Tag: Hausman

M.I.T. Department of Economics Annual Report by E. Cary Brown, 1975-1976

Post author By Irwin Collier
Post date 2024-04-20
No Comments on M.I.T. Department of Economics Annual Report by E. Cary Brown, 1975-1976

The following annual report of the M.I.T. department of economics was most likely written for the care and feeding of administrators and the members of the department’s visiting committee. This report covers what was my second year of graduate school, so for folks from that time it reads like an annual Holiday newsletter to the family.

_______________________

Department of Economics
1975 – 76

Undergraduate Program

The long-run impact of the past year’s changes in the Institute Requirement in the Humanities, Arts, and Social Sciences is not yet clear. Unquestionably they have increased the Department’s enrollment, but the precise amount is uncertain because simultaneously a major revision was made in the two introductory economics subjects. In the past year enrollments were larger than previously, but smaller than in the transition of the previous year. Nearly 200 of the Class of 1976 concentrated in economics for their Humanities, Arts, and Social Sciences Requirement. Of all students presently enrolled, 327 (primarily juniors and seniors) have elected to concentrate in economics.

Undergraduate majors remain steady in numbers. As in 1974-75, 20 degrees were awarded. In the spring term the Undergraduate Economics Association was reactivated. Its weekly meetings with faculty led to several proposals for revision of the undergraduate program, and several student-faculty socials were organized.

Graduate Program

Enrollment has been remarkably steady in the graduate program. The number of applications for admission was virtually identical to the average of the previous six years. Next year’s entering class of 32 will be slightly larger than average, and will have fewer foreign students and more women, reflecting a shift in the percentage of applications from these groups. Four students from minority groups are expected to be in this class.

Financial support for the graduate student has changed very little over the last several years. We are still fortunate in having from one-third to one-half of the entering students on National Science Foundation Fellowships. For the whole student body, there has been an increase in the support by US foundations (other than NSF) and a decrease in support provided by M.I.T.

The number receiving the Doctor of Philosophy increased somewhat in the past year to 21. For the first time, two American blacks received degrees.* The class fared well in placement, their median salary offer totaling 24 percent above that of 1971. Like the past average, 86 percent went into teaching and 14 percent into non-teaching positions.

*Samuel Myers, Jr. Ph.D. thesis: “A Portfolio Model of Illegal Transfers”, supervised by Robert Solow.
Glenn Loury. Ph.D. thesis: “Essays in the Theory of the Distribution of Income”, supervised by Robert Solow.
See: William Darity Jr. and Arden Kreeger, “The Desegregation of an Elite Economics Department’s PhD Program: Black Americans at MIT“, History of Political Economy 46 (annual suppl.)

The Graduate Economics Association awarded the outstanding teacher in the Department prize to Professor Stanley Fischer.

PUBLIC SERVICE ACTIVITIES

The faculty has always been involved in public service activities tying research to the public interest. In connection with M.I.T.’s participation in the Bicentennial Celebration, Professor Jagdish N. Bhagwati set up a recent conference on the New International Economic Order: Professor Ann F. Friedlaender is planning one for this fall on Air Pollution and Administrative Control. Through the German Marshall Fund, Professor Richard S. Eckaus is organizing a fall conference on economic problems of Portugal. Professor Franco Modigliani arranged a conference through the Bank of Finland on International Monetary Mechanisms.

Various Congressional committees and government agencies have been advised. Professor Peter A. Diamond served on the Consultant Panel on Social Security for the Congressional Research Service. Professors Rudiger Dornbusch and Fischer and Institute Professor Paul A. Samuelson prepared a report for the US Department of Commerce on international financial arrangements. Professor Robert E. Hall was a member of the Advisory Committee on Population Statistics, Bureau of the Census. Professor Jerry A. Hausman served on the Econometrics Advisory Committee to the Federal Energy Administration. Institute Professor Modigliani was a consultant and member of the Committee on Monetary Statistics, Board of Governors of the Federal Reserve System. Institute Professor Samuelson consulted with the Board of Governors of the Federal Reserve System, the US Treasury, and the Congressional Budget Office. Professor Charles A. Myers was a member of the National Manpower Policy Task Force. Institute Professor Robert M. Solow served as Deputy Chairman, Federal Reserve Bank of Boston.

Several faculty members have been involved with the National Academy of Sciences and its related organizations. Professor Eckaus prepared a report, Appropriate Technology for Developing Countries, for the Board on Science and Technology for Developing Countries of the National Academies of Science and Engineering. Professor Franklin M. Fisher served on a National Academy panel on the Effects of Deterrence and Incapacitation; Professor Friedlaender was on the Executive Committee, Assembly of Behavioral and Social Sciences, National Research Council; Institute Professor Modigliani was on the Finance Committee; Institute Professor Samuelson served on the Editorial Board of the Proceedings; and Institute Professor Solow chaired the Steering Committee on Environmental Studies.

Professor Eckaus led an OECD Mission to Portugal that included Professors Lance Taylor and Dornbusch.* Professor Paul L. Joskow was a consultant to OECD in energy. Professor Evsey D. Domar was a member of a delegation of economists sent by the American Economic Association to the Soviet Union. Institute Professor Modigliani, who gave much time to the problems of stabilization in Italy, was a member of the Board of Directors of the Italian Council for Social Sciences.

*Along with several graduate students among whom were Paul Krugman, Andrew Abel and Jeffrey Frankel. Paul Krugman has written a short note about this experience with a picture!

The Brookings Institution Panel for Economic Activity included Professors Dornbusch and Hall, with Institute Professors Modigliani, Samuelson, and Solow as senior advisors to it. Professor Friedlaender served on the examining committee, Graduate Records Examination, Educational Testing Service. Institute Professor Modigliani served on the Committee on Economic Stabilization, Social Science Research Council. Professor Fisher is a member of the Board of Governors of Tel Aviv University. Institute Professor Solow continues as Trustee for the Institute of Advanced Study.

RESEARCH

International topics seem to dominate the research interests of the faculty. Professor Bhagwati, in addition to his work in developing countries and international trade theory, has given attention to a proposal for applying taxation to the brain drain. Professor Eckaus studied the role of financial markets and their regulation and the behavior of income distribution in economic development. Professor Taylor had three major areas of research: the development of nutrition planning models in Pakistan, international food aid and reserve policies, and growth and income distribution in Brazil.

Professor Morris A. Adelman’s continuing research on the world oil market, Professor Joskow’s analysis of the international nuclear energy industry, and Professor Martin L. Weitzman’s examination of OPEC and oil pricing involve applied microeconomics with international implications.

Research in various applied microeconomics areas was responsible for the second largest fraction of faculty effort. Institute Professor Solow continued to research the economics of exhaustible resources, and Professor Weitzman completed his analysis of the optimal development of resource pools. Professor Joskow has explored the future of the electric utility industry and its financing, the future of the US atomic energy industry, and the pattern of energy consumption in the US. He is developing a simulation model of the energy industry, and is reviewing the regulatory activities of government agencies in general and the health care sector in particular. Professor Hausman examined the Project Independence Report and is analyzing the choice of new technologies in energy research.

In the transporation field, Professor Friedlaender surveyed the issues in regulatory policy for railroads and alternative scenarios in federal transporation policy. Professor Jerome Rothenberg examined such problems in urban transportation as pricing policies, demand sensitivity to price, and modeling locational effects. Professor William C. Wheaton considered an optimal pricing and investment policy in highways under a gasoline tax.

Inextricably intertwined with urban transportation are questions of urban location and housing. Professor Rothenberg carried out research in such aspects of this problem as microeconomics of internal migration, supply-demand for housing in multizoned areas, the impact of energy costs on urban location, and the development of a model of housing markets and of metropolitan development and location that can be applied to general policy questions. Professor Wheaton developed an equilibrium model of housing and locational choice based on Boston experience.

Institute Professor Modigliani also conducted research on the housing market, but his interest comes primarily from the side of stabilization policies and similar macroeconomic problems. He also participated in a review after 20 years of his life cycle hypothesis of saving, made monetary policy prescriptions for both the US and Italy, reflected on the description of financial sectors in econometric models, and explored more deeply the application of optimal control to the design of optimal stabilization policies in economic models. Institute Professor Samuelson reviewed the art and science of macromodels over the 50 years of their development. Professor Friedlaender completed a quarterly macromodel of the Massachusetts economy. Professor Hall developed a model to deal with income tax changes and consumption.

Public economics has both macro and micro aspects, both of which are represented in the Department’s research. With Visiting Professor James A. Mirrlees, Professor Diamond theorized about public shadow prices with constant returns to scale, and about the assignment of liability. He also has generalized the Ramsey tax rule and continued his research into an optimal Social Security system. Professor Hausman is reexamining the cost of a negative income tax; Professor Rothenberg analyzed the distributional impact of public service provision; and Professor Wheaton explored intertemporal effects of land taxes, fiscal federalism in practice, and the financial plight of American cities.

Besides such theoretical research, there was significant research of an entirely pure nature. Professor Robert L. Bishop reexamined the measurement of consumer surplus. Professor Fisher extended his exploration of the stability of general equilibrium and of aggregate production functions. Professor Weitzman investigated the welfare significance of national product in a dynamic economy. Professor Hal R. Varian further explored the theory of fairness, non-Walrasian equilibria, and macromodels of unemployment and disequilibrium. Professor Hausman examined the econometric implications of truncated distributions and samples, of probit models, and of simultaneous equation models. In historical research, Professor Domar was concerned with serfdom, while Professor Charles Kindleberger investigated the role of the merchant in nineteenth-century technologic transfer.

Publications

Professor Bhagwati edited Taxing the Brain Drain: A Proposal and Brain Drain and Taxation: Theory and Empirical Analysis, and coauthored Foreign Trade Regimes and Economic Development: India. Professors Dornbusch and Kindleberger published numerous papers on implications of the new international monetary exchange structure for exchange rates, price stability, international trade, and international capital movements. Professor Weitzman continued his study of the Russian economy with a paper on the new Soviet incentive model.

With Visiting Professor of Management Ezio Tarantelli*, Institute Professor Modigliani published Labor Market, Income Distribution and Private Consumption (in Italian) and various papers on stabilization policy in Italy. He also wrote papers on inflation and the housing market and edited New Mortgage Designs for Stable Housing in an Inflationary Environment. Professor Hall’s labor market research resulted in papers on persistence of unemployment, occupational mobility, and taxation of earnings under public assistance. Professor Michael Piore wrote on labor market stratification and the effect on industrial growth of immigration from Puerto Rico to Boston. Professor Fisher had several publications on indexation and adjustment of mortgages to inflationary episodes. In the realm of economic history, Professor Temin published Reckoning with Slavery and Did Monetary Force Cause the Great Depression?

*Ezio Tarantelli was the victim of a Red Brigades’ assassination in 1985.

Institute Professor Samuelson published theoretical papers on factor price equalization and trade pattern reversal. In the realm of pure research, he put out papers on nonlinear and stochastic population analysis, optimal population growth, and the optimal Social Security system implied in a lifecycle growth model. He also brought out the tenth edition of his famous text, Economics: An Introduction Analysis.

FACULTY

Visiting Professor John R. Moroney was here from Tulane University; Visiting Professor Mirrlees came in the spring term from Nuffield College, Oxford University. Regular faculty on leave were Professors Fisher and Joskow in the fall and Professor Weitzman in the spring.

It is a pleasure to report the promotion to Associate Professor of Jerry A. Hausman. A new appointee, Professor Jeffrey E. Harris, with the unusual background of an M.D. and a Ph.D. in economics, will provide long-sought coverage in health economics.

Professor Kindleberger will retire as Ford Professor and become a Senior Lecturer on a half-time basis. Since 1948, when he came as an Associate Professor, Professor Kindleberger has been an effective teacher, scholar, participant in faculty governance, and counselor to governments and the public. He has trained the leading international economists of the next generation; he has produced a dozen books and more than a hundred articles in international trade and finance and in economic history. He epitomizes the highest kind of academician.

Several honors were bestowed on members of the Department. Institute Professor Modigliani will complete his year as President of the American Economic Association. Professor Myers received a Distinguished Alumni award from Pennsylvania State University. Professor Fisher was F.W. Paish Lecturer to the Association of (English) University Teachers of Economics. Institute Professor Solow received a D. Litt. from Warwick University, and Institute Professor Samuelson, a D.Sc. from the University of Rochester.

EDGAR CARY BROWN

Source: MIT Libraries, Institute Archives and Special Collections. MIT Department of Economics Records, Box 1, Folder “Annual Report 1975-6”.

Image Source: Building E52, Alfred P. Sloan Jr. Building, later Morris and Sophie Chang Building

https://mitmuseum.mit.edu/collections/subject/building-e52-alfred-p.-sloan-jr.-building-later-morris-and-sophie-chang-building-52

Tags Adelman, Bhagwati, Bishop, BrownEC, Diamond, Domar, Dornbusch, Eckaus, Fischer, FisherFM, Friedlaender, Hall, HarrisJE, Hausman, Joskow, Kindleberger, Mirrlees, Modigliani, MoroneyJR, Myers, Piore, Rothenberg, Samuelson, Solow, Tarantelli, TaylorLD, Temin, Varian, Weitzman, Wheaton

Economics Programs M.I.T. Undergraduate

M.I.T. Economics department committee (re-)organization. 1976-78

Post author By Irwin Collier
Post date 2022-05-19

During my second year in graduate school at M.I.T. (1975-76), the economics department professors were engaged in a discussion about reforming the administration of their department. At the time I was completely unaware of this discussion that had been provoked by the following memorandum written by then Department Head, Professor E. Cary Brown, based on his experience with the growing overload of administrative chores and responsibilities in a department with the scale of that attained by M.I.T.’s economics department.

Brown’s memo to the faculty is followed by a transcription of a copy of the letter Brown wrote to Robert Solow, who as an administrative reorganization committee member, must have been asked for some further testimony. The entire committee’s (Peter A. Diamond, Stanley Fischer, Jerry Hausman, Paul Joskow, Robert M. Solow) report was completed two months after Brown’s memo. In the same departmental file from the M.I.T. archives, one finds a copy of the actual assignment of administrative responsibilities for the academic year 1977/78.

Many, if not most, of the administrative tasks had been allocated and faithfully executed before this “reorganization”. I know that Evsey Domar had long been covering the placement of new Ph.D.’s and also proudly serving as the departmental representative for library-related affairs. I sense reading these documents that the truly neglected child all along was the undergraduate program for which some arm-twisting was required to achieve equitable burden-sharing among the faculty. But perhaps there were other specific items that had been sore points too. Maybe Brown simply wanted an explicit organization chart to forestall “whataboutism” from the mouths of relatively uncooperative colleagues. But like I wrote above, this was a discussion that was invisible to me (appropriately so) at the time.

Cf. The committee assignments in the Harvard economics department during the 1972-73 academic year.

__________________________

MASSACHUSETTS INSTITUTE OF TECHNOLOGY
DEPARTMENT OF ECONOMICS
CAMBRIDGE, MASSACHUSETTS 02139

March 12, 1976

Economics Department Faculty

Dear [blank]

For some time I have become increasingly dismayed at the increase in the administrative burden in the Department, and now find the present job as Head to be a nearly impossible one. If the job is to be made tolerable, it must have substantial additional faculty support in some form to cut it down to a scope manageable either by me or a successor.

There are two basic ways that this can be achieved: (1) by spreading the administrative activities and responsibilities more widely among the faculty; or (2) placing these tasks on essentially an associate departmental head, whose precise title could take various forms Executive Officer, Academic Officer (e.g., Tony French in Physics), or Associate Head. I personally would favor the Associate Head route, but regard it as an open question subject to further discussion and consideration, and to Administration approval. This new structure should be treated as an experiment, to last no longer than until the next Head is chosen, and to be reconsidered at that time.

My own thinking about the administrative tasks of the Department separates them into four major areas: undergraduate programs, graduate programs, research programs, and personnel and budgeting. While these can be headed by an administrator or by faculty, it seems to me that the first two programs should have formal faculty control regardless of the form the administrative reorganization takes. The graduate program nearly has that form now and largely runs itself, with the exception of a few odds and ends that now lie outside the responsibility of the graduate registration officers. The undergraduate program is a long way from this structure and will require a good deal of imagination, initiative and effort to resuscitate the Undergraduate Economics Association and provide more guidance and support for majors. The research programs (student and faculty) focus more or less clearly under the Committee on Economic Research. Personnel and budgeting are an administrative responsibility. They have involved increasing amounts of time as budgets have tightened, space has tightened, and the search for new faculty has expanded.

The administrative structure is an important matter to the Department. Because it involves departmental administration and the role of the Department Head, it concerns the Administration through Dean Hanham. He has asked me to appoint the following committee to consider these questions of reorganization and to make recommendations: Bob Solow, Peter Diamond, Stan Fischer, Paul Joskow, and Jerry Hausman. Please give your views to members of the committee as soon as you can.

Sincerely,
[signed “Cary”]
E. Cary Brown, Head

ECB/sc

__________________________

Brown to Solow

March 16, 1976

Professor Robert Solow
E52-383

Dear Bob:

I shrink from making organization charts, but the following diagram is intended to give some idea of the orders of magnitude of faculty involvement in departmental chores.

Chairman, Committee on Undergraduate Studies

Faculty counselors (we have agreed with the UEA to keep members to 10 or less, and let faculty build up expertise by staying adviser for freshman, sophomore, junior, or senior year).

—10 faculty: 2 for each class. 4 for seniors

Faculty adviser for humanities concentration in economics (advises and signs up students); also considers the eligibility of economics subjects, what we consider concentration, etc.
Closely related to (2) is possible membership on the so-called Humanities Committee that approves and reviews the whole Humanities, Arts, and Social Science requirement and program. (We have no one on this year but as the largest concentration will surely need to have a presence.)
Approval of transfer of credits from other schools to M.I.T.
Advising with Undergraduate Economic Association in matters academic, professional, social.
Undergraduate placement, while an Institute responsibility, could be supervised and assisted by a faculty member who would keep up to date on summer placement, interning possibilities, salaries. The experience our students have applying to graduate schools, actual jobs offered and taken.
Design of curriculum, cooperative program, etc.
Various activities, such as providing information to undergraduates in their choice of major (Midway in fall, seminar in spring), Open House activities, Alumni activities, etc.
Relations with other Departments at undergraduate level, such as subject offerings, subject content, etc.
Supervision and staffing of undergraduate subjects with multiple sections — 14.001, 14.002, 14.03, 14.04, 14.06, 14.30, 14.31.
Catalog copy.

Chairman, Committee on Graduate Studies

Graduate Registration Officers, so far one each for first two years, and one for thesis writers. Has been suggested that we have an additional adviser for foreign students and minority and women?
Admissions Committee has, in the past, had three members.
Placement, both summer and permanent.
Supervision of core subjects.
Ph.D. and M.S. requirements, program, size.
Financial aid — coordinating various GRO; Admissions Committee, and Budget limitations.
Graduate School Policy Committee meetings.
Annual revision of brochure.
Graduate Economics Association, Black Graduate Economics Association.
Catalog copy.
Various activities — professional and social that are not contained within a particular class.

Chairman, Committee on Economic Research (I faculty)

Organized list of faculty projects requiring research assistants and the supply of them (both graduate and undergraduate). Assignment of R.A.’s.
Assistance in research proposals.
Inventory of internships and off-campus research.
Supervision of unscheduled subjects, such as UROP, Undergraduate Seminar, and thesis.
Supervision of M.I.T. Working Paper Series.
Allocation of computer funds, developing rules, developing alternative sources.

Personnel and Budgeting (Administrative Officer and a large chunk of my time)

Personnel
1. Nonfaculty is supervised by the Administrative Officer.
2. Faculty Personnel

(1) Employment — new Ph.D.’s and senior faculty
(2) Review and promotion
(3) Assignments, leaves, research

1. Postdoctoral personnel
Space allocations, revisions.
Budget Proposals
a. Proposals
b. Implementation

Telephone
Xerox & Ditto
Supplies
Equipment

There may be other matters that I am leaving out – routine meetings average probably a day a week, and things like that. Consultations with faculty, students, and other Departments, would probably add a couple more days.

If there are questions, I’ll oblige, of course.

Sincerely,
E. Cary Brown, Head

ECB/sc

__________________________

MEMORANDUM

May 10, 1976

TO: Department Faculty
FROM: Committee on Reorganization (PAD, SF, JH, PJ, RMS) [Peter A. Diamond, Stanley Fischer, Jerry Hausman, Paul Joskow, Robert M. Solow]

SUBJECT: Reorganization

ECB’s [E. Cary Brown] letter of March 12, which created this committee, starts from the premise that the administrative burden on the Department Head has become essentially impossible. This seems clearly to be the case. It has happened because the department has increased in size and complexity without any corresponding adaptation of its administrative arrangements. Every new function has fallen into the Head’s lap. (Top that, anyone.) Apart from the sheer burden of work thus created, another problem is the difficulty of communications, because that is also time-consuming.

After some palaver and negotiation, we have a reorganizational package to suggest. It rests on two conditions; since it is something of an interconnected web, it will probably unravel if the two conditions can not be met. (1) Since the only way to correct an excessively centralized structure is to decentralize it, we propose to diffuse administrative responsibility more widely through the department; there will be at least one serious administrative post for everyone, or perhaps two minor posts instead, but everyone will have to participate. (2) The administrative load attached to the undergraduate program has increased with the size of the enrollment and the improvement of the curriculum; no one wants to manage an inadequately staffed program. We propose, therefore, that the normal teaching load for everyone in the department be agreed to be half graduate and half undergraduate teaching. This definition should be extended to everyone on the departmental budget: joint appointees, visiting professors, etc. As soon as there are a couple of exceptions to this understanding, there will be more. Then the management of the undergraduate program will break down, and it will revert or default to the Department Head, and that is what we are trying to stave off.

The particular organization we have in mind is as follows.

The central functions (budgeting, space, leaves, relations with the MIT hierarchy, etc.) will be in the hands of the Department Head and an Associate Head namely PAD [Peter A. Diamond]). In addition, one of them (probably ECB [E. Cary Brown]) will be an ex officio member of the Committee on Undergraduate Studies to be proposed below, and the other will be an ex officio member of the Committee on Graduate Studies. The precise division of labor is obviously a matter of taste; for the moment, ECB [E. Cary Brown] will probably do most of the relations with the MIT structure and PAD [Peter A. Diamond] will concentrate on intra-departmental matters.
There will be a Director of Undergraduate Studies (PT [Peter Temin]), who will be chairman of a Committee on Undergraduate Studies (with 2 or 3 additional members, possibly RD [Rudiger Dornbusch], PJ [Paul Joskow] and one other). This committee will be responsible for revisions of the undergraduate curriculum adding and subtracting subjects, staffing them, degree requirements, etc. In recent discussions with the Undergraduate Economics Association, the proposal has merged that there should be a larger number of Undergraduate Advisors (i.e., registration officers) than there is now, with each taking care of at most 10 students. That suggests we would need about 8 such advisors. The members of the Committee might serve as advisors, plus others. Merely serving as registration officer for 10 undergraduates is by itself not an onerous job.
There seems to be no need for change in the organization of graduate studies in the department. We suggest that there be a Director of Graduate Studies (RSE [Richard S. Eckaus]) and a Committee on Graduate Studies which would, as now, consist of the other two Graduate Registration Officers. Things are going very well now with REH [Robert E. Hall] handling the first-year students. MJP [Michael J. Piore] the second-year students and RSE [Richard S. Eckaus] the thesis-writers. REH [Robert E. Hall] is prepared to take on the task or devising a scheme to keep track of post-generals students, and see that they find themselves a reasonable thesis topic in a reasonable amount of time. The scheme may need another person to look after it.
We suggest the creation of Committee on Staffing whose functions would include looking after the hiring of assistant professors, the dovetailing of visiting professors with faculty leaves, and the rationing of visiting scholars. The picture we have is that the members of committee would do the interviewing and preliminary screening of new Ph.D.’s at the annual meetings, and decide which of them to invite to come and give seminars. At that stage and thereafter, the whole department faculty would be in on the act, and final decisions would be made, as they are now, in a department meeting. The main time-consumer for this committee would be the correspondence in connection with hiring. Since that would fall on the Chairman, that post would be a major one. For the other members of the committee, the burden would be relatively light. We suggest REH [Robert E. Hall] as chairman, plus perhaps 3 others.
There seems to be no reason to change the way the Admissions Committee now functions.
We see no need for major change in the Placement process. Our only suggestion are (a) perhaps to provide EDD [Evsey D. Domar] with another person to share the load, and (b) to have a pre-season department meeting, analogous to the post-generals meeting, at which each graduate student entering the market could be discussed by the full facuIty, and information and ideas collected.
There are other details. RLB [Robert L. Bishop] is functioning as advisor to MIT undergraduates thinking about economics as part of their Humanities requirement, and we are happy to preserve that human capital. MAA [Morris A. Adelman] who has been our representative to CGSP is to begin a term on the CEP, which should count as a major administrative burden. We need his successor on CGSP.

One last point: we hope that each committee chairman will promptly send a written notice of each substantive decision to the Head and Associate Head for distribution to the department faculty, so that communications are well looked after. That plus rational expectations should do the trick.

Source: MIT Archives. MIT Department of Economics Records. Box 2, Folder “Department Organization”.

__________________________

DEPARTMENTAL ADMINISTRATIVE RESPONSIBILITIES:
ECONOMICS DEPARTMENT 1977-78

UNDERGRADUATE COMMITTEE

Chairman:	Peter Temin
Members:	Cary Brown	Senior Faculty Counsellor, Ex Officio
	Jerry Rothenberg	Senior Faculty Counsellor
	Peter Temin	Senior Faculty Counsellor
	Rudiger Dornbusch	Junior Faculty Counsellor
	Jeffrey Harris	Junior Faculty Counsellor
	Jagdish Bhagwati	Sophomore Faculty Counsellor (Fall)
	Henry Farber	Sophomore Faculty Counsellor (Spring)

Summer Jobs: Jeffrey Harris
Humanities Adviser: Robert Bishop
Transfer of Credits: Cary Brown

GRADUATE COMMITTEE

Chairman:	Richard Eckaus	Thesis, Graduate Registration Officer
Members:	Paul Joskow/Mike Piore	Second Year Graduate Registration Officer
	Marty Weitzman	First Year Graduate Registration Officer
	Jerome Rothenberg	CGSP Representative
	Stan Fischer, Ex Officio

Admissions Committee:

Chairman: Robert Bishop
Members: Frank Fisher and Lance Taylor

Placement: Evsey Domar
Harvard-MIT Theory Seminar: Eric Maskin
Theory Workshop: Kevin Roberts

OTHER DEPARTMENTAL ACTIVITIES

Staffing Committee: Chairman: Rudiger Dornbusch

(For New Ass’t Profs.) Members:

Paul Joskow
Jerry Hausman
Stan Fischer, Ex Officio
(Added for Temporary Visitors: Robert Solow)

Independent Activity Period: Jeffrey Harris/Marilyn Simon
Unstructured Subjects Committee: Peter Temin, Undergraduate; Richard Eckaus, Graduate
Computer Allocation: Richard Eckaus

ADDENDUM: INSTITUTE COMMITTEES

CEP: Morris Adelman
Associate Chairman of the Faculty: Michael Piore
Visual Arts: Jerry Rothenberg
Library System, Chairman: Evsey Domar

Image Source: For this portrait of members of the M.I.T. economics department in 1975 see the Economics in the Rear-view Mirror post that provides identifications.

Tags Adelman, Bhagwati, Bishop, BrownEC, Diamond, Domar, Dornbusch, Eckaus, Farber, Fischer, FisherFM, HallR, HarrisJE, Hausman, Joskow, Maskin, Piore, RobertsK, Rothenberg, Solow, TaylorLD, Temin, Weitzman

Chicago Funny Business Harvard M.I.T. Princeton

M.I.T. Faculty Skit, Playing Monopoly at Lunch, 1986

Post author By Irwin Collier
Post date 2021-05-14

It has been a while since I have added an artifact to the MIT economics skits wing of the Funny Business Archives here at Economics in the Rear-view Mirror. Apparently the following script was a, if not the sole, late-20th century MIT faculty skit not written by Robert Solow. I can believe that. In any event, today’s post is further grist to the mill for social historians of economics.

Again a grateful tip of the hat to Roger Backhouse is in order.

__________________

1986 FACULTY SKIT

(Skit opens with Dornbusch, Fischer, Diamond, Eckaus and McFadden seated around MONOPOLY board. Farber is standing alongside, watching the game. Fisher and Hausman are in the wings to make walk-on appearances).

ANNOUNCER: One of the most important unwritten rules in the Economics Department is that no one but Bob Solow writes the skit. This year, Bob reportedly outdid himself and wrote a sitcom in which Bob Lucas is struck by a blinding light while driving to work and transformed into a neo-Keynesian. The skit, titled “I’m OK, You’re OK,” follows Lucas’ attempts to explain why he is estimating Phillips curves to Lars Hansen and Tom Sargent.

Unfortunately, Bob is unable to be with us tonight, since he is delivering the presidential address to the Eastern Economic Association in Philadelphia. When we opened the envelope marked “SKIT” which Bob left for us, we were surprised to discover only a copy of his presidential address. We suspect he had a somewhat bigger surprise when he opened his envelope in Philadelphia. [Address published as “What is a Nice Girl Like You Doing in a Place Like This? Macroeconomics after Fifty Years” Eastern Economic Journal, July-September 1986]

We were of course scared skitless when we realized our predicament, and we were tempted to re-run some of the great Solow skits of the past. There was the 1974 Watergate Skit, in which Paul Colson Joskow testifies to Senator Sam Peltzman that he would run over his grandmother to get a t-statistic above two. There was the 1978 Star Wars skit, in which Milton Vader and his minions capture the wookie Jerrybaca and hold him captive in the Chicago Money Workshop. And in the incredible 1973 MASH skit, Hawkeye Hall and Trapper Jerry Hausman find Radar Diamond and Hot Lips Friedlaender cavorting in the Chairman’s office. (If that doesn’t give Solow Rational expectations, what does?)

We guessed that you had all seen these re-runs on late-nite channel 56, however, and therefore decided to try something new and provide a partial answer to the age-old question: What Really Goes On in the Freeman Room at Lunchtime on Wednesdays? We now invite you to join us for a brief look at one of these infamous gatherings…

MCFADDEN: (Rolling dice). “Who owns Oriental Avenue?”

DORNBUSCH: Me. That’s six dollars.

FISCHER: My turn? (Rolls dice). Damn. Inflation tax again; Here’s ten percent of my cash balances. I passed go, didn’t I?

DIAMOND: Uh huh. Here’s $186 dollars.

FISCHER: I should get $200.

DIAMOND: Not since Gramm-Rudman. Everything’s reduced seven percent across the board.

DORNBUSCH: My turn. (Rolling dice). Four. (Reaches over and moves marker).

ECKAUS: No way, Rudi—you just moved six places. No overshooting in this game. (Hands Dornbusch Chance card)

DORNBUSCH: Ah. Go directly to Brazil. Do not return until the day classes start.

HAUSMAN: (Walking in from side of stage) How come you guys are playing MONOPOLY? I thought you usually played RISK…

DIAMOND: Oliver [Hart] took that game home. You know, his contract calls for RISK-sharing…

HAUSMAN: Can you believe the graduate students scheduled the skit party for the Friday before income taxes are due? The only people who’ll come are graduate students and people like theorists who file 1040 EZ’s. (walks off)

(FISHER walks in)

DIAMOND: (Rolling dice). My turn. Oriental again. Six more dollars for Dornbusch.

FISCHER: That’s a pretty profitable property, Rudi.

FISHER: How many times do I have to say it! You can’t possibly tell that from accounting numbers! (Pause). Why don’t we ever play fun games, like Consultant?

ECKAUS: I hear Jorgensen and Griliches play that all the time up at Harvard. Maybe you should give them a call.

FISHER: They’re never around.

DIAMOND: Of course not, Frank—that’s how you play consultant.

(FISHER exits.)

FARBER: Speaking of Harvard, how are we doing on graduate recruitment this year? I heard there was some Princeton scandal.

DIAMOND: The AEA put them on probation for recruiting violations. People could look the other way when they offered prospective students money and cars, but this year Joe Stiglitz promised to write a joint paper with all entering students.

FARBER: They’re really giving out cars?

DIAMOND: Sure. Yugo’s.

FARBER: All I got was a motorcycle…

MCFADDEN: Harvard and Princeton have been dumping all over us. Every prospective student has heard that Jerry Hausman cashed in his Frequent Flyer miles for a 727. And some even know that Marty Weitzman has a Harvard offer.

FISCHER: Well, that offer was certainly no surprise. The Harvard deans read THE SHARE ECONOMY and decided they should hire more workers.

DIAMOND: Still, we’re getting the best students. This morning I signed a Yale undergrad by offering him Solow’s office. I figured Bob can share E52-390 with Krugman, Eckaus, and Farber next year. But what happens when we run out of river-view offices?

FARBER: How’s Harvard doing on recruiting?

ECKAUS: Not too well. They’re on a big kick to look relevant. Mas-Collel’s going nuts—Dean Spence has a new rule that any agent in a theoretical model has to have a proper name. Andreu’s having real problems with his continuum papers…

MCFADDEN: I hear the Kennedy School’s helping their visibility. Have you heard about the new Meese Distinguished Service Medal?

DIAMOND: No. Who’s getting them?

MCFADDEN: Sammy Stewart for Distinguished Relief Pitching,
Martin Feldstein for Distinguished Empirical Work,
Larry Summers for Distinguished Dress,
NASA for distinction in Travel Safety,
Bob Lucas and Bob Barro for Distinguished Plausible Assumptions,
Ferdinand Marcos for Distinguished Contributions to Charity,
and John Kenneth Galbraith for Distinguished Use of Mathematics.

DORNBUSCH: Harvard’s visibility campaign’s paying off. Just last week one of their junior guys hit the cover of PEOPLE magazine with a paper about marriage rates among movie stars.

FISCHER: You read PEOPLE?

FARBER: The National Enquirer had a story about a Harvard student who claimed to have a picture of Jeff Sachs in Littauer. Just like the old days with Howard Hughes…

DORNBUSCH: Perhaps we should return to the game.

(MODIGLIANI walks on).

DIAMOND: My turn again? (Rolls dice and moves piece). Community Chest. (Looking at card) You are elected department head. Lose three turns.

(Someone walks up and hands DIAMOND a telephone message. He stands up.)

DIAMOND: I nearly forgot. I’m scheduled to join Mike Weisbach who is taking a prospective student windsurfing this afternoon. Figured it was the least I could do to convince him we were as laid back as Stanford. Franco—do you want to take my place?

MODIGLIANI: (Sitting down in Diamond’s place) So, what are the new developments on the Monopoly front? [Famous Modigliani paper “New Developments on the Oligopoly Front,” JPE, June 1958] (Pause) Now, which of these pieces is Peter’s?

MCFADDEN: The coconut. [Reference here to Diamond’s coconut model of a search economy.]

MODIGLIANI: My turn now?

FISCHER: No Franco—but go ahead. [presumably a reference to Modigliani’s propensity to talk, and talk, and talk.]

MODIGLIANI: (Rolls dice and moves marker). Chance. (McFadden hands him a card). What is this? You have won second prize in a Beauty Contest, Collect $10? This is NOT POSSIBLE. This year I win only FIRST PRIZES [reference to 1985 Nobel Prize for Economics].

DORNBUSCH: (To audience) Wait till he gets the bequest card… [cf. the JEP Spring 1988 paper by Modigliani that surveys the bequest motive]

FISCHER: Franco, I have a deal for you. I’ll trade you Mediterranean and the Water Works for North Carolina and an agreement that you never charge me rent on either property. If you renege, I’ll order Chinese food.

MODIGLIANI: No deal. But what’s this about Chinese food?

FISCHER: It’s a new thing I learned from Garth [Soloner]—it makes the deal sub-gum perfect.

MCFADDEN: My turn. (Rolls and draws a Chance card). My favorite card: Advance Token to the Railroad with the Highest Logit Probability Value. Let me see which one that is… (pulls out a calculator)

FISCHER: While we’re waiting for Dan to converge, how did we do in junior hiring? Did we get that Princeton theorist?

ECKAUS: No dice. All the Princeton guys told him not to come.

DORNBUSCH: Why?

ECKAUS: They said “Go to Yale, go directly to Yale.”

MODIGLIANI: What about senior appointments?

FARBER: Ask Peter [Temin]. He’s on the Search Committee.

MCFADDEN: (Looking up from calculator). I’m having convergence problems. Maybe we should postpone the game for a few minutes while I run down to the PRIME.

[the image of the last page at my disposal is very blurred, fortunately it is only the wrap-up by the announcer]

ANNOUNCER: As you all know, NOTHING takes a few minutes on the PRIME. So until next year, when the [?] [?] Solow who accompanied Stan, 3PO and R2D2 to [?] the [?] [?] from Chicago returns to produce another skit. Good night.

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

Tags Barro, Diamond, Dornbusch, Eckaus, Farber, Feldstein, Fischer, FisherFM, Friedlaender, Galbraith, Griliches, Hall, HansenL, HartO, Hausman, Jorgensen, Krugman, Mas-Colell, McFadden, Modigliani, Peltzman, Sachs, Saloner, Sargent, Solow, Spence, Stiglitz, SummersL, Temin, Weisbach, Weitzman

Economics Programs M.I.T. Regulations

MIT. Revising Economics Ph.D. General Examinations. E.C.Brown, 1975

Post author By Irwin Collier
Post date 2021-02-12

What makes this memo from E. Cary Brown particularly useful is that it provides us with a list of the graduate economics fields along with the participating faculty members as of 1975. Also the major revision proposed was to have a system of two major fields (satisfied with general examinations) and two minor fields (satisfied by course work). Interesting to note that graduate student input was clearly integrated into the revision procedure.

________________________

Memo from Chairman E. Cary Brown
on a Revision of General Exams, 1975

April 28, 1975

To: Economics Department Faculty and Graduate Students
From: E. C. Brown
Re: Revision of General Examinations

While it has been left that a Committee would be appointed to review the procedures of the general examination (see minutes of the Department Meeting of April 23, 1975), further informal discussion has moved toward a proposed concept of these examinations that I am submitting for consideration and agreement.

There seems reasonable satisfaction about the structure of the present examinations, subject to clarification of the final 2 field examinations and their relationship to the 2 field write-offs.
It is proposed that the 2 fields satisfied by passing the “general” examinations be designated major The examination will be offered in a field, will cover the field in a general way, and will be separated from course examinations. Minor fields will be satisfied by course work. A somewhat lower standard will be imposed in minor fields than in major fields. The “generals” examination, therefore, would apply to the fields of the candidate’s expected expertise, and emphasis would be on a broad coverage of the field.
Each field should, therefore, describe its general requirements for the field as a major one, and list the subjects that may reasonably be offered as a write-off to satisfy the field as a minor one. There should also be some details on the requirements when fields are closely linked (e.g., the proposal for the transportation field and its relationship to urban economics).
Assuming this proposal to be agreeable, the question of term papers still needs settling.

I propose, therefore, the following procedures:

Would each of you give Sue Steenburg a list of your graduate subjects for this academic year, with an indication of whether or not a term paper was required and, if so, the percentage of final grade it represented.
Would faculty in each field submit a list of subjects that may be used to satisfy major and minor requirements in their field as it would ultimately appear in the brochure. The fields to be covered are as follows, the faculty in the field are listed, and the responsible member underlined.

Advanced Economic Theory	Bishop, Diamond, Solow, Fisher, Samuelson, Varian, Hausman, Weitzman
Comparative Economic Systems	Domar, Weitzman
Economic Development	Eckaus, Bhagwati, Taylor
Economic History	Kindleberger, Temin, Domar
Finance	Merton
Fiscal Economics	Diamond, Friedlaender, Rothenberg, Brown
Human Resources and Income Distribution	Thurow, Piore
Industrial Organization	Adelman, Joskow
International Economics	Kindleberger, Bhagwati
Labor Economics	Piore, Myers, Siegel
Monetary Economics	Fischer, Modigliani
Operations Research	Little, Shapiro
Russian Economics	Domar, Weitzman
Statistics and Econometrics	Hall, Hausman, Fisher, Kuh
Transportation	Friedlaender, Wheaton
Urban Economics	Rothenberg, Wheaton

If there are any difficulties with these suggestions, let me know right away. If we can proceed along these lines, it appears to be simply a clarification of our recent past and a substantial timesaver. The reports can be looked at this summer by a student-faculty group, with responsibility for faculty on me and for students on Dick Anderson.

Source: M.I.T. Archives. Department of Economics Records, Box 2, Folder “Grad Curriculum”.

Image with identifications: Economics Faculty group portrait, 1976.

Tags Adelman, Bhagwati, Bishop, BrownEC, Diamond, Domar, Eckaus, FisherFM, Friedlaender, HallR, Hausman, Joskow, Kindleberger, Kuh, MertonRC, Modigliani, Myers, Piore, Rothenberg, Samuelson, Shapiro, Siegel, Solow, Soloway, TaylorFW, Temin, Thurow, Weitzman, Wheaton

Funny Business M.I.T.

M.I.T. Economics faculty MAS*H theme skit. Robert Solow, 1977

Post author By Irwin Collier
Post date 2018-12-03

Dating an undated skit script or assigning skit characters to actual faculty members requires textual analysis skills not taught in economics graduate school. But puzzle solving is, so let’s see what we can do with the following skit written by Robert Solow.

Current events and transitory cohorts of graduate students are our main clues to work with.

The TV-series M*A*S*H began its run of many years in September 1972.
Andrew Abel, Jeff Frankel and Dick Startz, mentioned in the script, all entered the M.I.T. graduate economics program in September 1974, so the earliest they could have been mentioned would have been in the January 1975 show.
David Lilien belonged to the previous year’s cohort so he would have been around in 1975-1977.
I was in that cohort with Messrs. Abel, Frankel, and Startz, and I am honestly surprised that I do not remember this faculty skit at all. However I do remember well that the faculty, as well as our cohort, wrote and performed independent Wizard of Oz skits in 1976. So it appears that either 1975 or 1977 were likely years for the following skit.
Rudiger Dornbusch taught at the University of Chicago Graduate School of Business 1974-75 before coming to M.I.T. in 1975.

Solow’s authorship is firmly established in the prologue to the 1986 faculty skit, where it is written:

“…we were tempted to re-run some of the great Solow skits of the past. There was the 1974 Watergate Skit, in which Paul Colson Joskow testifies to Senator Sam Peltzman that he would run over his grandmother to get a t-statistic above two. There was the 1978 Star Wars skit [a coming attraction here at Economics in the Rear-View Mirror], in which Milton Vader and his minions capture the wookie Jerrybaca and hold him captive in the Chicago Money Workshop. And in the incredible 1973 [sic] MASH skit [below], Hawkeye Hall and Trapper Jerry Hausman find Radar Diamond and Hot Lips Friedlaender cavorting in the Chairman’s office…”

We can see how memory plays tricks even on professors, since there is really no way except in a perfect foresight world that in 1973 Robert Solow would have alluded to members of the cohort of 1974-75.

The Synopsis below was printed on an unattached page and while it clearly leads into the M*A*S*H skit, I somewhat doubt that it was actually recited in performance. The idea of a faculty skit of graduate students trying to write a skit seems undeveloped. Still this synopsis’ characterization of our cohort’s skits as “a series of separate episodes in which they make fun of the idiosyncrasies of the faculty” fits the data well. Thus if forced to choose a single date for the following skit, I would probably go with 1977.

_____________

Synopsis

It is Friday afternoon and the tenth year class still hasn’t thought of a good idea for a skit. A group including Able Andrew [Andrew Abel], Jacob Frankel [Jeffrey Frankel], “Skinny” Lilien [David Lilien], Dick Stops [Dick Startz]…, are meeting in desperation. Finally they decide that the best they can do is to have a series of separate episodes in which they make fun of the idiosyncrasies of the faculty.

Marty Weitzman (Jeff Harris can do this perfectly. He will write his part).
Jerry Hausman. Lecture to be given very fast. Stop after each point and grin.
Frank Fisher. Obvious.
Bob Hall. This character lectures with one toe on top of the other and his arms folded. Then he hops around the room in that position.
Rudi Dornbusch. This depends on being able to do the accent.

And so on. At the end, someone says this isn’t a very good idea after all and a second skit, based on “mash” is tried.

_____________

Announcer: We are about to tell you a heartwarming story that almost nobody knows. It is the story of a devoted, selfless, kind, hardworking people who are yet charming, humorous, sexy, brilliant and lighthearted even while they tend the youthful victims of a heartless bloody War, the famous WOE or War on Error, perhaps more accurately called the War on Other People’s Error or WOOPE. The warm, sympathetic, lovable heroes of this story are the Doctors of the Massachusetts Economics Students Hospital or M.E.S.H.

As the scene opens, we observe the crusty but kindly commanding officer of MESH, Col. Brown [E. Cary Brown], looking at latest casualty lists.

BROWN: (broad smile, laughing, etc.) Able Andrew [Andrew Abel], flunked; Dick Stops [Dick Startz], flunked; Ray Hartman [Raymond S. Hartman], Ray Hartman, flunked, flunked. This is awful, hohoho. Here’s one who lost his Fellowship. Here’s one who lost both his Fellowships. War is hell.

(PAD [Peter Diamond?] comes in and puts sheet of paper on desk)

BROWN: (shouts) Radar.

PAD: Yessir.

BROWN: Where is that new duty roster for next month?

PAD: Just gave it to you, sir.

BROWN: Hmmm, I see Major Samuelson is doing the history of surgical thought. How far does he go?

PAD: Up to Marx’s transplantation problem.

BROWN: I suppose someone’s assigned to each ward: yes, someone for G-1, and for G-2, G-3, M-2, M-3—say how come nobody’s assigned to M-1?

PAD: Demand for M-1 has dropped off a lot lately.

BROWN: Oh, yes, another outbreak of Goldfeld’s Syndrome. How well I remember the first case I ever saw, back at old Fort Sam Brookings in the old days. Why, boy, they had real cash balances in the Regular Army.

(Enter Hawkeye Hall [Robert Hall] and Trapper Jerry [Jerry Hausman].)

PAD: Hi Hawk, Hi Trapper. What’s up?

HH: Up, down, what difference does it make. It’s all a random walk anyway. I’ve got kids out there dying of underconsumption and all I can tell them is that their consumption is way below trend, but there’s no reason to expect it ever to get back to trend. Properly discounted, they’re already dead.

BROWN: Couldn’t you just amputate a bit of the life cycle—maybe they’re just suffering from Modigliani’s Disease—you know the symptoms, compulsive talking, recurrent forecasting errors, complete absence of bequests—why I remember back at old Fort Sam Brookings…

HH: Modigliani’s Disease? There’s no such thing. That stuff all went out with, with, with econometrics. Nowadays it’s all up down up down. Well, maybe a totally unexpected amputation might work. But only once. No, it’s hard telling those innocent soldiers that everything they were taught up until yesterday, even by me, is all wrong.

TJ: I think the smart ones realize that tomorrow it will appear that what we’re telling them today is wrong too. That’s rational expectations for you. Once you get on it’s hard to get off. I hear that over at the Illinois Economics Graduates Hospital or IEGH the surgeons have stopped doing econometric operations altogether. They’d rather let everybody die at the natural rate. One of our enlisted men, Olivier Lawrence [Olivier Blanchard?], is supposed to have suggested that at least time was an exogenous variable, so maybe you could do a few econometric operations. But Major Lucas [Robert Lucas], the executive surgeon at IECH, told him that only the deviations of time from trend can possibly matter and that’s…

PAD: Up down up down….

TJ: Thanks, Radar. According to Lucas’s method of surgery, all coefficients are either zero or one—dealer’s choice.

(Enter HotLips [Anne Friedlander] and Major Frank [Frank Fisher])

HL: Colonel, I’d like to have this crumb courtmartialed. He almost killed one of our students by disconnecting the MPS transfusion from the main computer. He said that if anyone ever put the peripheral equipment and the main-frame in the same market, he’d never be able to go near Yorktown Heights again. Hark! Do I hear a chopper?

PAD: No, Major HotLips it’s just one of the students with Modigliani’s disease.

HL: Radar, just stay in the supply room and out of the women’s shower.

HH and TJ: Up down up down.

HL: Colonel you’ve got to do something about these clods. And as for Frank here, when I think…what did I ever see in him?

F: Well, I’m a little hard not to see. But I’ll get even with you all. I got out of econometric surgery while there were still exogenous variables. Anti-anti-trust is where the money is now. You’ll regret your temper, HotLips. When these creeps are starving and broke, unemployed econometric surgeons, doing illegal surprise amputations for peanuts, I will be dancing in Yorktown Heights, testifying in the fifty-third year of the IBM case, on one side or the other. Colonel, if you can’t have some discipline in this MESH, I’m going to file a complaint with Judge Edelstein.

BROWN: I think I’ll apply for reassignment to old Fort Sam Brookings.

(Enter Corporal Klingenbusch, dressed in his usual.)

TJ: Gorgeous outfit you’ve got there Klingenbusch [Rudiger Dornbusch?].

K: Victory at last. I’ll be in old Fort Sam Brookings before you. It worked. At last I get to leave this nut house. I’ve been discharged. I’m going home to Japan.

HH: How did you work it Klingenbusch?

K: Easy. I didn’t satisfy the transvestality condition.

ANNOUNCER: And so we leave the dedicated Doctors of MESH. Perhaps you are wondering why none of the beloved students, for whom MESH lives and breathes, actually appeared in this story. The reason is simple and typical, not to say rationally expected. There was no space.

[Handwritten note at the end of the typed text:]

J. Harris (appears): My name is Jeff Harris. I am a chest-cutter by profession. This is the most ridiculous hospital I have ever seen. It makes the University of Pennsylvania look like heaven. I wouldn’t trust these people to do veterinary surgery although, in fact, I think some of them may be veterinarians, at best.

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

Image Source: Robert Solow in his office, MIT Museum Website.

Tags Abel, BrownEC, Diamond, Hall, Hartman, Hausman, Solow, Startz

Funny Business M.I.T.

M.I.T. “The Greatest Faculty Skit Ever Written”, ca. 1974

Post author By Irwin Collier
Post date 2018-10-15

The following faculty skit comes from the M.I.T. department of economics when memories of the Senate Watergate Hearings (summer of 1973) were still very fresh in everyone’s memories. This skit was likely presented at the 1973-74 annual skit party. Frederick Mishkin received his B.S. in 1973 from M.I.T. and his first year as a graduate student at M.I.T. was in 1973-74. Other graduate students named were either second year or thesis-writers.

I presume “E. Hausman Hunt” was a blend of the names of the MIT econometrician Jerry Hausman and the Watergate conspirator E. Howard Hunt.

“Bob Dean” was likely a blend of the names of Robert Hall (who taught the course 14.123) and Nixon’s special counsel John Dean (wife’s name Maureen).

“Paul Colson” might have been a blend of the names of Paul Joskow and Charles Colson, Nixon’s man for “dirty tricks” and who claimed he would have walked over his own grandmother to get Nixon reelected.

“F.” would appear with the remark about not understanding “goyim” to have been Frank Fisher.

Roger Backhouse graciously made his copy of this skit available for transcription. I have corrected many typos in the original text. If I ever identify the author, I shall update this post.

__________________

The Greatest Faculty Skit Ever Written
(in 1 hour, 15 minutes)

F. This here meeting will now come to order. Let the minutes show that this is the 732^ndmeeting of the Special Subcommittee of the Econometrics [sic] Society investigating the notorious Westgate affair.

M₁: Mr. Chairman, a point of personal privilege—

F. Yes, Mr. Solow.

M₂: I’ve been out of town testifying for IBM in Tulsa for the last 7 months. Could you fill me in on what’s been happening?

F. On the night of June 20, 1972 several graduate students were apprehended breaking into Gary Becker’s office. It appeared that these students were after Prof. Becker’s manuscript on a theory of marriage. Several pieces of evidence point [to] the fact that these students were after Prof. Becker’s manuscript on a theory of marriage. Several pieces of evidence point [to] the fact that a well known Eastern economist (with initials PAS) may have funded this break-in for as yet unknown reasons. This committee has been called to investigate this matter.

M₁Thank you Mr. Chairman.

F. Will the first witness step forward to testify?
Please state your name.

EHH E. Hausman Hunt.

F. What have you been doing for [the] last 3 months?

EHH. I’ve spent the last 3 months in Charles St. Jail polishing up my lecturing technique. If I could only speak a little faster during my lecture, just think how much more material I could cover.

F. Is it true that you were in charge of organizing the burglary of Becker’s office?

EHH. Yes; I used several graduate students from MIT: my first choices were Rick Kasten and Roger Gordon but we had to reject them since we were afraid they were too talkative. However I finally settled on Rick Mishkin and Glenn Loury; Mishkin because he was so calm and organized; and Louryto comply with equal opportunities satisfy HEW.

F. Is it true that you write econometrics papers under a pseudonym?

EHH. Yes, I’ve just produced my 43^rdpaper on the identification problem using the pseudonym “Franklin M. Fisher”

F. Well, I may be an old country bullfrog, but…
Next witness, please

(BH steps forward; Maureen sits in his lap; F. gives the eyebrows to the audience)

F. State your name, rank.

BD. I’m Bob Dean, special assistant professor.

F. And whom do you assist?

BD. Prof. Paul Anthony Samuelson, BA, PhD, L.H.D, L.L.D, Litt.D. (hon), LSD.

F. Can you describe briefly your part in the Westgate affair?

BD. Prof Samuelson was working on a theory of marriage at the same time as Prof. Becker. He had just succeeded in developing the formal first order conditions for the optimal marriage (using the LeChatelier principle) when he discovered Prof Becker’s work. He asked me to arrange for him to get a look at Prof. Becker’s manuscript.

F. Isn’t it true that you got married on or about this same period?

BD. Yes, that was also part of Prof Samuelson’s theory of marriage. He had also arranged for an empirical part of this work; after deriving the first order conditions, he hired a computer programmer to search for the optimal marriage in the department. Maureen and I were chosen. Pressured by Samuelson we agreed to get married.

F. How did you afford your honeymoon on an assistant prof’s salary?

BD. I borrowed some money from a departmental slush fund.

F. What is the source of this slush fund?

BD. It was accumulated for the sale of lecture notes from 14.123; why else do you think we sell those notes?

F. (eyebrows) I see. When did you again meet with Prof Samuelson?

BD. March 21, 1973;

F. What happened at that meeting?

BD. We received instructions from Prof. Samuelson on how to behave on our honeymoon. We asked Prof. Samuelson if it would be OK if our marginal utilities were not equalized; he said that “it would be wrong.”

F. Why was Prof Samuelson taking such an interest in your honeymoon?

BD. He wanted to be sure that his theory involved only “empirically refutable propositions”. He was also worried that we might behave too formally.

F. I don’t think I’ll ever understand you goyim.

F. Next witness. Please state your name.

PC. Paul Colson.

F. For what purpose were you hired by Prof Samuelson?

PC. I was supposed to ghost write the empirical part of the paper.

F. It says here (looking at notes) that you are one of the most dedicated of the applied econometricians?

PC. Yes, I’d run over my own grandmother to get a t-statistic greater than 2.

F. What were Prof. Samuelson’s instructions?

PC. As you know, Prof Samuelson was worried that Bob and Maureen Dean might be too formal on their honeymoon; I was sent along to collect data on their performance.

F. What happened? (eyebrows)

PC. As I peered into their motel room, I saw Bob come out of the bathroom dressed in pajamas and say to Maureen: I offer my honor. Maureen came out in her nightgown and replied I honor your offer.

F. (eyebrows) What happened next?

PC. From then on it was just honor and offer all night.

F. What went wrong?

PC. We forgot to check the second-order conditions and it was only a saddle point.

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

Image Source: Photo from U.S. Senate Watergate hearings. From left to right: minority counsel Fred Thompson, ranking member Howard Baker, and chair Sam Ervin of the Senate Watergate Committee.

Tags Becker, FisherFM, GordonRJ, Hall, Hausman, Joskow, Loury, Mishkin, Samuelson, Solow

Economists Funny Business M.I.T.

M.I.T. Analysis in Wonderland. Graduate Student Skit, 1975

Post author By Irwin Collier
Post date 2017-09-02

The annual skit party was a huge social event in the economics department at MIT in the 1970s and presumably before and after. Each of the cohorts was expected to write and perform its own skit in which economics and economics professors were the principal targets. Faculty written skits were often a part of the festivities. Here in this posting for the historical record, a parody of Alice in Wonderland set in the Wonderland Institute of Technology in 1975 written by the first-year class of 1974-75. But first I provide a list of my classmates with links to some biographical information where I was able to find something…whatever happened to Paul Krugman? Not everybody participated in the preparation and performance so there remains a presumption of comic innocence for the majority of the following.

In 1978 many of this cohort were involved in Casablank, a parody of the movie Casablanca. That script has been transcribed and posted at the highlighted link.

__________________

First Year Economics Graduate Students, 1974-75
M.I.T. (Spring 1975)

Abel, Andrew B.
Aspe, Pedro A.
Begg, David K. H.
Beleza, Luis Miguel C. P.
Bookstaber, Richard M.
Collier, Irwin L., Jr.
Datcher, Linda P.
Daula, Thomas V.
Desormeaux, Jorge J.
Donnelly, John F.
Duarte, Virgulino
Klorza, Santiago C.
Feiger, Margaret C.
Frankel, Jeffrey A.
Geehan, Randall R.
Giavazzi, Francesco
Halpern, Janice D.[sic, H.?]
Helms, L. Jay
Hill, Raymond D.
Krasker, William S.
Krugman, Paul R.
Malveaux, Julianne M.
Mincy, Ronald B.
Mooney, Patricia D.
Mork, Knut A.
Nagatani, Hiroaki
Neuer, Margaret R.
Smith, David A. [Alton]
Startz, Richard
Winicker, Mary K.

Source: M.I.T. Archives. MIT Department of Economics Records, Box 1, Folder “Women & Minorities”.

__________________

While transcribing this skit from my own days as a graduate student, I discovered how much I had indeed forgotten. The mapping of many a character to the corresponding faculty member was no longer obvious to me. I have added a listing of Dramatis Personae with annotations based on the combined incomplete memories of myself, Jeff Frankel, Dick Startz, Andy Abel, Ray Hill and Jay Helms. Perhaps some long-lost member of the troupe will stumble across this page and help me fill in the blanks, especially with respect to casting (20 characters!).

______________________

ANALYSIS IN WONDERLAND

Composed and performed by the first-year economics graduate students at M.I.T.
Second term, 1974-75

DRAMATIS PERSONAE

Narrator: played by Richard Bookstaber
Alice (Representative Graduate Student): played by Margaret (née Agnew) Feiger
Advisor (presumably the actual first-year advisor, Peter Diamond): actor unknown
Cheshire Cat (Jagdish Bhagwati): actor unknown
Micro: (Hal Varian?): actor unknown
Macro: (Stanley Fischer?): actor unknown
Quick & Dirty (Martin Weitzman): actor unknown
Palmer (Palmer, an actual Sloan School graduate student): actor unknown
Dormouse (Evsey Domar?): actor unknown
Mad Hatter (Charles Kindleberger): played by Jeffrey Frankel
March Hare (Robert Engle?): actor unknown
Tweedledee (Jerry Hausman): possibly played by Jay Helms
Tweedledum (Robert Hall): possibly played by Bud Collier
Knave of Hearts (Franco Modigliani): actor unknown
Knave of Clubs (Arthur Burns): actor unknown
Knave of Spades (William McChesney Martin): actor unknown
Knave Alan (Allan Greenspan): actor unknown
King (President Gerald Ford): actor unknown
Joker (Paul Samuelson): possibly played by Ray Hill
White Rabbit (Robert Bishop?): actor unknown

ACT I

Narrator:	The first year class presents… Analysis in Wonderland, a tragicomedy in four unnatural acts. Any resemblance to faculty members living or otherwise should be inferred from the initials worn by the characters. Act I, Alice enters Wonderland and meets the Cheshire cat.
(Alice is sitting at a table reading Samuelson’s Economics.)
Narrator:	One day Alice was reading a book, but she was getting very bored, for the book had no conversations or jokes in it.
Alice:	And what is the use of a book without conversations or jokes?
Narrator:	And so she began to drift off. And eventually she noticed that there was someone on the other side of the desk…
Advisor:	Hi! Welcome to the Wonderland Institute of Technology. You must be a first year graduate student. I’m your first year advisor, and it’s my job to talk to you and give you a feeling that someone cares about you personally. Now, let me see your schedule (grabs book). Well, uh, (looks at book then says with emphasis) Paul, this schedule looks fine to me (signs it) and remember to turn in your roll cards on the first day of each class. (Through all this Alice keeps going “uh” and “but”…but can’t manage to say anything) Remember that if you have any questions or problems, just come in and talk to me, I have plenty of time. Excuse me! (The advisor gets up and runs out. Alice runs after, then comes back)
Alice:	What a strange place! But where should I go from here? Why there’s a Cheshire Cat. (Enter Cheshire cat) Excuse me, sir, but can you tell me where I ought to go from here?
Cheshire Cat:	Why, I’m wery [sic] glad you asked me that. You should go to the optimal point, of course.
Alice:	But how long will that take me?
Cheshire Cat:	I can’t tell you that, listen to this. (Turns on radio, which produces static. Turns it off.) You see! Our economic theories are all static.
Alice:	I would like to see some faculty.
Cheshire Cat:	Well, you could go to Harward [sic], but it’s wery rare that anyone sees any faculty there. Or you could stay here, but everyone here has completely lost their faculties. They’re all mad, you know.
Alice:	But I don’t want to go among mad people.
Cheshire Cat:	Oh, you can’t help that; we’re all mad here. I’m mad. You’re mad.
Alice:	How do you know I’m mad?
Cheshire Cat:	Well, a physicist’s not mad, you grant that? Now, a physicist starts with facts and tries to find theories that fit them. I start with theories and don’t bother with facts. Therefore I’m mad. Yes?
Alice:	But what are your theories about?
Cheshire Cat:	Do they have to be about anything?
Alice:	Well, I’ve often seen a subject without a theory, but a theory without a subject? It’s the most curious thing I ever saw in all my life! (Alice suddenly starts)
Cheshire Cat:	Don’t worry, it’s just the inwisible hand.
(Enter two characters with paper hats (?) on which are cross diagrams. One has a potato chip taped to his shoulder.)
Cheshire Cat:	They’re Mike and Mac Ro
Micro:	Someone must stop him! It’s shameful! Look at that silly diagram he’s wearing! It’s a disgrace to the profession.
Macro:	It’s a perfectly good diagram. Not like that ridiculous diagram you’re wearing!
Alice:	But the diagrams look just the same.
Cheshire Cat:	Shhh! You’ll only get them more upset.
Alice:	Why don’t you try to talk your differences over?
Micro:	Well, we microeconomists believe in logic, so I’m willing to reason it out.
Macro:	You can’t expect me to be reasonable. Can’t you see I’ve got a chip on my shoulder?
Alice:	Why, yes—it’s a potato chip in fact.
Macro:	I wear it in honor of our founder, Cain’s. So prepare to defend yourself.
Micro:	I warn you, I’m a master of the Marshallian arts.
Macro:	But I’m armed with the most deadly tool of macroeconomics: (pulls out several pairs of pliers)…Multi-pliers!
Micro:	And I have the most dangerous concept of microeconomics. (pulls out a slingshot) Elasticity!
Alice:	Oh no, they’re going to have a duel and micro is a semi-strict under dog! (Mike and Mac turn back to back) (enter panting, the Quick and Dirty banker, carrying a money bag and a calculator)
Q&D:	Wait! You can’t have a duel without a primal.
Alice:	Who are you?
Q&D:	I’m duh quick and doity bankuh. And by my quick and doity bankuh’s calculation, I find dat what you need is more liquidity which I will now provide. (out of the moneybag he pulls a waterpistol, shoots everyone, then runs)
Macro:	Now we’re all wet. What are we going to do?
Alice:	It’s all right, I know just what to do. Here’s the driest thing I know. (begins reading from Bishop [notes])
Micro:	This isn’t getting me dry at all.
Macro:	Now there’s only one way to get dry, and this will prove to you that macroeconomics is good for something.
Alice:	What are you going to do?
Macro:	I’m going to do some hand-waving! Macroeconomists are always drying things out by waving their hands.
Alice:	They are?
Macro:	Of course! That’s why none of their theories will hold water. Now, watch this! (He begins to draw a diagram)
Alice:	What do those lines mean?
Macro:	Oh, I don’t know. But they’re pretty good lines, and Lord knows I have the right to a few good lines in this ridiculous skit.
Palmer:	Haven’t you got the A line drawn wrong?
Macro:	(Going very fast) Well, that line doesn’t really matter. (erases it)
Palmer:	But then shouldn’t you erase the k line, too?
Macro:	Well, all right (erases).
Palmer:	What do X and Y stand for?
Macro:	Oh, don’t worry about the axes (erases them). Actually, these are not quite like this anyway. (erases remaining lines) And, as you can see, equilibrium is at the intersection.
Alice:	Well, I’ve often seen lines without an intersection, but an intersection without lines? It’s the most curious thing I ever saw in my whole life.
Narrator:	You’re repeating yourself, Alice.
Alice:	What do you expect, Mel Brooks?
Micro:	You think that’s hand-waving! Why, I have seen hand-waving, compared with which that is no better than eternal bliss.
Alice:	But what is better than eternal bliss?
Micro:	Well, a ham sandwich, for instance.
Alice:	But nothing’s better than eternal bliss.
Micro:	And a ham sandwich is better than nothing. So, by transitivity, there you are!
Alice:	(ignoring Micro as she turns to the Cheshire Cat) Isn’t there anyone here who isn’t mad?
Cheshire Cat:	You might try an assistant professor.
Alice:	Which one should I try?
Cheshire Cat:	It doesn’t matter—pick one at random.
Alice:	How do I do that?
Cheshire Cat:	Just draw one from an assistant professor urn.
Alice:	What’s an assistant professor urn?
Micro, Macro, Cheshire Cat, Narrator (in unison)	About eleven thousand a year!
(pause)
Narrator:	…and a copy of Bishop’s notes.
Alice:	Curiouser and curiouser.
(exeunt all)

ACT II

Narrator:

Act II. The Mad Boston Tea Party

(Dormouse sleeps throughout. Mad Hatter stuttering throughout; price keeps going up on hat.)

Mad Hatter:

What’s your liquidity preference my dear?

Alice:

It looks like you have nothing but tea.

Mad Hatter:

That is all we have.

Alice:

Then why did you ask?

Mad Hatter:

Consumer sovereignty. (gives Alice tea) I would like to suggest to you that that will be eight pence (takes shilling from Alice.)

Alice:

No cover charge?

Mad Hatter:

A gentleman never takes cover, as we say in the old country.

Alice:

Hey, I gave you a shilling and you only gave me two pence change back!

Mad Hatter:

A gentleman never counts his change.

Hare:

Gentleperson!

Alice:

This sounds like a liquidity trap to me.

Mad Hatter:

Alright, I’ll put it down on the T-account…(gets book)

Alice:

There is something floating in my tea.

March Hare:

(looking) Exchange rates.

Mad Hatter:

… two pence… (fiddling with T-accounts)

Alice:

No it’s ice.

Mad Hatter:

…under frozen assets.

Hare:

Gary Becker! (general laughter)

Mad Hatter:

Why is the Poisson distribution like a temperature of 102?

Alice:

Well, let’s see… I suppose you would have to integrate e to the…

Mad Hatter:

Integration! They only do that in South Boston.

March Hare:

No, that’s disintegration.

Alice:

I suppose you have to differentiate between…

Mad Hatter:

Differentiate? The first derivative is the last refuge of a scoundrel.

Alice:

I give up, why is the Poisson distribution like a temperature of 102?

Mad Hatter:

I haven’t the slightest idea.

Alice:

That’s not very funny.

Mad Hatter:

Funny?

March Hare:

She wants to hear a joke.

Mad Hatter:

A joke, a joke!

March Hare:

…Fogel and Engerman! (general laughter)

Alice:

I’m afraid I don’t get it.

Mad Hatter:

Well, you see, certain names are standing jokes around here, like…Walt Whitman Rostow! (laughter)

Alice:

Can I try one?

Mad Hatter:

Go right ahead.

Alice:

Milton Friedman! (silence among the actors who look sour a moment after the audience’s laughter dies down.)

Mad Hatter:

Try another one.

Alice:

Jay Forrester….(more silence).

Alice:

I don’t understand. What’s wrong?

Mad Hatter:

Well, some people just can’t tell a joke.

March Hare:

Perhaps you’d like to see a proof?

Mad Hatter:

A proof! A proof!

March Hare:

This is a proof I recited before the Queen of Hearts. (goes to board)

Twiddle Twiddle lambda star
Alpha hat, beta hat times X bar.
Alpha hat, beta hat sigma X_i

One over n, equals mean of Y.

[writes on board:]:
$\begin{array}{l}\mathop{{\tilde{\tilde{\lambda }}}}^{*}=\hat{\alpha }+\hat{\beta }\cdot \bar{X}\\=\hat{\alpha }+\hat{\beta }\cdot \sum{{{X}_{i}}}\left( \frac{1}{n} \right)=\bar{Y}\end{array}$

Mad Hatter:

Time to move on to the next place.
(everybody gets up to move)

Alice:

What?! You mean you just move on to the next place without erasing?

March Hare:

We don’t have to erase; we just relabel the axes.

Mad Hatter:

I always erase twice, once before the period and once afterward. (erases)

(everyone moves down one, and relabels axes and curve)

Alice:

And I suppose when you use up all the places you just start again at the beginning of the circle?

Mad Hatter:

Yes. It’s called recycling.

March Hare:

You better wake up the Dormouse.

(Mad Hatter and March Hare exit)

Alice:

(To Dormouse) Wake up, wake up. (shakes him)

Dormouse:

(waking) Whaaaaat?

Alice:

Wake up. It’s over.

Dormouse:

(Pause…) Can I Xerox your notes?

Alice:

(starts to leave. turns and says) Why is a Poisson distribution like a temperature of 102? (Pause. Alice exits)

Dormouse:

(alone) Because it’s not normal.

ACT III

Narrator:	Act III. Alice meets Tweedledum and Tweedledee, who have a battle.
(Alice enters and sits down. Dum and Dee enter, arm-in-arm, prancing. Dee sits down; Dum goes to the board and begins. Throughout, Dee is frantic, pacing, and talking very fast. Dum is red-faced, slow-talking, constantly looking at the floor; arms folded, with noticeably short pants and a turtleneck.)
Dum:	So, to conclude yesterday’s talk, we can see that it’s entirely possible that for the two sub-groups, say, men and women, you could have different parameters in the regression…
Dee:	(jumping up to interrupt) I think I can draw a picture that will make that all clear. Wish I had my colored chalk… [draws pictures].

	…so you see that while the slope in the pooled regression is zero, contrariwise; it’s actually negative for men and positive for women.
Dum:	…Sort of, different slopes for different folks, which tells us…
Dee:	[interrupting] …and contrariwise, I can clear this up by drawing a picture that would show…[draws picture]

Dum:	[interrupting]…that there could be kinky behavior in some subgroups….
Dee:	Right. (sits down)
Dum:	But, as I was going to say, this illustrates the 287^th “Iron Law” of econometrics, which states that….
Dee:	(again jumping up to interrupt)…Contrariwise,…I think I can make that clear with a picture in four dimensions. Damn, I just wish I had my colored chalk…(draws pictures)

	…which shows that…
Dum:	(getting very irritated, interrupting) Nohow! The time has come, the Walras said to talk of many things, of matrices and error terms of cabbages and kings, and keeping out your pictures that keep complicating things.
Dee:	Contrariwise! In my way of showing things I’m better far than you, Your talk is like an old dead horse– It’s slow, not unlike glue.
Dum:	Now wait a second…
(Dum and Dee break into a general dispute, yelling at one another.)
Dum:	….you’re not consistent…
Dee:	…you’re almost surely driving me to the p-limit…
Dum:	…you’re a homoscedastic deviate…
(While Tweeledum and Tweedledee continue arguing, the Narrator breaks in…)
Narrator:	So Tweedledum and Tweedledee Agreed to have a fight For Tweedledum said Tweedledee Couldn’t prove Gauss-Markov right.
Dum:	Of course we must have a fight. What time is it?
Dee:	10:40—We’re late getting started, so we better hurry up.
Dum:	Let’s fight ‘till noon, then have lunch.
Narrator:	So they agreed to fight and, as Alice watched, they began to see who could prove the theorem better.
(Dum and Dee give lectures simultaneously, beginning and ending at the same time with the same words.)
Dee:	[simultaneously with Dum] I CLAIM THAT OLS IS BLUE. Basically, we want to prove that ${{\sum{\left( \mathbf{{X}'Y} \right)}}^{-1}}\mathbf{{Z}'}\beta \le {{\sum{\left( \mathbf{{X}'\tilde{Y}} \right)}}^{-1}}\mathbf{{Z}'}\gamma$ Now just take the inverse of the antilog of the Jacobian and delete the fourth row. Let little x be the square root of big X, and let medium-sized x be measured from its mean; substitute back in and we have ${{\sum{\left( \mathbf{{X}'}\left[ \begin{matrix} \mathbf{Y} \\ \mathbf{Z} \\ \end{matrix} \right] \right)}}^{-1}}{\left\| J \right\|\cdot \Pi \cdot {{R}^{2}}}/{\text{hat size}}\;$ which you will recall from 14.381. Then, as I promised, you can use this by transposing Z and x, deleting R and reversing the inequality…..OH SHIT…I’ve screwed up…Well, just change every medium-sized x in your notes to big X, delete all sigmas, and reverse the third and fourth steps of the proof I gave last week which was right here on the board. Or look in Tahl’s [Theil with an West Virginian accent] book. Everyone should understand this perfectly—and of course the notation is clear. Then, adding the obvious steps we learned in 14.381 to this proof completes the argument. SO OLS IS BLUE, as promised.
Dum:	[simultaneously with Dum] I CLAIM THAT OLS IS BLUE. Well….a lot of people go around proving the Gauss-Markov….Theorem….but the literature is full of cases….where what’s done is wrong….Take matrix addition for example….Some people just add element-by-element….while often the more interesting thing to do…..is to use the Choleski factorization of one of the matrices….And recalling that Tweedledum and I are the final arbiters of econometrics at W.I.T. (at least until Fisher gets back off leave) you’d better do it this way, or consider dropping the course. SO OLS IS BLUE, as promised.
Palmer:	Shouldn’t you invert that Jacobian before proceeding to expansion in Lambert spaces….
Dee:	[interrupting] If it was so, it might be; If it WERE so, it could be; But as it isn’t, it ain’t. That’s logic.
Narrator:	Alice couldn’t figure out just who had won the fight, although Tweedledee HAD used a lot more words….
[exeunt]

ACT IV

Tweedledee:	Act Four, “The trahl”.
Narrator:	Within a few moments Alice will witness the trial of the Knave of Hearts who is in deep trouble now because the King of Hearts is flying all the way from the Capital of Wonderland to preside at the trial. You are undoubtedly familiar with the Knave of Hearts most important contribution to economic analysis, “A Life-Cycle Built for Two”. But now he has been accused of starting the latest Wonderland inflation and depression—or as they say in the seminar rooms down by the River Chuck—“inflession”. The economic experts of the King—Knave Arthur of Clubs, Knave William of Spades, and Knave Alan of Diamonds—have all convinced him that economic voodoo has been practiced on models on the Wonderland economy in the hallowed halls of W.I.T. Since the King of Hearts has never played with a full-deck in his life, he was easily deceived by these rascals. Fortunately for the Knave of Hearts the Queen was unable to come to the trial due to a prior speaking engagement before the Veterans of Foreign Business Cycles.
	(Enter Knaves of C.S. &D. They play “Hail to the Chief” on kazoos for a few bars and end with “Pop goes the weasel.” Then the King enters wearing a helmet and carrying a football. A WIN button is conspicuous. King bends over, hikes the ball to Knave of Clubs. King sits down on throne in middle of stage.)
Knave of Clubs.	Where’s the jury?
King of Hearts.	(points at the Knaves) You. (Knaves turn around but no one is behind them. King continues…) Yes, you. You are his peers. And for a proper trial before we cut off his grant, we must have a jury of his peers.
Knight of Diamonds.	(tossing a coin à la [George] Rath) We know what to do.
	(Enter all the other characters from Wonderland, except Joker and reporters)
King:	What are the charges?
Knave of Clubs:	Eleven dollars a barrel.
White Rabbit:	The King of Hearts, he has no smartz But Unemployment yes. The Knave of Hearts has played his part To make inflation worse.
Knaves in the jury-box:	Boo, Hiss, Boo!
King:	It is a pretty despicable offense isn’t it?
Knave of Spades:	Are you kidding? The charges don’t even rhyme.
King:	Will the defendant rise?
Knave of Hearts:	If I had known you were going to ask me that question I would have built it into my model.
King:	I’ll hold you in contempt!
Knave of Hearts:	I don’t suppose I’ll become overly fond of you either.
King:	Let the jury note the defendant’s behavior.
Knave of Hearts:	Which reminds me of my 1944 paper, but that is of course a secondary issue given the gravity of the problems which we now face. While I can’t formally defend the following equation to my own satisfaction, I think that it does make some economic sense. But first I should say that things will be getting much worse before they will get better, I can give you the latest predictions…..
King:	(fuming through all of the above) Bind the bearer of bad tidings or he’ll talk us to death…
Knave of Clubs:	But what shall we bind him with?
King:	Bearer bonds, naturally!
	(The Knaves come out of the jury box and use first-aid gauze to tie the knave of Hearts by body and legs & gag him—leaving only one arm free. Knave of Hearts has been talking with his hands throughout his testimony, and he continues gesturing with his free hand while occasional grunts can be heard under his gag.)
King:	May it be noted that in the tradition of Wonderland jurisprudence we have left the defendant with one degree of freedom in spite of his lack of respect for this court. Are there any witnesses?
Mad Hatter:	I am.
King:	Take the stand.
Knave of Clubs (to Mad Hatter):	Did the defendant do it?
Mad Hatter:	Certainly not.
Knave of Spades:	And you witnessed this with your own eyes?
Mad Hatter:	And I didn’t hear or smell him do it either.
Knave of Diamonds:	But how strong was your prior?
Mad Hatter:	Well, I don’t like to boast but when I was a young man working for the OSS during the War, I once spent a week in bed with a….
Knave of Clubs:	No, no, no. How much could new data affect your prior beliefs, and if considerably, what was your posterior judgment?
Mad Hatter:	I don’t now, that’s a good one. But I’ve got one for you. What weighs 12,000 pounds and has a twice differentiable indifference map over hay and peanuts?
King:	That’s irrelevant!
Mad Hatter:	That’s right.
King:	Give your evidence, or I’ll cut your grant off on the spot!
Mad Hatter:	(stutters) I’m a poor man your majesty.
King:	You’re a very poor speaker. (knaves laugh) I thought that was a pretty good one too. I’m in the mood for a few laughs (to White Rabbit) Call in the Joker.
White Rabbit:	The Joker.
(Enter Joker, attended by secretary, fans seeking autographs, and reporters taking pictures)
Joker:	It’s great to be back in Wonderland folks. A funny thing happened on my way…
King:	(interrupting) You have been called here to testify. What is the Keynesian viewpoint?
Joker:	As Uncle Miltie Friedman would say, only blindmen use Keynes. Hey, that’s a pretty good one. (To secretary) Write that down for my textbook—Better yet, put out a new edition. But, seriously folks just the other day I was leafing through a volume of Ricardo’s letters in the Sraffa collection when I came across a letter from Ricardo to James Mill describing the following encounter between Thomas Malthus and David Ricardo. Ricardo was walking down the street one day when he ran into the good Reverend who was, much to Ricardo’s surprise, sporting a banana in his left ear. Ricardo was surprised because Malthus was always the last of the political economists to adopt a new fashion. Finally Ricardo’s curiosity got the better of him and he asked, “I say Tom, why is that banana in your ear?” Malthus didn’t seem to understand—but that was hardly unusual as Malthus, more often than not, couldn’t understand what his friend was saying. In fact, old Malthus personally thought that Ricardo couldn’t optimize his way out of a paper sack, much less a Lambert space. Finally Malthus said, “I’m sorry Dave, but I can’t hear you, you see, I have this banana in my ear.” (everyone in the courtroom is sleeping) And now….ahem…ahem (everyone wakes up). A few of your favorite impressions: Francois Quesnay! (He covers his face with his hands; removes hands; expression unchanged) Böhm-Bawerk! (same routine)
King:	Enough!
Joker:	Nassau Senior! (same routine)
King:	Take him away. (White rabbit and knaves carry Joker off, still doing impressions. e.g. Stanley Jevons, Joseph Schumpeter, Vilfredo Pareto….)
King:	Who is the next witness?
Rabbit:	Alice!
Alice:	Here! (she goes to the witness stand)
King:	What do you know about this business?
Alice:	Nothing.
King:	If you say anything, I’ll give you part credit. Otherwise….
Alice:	But I don’t need part credit!
King:	Young lady, I’m growing impatient. Either tell us something about this business or I’ll cut off your grant.
Alice:	(crying) But I don’t have a grant.
King:	Then why are you so upset, indeed.
Alice:	What sort of….(alarm clock goes off in the jury box and the knaves wake up).
Knaves:	(in unison) Verdict time!!
Knave of Spades:	(To Knave of Diamonds) Do you have the coin?
Knave of Diamonds:	Yes I do. (to Spades). You’re innocence, (to Clubs) you’re guilt. Call it innocence. (he tosses the coin high in air)
Alice:	What kind of trial is this?
King:	Don’t be a stupid child. It’s a Bernoulli trial.
Knave of Spades:	Tails.
Knave of Diamonds:	Sorry it’s heads. He’s guilty!
Alice:	May I see the coin? (it’s tossed to her) This coin has two heads.
King:	Did anyone say p equaled one half?
	(Lights out. Everyone leaves but Alice. Lights on she has book and wakes up.)
Alice:	I’m glad I woke up before I had to take generals. (She leaves)
Audience:	(Deafening applause) Bravo. Cheers. Whoopee.

Source: Transcribed by Irwin Collier from personal copy.

Tags Abel, Aspe, Begg, Beleza, Bhagwati, Bishop, Bookstaber, Collier, Datcher, Daula, Desormeaux, Diamond, Domar, Donnelly, Duarte, Feiger, Frankel, Giavazzi, Hall, Halpern, Hausman, Helms, Hill, Kindleberger, Klorza, Krasker, Krugman, Malveaux, Meehan, Mincy, Modigliani, Mooney, Mork, Nagatani, Neuer, Samuelson, SmithDA, Stanley Fischer, Startz, Weitzman, Winicker

Economists M.I.T.

MIT. Department of Economics Group Photo, 1976

Post author By Irwin Collier
Post date 2016-04-12

Back Row: Harold FREEMAN, Hal VARIAN, Jerome ROTHENBERG, Peter DIAMOND, Jerry HAUSMAN

4th Row: Paul JOSKOW, Anne FRIEDLAENDER, JOHN R. MORONEY (VISITOR TO DEPARTMENT)

3rd Row: Stanley FISCHER, Jagdish BHAGWATI, Rudiger DORNBUSCH, Robert SOLOW, Robert HALL

2nd Row: Edward KUH, Morris ADELMAN, Abraham J. SIEGEL, Richard ECKAUS, Martin WEITZMAN

1st Row: Evsey DOMAR, Paul SAMUELSON, Charles KINDLEBERGER, E. Cary BROWN, Franco MODIGLIANI, Sydney ALEXANDER, Robert BISHOP

Apparently didn’t get the memo and/or not pictured: Michael PIORE, Frank FISHER, Peter TEMIN.

Thanks to Robert Solow, the photo-bomber standing to Solow’s left in the picture has been identified as a guest from Tulane University, John Moroney. It is possible that I forgot some other person not included in this faculty picture.

I note that the entire front row has gone to that great Department of Economics in the Cloud.

Source: A graduate student buddy of mine who entered the MIT Ph.D. program in 1975/76.

______________________

If you find this posting interesting, here is the complete list of “artifacts” from the history of economics I have assembled of which this is the 250th. You can subscribe to Economics in the Rear-View Mirror below. There is also an opportunity for comment following each posting….

Tags Adelman, Bhagwati, Bishop, BrownEC, Diamond, Domar, Dornbusch, Eckaus, Franklin Fisher, FreemanHA, Friedlaender, Hall, Hausman, Joskow, Kindleberger, Kuh, Modigliani, Piore, Rothenberg, Samuelson, Siegel, Solow, Stanley Fischer, Temin, Varian, Weitzman

Department of Economics 1975 – 76

MASSACHUSETTS INSTITUTE OF TECHNOLOGY DEPARTMENT OF ECONOMICS CAMBRIDGE, MASSACHUSETTS 02139

Brown to Solow

MEMORANDUM

DEPARTMENTAL ADMINISTRATIVE RESPONSIBILITIES: ECONOMICS DEPARTMENT 1977-78

1986 FACULTY SKIT

Memo from Chairman E. Cary Brown on a Revision of General Exams, 1975

Synopsis

The Greatest Faculty Skit Ever Written (in 1 hour, 15 minutes)

First Year Economics Graduate Students, 1974-75 M.I.T. (Spring 1975)

ANALYSIS IN WONDERLAND

Composed and performed by the first-year economics graduate students at M.I.T. Second term, 1974-75

DRAMATIS PERSONAE

ACT I

ACT II

ACT III

ACT IV

Department of Economics
1975 – 76

MASSACHUSETTS INSTITUTE OF TECHNOLOGY
DEPARTMENT OF ECONOMICS
CAMBRIDGE, MASSACHUSETTS 02139

DEPARTMENTAL ADMINISTRATIVE RESPONSIBILITIES:
ECONOMICS DEPARTMENT 1977-78

Memo from Chairman E. Cary Brown
on a Revision of General Exams, 1975

The Greatest Faculty Skit Ever Written
(in 1 hour, 15 minutes)

First Year Economics Graduate Students, 1974-75
M.I.T. (Spring 1975)

Composed and performed by the first-year economics graduate students at M.I.T.
Second term, 1974-75