each of the 14 topics covered. The pollees voted for more of everything but economic history and Gill accordingly chopped out a third of the material. Some feel he should have gone farther.

“The course has to be introduced with a problem,” says one section man, “but the story of how England got to be the kind of economy it is, is not as germaine as it might be for the majority of students.” Another, who is in his third year teaching the course, says, “At first I couldn’t see any point to it, but now I’m starting to agree with Gill that it’s a good way to get people started.”

Behind the criticisms of Ec 1’s historical material and behind last month’s critique as well is the conviction that the course would be better if it were more political. “This is the only course most people take in economics,” says a section man, “so there ought to be more time on present problems and less on economic tools.” Kelman’s call for more “controversy” in Economics I was based on a similar idea — the course should be constantly examining both sides of economic questions instead of trying to develop an objective economic theory first.

The critique’s vision of an issues-oriented introductory course is not a new idea. In the late ’50’s and early ’60’s Harvard had a Gen Ed course called “Economics of the Citizen” which tried this approach. It never became as popular as the more rigorous Ec 1. Eventually it gained the reputation of being a gut of little substance that the self-respecting avoided. Gill argues that talking explicitly about controversy isn’t always the best way to equip students to talk about political problems — “you can’t just describe economics — you’ve got to get down to working those damn curves to understand the problems.”

Gill’s 1959 plan changed the structure of Ec 1 as well as the material it covers. In the old days Ec 1 lectures were strictly a star show-each of the Department’s great men mounted the podium once and talked for an hour to the crowds below. Though continuity may still be lacking, the lectures under Gill’s regime have a function. They come in blocks instead of being scattered sporadically throughout the term and the blocks give the course more structure than it once had by forcing section men to keep pace with upcoming lectures.

Lectures are scheduled on the kind of material that probably wouldn’t otherwise get covered — background to policy and development questions where vast amounts of knowledge have to be condensed and jammed into a single meeting. The section men are left with huge chunks of the course material — notably microeconomic theory for which they have to develop a teaching approach of their own. This ingenious division of labor, Gill’s biggest improvement, has made the monster course smooth and flexible.

Gill has been the influential figure in giving Ec 1 its present shape, but he doesn’t run the course by himself. Actually Economics 1 is governed like a Harvard in miniature — responsibility is scattered and different kinds of decisions are made at different levels. In the course catalogue, the Department chairman’s name always is listed first — even before Gill’s. Most years the chairman gets no closer to the mechanics of the course than providing section men and giving a couple lectures, but the listing indicates that… [article truncated here]

SourceThe Harvard Crimson, 12 April 1967.

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Touching Basses: The Extraordinary Lives of Richard T. Gill
CLASS OF 1948

By Andrew K. Mandel, CRIMSON STAFF WRITER
June 1, 1998

What happens when you put a prizewinning pugilist, an economist, a world-renowned opera singer, a Harvard House master and a television personality in the same room?

Richard T. Gill ’48 stands alone.

A former Economics 1 professor who led Leverett for 16 years as senior tutor and then master, Gill has written books with Professors Nathan Glazer and Stephan Thernstrom, has sung with all Three Tenors and Beverly Sills, earned The Atlantic Monthly’s short story prize and won a few boxing matches along the way. This all began not long after he entered Harvard College–at age 16.

Gill’s sister says her brother has always been “phenomenal.”

And his wife cannot help but chuckle when she looks back on her “very fascinating, if at times hair-raising” life alongside her husband of 48 years.

Longtime Harvard administrator Fred L. Glimp ’50 says Gill is “as close to a Renaissance man as I’ve ever met,” calling his former colleague “the kind of a guy that–if he weren’t so nice and so kind and impressive in a human way–everybody would hate him because he’s so dog-gone good at almost anything he puts his hand to.”

With Honors

The Long Branch, N.J. native was a product of the Depression, the youngest of three children.

His father Thomas G. Gill worked for a billboard advertising firm hit hard by the economic crisis of the 1930s; Richard lived what he called a “tight, but very happy childhood,” drawn to vocal performance by his mother Myrtle, a music teacher.

Gill met his future wife Elizabeth at a community concert when they were both 15. Their relationship was “stormy off and on,” Elizabeth Gill says, “but ultimately it was on.”

Placing second out of more than 100,000 students in a national American Legion Oratorical Contest in high school, Richard Gill came to Harvard in 1944 and led the Debate Council as its president, winning the College’s Coolidge debate prize and delivering the Class Oration senior year.

A congenial man to interview, Gill was apparently quite the fighter–both behind the podium and in the ring–as an undergraduate.

After Gill accidentally broke someone’s nose in boxing class, the coach of the varsity boxing team approached Gill and encouraged him to fight for Harvard.

Gill also managed to find a niche as a soloist in the Glee Club, the editor of the Student Progressive, the head of the Liberal Union and a member of Phi Beta Kappa junior year.

“I was busy,” Gill acknowledges.

Called away from Cambridge after sophomore year, Gill spent time in the army stationed in Japan, and won the regimental boxing championship, in the middleweight division.

Once back in the Square, Gill graduated summa cum laude in economics, garnering the Palfrey Exhibition (awarded to the most distinguished graduating scholarship student) and a Henry Fellowship to study philosophy and psychology at Jesus College in England.

And though he later earned a Fulbright Fellowship for further study, Gill returned to the States after only a year abroad when his father became ill.

Mastering Harvard

At age 21, Gill became an assistant dean of the College, and claims to be the youngest “baby dean” in Harvard College history.

Awarded his Ph.D. in economics in 1956, Gill directed the largest course at the College, known now as Social Analysis 10: “Principles of Economics.”

And by 1963, after an eight-year stint as senior tutor, Gill and his wife Elizabeth were moving into the master’s residence at Leverett House.

Being administrators during the days of student protests was challenging, the Gills admit.

When strangers threw rocks through the windows of the Gill home and nearly injured their children, Elizabeth Gill was not sure if the protests were directed at her advocacy of increased diversity in Cambridge’s public school teaching staff–or at her husband’s “neanderthal” ideologies.

“It turns out they were my enemies,” she sighs.

Her husband’s commitment to freedom of speech was unpopular in the late ’60s, Gill says.

“I was very much a law-and-order type,” Richard Gill notes.

Gill says one of his Leverett students had interned for President Lyndon B. Johnson, and there was a good chance LBJ would agree to speak at the House senior dinner. (“Not even [famed Eliot House Master] John [H.] Finley [’25] could’ve topped that,” Gill laughs.)

Ultimately, Johnson declined the offer–and Gill, who faced “the sharpest of criticisms” from some Faculty members for extending an invitation to the commander-in-chief during the Vietnam War, concedes that the president’s arrival “would have caused a riot.”

The Making of a Star

At the same time protesting at Harvard had begun to take center stage, Gill found his way to the spotlight.

A heavy smoker for many years, Gill decided to quit in favor of private voice lessons, where he practiced furiously.

In May of 1967, Gill appeared as the Count in the Leverett House Opera’s The Marriage of Figaro. The production–“the most charming I have ever been a part of,” Gill beams–was organized by the student-directoral team of John Lithgow ’67 and John C. Adams ’69.

The Crimson review of Figaro was quite positive.

“Master Richard Gill, who plays the Count, would be well worth hearing by himself. His voice is as majestic as his hearing; he is at once dramatic and agile,” the student reviewer wrote. “If his tone quality were only a little more variable, if he could sound sweet and smooth when necessary, he would be unassailable.”

Spending a year on sabbatical in England, Gill sang regularly–away from the “fear of failure in front of my Harvard colleagues”–and was encouraged to perform professionally.

By 1971, he could not resist auditioning for the New York City Opera–just to see how good he was.

He was deemed extremely good–and eventually accepted a trial position as a basso with the Manhattan opera company in 1971.

The contract paid $75 a night, and Gill was guaranteed a grand total of two performances.

It was “risky” to say the least, but Gill says he and his wife agreed that they “had to just go for it.”

Armed with a sizable advance on a large economics textbook Gill was commissioned to complete, the couple announced their departure to nonplussed Dean of the Faculty John T. Dunlop in the spring.

Their three sons were supportive of the career change, and their youngest transferred high schools when the Gills moved to Allendale, N.J.

“We were sort of oblivious to the real risks he took,” says son Peter S. Gill ’78, who was unfazed upon noticing that his sixth-grade anthology of short stories contained works by James Thurber, Ogden Nash and Richard Gill. “We always thought this was typical for him.”

“If I failed, there was no way to return to Harvard,” says Richard Gill, noting he would have opted to teach in “somewhere like Honolulu or Wyoming” if he bombed in New York. “Harvard is no place to come after you stub your toe violently.”

Gill’s toe did just fine.

Earning the rare distinction of moving from the New York City Opera to the Metropolitan Opera by virtue of the Met’s invitation, Gill performed as a principal artist from day one.

The former Harvard House master became a world-class opera singer overnight, travelling from Pittsburgh to Amsterdam to Carcacas in a 14-year career spanning dozens of operas. His performance stirred Variety magazine to use the words “Richard T. Gill” and “tour de theatre” in the same sentence.

In the mid ’80s, Gill added another section to his resume. Combining the scholarship of his Harvard days with the glamour of the opera, Gill found a home in the television studio, helping to create ECONOMICS U$A, a 28-program public broadcasting television series for which he served as an on-air analyst.

The Encore Academic

By 1992, Gill had written several economic textbooks, as well as a sociological work entitled Our Changing Population with Professor of Education and Social Structure Emeritus Nathan Glazer and Winthrop Professor of History Stephan Thernstrom. His latest work, Posterity Lost: Progress, Ideology and the Decline of the American Family, was published last year.

Gill will discuss his book in one of the symposia planned for the class of 1948 on Wednesday.

But first, Gill will perform with the Boston Pops as their featured vocalist tomorrow evening.

“He’s Mr. Eclectic,” son Peter says.

When asked to explain his wild versatility, Richard Gill jokes that one must have “a certain limited intelligence to try so many things.”

Originally considering life as a lawyer, after serving a year in the Army as a teenager, “I had a reconsideration of my lifelong goals,” Gill says. “I can only applaud this decision in retrospect.”

SourceThe Harvard Crimson, 1 June 1998.

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Course Announcement

Economics 1. Principles of Economics

Full course. Indivisible. M., W., F., at 12. The major part of the course is conducted in sections. Throughout the year, however, there will be lectures, generally on W., at 12. M., W., and F., at 12 will be the normal hour for section meetings, but sections will be scheduled at other hours. Professor Dunlop, Drs. R. T. Gill, Sanberg and other Members of the Department.

The Department encourages students considering concentration to take this course in their freshman year.

Designed to introduce students to the methods of economic analysis that bear on the issues which confront this country and the world. Will thus serve the needs both of those students who plan no further work in Economics and those who desire to obtain the groundwork for more advanced courses in the field.

Source: Harvard University, Faculty of Arts and Sciences. Courses of Instruction for Harvard and Radcliffe, 1965-1966, p. 102.

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ECONOMICS I
1965-66
Readings for the Fall Term

*To be purchased by students

Adams, W. (ed.), The Structure of the American Economy (Third Edition)

*Caves, R., American Industry: Structure, Conduct, Performance

Committee for Economic Development, An Adaptive Program for Agriculture

Council of Economic Advisers, Report to the President on Steel Prices

*Dorfman, R. The Price System

*Gill, R., Economic Development: Past and Present

Hanson, A., Business Cycles and National Income

Heilbroner, R., The Making of Economic Society (paperback)

Heilbroner, R., The Worldly Philosophers (paperback; revised edition)

Joseph, M.L., et.al., Economic Analysis and Policy

Koivisto, W.A., Principles and Problems of Modern Economics

Mantoux, P., The Industrial Revolution in the Eighteenth Century

Meier & Baldwin, Economic Development

Phelps, E.S., Private Wants and Public Needs

Rees, A., The Economics of Trade Unions

*Schultze, C.L., National Income Analysis

Smith, A., Wealth of Nations

*  *  *  *  *  *  *  *  *  *  *

ECONOMICS 1

All lectures will be given at 12 noon in Lowell Lecture Hall. Section assignments will be posted outside University Hall 9 at 9:00 a.m. on Thursday, September 30. If any conflicts develop, resectioning will be held in University Hall 9 on Monday, October 4, and Tuesday, October 5, from 2:00 to 4:00 p.m.

Lectures: Dr. Gill Sections
Mon., Sept. 27 Fri. or Sat., Oct. 1 or 2
Wed., Sept. 29 Mon. or Tues., Oct. 4 or 5
Wed. or Thurs., Oct. 6 or 7
Fri., Oct. 8 Mon. or Tues., Oct. 18 or 19
Mon., Oct. 11
Wed., Oct. 13
Fri., Oct. 16

Hour Exam, Wed. Oct. 20 at 12 noon

Sections meeting at 12 noon will take the hour exam in their regular classrooms; sections meeting at other hours will take the exam in Lowell Lecture Hall at 12.

There will be occasional lectures later in the term which will be announced in sections and in the Crimson.

*  *  *  *  *  *  *  *  *  *  *

ECONOMICS I
Fall Term 1965-66

  1. Introduction: Problems and Concepts (Sept. 27 to Oct. 2)

Reading:

Koivisto, Principles and Problems of Modern Economics, Chaps. 1 & 3

  1. Historical Development and the Doctrine of Laissez-Faire (Oct. 4 & Oct. 19)
    1. Historical Foundations of Industrial Society

Readings:

Gill, Economic Development, Chaps. 1-4

Heilbroner, The Making of Economic Society, Chaps. 1-3

Mantoux, The Industrial Revolution in the Eighteenth Century, Part II

    1. The Classical Economists and the Doctrine of Laissez-Faire

Readings:

Heilbroner, The Worldly Philosophers (revised ed.), Chaps. 1-4, 6

Smith, The Wealth of Nations, Bk. I, Chaps. 1 & 2; Bk. IV, Chaps. 2 & 3, Part II

Meier & Baldwin, op. cit., Ch. I

October 20, Hour Exam on Parts I & II

  1. Markets and Industrial Organization (October 22 to December 18)
    1. Competitive Markets
      1. The Concept of the “Invisible Hand”
      2. Theory of the Firm
      3. Household Behavior
      4. Market Structure

Reading:

Dorfman, The Price System (last two chapters at the discretion of the instructor)

    1. Modern Industrial Organization
      1. Introduction

Reading:

Caves, American Industry, Ch. I

      1. Market Behavior

Readings:

Caves, op. cit., Chaps. 2 & 3

Adams, Structure of the American Economy, Chaps. 5 & 10

Council of Economic Advisers, Report to the President on Steel Prices

      1. Market Regulation

Reading:

Caves, op. cit., Chaps. 4-6

      1. Unions and Collective Bargaining

Readings:

Koivisto, op. cit., Ch. 21

Rees, Economics of Trade Unions, Chaps. 3 & 4

Joseph, Economic Analysis and Policy, Sections 41-46

      1. Agriculture

Readings:

CED, An Adaptive Program for Agriculture

Joseph, op. cit., Section 38

  1. The Economy in the Aggregate (Jan. 3 to Jan 28): Introduction to National Income Analysis
    1. Business Fluctuations and Depressions

Readings:

Hansen, Business Cycles and National Income, Chaps. 1-2

Joseph, op. cit., Sections 13-16

    1. The Determinants of National Income

Reading:

Schultze, National Income Analysis, Chaps. 2,3, & 4

Source: Harvard University Archives. Syllabi, course outlines and reading lists in Economics, 1895-2003, Box 9; Folder: “Economics, 1965-66 (1 of 2)”.

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1965-66
HARVARD UNIVERSITY
Midyear Examination
January 26, 1966

ECONOMICS I
(Three hours)

Answer all questions

  1. (20 minutes)

The major classical economists opposed the Corn Laws. What arguments of classical economic theory could be used to defend this position? In what respects were these arguments particularly relevant to British conditions in the early 19th century?

  1. (20 minutes)

The government decides to pay 20 percent of the cost of all food consumed.
(Do not worry about the source of the funds.) Illustrate the effects this policy would have on the consumption patterns and the standard of living of a typical consumer.

  1. (30 minutes)

Suppose the government legislates a significant increase in the minimum wage for a given industry. Taking a typical profit-maximizing firm in an industry with freely competitive product and factor markets, initially in long-run equilibrium, trace the effects of this law on the use of labor, the use of other factors of production, the firm’s cost curves, and its output. What changes would one be likely to observe in the industry as a whole over a longer period of time? In what ways would such a policy affect the “efficient” allocation of resources in the economy?

  1. (30 minutes)

Show how the following phenomena operate as barriers to entry:

    1. scale economies
    2. absolute cost barriers
    3. product differentiation

Illustrate each of the above types of barriers to entry with references to the assigned reading.

  1. (20 minutes)

The demand for labor is said to be derived from the demand for the products which it produces. Show in what sense this is true. How might knowledge of this demand relationship be useful to a union in determining its wage demands?

  1. (20 minutes)

Using supply and demand analysis, discuss the operation of:

      1. an acreage limitation on a given agricultural commodity
      2. a law which requires that the commodity cannot be sold below a given price (which is higher than the present market price)
      3. a subsidy paid by the government to the farmer growing the commodity of a given number of cents per bushel grown
  1. (40 minutes)
GNP-GNI Personal Income Disposable Income Consumption Corporate Profits Indirect Taxes
300 240 200 190 36 24
350 280 233 220 42 28
400 320 267 250 48 32
450 360 300 280 54 36
500 400 333 310 60 40

Government spending is initially 80.
Private investment is 70.

    1. Given the above information, determine the equilibrium level of GNP. Show how you arrived at your answer. In what sense is this an “equilibrium” level?
    2. Why is Gross National Product (GNP) equal to Gross National Income (GNI)?
    3. Must the income and expenditures of each major sector of the economy — private individuals, business, and the government — balance in equilibrium? How do they compare in the above example?
    4. What is the Marginal Propensity to Consume out of GNP in the above example? What is the income multiplier?
    5. Suppose that full-employment GNP is at a level of 450. What change in government spending is necessary to achieve it, it no other relationship in the economy changes? What would this do to the government balance (surplus or deficit) in the new equilibrium position?

Source: Harvard University, Faculty of Arts and Sciences. Papers Printed for Mid-Year Examinations [in] History, History of Religions, Government, Economics, … , Naval Science, Air Science. January, 1966.

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ECONOMICS I
1966
Readings for the Spring Term

*To be purchased by students

Agarwala & Singh, The Economics of Underdevelopment

Bergson, A., The Economics of Soviet Planning

*Campbell, R., Soviet Economic Power

Domar, E., Essays in the Theory of Economic Growth

*Duesenberry, J., Money and Credit: Impact and Control

“Eckstein, A., “On the Economic Crisis in Communist China,” Foreign Affairs, July 1964.

*Eckstein, O., Public Finance

Friedman, M., Capitalism and Freedom

*Gill, R., Economic Development

Goldman, M., “Economic Controversy in the Soviet Union,” Foreign Affairs, April 1963.

Goldwin, R., Why Foreign Aid?

Hirschman, A., The Strategy of Economic Development

*Johnson, L., The Economic Report of the President, 1966

*Kenen, P., International Economics

Krause, L., The Common Market

Kuznets, S., Postwar Economic Growth

Leeman, W., Capitalism, Market Socialism and Central Planning

Lewis, J., Quiet Crisis in India

Mason, E., Economic Planning in Underdeveloped Areas: Government and Business

Nurkse, R., Problems of Capital Formation in Underdeveloped Countries

Phelps, E., Private Wants and Public Needs

Rostow, W., The Economics of Take-off into Sustained Growth

*Schultze, C., National Income Analysis

*  *  *  *  *  *  *  *  *  *  *

ECONOMICS I
Spring Term 1965-66
  1. The Economy in the Aggregate, Part II: Analysis of the Problems of Economic Stability and Growth (February 7 – April 1)
    1. The Determinants of National Income – Review

Reading:

Schultze, National Income Analysis, Chs. 2-4 (review)

    1. Public Finance and Government Expenditure

Readings:

Eckstein, Public Finance, Chs. 1-2, 5-8

Phelps, Private Wants and Public Needs, Chs. by Galbraith, Bator, Hayek, and Break.

    1. Money and Monetary System

Readings:

Schultze, National Income Analysis, Ch. 5

Duesenberry, Money and Credit, Chs. 1-8

Friedman, Capitalism and Freedom, Chs. 3 & 5

    1. The Dynamics of Growth

Reading:

Domar, Essays in the Theory of Economic Growth, Ch. 4
(also in American Economic Review, March 1947, pp. 34-55)

    1. Economic Growth in Advanced Countries

Readings:

Schultze, National Income Analysis, Ch. 6

Kuznets, Postwar Economic Growth, Lecture II

    1. International Trade

Readings:

Kenen, International Economics, Chs. 1-5

Krause, The Common Market, Introduction

    1. Problems of Government and Economic Policy

Reading:

The Economic Report of the President, 1966

(Spring Recess April 3 – April 10)

  1. Economic Growth and Organization in Other Countries (April 11 – May 19)
    1. The Soviet Economy
      1. Introduction: The Theory of Planning

Readings:

Mason, Economic Planning, Ch. 3

Leeman, Capitalism, Market Socialism…, Ch. by Leontief

Bergson, The Economics of Soviet Planning, Ch. 14

      1. Growth and Organization of the Soviet System

Reading:

Campbell, Soviet Economic Power, Chs. 1-8

      1. Outlook for the Future

Readings:

Campbell, Soviet Economic Power, Ch. 9

Goldman, “Economic Controversy in the Soviet Union,” Foreign Affairs, April 1963

Kuznets, Postwar Economic Growth, Lecture IV

    1. Economic Growth of Underdeveloped Areas
      1. The Underdeveloped Economy

Readings:

Gill, Economic Development, Ch. 5

Kuznets, “Underdeveloped Countries and the Pre-industrial Phase in the Advanced Countries,” in Agarwala & Singh

      1. The Process of Economic Growth

Readings:

Rostow, “The Take-off into Self-sustained Growth,” in Agarwala & Singh

Kuznets, “Notes on the Take-off,” in Rostow, Ch. 2

      1. Issues in How to Induce Economic Growth

Readings:

Nurkse, Problems of Capital Formation, Ch. 1

Hirschman, The Strategy of Economic Development, Chs. 2 & 4

      1. Case Studies — India and China

Readings:

Lewis, Quiet Crisis in India, Chs. 2, 3, & 6

Eckstein, A., “On the Economic Crisis in Communist China,” Foreign Affairs, July 1964

Gill, Economic Development, Ch. 6

      1. Foreign Aid and International Trade

Readings:

Goldwin, Why Foreign Aid?, pp. 10-32, 90-108, & 131-140

Kenen, International Economics, Ch. 6

  1. Conclusion: Problems and Prospects (May 20 – May 23)

No Readings

NOTE: Resectioning to remove class conflicts will be held in University Hall 9 on Monday, February 7 and Tuesday, February 8 from 2:00 to 4:00 p.m.

Source: Harvard University Archives. Syllabi, course outlines and reading lists in Economics, 1895-2003, Box 9; Folder: “Economics, 1965-66 (1 of 2)”.

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1965-66
HARVARD UNIVERSITY
Final Examination
June, 1966

ECONOMICS I
(Three hours)
  1. (60 minutes)

Suppose inflationary pressures lead to price increases in several sectors of the economy. What steps should the Federal Government take to restrain these inflationary pressures? How might other economic objectives be jeopardized by efforts to control the inflation? How might your views on the question of “social balance” of the public versus the private sector affect your policy proposals for dealing with the inflationary problem? If the country in question were the United States in 1966, would you have to take into account the balance of payments situation in making your policy decisions?

  1. (30 minutes)

Define and relate four of the following five pairs of terms:

    1. Full employment surplus – balanced budget multiplier
    2. Preconditions – take-off
    3. Allocational efficiency of taxation – equity of taxation
    4. G.A.T.T. – E.E.C.
    5. A budget deficit financed by Treasury sales of bonds in the open market – a Federal Reserve open market sale of bonds
  1. (30 minutes)

In The Good Society (1936) Walter Lippmann wrote:

“It may be predicted confidently that if ever the time comes when Russia no longer feels the need of mobilization military build-up and forced industrialization), it will become necessary to liquidate the planning authority and to return somehow to a market economy.”

Do recent economic reforms in the Soviet Union support this statement? What advantages might an increased role of markets in the U.S.S.R. have for that economy?

  1. (30 minutes)

“If one thing is certain it is that the path to development of the modern poor country will be very different from that of the earlier developers of the West. The problems are different and so also are the mechanisms for solving these problems.”
Discuss this question, giving specific examples to illustrate your points.

  1. (30 minutes)

Choose one of the following questions:

    1. Country X has three nationalized industries: railways, steel production, lighthouses.
      What should be the price and output policies of each industry if efficient allocation of resources were the national goal? How would each industry be financed? How would the results compare with a free market organization in these industries?
    2. In Australia, with no foreign trade, wool costs $5.00 per unit and cloth costs $12.00 per unit. In India, with no foreign trade, wool costs 10 rupees per unit and cloth costs 12 rupees per unit.
      If the cost of shipping a unit of either wool or cloth from one country to the other is $2.00, would trade take place? Explain.
      If it costs $2.00 to ship a wool unit, what is the cost of shipping cloth at which there will no longer be any gain from trading?

Source: Harvard University, Faculty of Arts and Sciences. Papers Printed for Final Examinations [in] History, History of Religions, Government, Economics, … , Naval Science, Air Science. June, 1966.

Image Source: Master of Leverett House, Richard T. Gill in The Harvard Class Album 1966.

Categories
Economists Harvard

Harvard. Annual report on the department of economics. Dunlop, 1961-1962

An overview of the annual comings and goings of a department are typically chronicled in a report prepared by the department chair. Such low circulation documents are sometimes targeted to a specific readership, e.g. a visiting committee, a dean, the alumni, but the report transcribed in this post for the Harvard economics department in 1961-62 does not appear to have had a particular audience in mind.

___________________________

About  Chairman John T. Dunlop
(Harvard Album, 1960)

Sallying forth from an office in the farther reaches of Littauer to Washington, D.C., JOHN THOMAS DUNLOP, Professor of Economics and faculty member in the Graduate School of Public Administration, is certainly one of the university’s most travelled professors. Dunlop, a labor expert, teaches an undergraduate course on unionism and public policy applying to labor relations and problems; in the grad school he conducts two seminars, in one of which he had worked closely with the late Professor Slichter. But in addition to his teaching, Professor Dunlop is one of the country’s leading strike arbitrators, and he figures that he travels in the vicinity of 150,000 miles a year on this outside work. The occasion for a weekly trip to the nation’s capital is his post as the impartial chairman of a joint committee in the construction industry, comprising representatives of the eighteen major unions and contracting firms. In this position Professor Dunlop must mediate disputes between the union and management. He is also a permanent umpire for the women’s garment industry and in the past has served in similar capacities for the brass companies of Connecticut and the bituminous coal producers. The dispute in 1955 involving the complexities of the ratio of required conductors to the length of a freight train called him back to the role of mediator, following a long term with the Atomic Energy Labor panel. At present he edits the Wertheim series on the histories of various big corporations and unions, and he also administers a Ford Foundation grant to study the functionings of labor and management in the underdeveloped countries of Asia.

Professor Dunlop was born in the Forty-Niner gold region and graduated from the University of California in 1935. He has been with Harvard since 1938, when he joined the faculty as an instructor. He gets back to California at least once a year, and the last time he returned he did so by travelling eastward via Indonesia. Professor Dunlop lives in Belmont, and, when not compiling mileage, he devotes his time to his wife and three children, and concentrates on his tennis game.

Source: The Harvard Album, 1960, p. 29.

___________________________

Previously posted departmental reports

Department Reports to the Dean (1932-41)
Department Reports to the Dean (1942-1946)
Department Reports to the Dean (1947-1950)
Department Report to the Dean (1955-56)
Department Newsletter (June 1960)

___________________________

June 26, 1962

Report
Department of Economics, 1961-1962

1. Staff

Professor Gerschenkron was Taussig Research Professor for the year, and Professor Albert J. Meyer, lecturer in the Department, was also on leave. Professor Galbraith and Kaysen continued on leave in government appointments. During the spring term Professor Harris was on sabbatical leave; Professor Bergson held a Ford Faculty Research Fellowship, and Professor Leontief was Visiting Professor at the College du France, Paris. Assistant Professors Gill and Vanek were also on leave throughout the year.

As a consequence of the number of senior members on leave, the Department included this year a relatively large number of visiting professors and lecturers. Professor Jesse Markham of Princeton University taught the courses in industrial organization; Dr. Frank Spooner was in charge of economic history; Professor William H. Nicholls of Vanderbilt instructed in agriculture and economic development. Professor Jacob Viner was Taussig Research Professor, and while he taught no courses, we were delighted to have him with us for the year. Professor Schmookler of Minnesota was associated with the science and public policy seminar of the Littauer School, and was a visiting lecturer in the Department. In addition, Professor Domar of M.I.T. taught a course in the Soviet economy in the spring term. Mr. Langley gave courses ordinarily taught by Professor A.J. Meyer, and Professor Caleb Smith of Brown University continued to teach the accounting course.

2. New Appointments

       The Executive Committee unanimously recommended the appointment of Professor Richard Caves as a permanent addition to the Department. Following the established procedures, the governing boards on May 14, 1962 voted his appointment as Professor of Economics effective July 1, 1962. Professor Caves completed his Ph.D. degree in the Department in 1958 and has been on the staff at the University of California (Berkeley) since 1957. He has been vice-chairman of the Berkeley Department. The appointment of Professor Caves will materially strengthen the Harvard Department, particularly in the fields of international trade and industrial organization. Moreover, he is regarded as an excellent undergraduate teacher.

       The Department unanimously recommended and the President and governing boards approved the appointment of four new assistant professors starting July 1, 1962: Clopper Almon, Jr., Elliot Berg, Phoebus Dhrymes, and Thomas Wilson. It is planned that these assistant professors in the Department will devote part time to research and be paid in part from research budgets. Such arrangements, combined with the higher salary scales starting July 1, 1962, should facilitate the recruitment of first rate assistant professors; it has often been difficult in the past to fill this rank in this Department.

       In approving these four appointments on March 5, 1962, President Pusey stated:

“It is my understanding that these four new Assistant Professors will devote part of their five-year tenure to special research projects and that an appropriate fraction of their salaries during these periods will be charged against the project budgets. I approve in principle the idea of experimenting in this way with charging portions of the salaries of assistant professors to grants or contracts, provided these grants or contracts are of sufficient duration to avoid the danger of funds running out when there are still large salary commitments in excess of our normal academic salary budget. Thus I feel that we should move with caution in this direction, treating the above appointments as experimental, and waiting for the results to become apparent before venturing further along this road.”

3. Chair in Modern China Studies and Economics

       The primary responsibility for filling this chair has now been placed in the Department of Economics. After a series of conferences with the East Asia Research Center of Harvard University, President Pusey approved the arrangements under which the Department will seek a permanent appointment competent in Economics and with a command of the Chinese language. In the meanwhile, the Department is to be responsible for providing some instruction on term appointments in the field and is to have the use of the income of the endowment for such instruction and to develop promising scholars in this field.

       Professor Kuznets is to be Chairman of the Committee of the Department to seek appropriate appointments. It is expected that Mr. Dwight Perkins, a graduate student in the Department, will provide a half course of instruction on the Economy of China in the spring term, 1963.

4. Undergraduate Program

       The enrollment in the undergraduate courses in the Department has grown in the last several years. The aggregate enrollment in undergraduate courses was 926 in the fall of 1959 and 1375 in the fall of 1961; the aggregate enrollment was 1080 in the spring term of 1960 and 1281 in the spring of 1962. These figures include the enrollment in Economics 1 which averaged 540 in 1959 and 628 in 1962. It is thought that these increases in part reflect the reorganization of the undergraduate program placed into effect in the fall of 1960 following several years of work on the part of the committee on undergraduate instruction. The division of full year courses into half year courses, the arrangement of courses into four groups according to prerequisites and level of difficulty, the lectures in Economics 1 and the addition to the curriculum of a few new courses is thought to have stimulated enrollment.

       Despite the increases in enrollment in undergraduate courses, the Department faces a serious continuing problem to maintain and to increase the number of concentrators in the field. The percentage of all concentrators who elect the field of Economics has declined from 7.7 percent in 1956-57 to 6.0 percent in 1960-61. The low concentration in Economics at Radcliffe is of particular concern to the Department, and conferences seeking to increase interest among the students have been held with President Bunting and other members of the Radcliffe staff.

       In order to improve the quality of our instruction, Economics 98 (junior tutorial) is to be reorganized. The adoption of the Gill plan by the Faculty materially increased the number of students in Economics 98 from 40 or 50 to more than 80. The instruction in economic theory by lectures has proven to be inappropriate with the larger group. Next year, 1962-63, it is planned to divide the group into three or four seminars, each of approximately 20 students; each seminar is to be under the direction of a senior member of the Department or an assistant professor. In addition, tutorial groups of four or five students will meet with individual tutors. Professor Caves has been given overall responsibility for this important part of the undergraduate program.

5. Graduate Instruction

       There was a total of 48 first year graduate students in the Department this year including 5 women and 3 enrolled through Littauer. There were 88 continuing graduate students including 6 women, 6 from Littauer, and 2 in joint degrees, for a total of 136 graduate students; in addition, the Department had 10 special students and 10 special auditors. A total of 21 Ph.D. degrees were awarded to students in the Department of Economics.

       The competition for places in the graduate schools for work in the Department of Economics has grown more severe in recent years. From the more than 260 applications for admission to the Graduate School of Arts and Sciences received in the spring of 1962, there will only be about 45 new graduate students in the fall of 1962. Almost half of these students will be from outside the United States and Canada. For the fall of 1962 we have been able to obtain the admission of 8 out of the first 10 on our list, a considerably higher fraction than in recent years.

       The Department faces strong conflicting pressures in making decisions on the number of new graduate students to be admitted. On the one hand, the Department is anxious to provide individual instruction particularly after the first year of graduate study for the highest quality students. A greater enrollment would also complicate materially the teaching of the required graduate courses in economic history, statistics and theory, and after a point would require further manpower so that two senior members of the Department might give parallel courses or sections. On the other hand, the Department is anxious to make its contribution to the increased demands for economists particularly for developing countries. Moreover the quality of a number of the students rejected for admission (perhaps as many as 15 to 20) appears to be very good. In the selection of students from abroad it is particularly difficult to know whether one has made the best selections. When students are admitted whose records turn out to be poor, there are often many complications for both the student and the University. The Department has spent considerable energy in reviewing the records of students admitted during the past decade; a careful statistical study was made under the direction of Professor Houthakker. The Department is continuing to seek to improve admission procedures.

         Financial resources available to the Department for its own use for scholarships and fellowships is a serious problem since the money made available by the generous gift of Mr. Roger Kyes has now been exhausted.

6. Organization of the Department

The Department now performs much of its routine business through committees. The two major committees are on Undergraduate Instruction under Professor Eckstein and on Graduate Instruction under Professor Dorfman.

7. Research

         A very large amount of research activity is carried out by members of the Department of Economics. In addition to individual research by senior members, an increasing number of research projects which employ a number of graduate students and junior staff are being conducted under the direction of senior members. These research projects often provide opportunities for training of graduate students in research methods and afford topics and financing for Ph.D. dissertations.

         Among these research projects with financial support are the following:

Professor Leontief Harvard Economic Research Project which has recently been refinanced for a period of years.
Professor Mason The relations of government and business in economic development.
Professor Mason and Dr. Papanek Overseas operations and training
(Center for International Affairs)
Professor Kuznets Economic growth
Professor Eckstein Economics of public expenditures
Professor Houthakker Forecasting consumers’ expenditures
Professor Harris Education and Public Policy
Professor Schelling Defense studies and Experimental Study of Bargaining
Professor Dunlop Labor-Management History and Economics of Medical Care
Professor Duesenberry Capital Markets
Professor Meyer Business Decisions
Professor Bergson Soviet Economics
Professor Gerschenkron Economic History Workshop

8. Public and Professional Activities

         A number of members of the Department were engaged in a wide variety of professional activities and public service during the year. A few instances may be of interest; no attempt is made for a complete listing.

         The president of the American Economic Association comes from this Department two years in a row. Professor Mason is president for 1962, and Professor Haberler is president-elect.

         Professor Leontief was chairman of the International Conference on Input-Output Techniques held in Geneva, Switzerland in September 1961 and sponsored by the Harvard Economic Research Project in association with the U.S.[sic] Secretariat. He was also a member of the Commission of Experts for the United Nations which reported on the Social and Economic Consequences of Disarmament.

         Professor Dorfman served as a member of the President’s Scientific Advisory Committee team on Waterlogging and Salinity in West Pakistan. He is also a member of the President’s Committee to Appraise Employment and Unemployment Statistics.

         Professor Harris is serving as Economic Advisor to the Secretary of the Treasury and is a member of the Public Advisory Board of the Area Redevelopment Program.

         Professor John R. Meyer served as a consultant in connection with the President’s message on Transportation Policy.

         Professor Kuznets is Chairman of the Committee on the Economy of China of the Social Science Research Council.

         Professor Bergson is a member of this same Committee and chairman of the Joint Committee of Slavic Studies of the Social Science Research Council and the American Council of Learned Societies. His study, The Real National Income of Soviet Russia Since 1928, was published in 1961 by the Harvard University Press.

         Professor Mason is Chairman, Advisory Committee, A.I.D.

         Professors Duesenberry, Eckstein and Smithies have been consultants to the Council of Economic Advisors. Professor Duesenberry was on the staff of the Commission on Money and Credit and was chairman of the Joint Economic Committee’s Inventory Study Committee.

         Professor Schelling has been a consultant to the Department of Defense and to the Scientific Advisory Board of the Air Force. His study Strategy of Arms Control (with Morton J. Halperin), was published by the Twentieth Century Fund in 1961.

         Professor Houthakker has worked on revenue forecasting problems for the Department of the Treasury.

         Professor Dunlop was a member of the Presidential Railroad Commission (1960-1962), and is a member of the President’s Missile Sites Labor Commission. He was Chairman of the International Conference on Labor Productivity under the auspices of the International Economic Association held August-September 1961.

9. Visiting Committee

         A series of meetings this year with the Chairman of the Visiting Committee, and others of its members, have improved the relations between the Visiting Committee and the Department of Economics. I believe these new attitudes are reflected in the annual report of the Committee. There is a genuine desire on the part of both the Department and the Committee for a constructive relationship.

___________________
John T. Dunlop
Chairman

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

Image Source: The Harvard Class Album 1960, p. 29.

Categories
Harvard Suggested Reading Syllabus Teaching Undergraduate

Harvard. Junior Year Seminar/Tutorial Reading Assignments. Caves, 1964-1965

The evolution of the Harvard tutorial system as an integral aspect of its undergraduate economics program is a subject worthy of a long essay. For now we simply add the following snapshot of the “Tutorial for Credit, Junior Year” that Richard Caves had been tasked to reform when he joined the Harvard faculty in the 1962-63 academic year. This post provides the reading lists for the third iteration of Caves’ seminar/tutorial model that replaced the earlier lecture/tutorial model.

As far as content goes, the 1964-65 version of Economics 98 can be seen to have attempted an ambitious, advanced intermediate coverage of mainstream micro- and macroeconomics.

Harvard’s Memorial Minute for Richard Earl Caves (1931-2019).

____________________________

Course Announcement

*Economics 98a. Tutorial for Credit — Junior Year

Half course (fall term). Tu., 2-4, and tutorial meetings to be arranged. Professor Caves, Assistant Professor T. A. Wilson, Dr. Brunt and other Members of the Department.

*Economics 98b. Tutorial for Credit — Junior Year

Half course (spring term). Tu., 2-4, and tutorial meetings to be arranged. Professor Caves, Assistant Professor T. A. Wilson, Dr. Brunt and other Members of the Department.

Economics 98a will deal with micro-economic and 98b with macro-economic theories and policies. These seminars will serve as preparation for more specialized training in their subject matter in Group IV graduate and undergraduate courses. Economics 98a and 98b are required of all honors candidates and are open to non-honors candidates with the permission of the instructor.

The courses will consist of both seminar and tutorial, normally with one seminar and one tutorial session a week.

Source: Harvard University, Faculty of Arts and Sciences. Courses of Instruction for Harvard and Radcliffe, 1964-1965, p. 106.

____________________________

Harvard Crimson Article on the New Junior Seminars
May 16, 1962

Ec. 98 Will Be Taught in Small Seminar Units
Lecture Format Found Unwieldy

By Richard B. Ruge

The Economics Department announced yesterday that four seminar-groups of approximately 20 students each will replace the once weekly lectures in Ec. 98, or tutorial for credit, and that an associate professor at the University of California has been appointed to head the new junior tutorial program.

John T. Dunlop, chairman of the Department, said that increased enrollment in 98 had made lecture presentation of the subject matter — the central core of economic concepts — ineffective. Since Gill Plan opened tutorial for credit all concentrators, the number of students in the course has jumped to 80.

Dunlop declared that the use of two-hour, smaller seminar discussion groups meeting once a week is “more properly the spirit of tutorial, will improve a level of instruction, and will allow the students and professors to develop their own interests more thoroughly and participate in good give-and-take discussions.”

The seminars will split into smaller groups of four of five students, meeting once a week for 90 minutes to present and discuss papers. These groups will focus on the major aspect of economic thought considered in the larger seminars.

Caves to Head Program

Heading the program will be [Richard] Caves, who will become professor of economics on July 1. An expert on industrial organization, Caves worked on a new foreign trade program as deputy special assistant to the President in 1961. He received his M.A. and Ph.D. from Harvard before joining the faculty at California.

Source: The Harvard Crimson, May 16, 1962.

____________________________

Tutorial Assignments for Ec 98a Fall 1964

Harvard University
Department of Economics

Economics 98a
List of Suggested Tutorial Assignments
August 17, 1964

This list includes items which tutors may find helpful as assignments for discussion in tutorial sections, bases for small projects or papers, and the like. Many but not all have been used successfully for these purposes in the past. A few items contain mathematical or statistical complexities that make them suitable only for students with special backgrounds. Make sure that you check any item before using it.

If time permits, a more complete list will be prepared and issued at the beginning of the semester. Suggestions for additions from the tutors would be appreciated, as would reports of adverse experiences with any of the following items.

R.E.C.

  1. Consumer behavior [sic, “1. Introduction” not included here]

Becker, Gary S., “Irrational Behavior and Economic Theory,” Journal of Political Economy, February, 1962, 1-13

Houthakker, H.S., “An International Comparison of Household Expenditure Patterns, Commemorating the Centenary of Engel’s Law,” Econometrica October, 1957, 532-551

U.S. Department of Agriculture, Technical Bulletins on Demand Analysis, No. 1253 (meat), 1168 (dairy products), 1136 (wheat)

Alchian, A., “The Meaning of Utility Measurement,” American Economic Review, March, 1953, 26-50

Ellsberg, D., “Classic and Current Notions of Messurable Utility,” Economic Journal, September, 1954, 528-556

Friedman, M., and L.J,. Savage, “The Utility Analysis of Choices Involving Risk,” Am. Econ. Assn., Readings in Price Theory, chap. 3

  1. Theory of the firm

Hirshleifer, J., “An Exposition of the Equilibrium of the Firm: Symmetry between Product and Factor Analyses,” Economica, August, 1962, 263-268

Scott, R.H., “Inferior Factors of Production,” Quarterly Journal of Economics, February, 1962, 86-97

Apel, H., “Marginal Cost Constancy and Its Implications,” American Economic Review, December, 1948, 870-886

Hitch, C.J., and R.N. McKean, The Economics of Defense in the Nuclear Age, chaps. 7, 8

Cookenboo, Leslie, Jr., Crude Oil Pipe Lines and Competition in the Oil Industry, chap. 1

F.T. Moore, “Economies of Scale: Some Statistical Evidence,” Quarterly Journal of Economics, May, 1959, 232-245; also discussion August, 1960, 493-499

Alexander, Sidney, “The Effect of Size of Manufacturing Corporation on the Distribution of the Rate of Return,” Review of Economics and Statistics, August, 1949, 229-235

Johnston, J., Statistical Cost Analysis, chap. 4 (secs, 1, 3, 4); chap. 5; chap. 6 (pp. 186-194)

Staehle, Hans, “Measurement of Statistical Cost Functions,” American Economic Review, June, 1942; Readings in Price Theory, chap. 13

Eiteman, W.J., and G.E. Guthrie, “The Shape of the Average Cost Curve,” American Economic Review, December, 1952, 832-839

Hall and Hitch, “Price Theory and Business Behavior,” in T. Wilson, ed., Oxford Studies in the Price Mechanism

Earley, J.S., “Recent Developments in Cost Accounting and the ‘Marginal Analysis’,” Journal of Political Economy, June, 1955, 227-242

Earley, J.S., “Marginal Policies of ‘Excellently Managed Companies,” American Economic Review, March, 1956, 44-70

Grayson, C.J., Decisions under Uncertainty, pp. 233-278

  1. Competitive product and factor markets

Vernon L. Smith, “An Experimental Study of Competitive Market Behavior,” Journal of Political Economy, April, 1962, 111-137

Ezekiel, M., “The Cobweb Theorem,” Am, Econ, Assn., Readings in Business Cycle Theory, chap. 21

Richardson, G.B., Information and Investment.

Friedman, M., Price Theory: A Provisional Text, chaps, 7-9

Lester, R.A., and Machlup, F., marginalist controversy, reprinted in R.V. Clemence, ed., Readings in Economic Analysis, Vol. 2, chaps, 6-9

Bachmura, F.T., “Man-Land Equalization through Migration,” American Economic Review, December, 1959, 1004-1017

  1. General equilibrium and welfare

Stone, Richard, and G. Croft-Murray, Social Accounting and Economic Models, chaps. 1-3

Lange, Oscar, On the Economic Theory of Socialism, B. Lippincott, ed.

Hirshleifer, J. et al., Water Supply: Economics, Technology, and Policy, chap. 8

Nelson, J.R., ed., Marginal Cost Pricing in Practice, chaps. 1, 2, 3, 5 (skip pp. 110-123), 6, 7

  1. Imperfect competition: product markets
    1. Monopoly

Neale, Walter C., “The Peculiar Economics of Professional Sports,” Quarterly Journal of Economics, February, 1964, 1-14

Olson, M., and D. McFarland, “The Restoration of Pure Monopoly and the Concept of the Industry,” Quarterly Journal of Economics, November, 1962, 613-631

Wallace, D.H., Market Control in the Aluminum Industry, Part II

Davidson, R.K., Price Discrimination in Selling Gas and Electricity

    1. Monopolistic competition

Stigler, G.J., Five Lectures on Economic Problems, Lecture 2

Chamberlin, E.H., Towards a More General Theory of Value, chap. 15

    1. Oligopoly

Peck, M.J., Competition in the Aluminum Industry, 1945-1948

Markham, J., Competition in the Rayon Industry

Weiss, L.W., Economics and American Industry, chaps, 7, 8

Modigilani, F., “New Developments on the Oligopoly Front,” Journal of Political Economy, June, 1958, 215-232

Shubik, M., “A Game Theorist Looks at the Antitrust Laws and the Automobile Industry,” Stanford Law Review, July, 1956

Marris, Robin, “A Model of the ‘Managerial’ Enterprise,” Quarterly Journal of Economics, May, 1963, 185-209

  1. Imperfect, competition: factor markets

Fellner, W.J., “Prices and Wages under Bilateral Monopoly,” Quarterly Journal of Economics, August, 1947, 503-532

Segal, Martin, “The Relation between Union Wage Impact and Market Structure,” Quarterly Journal of Economics, February, 1964, 115-128

*  *  *  *  *  *  *  *  *  *  *  *

Harvard University
Department of Economics

DRAFT Reading List
Economics 98a
Fall Term, 1964

Students will be requested to purchase W.J.L. Ryan, Price Theory (London: Macmillan, 1958). Seminars may vary in the extent that they depend on Ryan for the basic exposition of micro theory. The following list assumes complete dependence on Ryan. Other readings are very tentatively included, and the list probably errs on the side of containing too much.

  1. Introduction

Lange, Oscar, “The Scope and Method of Economics,” in Arleigh P. Hess et al., Outside Readings in Economics, pp. 1-20

Knight, Frank, The Economic Organization, pp. 3-66

    1. Consumer behavior

Ryan, chaps. 1, 6

Alfred Marshall, Principles of Economics, Book III (or a textbook treatment of utility theory, such as D.S. Watson, Price Theory and Its Uses, chaps 4, 5)

One of the following:

Duesenberry, James S., Income. Saving and the Theory of Consumer Behavior, pp. 6-39

Leibenstein, H., “Bandwagon, Snob, and Veblen Effects In the Theory of Consumers’ Demand,” Quarterly Journal of Economics, May, 1950, 183-207

Frisch, Ragnar, “Some Basic Principles of Cost of Living Measurements,” Econometrica, October, 1954, 407-421

Fisher, Irving, The Theory of Interest, pp. 61-124.

  1. Theory of the firm

Ryan, chaps. 2, 3

Chamberlin, E.H., The Theory of Monopolistic Competition, Appendix B

Dean, Joel, Managerial Economics, pp. 257-313

Universities—National Bureau Committee for Economic Research, Business Concentration and Price Policy, pp. 213-238

Cyert, R.M., and J.G. March, A Behavioral Theory of the Firm, pp. 4-21, 26-43

Bierman, Harold, and S. Smidt, The Capital Budgeting Decision, chaps, 1-6, 9

  1. Competitive product and factor markets

Ryan, Chap, 4

Chamberlin, chap. 2

Marshall, Book V, chaps. 1-5; Book IV, chap. 13

Working, E.J., “What Do Statistical Demand Curves Show?”, in American Economic Association, Readings in Price Theory, chap. 4

Robinson, Joan, “Rising Supply Price,” Readings in Price Theory, pp. 233-241

    1. General equilibrium and welfare

Ryan, chap. 9

Boulding, Kenneth, “Welfare Economics,” in B.F. Haley, ed, for American

Economic Association, A Survey of Contemporary Economics, pp. 1-34

Bator, Francis M., “The Simple Analytics of Welfare Maximization,” American Economic Review,March, 1957, 22-44 (omit 44-59)

Scitovsky, Tibor, “Two Concepts of External Economies,” Journal of Political Economy, April, 1954, 143-151

McKean, R.N., Efficiency In Government through Systems Analysis, chaps, 1-5 (or something else on benefit-cost analysis)

  1. Imperfect competition: Product markets

Ryan, chap. 9

    1. Monopoly

Ryan, chap. 10

Bain, Joe S., Price Theory, pp. 208-247

Weiss, L.W., Economics and American Industry, chap. 5

    1. Monopolistic competition

Chamberlin, chaps. 1, 4, 5

Triffin, Robert, Monopolistic Competition and General Equilibrium Theory, pp. 78-89

Weiss, chap. 9

    1. Oligopoly

Ryan, chap. 11

Fellner, William, Competition Among the Few, chap. 1

Sweezy, Paul, “Demand under Conditions of Oligopoly,” Readings in Price Theory, chap. 20

Bain, pp. 297-332

Duesenberry, James S., Business Cycles and Economic Growth, chap. 6

Baumol, W.J., Business Behavior, Value, and Growth, pp. 27-32, 45-46

  1. Imperfect competition: factor markers

Chamberlin, chap. 8

Dunlop, John T., “Wage Policies of Trade Unions,” American Economic Association, Readings in the Theory of Income Distribution, chap. 19

Cartter, A.M., Theory of Wages and Employment, chaps. 7, 8

Friedman, Milton, “Some Comments on the Significance of Labor Unions for Economic Policy,” The Impact of the Union, D. McC. Wright, ed., pp 204-234

____________________________

Tutorial Assignments for Ec 98b Spring 1965

HARVARD UNIVERSITY
Department of Economics

Economics 98b
Reading List
Spring Term, 1965

All selections listed below should be considered as assigned, although the leaders of Individual seminars may choose either to add or subtract items. Students may wish to purchase Gardner Ackley, Macroeconomic Theory (New York: Macmillan, 1961), which will be assigned in part, especially at the beginning of the semester, and will serve as a general reference for issues which arise during the course. R.C.O. Matthews, The Business Cycle, will also be used extensively.

  1. Introduction of macro-economics (two weeks)
    1. The national income

Gardner Ackley, Macroeconomic Theory, chaps. 1-4.

U.S. Department of Commerce, Survey of Current Business, July, 1964, pp. 7-40.

S. Rosen, National Income, pp. 172-187.

    1. Prices and employment: pre-Keynesian background

Ackley, pp. 105-167.

  1. Income and employment determination (seven weeks)
    1. Effective demand

J.M. Keynes, The General Theory of Employment, Interest and Money, chaps. 1, 2.

A.H. Hansen, A Guide to Keynes, pp. 25-35.

P. Wells, “Aggregate Demand and Supply: An Explanation of Chapter III of the General Theory,” Canadian Journal of Economics and Political Science, XXVIII (Nov., 1962), pp. 585-59.

    1. Consumption function and the multiplier

Hansen, A Guide to Keynes, pp. 67-85.

J.S. Duesenberry, Income, Saving and the Theory of Consumer Behavior, chaps. 3, 5,

J. Tobin, “Relative Income, Absolute Income, and Saving,” Money, Trade and Economic Growth: Essays in Honor of J.H. Williams, pp. 135-156.

M. Friedman, A Theory of the Consumption Function, 220-229, 233-239.

Ackley, chap. 10.

Hansen, A Guide to Keynes, pp. 86-114.

A.H. Hansen, Business Cycles and National Income, chap. 12.

W.J. Baumol and M.H. Peston, “More on the Multiplier Effects of a Balanced Budget,” American Economic Review, XLV (March, 1955), 140-148.

    1. Investment

Keynes, chap. 11.

Hansen, Business Cycles and National Income, chap. 9.

J.M. Clark, “Business Acceleration and the Law of Demand: A Technical Factor in Economic Cycles,” in American Economic Association, Readings in Business Cycle Theory, chap, 11.

R.C.O. Matthews, The Business Cycle, , chaps. 3-5.

J.S. Duesenberry, Business Cycles and Economic Growth, chaps. 4, 5.

J.R. Meyer and R. Glauber, Investment Decisions, Economic Forecasting, and Public Policy, pp. 1-22.

    1. Interest

Keynes, pp. 165-185, 195-209.

Hansen, A Guide to Keynes, chap. 6.

L.R. Klein, The Keynesian Revolution, pp. 117-123.

    1. The Keynesian system

Keynes, pp. 257-271.

H.G. Johnson, Money, Trade and Economic Growth, chap. 5.

V. L. Smith, “A Graphical Exposition of the Complete Keynesian System,” Southern Economic Journal, XXIII (October, 1956), 115-125.

Ackley, chap. 15.

D. Patinkin, “Keynesian Economics Rehabilitated: A Rejoinder,” Economic Journal, LXIV (Sept.,1959), pp. 582-587.

D. Patinkin, “Price Flexibility and Full Employment,” American Economic Association, Readings in Monetary Theory, pp. 252-283

A.P. Lerner, “Comment,” American Economic Review, LI (May, 1961), pp. 20-23.

  1. Models of growth, fluctuations, and inflation (three weeks)
    1. Economic growth and fluctuations

Duesenberry, Business Cycles and Economic Growth, chap, 2.

W.J. Baumol, Economic Dynamics, chaps. 2, 3.

Hansen, Business Cycles and National Income, chap. 11.

D.B. Suits, “Forecasting and Analysis with an Econometric Model,” American Economic Review, LII (March, 1962), 104-132 (pp. 118-31 optional).

Matthews, chaps. 2, 13.

    1. Inflation

A.C.L. Day and S.T. Beza, Money and Income, chaps. 19-21.

Keynes, pp. 292-304.

M. Friedman, “Some Comments on the Significance of Labor Unions in Economic Policy,” Impact of the Union, D. McC. Wright, ed., 204-234.

S. Slichter, “Do the Wage-Fixing Arrangements in the American Labor Market Have an Inflationary Bias?” American Economic Review, XLIV (May, 1954), pp. 322-346.

C. Schultze, Recent Inflation in the United States (Study paper No. 1, Employment, Growth and Price Levels), pp. 1-77. Joint Economic Committee

O. Eckstein and T.A. Wilson, “Determination of Money Wages in American Industry,” Quarterly Journal of Economics, LXXVI (August, 1962), 379-409.

    1. Coordinating Policy for Growth and Stability

J. Tinbergen, Economic Policy: Principles and Design, pp. 1-37.

Source: Harvard University Archives. Syllabi, course outlines and reading lists in Economics, 1895-2003. Box 8, Folder “Economics 1964-1965 (1 of 2)”.

Image Source: Harvard Square, 1961. From the Cambridge Historical Commission, image in the Photo Morgue Collection. Online: Digital Commonwealth.

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

Harvard. Basic graduate microeconomic theory. Chamberlin and Samuelson, 1956-1957

 

For some reason, Paul Samuelson was asked to help out with the teaching of Edward H. Chamberlin’s graduate theory course during the 1956-57 academic year. In Paul Samuelson’s papers at Duke I was able to find a letter from the Harvard economics chair, Seymour Harris, confirming his appointment as “Visiting Professor” for co-teaching Economics 201. The actual “allocation of subject matter” between Chamberlin and Samuelson is not clear from Samuelson’s papers, nor from the course outlines. Since the second semester reading list only has Chamberlin’s name on it, it seems likely that Samuelson’s participation was limited to the first semester of the course. Because Robert Bishop’s manuscript on Economic Theory (taught to generations of M.I.T. graduate students) was included in the first section of the fall semester reading list and we find questions for a one hour mid-term exam in Samuelson’s folder for the course, I am led to conjecture that Samuelson taught most or all of the first half of the fall semester of the course. As we can see from the internal M.I.T. department teaching records included below, Paul Samuelson continued teaching his courses at “Tech” that year.

Perhaps a future trip to Duke University’s David M. Rubenstein Rare Book Manuscript Library  to consult the Edward H. Chamberlin papers that were donated in 2019 will help to establish why Samuelson was needed at Harvard that year.

_________________________

Letter from Chairman Seymour Harris to Paul Samuelson
May 25, 1956

HARVARD UNIVERSITY
DEPARTMENT OF ECONOMICS

Office of the Chairman

M-8 Littauer Center
Cambridge 38, Massachusetts

May 25, 1956

Professor Paul A. Samuelson
Department of Economics and Social Science
Massachusetts Institute of Technology
Cambridge 39, Massachusetts

Dear Paul:

Economics 201 meets Tuesday, Thursday, and at the pleasure of the instructor Saturday at 10. It would be hard to change that hour because of the arrangement of other courses, and also because we must have the same hour for the second semester.

I hope that you would get together with Ed and discuss the allocation of subject matter. You can have [Richard] Gill as an assistant, and he would, I am sure, be willing to meet the class once a week when you think it necessary. You will find him a most adequate assistant.

I may add that the Dean has agreed to recommend your appointment as a Visiting Professor, which is an unusual appointment, for most appointments of this kind, inclusive of Tech, are Visiting Lecturers. This suggests the high regard in which we hold you.

Sincerely yours,

[signed] Sey
Seymour E. Harris
Chairman

SEH/c
cc: Professor Chamberlin

P.S. I hope you will remember to bring my article on Saturday and any comments.

 

Source: Duke University. David M. Rubenstein Rare Book and Manuscript Library. Economists’ Papers Archive. Papers of Paul Samuelson, Box 33, Folder “Ec201 Harvard Course, 1955-1956 [sic]”.

_________________________

From the M.I.T. economics department records for 1955-56

Paul Samuelson was teaching full time 1956-57. He taught Economics and Industrial Management (14.117) and Mathematical Approach to Economics (14.151) in the fall semester and Economic Analysis (14.122) and Economics Seminar (14.192) in the Spring semester.

Source:  M.I.T. Archives. M.I.T. Department of Economics Records, 1947—. Box 3, Folder “Teaching Responsibility”.

_________________________

Enrollment figures from Harvard President’s Report

[Economics] 201. Economic Theory. Professor Chamberlin and Professor Samuelson (Massachusetts Institute of Technology). Full course.

(F) Total 38: 26 Graduates, 2 Seniors, 1 Junior, 4 Radcliffe, 5 Others.
(S) Total 39: 27 Graduates, 2 Seniors, 1 Junior, 3 Radcliffe, 6 Others.

Source: Harvard University. Report of the President of Harvard College, 1956-1957, p. 70.

_________________________

Economics 201
Economic Theory
Fall 1956
READING LIST

I. Supply, Demand, Revenue and Cost

Marshall, Principles (4th edition or later), Book III, Ch. 3, 4, 6

Mill, Principles, Book III, Ch. 1-6

Chamberlin, Theory of Monopolistic Competition, Ch. 2

Schultz, H., Theory and Measurement of Demand, pp. 5-12

Bishop, Economic Theory Ms., Book II, Ch. 1, 2, 3

Viner, Cost Curves and Supply Curves (1930), AFA or Clemence Readings

Robinson, Economics of Imperfect Competition, Ch. 2

Suggested:

Ricardo, Political Economy (Gonner Edition or Sraffa Edition), Chapter I

Mills’ Autobiography or the Introduction to the Ashley edition of the Principles

Jevons, Theory of Political Economy, Chapters 3, 4

Keynes, “Alfred Marshall,” Economic Journal, September 1924 (Also in Keynes, Essays in Biography)

II. Production and Consumption Analysis

A. Production and Cost

Chamberlin, Theory of Monopolistic Competition, Ch. 8, Appendix B

Knight, Risk, Uncertainty and Profit, pp. 94-109.

Stigler, Production and Distribution Theories, Introduction

Stigler, Theory of Price, Chs. 7, 8

Suggested:

Douglas, P. Theory of Wages

Hicks, Value and Capital, Chs. 6, 7

Carlson, Sune, Theory of Production

Cassels, J. H, “On the Law of Variable Proportions,” in Explorations in Economics, essays in honor of Taussig

Schneider, E., Pricing and Equilibrium

B. Utility and Consumption Theory

Hicks, Value and Capital, Chs. 1, 2, 3

Stigler, Theory of Price, Chs. 5, 6

III. Welfare Economics

Boulding, K., “Welfare Economics,” Survey of Contemporary Economics, Vol. II

Hicks, J.R., “Foundations of Welfare Economics,” Economic Journal, 1939

Pigou, A.C., Economics of Welfare, Preface, Part I., Chs. 3, 7, 8; Part II, Introductory, Ch. 9

Lerner, A. P., Economics of Control, Chs. 3, 5, 6, 7, 9

Source: Harvard University Archives, Syllabi, course outlines and reading lists in Economics, 1895-2003”, Box 6, Folder “Economics, 1956-1957 (2 of 2)”.

_________________________

Economics 201
Hour Exam
November 3, 1956

  1. Define “external” and “internal” economies. What do we mean when we say these economies are (a) “pecuniary,” (b) technological”? (10 min.)
  2. What are the conditions of stable equilibrium of supply and demand as analyzed by (a) Walras and (b) Marshall? Explain the “apparent contradiction” between the Walrasian and Marshallian stability conditions. (20 min.)
  3. In the “Ricardian increasing cost” case, as described by Viner, what would be the effect on price, output, and rent to the fixed factor, of a tax of “x” cents per unit of output? Illustrate graphically. (20 min.)

Source: Duke University. David M. Rubenstein Rare Book and Manuscript Library. Economists’ Papers Archive. Papers of Paul Samuelson, Box 33, Folder “Ec201 Harvard Course, 1955-1956 [sic]”.

_________________________

1956-57
HARVARD UNIVERSITY
Economics 201
Midyear examination. January, 1957.

Answer the first two (2) questions and any three (3) of the others. Be sure to allocate your time approximately as indicated.

  1. (Forty-five minutes). Assume two individuals (who act as pure competitors) and two commodities. Given the “production-possibility” or “transformation” curve for each individual and also his indifference map, indicate graphically: a) the equilibrium price; b) the equilibrium quantities of each good produced by each individual; and c) the quantity of each good exchanged.
  2. (Forty-five minutes). Discuss the scope and limitations of “Welfare Economics.” Illustrate your discussion with reference to one or two specific theoretical problems (e.g., the box-diagram).
  3. (One-half hour). A production function relates product (Q) to two factors, labor (L) and capital (C). Distinguish the “three stages” for each factor, and give an interrelations among them in a) the case of constant returns to scale (homogeneous production function) and b) the general case.
  4. (One-half hour). Distinguish “internal” and “external” economies and analyze the possibility of equilibrium under pure competition in each case.
  5. (One-half hour). A monopolistic firm can buy labor and land at fixed prices but sells its output in an impurely-competitive market. Now let it be subject to a tax of $X per unit of its output. On the oversimplified assumption that the tax leaves its factor prices, the consumer demand for its product, and its production function unchanged, compare the new equilibrium of output, price, and factor hirings with the old.
  6. (One-half hour). Define the “income” effect and “substitution” effect of a price change. Indicate, in terms of these effects, the likelihood of a) a backward-bending supply curve, and b) a positively-sloping demand curve.

Source: Harvard University Archives. Harvard University Final Examinations, 1853-2001. Box 25. Papers Printed for Final Examinations [in] History, History of Religions, …, Economics, …, Naval Science, Air Science. January, 1957.

_________________________

A twitter prayer.

_________________________

Economics 201
Spring Term, 1956-57
Economic Theory—Professor Chamberlin

I. Monopoly and Monopolistic Competition

Chamberlin, Monopolistic Competition, Chapters 1, 4,5, 9.

_________, “Monopolistic Competition Revisited,” Economica, November 1951.

Robinson, J., Imperfect Competition, Foreword, Introduction, Chapter 1.

Monopolistic Competition, Chapter 3, Appendix A.

Triffin, Monopolistic Competition and General Equilibrium T-heory, pp. 78-108.

Hall and Hitch, “Price Theory and Business Behavior,” Oxford Economic Papers, No. 2 (1939). (Also in Oxford Studies in the Price Mechanism, T. Wilson, Editor).

Chamberlin, “‘Full Cost’ and Monopolistic Competition,” Economic Journal, May 1952.

_________, “The Product as an Economic Variable,” Quarterly Journal of Economics, February 1953.

Monopolistic Competition, Appendix C, Chapters 6, 7.

Chamberlin, “Product Heterogeneity and Public Policy,” American Economic Review, May 1950.

Suggested:

Robinson, J., Imperfect Competition, Chapters 3-7.

Fellner, Competition Among the Few, Chapters 1-7.

Holton, Richard H., “Marketing Structure and Economic Development,” Q.J.E., August 1953.

Alsberg, C. L., “The Economic Aspects of Adulteration and Imitation,” Q.J.E., 46:1 (1931)

Brems, “The Interdependence of Quality Variations, Selling Effort, and Price,” Q.J.E., May 1948.

II. Income Distribution—General; Wages.

Readings in the Theory of Income Distribution, 3.

Marshall, Principles, Book VI, Chapters 1-2.

Hicks, Theory of Wages, Chapters 1-4.

Readings, 12.

Monopolistic Competition, Review Chapter 8 and pp. 215-18, 249-52, (5th or later edition).

Hicks, Chapters 5, 6.

Marshall, Book VI, Chapters 3-5.

Taussig, Principles, 4th edition, Chapter 52 (or 3rd revised edition, Chapter 47).

E.H.C., “The Monopoly Power of Labor,” in The Impact of the Union.

Readings, 19.

Hicks, pp. 170-185.

Suggested:

1. Douglas, Theory of Wages, Chapter 2.

2. J.B. Clark, Distribution of Wealth, Chapters 7, 8, 12, 13.

III. Interest

Böhm-Bawerk, Positive Theory, Book I, Chapter 2; Book II; Book V.

Marshall, Principles, Book IV, Chapter 7; Book VI, Chapter 6.

Wicksell, Lectures, Vol. I, pp. 144-171, 185-195, 207-218.

Clark, J.B., Distribution of Wealth, Chapters 9, 20.

Suggested:

Fisher, I., Theory of Interest, Chapters 5, 6.

Readings, Chapters 20, 21.

IV. Rent

Ricardo, Chapter 2.

Marshall, Book V, Chapters 8-11.

Robinson, Imperfect Competition, Chapter 8.

V. Profits

Marshall, Book VI, Chapter 5, Section 7; Chapters 7,8.

Taussig, Principles  (4th edition), Vol. II, Chapter 49, Section 1 (3rd revised edition, Chapter 50, Section 1)

Veblen, Theory of Business Enterprise, Chapter 3.

Henderson, Supply and Demand Chapter 7.

Bernstein, P., “Profit Theory—Where Do We Go From Here?” Q.J.E., August 1953

Monopolistic Competition, Chapter 5, Section 6; Chapter 7, Section 6; Appendices D, E.

Schumpeter, Theory of Economic Development, Chapters 1-4.

Suggested:

1. Readings, 27, 29.

Source: Harvard University Archives, Syllabi, course outlines and reading lists in Economics, 1895-2003”, Box 6, Folder “Economics, 1956-1957 (2 of 2)”.

_________________________

HARVARD UNIVERSITY
Department of Economics
Economics 201
Final Examination
May, 1957

A. Choose two of the following questions, allowing one-half hour for each.

  1. Write a brief article on the subject of “oligopoly” designed for an encyclopedia of the social sciences, and therefore to be consulted and used mainly by non-specialists in the subject. (Consider well your objective before you begin.)
  2. Discuss excess capacity in the economy, its meaning and its compatibility with “equilibrium.” What are the chief forces tending (a) to bring about, and (b) to eliminate, excess capacity?
  3. (a) Discuss the issues involved in distinguishing between production costs and selling costs, and defend your own conclusions. (b) Are selling outlays, like production outlays, subject to the law of diminishing returns? Discuss, and illustrate your conclusion graphically.

B. Choose four of the following questions, allowing one-half hour for each.

  1. “It is inappropriate to say that the marginal productivity of a certain type of labor determines its wage; wages, like the prices of all economic goods, are determined by both supply and demand.” Discuss with particular reference to the role of supply factors in an adequate theory of wages.
  2. Develop the role which you would give to either (a) monopoly, or (b) rent, in your own theory of wages.
  3. “Waiting is certainly not an element of the economic process in a static state, because the circular flow, once established, leaves no gaps between outlay or productive effort and the satisfaction of wants. Both are, following Professor Clark’s conclusive expression, automatically synchronized.” Discuss the several aspects of this quotation.
  4. Outline your own theory of land rent, with some critical discussion of writers with whom you are familiar. (Restrict your discussion to the problem of land income, without extending the analysis to other factors.)
  5. Write on risk as an element in the theory of profits, choosing such subdivisions or aspects of the problem as seem to you most significant. In what respects, if at all, would you regard a risk theory of profits as inadequate?

Source: Harvard University Archives. Harvard University Final Examinations, 1853-2001. Papers Printed for Final Examinations [in] History, History of Religions, …, Economics, …, Naval Science, Air Science. June, 1957. In bound volume Final Exams—Social Sciences—June 1957 (HUL 7000.28, 113 of 284).

Image Sources:

John Simon Guggenheim Memorial Foundation, Edward H. Chamberlin, Fellow 1958.

M.I.T., Paul Samuelson Memorial Information Page/Photos from Memorial Service.  Accessed via the Internet Archive Wayback Machine.

 

Categories
Economics Programs Harvard Undergraduate

Harvard. Undergraduate economics concentrators dropped over 50% in 1950s.

 

This post provides some backstory to the next post that features the reading lists for Harvard’s junior year tutorial in macroeconomics (Arthur Smithies) and microeconomics (Edward Chamberlin) used in 1960-61. The following Harvard Crimson article describes the undergraduate program in crisis (as seen in the massive drop in economics concentrators). The fall in numbers was attributed to the observation that economics “instruction gyrates widely from verbal triviality to mathematical incomprehensibility”.  Now one might say that much economics instruction gyrates from verbal incomprehensibility to mathematical triviality.

Alfred Marshall tried to design his own Cambridge Curriculum to address two classes of students, those needing general economics training for leadership careers in business and government and those needing advanced training for research careers in economics. Integrated training of the two classes within a single program at Harvard appears to have reached its limits by the second half of the twentieth century. 

Marshall, Alfred. The New Cambridge Curriculum in EconomicsLondon: Macmillan, 1903.

________________________

Economics: Undergraduate Program Undergoes Extensive Re-Evaluation
By Michael Churchill

The Harvard Crimson, November 14, 1959

C. P. Snow, British scientist and author, recently called attention to what he termed the problem of two cultures in our society–the gap in understanding between the traditional humanities and social sciences on the one hand and modern science and technology on the other. Both exist side by side, yet remain intellectually divorced in our modern society. This dichotomy serves well in considering the difficulties surrounding the discipline of economics, for its midway position in such a scheme is indicative of its problems.

The subject matter of economics is the productive system, with all its relations to the world of technology. The concern of economics, however, is this system’s role in society and its effect on men, their livelihood, and their institutions. Not an integrator of the two cultures, nevertheless it must span the separation.

The Economics Department is currently undergoing a crisis. It has failed up to now to accommodate both elements in a coherent program. The result is strikingly demonstrated by the flight of undergraduate concentrators from the field. In less than a decade the number has declined by over half; from 709 in 1949 to 340 in 1958. Although the decline may partially reflect a nationwide tendency, it also is the result of the confusion and frustration attending the undergraduate program here, as the instruction gyrates widely from verbal triviality to mathematical incomprehensibility.

Though economics stands mid-way between two cultures, it is its similarity to the natural sciences that causes the greatest problems. Professional economics shares with the sciences an analytic technique “remote from the common experience of the layman and a language that is principally mathematical,” to use the words the Bruner Committee applied to the natural sciences. And to judge from the current trend this will become increasingly so.

Another similarity with science is that the study of economics is often cumulative, thereby necessitating an extensive introduction to provide the requisite basic knowledge. These are the same problems with which the Bruner Report was concerned in the teaching of natural sciences in a liberal arts program. That report dealt primarily with the problem of the non-concentrator in science–the General Education courses in natural sciences. The Economics Department, however, because of the interest of its concentrators, encounters the same problems throughout its program.

Some of the concentrators are presumably economists, and the Department little wishes to discourage their interests. The vast majority, however, will be lawyers, doctors, and even, despite the Department’s hostility, businessmen.

A final similarity with the sciences lies in the difficulty both areas have in getting the proper senior faculty to teach undergraduate courses. Because of the vast gap between the level of professional work and the elementary nature of undergraduate work–a gap so great that the difference is not only of degree of sophistication but of content–many professors are either reluctant to teach undergraduates or incapable of making the transition.

The combination of the inherent difficulties in teaching economics in a liberal arts college plus the almost total neglect of the undergraduate program in past years has resulted in the precipitous decline in concentrators. The hope of halting that decline lies at the bottom of the Department’s plans to re-design the undergraduate program, which are now under way.

Arthur Smithies, Chairman of the Department, met frequently this summer and again this fall with a Department Committee on Undergraduate Education appointed last spring. Headed by Professor Dunlop, members of the group are Professors Chamberlin, Duesenberry, and Meyer, Assistant Professors Gill and Lefeber, and instructors Baer and Berman.

The results of this increased attention are already apparent in changes made this year in Economics 1 and Junior tutorial, Ec. 98. Historical and topical subjects have gained emphasis at the expense of some of the more theoretical and analytical material, which is now consigned to Sophomore tutorial. In former years economic theory was presented in a historical vaccum without any consideration of the evolution of the economic system from a local medieval subsistence economy to the modern international productive system. The first month of Economics 1 is now devoted to filling this gap. Other changes include an increased emphasis upon the problem of underdeveloped countries and the substitution of a three-week study of the economy of the Soviet Union for the former week’s survey of comparative economic systems.

Along with these changes in content have come those of organization. Gone is the “parade of stars” which formerly masqueraded as lectures. Instead there are now blocs of integrated lectures covering single aspects of the course, for example the series of lectures the first month that Professor Gill gave on economic history. Another long-standing distinguishing trait of the course, its extensive use of teaching fellows, is also on the way out.

The changes are clearly tending to make the course less an introduction into the Department and more a General Education course in the social sciences. The stress, in the attempt to interest the non-concentrator through presentation of historical and topical issues, is now upon political economy rather than upon economics. In a liberal arts college such a solution to the problems affecting the discipline seems to be the most logical and rewarding for an introductory course.

Faced, however, with the task of teaching its concentrators some of the methods and techniques of the economist, the department has moved towards increasing utilization of Sophomore and Junior tutorial for this purpose. The analytic material ejected from Ec. 1 has found refuge in Sophomore tutorial, while Ec. 98 (Junior tutorial) although heavily biased towards the empirical is the only course in the Department offering an overall view of the field.

But there is this year, in addition, an increased amount of attention towards policy questions and topical economic issues in both courses, a reflection of the prevalent belief that meaningful economics on the undergraduate level should relate, as Smithies said, “to the great public issues of the day.” In practice these two elements–the analytical tools and the social framework in which they must fit–still remain divorced in these courses, but at least the attempt is being made to integrate them.

The most perplexing problems facing the Department occur in the area of the middle group courses. To some extent they are aggravated by the Department’s quantative approach to the number of concentrators, with its concern to retain the marginally interested student within the Department. And again the nature of the field, with its disparity between advanced professional techniques and an undergraduate approach, intensifies the problem that confronts many other departments in the College–that of withstanding the polar attractions of pre-professional orientation or of superficiality. Concerning the middle course group area, Dunlop’s committee has only just begun its discussions, but the major alternatives are well known.

There is general agreement, according to Dunlop, that the undergraduate program as part of a liberal arts program should not be a pre-professional training. Disagreement, however, becomes manifest quickly after that statement. Many members of the department, for instance, feel that the best concentrators, the potential future economists, should be allowed to take courses on the graduate level, and indeed should be encouraged to do so. In effect these students would be obtaining a pre-professional training, but the supporters of this proposal feel that this is the only way whereby the interest of the economics-oriented student can be prevented from obstruction by the triviality of normal undergraduate economics courses. At present many undergraduates already take graduate level courses, but the new plan would make a sharper distinction between those who do and do not.

Another group in Department, however, voices the opinion that the College student should not clutter his schedule with pre-professional courses, but rather use his time to study such fields as music, literature, and mathematics. If a student does do graduate work later in economics he will have no trouble picking up whatever advanced analytic tools he needs at that time, while if he does not intend to do so there is no sense in wasting his time with a lot of specialized technique, this bloc maintains.

One proposal, approved by nearly all and sorely needed, is to introduce a greater flexibility into the program through increased use of half-year courses. Presently over half of the seventeen courses offered run from September to June. Many of these, it is admitted, could be pared down to a half-year.

This leads to the proposal for a new type course to replace the far-flung surveys. They would probe smaller areas, but penetrate deeper. Based on the combined desire to attract more students, and the premise that the goal is a more intelligent understanding of the public issues of the past and present, the courses would be designed around the topical approach. Examples would be courses on the corporation, on the economic impact of government activity, the present course on the Soviet Union, a half-year course on underdeveloped countries. In discussing this approach, Dunlop stressed that these would not be “watered down versions of the analytic approach but a new crosscut.” It should be noted that, while not analytical, these courses would still include some quantitative analysis or even simple economic models, but these methods would not become ends or major concerns of the courses.

Another proposal is to set up a core program in the Department. There is, in fact, almost one already. Ec. 141–Money and Banking, Ec. 161–Industrial Organization, and Ec. 181–Industrial Relations, cover the major areas of the field and at least two of them are necessary to handle Generals well. A real core program where all concentrators would progress from one level of the next has many advantages; it provides a common background which the lecturer can assume, gives a common training, and insures that a student will not neglect a vital aspect of the field. But it also has disadvantages, the primary one being the difficulty of handling non-concentrators who have not had this core. Separate sections in a course might be a simple answer here. A more difficult problem is that of time. Ec. 1, 98, and 99 already constitute three-fifths of the required courses. A central core program of another three semesters would aggravate the present lack of flexibility.

For the Economics Department this is a time of discussion, but it must soon reach the hour of decision. Certainly the present situation is not tolerable. By its over-concern with theoretical models and tools, the Department has separated itself from the true materials of a liberal arts education in economics. It should not, however, allow itself to reach the other extreme, in its quest for concentrators, of reducing the content of the courses to a point where an economics student is no more qualified to discuss and solve an issue of political economy than an intelligent government concentrator.

There is little question of the importance of economics today, with its strategic position between the technological productive system and the literary tradition of the social sciences, and with its unique combination of the empirical and theoretical. It remains only to be taught well.