Month: December 2018

Categories
Chicago Exam Questions Problem Sets

Chicago. Problems and exam. Income and Employment Theory. Friedman, 1966-67

 

In an earlier post we saw that Milton Friedman resisted the move to relabel the Chicago courses in (aggregate) income and employment theory “macroeconomics”. Below we have the take-home problem sets for 1966 and 1967 together with the final examination questions for the 1966 version of the course transcribed from copies in Friedman’s papers at the Hoover Institution Archives.

Pro-tip: Incomplete transcripts of his taped lectures for the course are filed at the Hoover Archives along with the material posted here. These await the caring editorial hand of some (other) historian of economics.

_______________

ECONOMICS 332
Winter, 1966
Problems for Reading Period

(Due at Final Exam, Monday, March 14, 1966, 1:30 P.M.)

  1. In an economy using fiduciary money, it costs nothing to create additional cash balances. Hence, it is desirable to encourage wealth-holders to hold additional cash balances so long as they get any additional non-pecuniary return from them. One way to do so is through a deliberate policy of announced deflation.
  2. For individuals, additions to cash balances are a substitute for real saving in the form of direct investment or loans to finance direct investment; hence, the larger the additions to cash balances, the lower will tend to be the volume of real capital formation. Since economic growth depends on the volume of real capital formation, it is desirable to discourage the hoarding of cash. One way to do so is through a deliberate policy of announced inflation.
    Both statements offer plausible, yet they lead to precisely opposite policy conclusions. Can you reconcile them? If not, which, in your opinion, is in error? What is the source of the mistake?

*  *  *  *  *  *  *  *  *  *  *

Milton Friedman

ECONOMICS 332
Final Examination. Winter, 1966
March 14, 1966

[25 Points]

  1. Indicate in each box whether the change in the indicated variable would, under the specified conditions, tend to be an increase (+), decrease (-), no change (0), or is uncertain (?). In each case, of course, assume other relevant variables unchanged.
    Make usual assumptions about behavior functions.

Assumed change

Underemployment
Rigid Wages

 Full Employment
Flexible Wages
Employ-
ment		 Interest
rate		 Real
stock
of
money		 Con-sump-tion Price level Interest rate Real stock of money

Consump-tion
(1) Rise in tariff
(2) Increase in government taxes, no change in government expenditures
(3) Reduction in legal reserve requirements of member banks
(4) Discovery of vast oilfields
(5) Substitution of tax on land values for tax on wages, no change in revenue
(6) Emergence of widespread fear of civil disturbances

 

[30 Points]

  1. An earthquake destroys half the physical capital in a country but miraculously there is negligible loss of life. The earthquake was most unusual, was unexpected and no one expects a repetition.
    1. Show graphically the effect on (1) the stock demand and supply for capital; (2) the flow demand and supply curves.
    2. Assuming flexible prices and full employment throughout, what, if anything, can you say about the initial effects on (1) rental rate on capital goods; (2) sales price of capital goods; (3) interest rate [i.e., ratio of (1) to (2)]; (4) real wage rate; (5) fraction of income consumed; (6) absolute level of investment.
    3. What about ultimate effects on these variables?
    4. Assuming initially rigid wages and underemployment, what, if anything, can you say about initial effects on items listed in (b)?

[15 Points]

  1. “The relation between the volume of economic activity and the price level is not simple. As a first approximation, the classical law of supply and demand leads one to expect that the change in the price level will depend mainly on the size of the gap between capacity and actual output” 1966 Annual Report, Council of Economic Advisers, pp. 63-64.
    “Money prices, as opposed to relative prices, can never be governed by the conditions of the commodity market itself (or of the production of goods)” K. Wicksell, Interest and Prices (1898), p. 24.
    In your opinion, does this shift in economic theory over the past 68 years reflect progress or retrogression? Justify your answer.

[15 Points]

  1. Consider a hypothetical economy in which initially, government expenditures (G) are 100, private investment (I) is 50, and private consumption (C) is 350, so that national product (Y) is 100 + 50 + 350 = 500, and tax receipts (T) are 90. Assume that G and T are both reduced by 10 to 90 and 80 respectively, and that wage rates are rigid.
    1. If you neglect any effects on the rate of interest, what would be the resulting values of C, I, and Y? Prove your answer in general by a simple algebraic analysis.
    2. Would you expect any effects on the interest rate if nominal quantity of money is constant? If so, what effect? How would this in turn affect I, C, and Y? Give hypothetical numbers that might correspond to final outcome.
      Again, prove your answer.
    3. What additional complications, if any, are relevant in generalizing these effects of a balanced budget change to actual circumstances?

[15 Points]

  1. Discuss the “real balance effect,” indicating what you think to be its meaning, and what role it has played in discussions of the possibility of under-employment equilibrium. In the course of your answer indicate what economists have been the main contributors to the discussion and what their specific contributions have been.

*  *  *  *  *  *  *  *  *  *  *

Milton Friedman
Spring Quarter, 1967
Economics 332

ECONOMICS 332
Problem for Reading Period
Due at Final Exam, Wed., June 7, 1967
(Maximum length = 1,000 words)

MONETARY vs. FISCAL POLICY

Define fiscal policy as deliberate changes in the government tax structure or expenditure structure for a given behavior of the quantity of money; monetary policy as a change in the rate of change of the quantity of money for a given tax and expenditure structure.

  1. Using the standard income-expenditure model, and assuming prices are rigid, analyze the effect on real income and interest rates of an increase in taxes which would raise the full-employment surplus (or lower the full-employment deficit) by X billion dollars. Specify the parameters on which the result depends and indicate limiting cases.
  2. Using the same model, indicate how to determine the change in monetary policy that would have the same effect on real income. How would other effects of the two policies differ?
  3. The standard model is in terms of comparative statics, so (1) and (2) would be analyzed in terms of a comparison of two alternative positions at a single date. In addition, the only stock variable in the standard model is the quantity of money. Modify the analysis in (1) in both respects. That is, indicate the time path of adjustment you might expect and why, taking into account any effects on such stock variables as total holdings of government and private securities.
  4. Similarly, analyze the time path of the effect of a decline in the rate of monetary growth by, say, X percentage points, again allowing for effect on stocks.

Source: The Hoover Institution Archives. Papers of Milton Friedman, Box 77, Folder “University of Chicago, Econ. 331 [sic]”.

Image Source: Milton Friedman at Pepperdine University in 1977.

 

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

M.I.T. Reading list and final exam for core graduate growth and capital theory. Solow, 1973

 

Core macroeconomic theory was taught in a sequence of four half-semester courses at M.I.T. In this post we have material from the final course of the sequence (typically taken in the fall term of the second year of residency) that was dedicated to growth and capital theory and taught by Robert Solow in 1973.

The course syllabus and final examination for the third course in the sequence on Macroeconometric Models taught by Franco Modigliani were transcribed for the previous post.

Economics in the Rear-view Mirror thanks Juan C. A. Acosta who copied the course syllabus and final examination that are found in the Franco Modigliani Papers (Box T7) at the Duke University Economists’ Papers Project and has graciously shared them for transcription here. 

___________

14.454
MACRO THEORY IV
Fall 1973 2nd half

  1. Growth Theory

background, if necessary: Solow, GROWTH THEORY, Ch. 1,2
Burmeister and Dobell: MATHEMATICAL THEORIES OF ECONOMIC GROWTH, Ch. 1-4
and/or
Wan: ECONOMIC GROWTH, Ch. 1, 2, 4 (sec. 3)
Kahn: “Exercise in the Analysis of Growth,” OXFORD ECONOMIC PAPERS, New Series, Vol. 11, 1959, pp. 143-156 (reprinted in GROWTH ECONOMICS, ed. A. K. Sen, Penguin)
Wan: Ch. 4, sec. 4

  1. Optimal Growth

background, if necessary: Solow, GROWTH THEORY, Ch. 5
Burmeister and Dobell: Ch. 11
and/or
Wan: Ch. 9, 10
Koopmans: “Objectives, Constraints and Outcomes in Optimal Growth Models” ECONOMETRICA, Vol. 35, 1967, pp. 1-15 (reprinted in Koopmans, SCIENTIFIC PAPERS, pp. 548-560)

  1. Capital Theory

Malinvaud: LECTURES ON MICROECONOMIC THEORY, Ch. 10
Hirschleifer: INVESTMENT, INTEREST AND CAPITAL, Ch. 2, 3, 4, 6
Dougherty: “On the Rate of Return and the Rate of Profit” ECONOMIC JOURNAL, December 1972, pp. 1324-1349
Burmeister and Dobell: Ch. 8, 9
Weizsäcker: STEADY-STATE CAPITAL THEORY, pp. 1-22, 32-47, and passim

Source:  Duke University. David M. Rubenstein Rare Book and Manuscript Library. Economists’ Papers Archive. Papers of Robert M. Solow, Box 68. Also in Franco Modigliani Papers, Box T7.

 

14.454 FINAL EXAM
19 Dec 1973
R. M. Solow

ANSWER TWO QUESTIONS, total time 1 ½ hours

  1. Suppose an economy with effectively unlimited supply of labor in the sense that any amount of labor is available (from an agricultural pools, say) at an institutionally determined real wage \bar{w}. In other respects the economy is like the standard one-sector model.
    1. Analyze the growth of such an economy if saving and investment are proportional to output. What might correspond to the “full employment, full utilization” assumption?
    2. What if saving and investment are proportional to profits?
    3. How does a once-for-all change in \bar{w} affect the growth path, and the share of wages in total output?
  2. Sketch an analysis of an optimal-capital-accumulation problem in which the criterion function values the capital stock (per worker) as well as consumption, for prestige or power reasons, say, so that instantaneous utility is written u(c,k). In particular, is it true, as we would expect, that such a society should save more than it would if it valued consumption only?
  3. Criticize the “neoclassical” theory of growth and capital; but do not be vague – where you have a complaint you should be prepared to suggest a better way.

 

Source:  Duke University. David M. Rubenstein Rare Book and Manuscript Library. Economists’ Papers Archive. Franco Modigliani Papers, Box T7.

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

 

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

M.I.T. Macroeconometric models. Reading list and final exam. Modigliani, 1973

 

Core macroeconomic theory was taught in a sequence of four half-semester courses at M.I.T. In this post we encounter the third course of the sequence (typically taken in the fall term of the second year of residency) that was dedicated to Keynesian macroeconometric models and taught by Franco Modigliani in 1973.

In the same folder is a qualifying exam for 14.454, Macro IV which would be a waiver examination given before the term begins. There is no year indicated on this exam, but the content of the questions clearly matches that of the empirical macro course 14.453 offered in 1973. In the fall term of 1973, the quantitative macro and the dynamic macro switched their order which is probably the reason for the confusion about the course number at the start of the term.

Economics in the Rear-view Mirror thanks Juan C. A. Acosta who copied the course syllabus and final examination that are found in the Franco Modigliani Papers (Box T7) at the Duke University Economists’ Papers Project and has graciously shared them for transcription here. 

___________

14.453 MACRO THEORY III
Fall 1973, 2nd Half

I – ECONOMETRIC MODELS

Tinbergen, J. Statistical Testing of Business Cycles, Theory II. Business Cycles in the U.S.A.
Klein, L. R. & A. S. Goldberger. An Econometric Model of the United States, 1955; Impact Multipliers & Dynamic Properties of the K-G Model, 1959.
Suits, D. B. “Forecasting and Analysis with an Econometric Model”, AER, March, 1962. Reprinted in Readings in Business Cycles.
Hymans, S. H. & H. T. Shapiro. The Michigan Quarterly Econometric Model of the U.S. Economy, 1973.
_____________, Revision as of June, 1973 – Mimeo
Green, G. R., M. Liebenberg, A. A. Hirsh. “Short and Long Term Simulations with the OBE Econometric Model” in Econometric Models of Cyclical Behavior, Studies in Income and Wealth, Vol. 36.
Fair, R. C. A Short Run Forecasting Model of the United States Economy, 1971.
Adams, G. F. & David M. Rowe, “Forecasts and Simulations from the Wharton Econometric Model”, Multilith.

ECONOMETRIC FORECASTING SYSTEM

1 – DR1 Quarterly Model
2 – Operations Overview

Fromm, G. & L. R. Klein. “A Comparison of Eleven Econometric Models of the United States”, AER, Papers and Proceedings, May, 1973, pp. 385-393.
Fair, R. C. “Forecasts from the Fair Model and Comparison of the Recent Forecasting Record of Seven Forecasters – July, 1973”. Princeton University – Multilith. 
Tsurumi, H. “A Comparison of Econometric Macro Models in Three Countries”, AER, May 1973.
Moriguchi, C. “Forecasting and Simulation Analysis of the World Economy”, AER, May, 1973.

THE MPS MODEL

Equations in the MIT-Penn-SSRC Model of the United States, January, 1973.
Data Directory, January, 1973.
Ando & Modigliani, “Econometric Analysis of Stabilization Policy,” AER, May, 1969.
Ando, A. K. “Basic Structure of the MPS Model” –Multilith.
Modigliani, F. “The Channels of Monetary Policy in the FMP Econometric Model of the U. S.” – Multilith.

II – THE CONSUMPTION FUNCTION

Keynes, J. M. The General Theory of Employment, Interest & Money, Ch. 8 & 9.
Modigliani, F. Lecture Notes on Monetary Theory, Part IV, Section A&B, (especially A.4 to B.2)
Brady, D.S. & Friedman, R. D. “Savings and the Income Distribution”, Studies in Income and Wealth, Vol. X, pp. 247-265.
Duesenberry, J. S. Income, Saving and the Theory of Consumer Behavior.
Modigliani, F. “Fluctuations in the Saving Income Ratio: A Problem in Economic Forecasting”, in Studies in Income and Wealth, Vol. XI, National Bureau of Economic Research, 1949.
_____________, “The Life Cycle Hypothesis of Saving Twenty Years Later”, Multilith.
_____________ and Brumberg, F. “Utility Analysis and the Consumption Function: An Interpretation of Cross-Section Data”, in K. Kurihara, (ed.) Post-Keynesian Economics, New Brunswick, 1954.
_____________ and _____________, “Utility Analysis and Aggregate Consumption Functions: An Attempt at Integration”, unpublished.
Merton, R. C. “Optimum Consumption and Portfolio Rules in a Continuous-Time Model”, Journal of Economic Theory, December, 1971.
Dreze and Modigliani, “Consumption Decisions under Uncertainty”, Journal of Economic Theory 5, 1972.
Modigliani, F. “The Life Cycle Hypothesis of Saving, the Demand for Wealth and the Supply of Capital” Social Research, Summer 1966.
_____________, “The Life Cycle Hypothesis of Saving and Inter-country Differences in the Saving Ratio”, in Induction, Growth and Trade, Essays in Honor of Sir Roy Harrod, 1970.
Ando, A. and Modigliani, F. “The Life Cycle Hypothesis of Saving: Aggregate Implications and Tests,” American Economic Review, March, 1963.
Modigliani, F. “Monetary Policy and Consumption: Linkages via Interest Rate and Wealth Effects in the FMP Model”, in Consumer Spending and Monetary Policy: the Linkages, The Federal Reserve Bank of Boston, 1971; and Appendix by Ando and Modigliani, “Consumption and Consumer Expenditure”.
Kaldor, N. Essays in Value and Distribution, London, 1960.
Tobin, J. “Life Cycle Saving and Balanced Growth”, in Ten Economic Essays in the Tradition of Irving Fisher, 1967.
_____________ and Dolde, W. C. “Wealth, Liquidity and Consumption”, in Consumer Spending and Monetary Policy: the Linkages, The Federal Reserve Bank of Boston, 1971.
Mayer, T. Permanent Income, Wealth, and Consumption, 1972.

III – THE INVESTMENT FUNCTION

Keynes, J. M., General Theory, Chapters 11 and 12.
Jorgenson, D. W. “Econometric Studies of Investment Behavior”, Journal of Economic Literature, Dec. 1971.
_____________ and R. E. Hall, “Application of the Theory of Optimum Capital Allocation” in Tax Incentives and Capital Spending, (edited by Fromm).
Bischoff, C. W. “The Effects of Alternative Lag Distributions”, in Tax Incentives and Capital Spending, G. Fromm, ed., Brookings Institution, 1971.
Ando, Modigliani, Rasche & Turnovsky, “On the Role of Expectations of Price and Technological Change in an Investment Function”. Multilith.
Eisner, E., and M. I. Nadiri, “Investment Behavior and Neoclassical Theory.” Review of Economics and Statistics. Vol. 50, August 1968.
_____________, “Neoclassical Theory of Investment Behavior: A Comment.” Review of Economics and Statistics, Vol. 52, May 1970.
Bischoff, C. W., “Hypothesis Testing and the Demand for Capital Goods,” The Review of Economics and Statistics, August 1969.
_____________, “Business Investment in the 1970’s: A Comparison of Models”, Brookings Papers on Economic Activity, 1, 1971.
Nadiri, I. M. “An Alternative Model of Business Investment Spending”, Brookings Papers on Economic Activity, 3, 1972.
Kalchbrenner, J. H. “A Model of the Housing Sector”, Chapter 6, in Savings, Deposits, Mortgages and Housing, Studies for the Federal Reserve-MIT-Penn Economic Model, (eds. Gramlich and Jaffee), 1972.
Ando and Modigliani, “Consumption and Consumer Expenditure”, pages 9-17, (APPENDIX A), Multilith.

IV – FINANCIAL MARKETS

Tobin, J. “A General Equilibrium Approach to Monetary Theory”, JMCB, February, 1969.
Brainard, W. and J. Tobin. “Pitfalls in Financial Model Building”, AER, May, 1968.
Ando and Modigliani. “Some Reflections on Describing Structures of Financial Sectors”. Multilith.
Ando, A. K. “Some Comments on Brainard-Tobin Framework for Financial Analysis”. Multilith.
Modigliani, F., Rasche, R. and J. P. Cooper, “Central Bank Policy, the Money Supply, and the Short-Term Rate of Interest,” Journal of Money, Credit and Banking, 2, 1970.
Modigliani, F. and R. Shiller, “Inflation, Rational Expectations, and the Term Structure of Interest Rates,” Economica, February, 1973.
Jaffee, D. M., and F. Modigliani, “A Theory and Test of Credit Rationing”, American Economic Review, December, 1969.
_____________, Credit Rationing and the Commercial Loan Market, John Wiley and Sons, 1971.
Gramlich, & Jaffee, editors, Saving Deposits, Mortgages and Housing, Chapters 1 to 5, and 7.
Modigliani, F. “The Valuation of Corporate Stock”. Multilith.

V – WAGES, PRICES, EXPECTATIONS

Phillips, A. W. “The Relation between Unemployment and the Rate of Change of Money Wages in the U. K.” Economica, November 1958.
Lipsey, R. G. “The Relation between Unemployment and the Rate of Change of Money Wage Rate in the U. K.: A Further Analysis”, Economica, 1961.
Phelps et al. Macro Economic Foundations of Employment and Inflation Theory, See especially the two contributions of Holt.
The Econometrics of Price Determination Conference, Board of Governors of the Federal Reserve System and SSRCs.

De Menil and Enzler, “Prices and Wages in the FR-MIT-Penn Econometric Model”.
Tobin, “The Wage-Price Mechanism: Overview of the Conference”.
Hyman, “Prices and Price Behavior in Three U.S. Econometric Models”.
Nordhaus, “Recent Developments in Price Dynamics”.
Lucas, “Econometric Testing of Natural Rate Hypothesis”.

Modigliani and Tarantelli, “A Generalization of the Phillips Curve for a Developing Country”, Review of Economic Studies, April, 1973.
Eckstein and Brinner, “The Inflation Process in the United States”, Joint Economic Committee, Congress of the U.S., 92 Congress, 2ndSession.
Modigliani, “New Developments on the Oligopoly Front”, Journal of Political Economy, Vol. 66, June 1958.
Lucas, R. “Some International Evidence on Output-Inflation Tradeoffs”, AER, June, 1973.
Sargent, T. J. “Rational Expectations, The Real Interest Rate and the ‘Natural’ Rate of Unemployment.” Multilith—forthcoming in Brookings Papers on Economic Activity, 2, 1973.
Gordon, R. J. “The Welfare Cost of Higher Unemployment”, Brookings Papers on Economic Activity, 1, 1973.
Turnovsky, S. J. “Empirical Evidence on the Formation of Price Expectations”, J.A.S.A., December 1970.
de Menil and Bhalla, “Direct Measurement of Popular Price Expectations”—Princeton University Econometric Research Program, Memorandum No. 149.
de Menil, G. “Rationality in Popular Price Expectations”. Multilith.

______________________

QUALIFYING EXAM FOR 14.454 (sic)
MACRO IV (sic)

Time Period: Less than two hours
Answer at least 2 questions

  1. Tests carried out for a number of countries of the major alternative models purporting to explain aggregate consumption (Duesenberry-Modigliani, permanent income, life cycle, Kaldorian model) are typically found to fit the data quite well, and the difference in fit is generally not large.
    1. give a brief description of each of the above models
    2. what explanation, if any, can be advanced for the empirical finding that there are no substantial differences in the closeness of fit in the various models
    3. does the fact that the alternative models fit roughly as well imply that it makes little difference which of these equations is incorporated in an econometric model
      1. rom the point of view of forecasting
      2. from the point of view of predicting the effect of alternative monetary and fiscal policies
  2. Consider the coefficient estimates of the St. Louis “reduced form model”.
    1. what are possible and likely sources of biases in these coefficients? (Be sure to explain what you mean by bias in this context.)
    2. are these estimates consistent with the monetarist view of the working of the economy?
    3. with the view embodied in the standard econometric models of the U.S.?
    4. with the view embodied in the MPS model? (optional)
  3. The “multiplier” played an important role in early Keynesian thinking.
    1. review how this notion has developed since that time.
    2. in the light of (i), describe the kind of simulations you would perform in order to evaluate the “multiplier effect of an increase in government expenditure” implied by one of the major contemporary econometric models of the U.S.
    3. can an estimate of the above multiplier be inferred from the coefficients of the St. Louis “reduced form model”?

______________________

14.453 MACRO THEORY
FINAL EXAMINATION

Franco Modigliani
Wednesday, 12/19/73

1 ½ hours

Answer Question I and at least one other question

  1. Enclosed is a forecast for the U.S. economy generated by the MPS Model in October 1973, before the so-called oil crisis. Assume an exogenous reduction in oil imports of 3 million barrels per day (representing somewhat over 15% of the consumption of oil implicit in the above forecast) beginning in the fourth quarter of ’73, and becoming fully effective from the first quarter of ’74.
    1. analyze the likely effects of this event on the above projections of real and money GNP and its components, assuming no change in monetary and fiscal policy.
    2. what changes in economic policy, if any, would you recommend, and why?
    3. can the MPS model (or analogous macro-econometric models) be used without major modification, to simulate the effects of the reduction in oil supply? Explain.

(Note: the monetary policy assumed in the projection is a growth of the money supply at 6% in ’73.4, at 6.5% in the first half of ‘74, and 7% thereafter.)

  1. The “multiplier” played an important role in early Keynesian thinking.
      1. review how this notion has developed since that time.
      2. in the light of (i.), describe the kind of simulations you would perform in order to evaluate the “multiplier effect of an increase in government expenditure” implied by one of the major contemporary econometric models of the U.S.
      3. can an estimate of the above multiplier be inferred from the coefficients of the St. Louis “reduced form model”?
  2. Formulate your model of the short and long run determinants of the price level. Use your theory to evaluate the often expressed view that fiscal policy should be used to control real output and monetary policy to control prices.
  3. Discuss the role of price expectations in macro-economic analysis, and review the present state of knowledge with respect to the modeling of price expectational variables in macro-econometric models.

1973_14453_exam_MPSoutputReduced

Source:   Duke University. David M. Rubenstein Rare Book and Manuscript Library. Economists’ Papers Archive. Franco Modigliani Papers, Box T7.

Image Source: Franco Modigliani picture from the MIT Museum Website.

Categories
Columbia Economics Programs

Columbia. Memo from economics chair to department members with three recommendations, 1945

October 30, 1945

To the Members of the Department of Economics:

            During the past two years the members of the Department have reviewed the contents of the various courses in the present curriculum, and have discussed problems of departmental organization. Certain of the issues raised in these discussions, and one or two related general problems, should be settled within the present year. Questions that were academic during the period of reduced registration are more pressing at the present time, and will be insistent under the heavy registration to be expected next year.

            The following are some of our present and pending problems:

  1. The numbers of students registered in certain courses are too large for effective instruction by the methods preferred by the instructors. This problem promises to become more serious.
  2. The heterogeneity of the student body with respect to training and experience makes it difficult to do justice to the well-prepared students while meeting the needs of the less well-prepared.
    Like problems arise from the mixture of part-time and full-time students, and from the mixture of students planning to become professional economists with students who have no serious professional interests. Standards of instruction suffer, as a result.
  3. Failure to week out weaker students lessens the effectiveness of the work we can do with capable advanced students.
  4. Under present arrangements for the preparation of dissertations it is difficult properly to supervise the research work of advanced graduate students, and to give them adequate training in research procedures.

            The following recommendations bear upon these and related problems. The considerations that prompt each recommendation will be familiar to members of the Department, and need not be expounded in detail.

  1. I propose that we set up a clear distinction between two classes of graduate students.
    1. Standard candidates, whose objective is the doctoral degree, with or without the M.A. as an intermediary degree.
      Standard candidates will be selected upon the basis of their own statements of intention, and after careful review of their educational records by the Office of Admissions and the Department of Economics. High standards will be enforced. Standard candidates must register each term for a minimum of 12 points (or for a smaller number if that number will complete residence requirements for the doctorate).
      Standard candidates may be designated at the time of admission to the Graduate School, or later.
      The status of all standard candidates will be reviewed by the Department at or before the close of their first full year of graduate study. This review may take the form of special written examinations. Only with explicit approval of the Department may standard candidates register for a second year of graduate work. The Department may subject standard candidates to review at later stages of their work, as well as at the close of the first year.
      Certain courses of instruction and certain seminars will be open only to standard candidates.
    1. Terminal M. A. candidates. These are students whose final objective in the graduate school is the Master’s degree. In general, the present rules for the M.A. degree will apply to this group.
      The one important modification proposed is that grades of B or better be required for the 21 points of examination credit that must be offered for the M.A. degree. This tightening of M.A. standards seems essential. With it we might, to advantage, enforce more rigorous standards for the M.A. thesis.
      The students placed in this class would include all those who contemplate no graduate work beyond the M.A., and those whose intentions regarding graduate work beyond the M.A. are uncertain.
      The accomplishments of students in this group would be subject to periodic review and those with definitely unsatisfactory records would not be allowed to continue their graduate work.

Unclassified graduate students, students provisionally admitted to the graduate school and students not candidates for a higher degree will be grouped with Terminal M.A. candidates in determining admissibility to graduate courses and seminars. Students desiring to work for the doctorate but whose educational records do not warrant immediate acceptance as standard candidates will also be grouped with terminal M.A. candidates. The Department may transfer such students to the standard category on the basis of demonstrated capacity.

Under this proposed classification, we shall set off for special attention legitimate candidates for professional training as economists, and for this group shall enforce standards of attendance and accomplishment more rigorous than those applied to other graduate students. If we are to preserve high standards of instruction and training for the doctorate there is only one alternative to the proposed segregation. That is the drastic curtailment of the size of the graduate group. Under present conditions this does not appear to be a feasible alternative.

            In determining what courses are to be restricted to standard candidates, account will be taken of the wishes of the instructors, the specified pre-requisites and the manner in which the instructors wish to handle their classes (e.g. lectures, or discussion), as well as subject matter.

            Some review of our curriculum will be called for, if this division is to be enforced. Small classes, with more emphasis on seminars and specialized research, will be appropriate in the programs of the standard candidates. Large lecture courses and courses of fairly wide scope will continue to be given for the terminal M.A. candidates and unclassified students. There will be, of course, a mixing of groups in some classes.

            There should be considerable flexibility in the framing of programs for the standard candidates, so that men who come to Columbia with a considerable background of work in economics will not be obliged to take certain of the general courses intended for men who come with a liberal arts background and little specialization in economics.

            2. I recommend that every doctoral candidate be required to devote a period equivalent to at least one semester, and preferably one year, to rigorous research training, under the supervision of the Department. In general this should mean a year in residence, or in an approved research position, following the oral examination on subjects. During this period the candidate’s dissertation should be substantially completed. An appropriate administrative rule, when formulated, will have to make some allowance for flexibility of application, but the objective should be clear. The writing of the doctoral dissertation is an integral part of the candidate’s professional training. It should be completed under the guidance of the Department, or under other conditions that will assure appropriate supervision and sound training in research techniques.

            3. I recommend that the Department approve, in principle, the organization of two specialized centers of economic research. Plans for these institutes, or research centers, will be submitted to the President. Financial support will be sought within and without the University. It is hoped that these institutes will provide members of the faculty with research funds and research facilities, and that they will strengthen the educational work of the Department by providing advanced graduate students with opportunities to assist in research projects during their period of graduate training.

            The centers now proposed are an Institute of Public Finance and an Institute of International Economics. Detailed memoranda on the organization of these institutes have been prepared.

            If the Department favors these three general recommendations consideration will have to be given to requisite curricular changes and, possibly, to admission procedures and minor administrative matters. Appropriate recommendations can be placed before the Department at a later time.

Frederick C. Mills

Source:  Columbia University Archives. Rare Book and Manuscript Library. Central Files 1890-.  Box 396. Folder: “1.1.288 1/1 Mills, Frederick Cecil.”

Categories
Economic History Harvard Regulations

Harvard. What to do about economic history, 1973

 

 

The December 1973 memo transcribed below can be viewed as a last stand in anticipation of the retirement of Alexander Gerschenkron to continue to require Harvard graduate students in economics demonstrate a modest acquaintance with some economic history from somewhere or other. The Committee writing the report consisted of two professors, Abram Bergson (Soviet economy and comparative economics) and Albert O. Hirschman (by this time dedicated to work in matters of intellectual history) along with two Harvard economics graduate students, Deborah G. Clay-Mendez (b. 1949, Harvard Ph.D., 1981) and William D. White (b. 1945, Harvard Ph.D., 1975).

Cf. Harvard’s current distribution requirement (from a screen capture dated November 13, 2018 at the Wayback Machine)

The distribution requirement is fulfilled by taking an approved field course in Economic History, Political Economy or Behavioral. The purpose of the requirement is to ensure that students are exposed to non-standard ways of thinking about issues central to economics. The course must be passed with a grade of B or better.

 

_______________

DEPARTMENT OF ECONOMICS

January 9, 1974

To: Members of the Department of Economics
From: James S. Duesenberry, Chairman

NOTICE OF DEPARTMENT MEETING

There will be a meeting of the Department of Economics on Tuesday, January 15thin the Littauer Lounge from 4 to 6 p.m.

The main items on the Agenda will be a report of the Committee on Economic History Requirements and a discussion of theory requirements.

*  *  *  *  *  *  *  *  *

Course Offerings and Examinations in Economic History

As directed by the Chairman of the Economics department and the Chairman of the Graduate Instruction Committee, a Committee consisting of the undersigned has reviewed the graduate course offerings and examinations in economic history at Harvard. We have deliberated as a group a number of times, and have also solicited the opinions of persons not members of the committee, including graduate students in economics and faculty members offering courses in economic history and related fields. We focused on several related issues, and set forth below our recommendations on each in turn:

  1. Should there be an economic history requirement for graduate students in economics? We all agreed that there should be, and that the aim of such a requirement should be to assure that the student gains an understanding of processes of long-term economic change, and of the comparative role of economic and non-economic factors in such change. The requirement should also be a means by which the student becomes better acquainted with a variety of economic institutions other than our own contemporary ones.
  2. What sort of requirement is in order? In our view, normally the completion of work with an average grade of B+ or better in two semester courses in economic history or their equivalent. Should the student fail to achieve a grade of B+ or better in such courses, however, he may be allowed, on petition to the Committee on Economic History (see below), to complete the requirements by retaking the final examination in one or both of the courses in question. Alternatively, depending on the circumstances, the student might be asked to do under faculty guidance a research paper of suitable quality. As in the past, a creditable performance in an appropriate and suitably delimited oral examination should also signify completion of the requirement.
  3. In what specific fields of economic history may the requirement be completed? We agreed that the requirement should permit work in various fields of economic history relating to the experience of industrialized societies including among others those of Western Europe, the United States and Japan.
    To that end, the Department has an obligation to see that appropriate courses in diverse fields are in fact offered to the student. Additional courses might be made available in other departments and through cross registration at MIT, the Business School and the like.
    The Committee also considered whether work in economic development or comparative economic systems might be countered towards the requirement. It was agreed that one semester’s course work in one field or the other might be counted, but on the understanding that the courses in question must be substantially concerned with processes of long-term economic change and in a context in which substantial attention is given to the interplay between economic and non-economic factors, and between economic doctrines and developments.
  4. How should the requirement be administered? We agreed that a Committee should be appointed by the Department to oversee the economic history requirement. It should be responsible particularly for assuring that in one way or another suitable courses are available, and for determining just what courses should be eligible for meeting the economic history requirement. It should also consider petitions such as are referred to in item 2, above, and should have responsibility for setting standards for and delimiting oral examinations.

Respectfully submitted

Deborah Clay
William White
Albert Hirschman
Abram Bergson, Chairman

December 26, 1973

 

Source:  John F. Kennedy Presidential Library. John Kenneth Galbraith Papers. Series 5. Harvard University File, 1949-1990. Box 526, Folder: “Harvard University. Department of Economics: General Correspondence, 1967-1974 (1 of 8)”.

Image Source: Abram Bergson (From National Academy of Sciences Biographical Memoir written by Paul Samuelson); Albert O. Hirschman (From the Institute for Advanced Study Archives).

Categories
Exam Questions Harvard Suggested Reading

Harvard. Exams and Reading Lists for Latin American Economies. Bradley, 1944/1948/1949

 

 

 

An earlier post provided the reading list for a course taught at Harvard by Philip Durgan Bradley, Jr., Economics 38b “Economic Problems of Latin America” in the Spring Term of 1944. In the meantime, I have found a copy of the exam that I have transcribed for this post.

A few years and a course number change later, Bradley taught a course with the title “The Economy of Latin America” (Econ 14b). The reading list provided for the course in the spring semesters of 1948 and 1949 were identical except for a single item and is provided below as are the final examination questions from 1948 and 1949.

____________________

Final Exam, June 1944

1943-44
HARVARD UNIVERSITY
ECONOMICS 38b

One hour

  1. “Variations in the international balance of payments are the principal factors determining the level of economic activity is the Latin American area.” What were the principal variations in the Latin American balance of payments during the period 1923-43? In what specific respects and by what means did these variations in the balance of payments affect the internal level of economic activity in the Latin American countries during this period? (Treat the area as a whole.) Do you agree that the above quotation is substantially correct?

Choose ONE question. 50 minutes

  1. The returns earned on United States Direct Investments guarantee two things for the future: (1) a substantial share of total private United States capital sent abroad in any year will go to Latin America and (2) every country and every major type of industry in Latin America will be assured of an adequate future flow of United States private capital. Discuss.
  2. “One essential difference between petroleum and mineral products on the one hand and the products of agriculture and industry on the other consists of the fact that the former products represent the exploitation of non-replaceable, wasting-assets while the latter do not. The domestic requirements for petroleum and mineral products in industrially backward countries are small, and these products are produced primarily for export purposes. The continued or increased exploitation of these wasting-assets for export purposes constitutes a drain upon the national wealth which must necessarily prevent the realization of higher levels of national income in such countries.” Discuss, including a statement of your agreement or disagreement with the foregoing conclusion.

Choose TWO. 35 minutes each

  1. “The high cost of living in Venezuela is a direct consequence of that nation’s petroleum policy.” Discuss.
  2. What were the principal objectives of the Brazilian coffee control programs? Of the Inter-American Coffee Agreement? Do you believe that an international approach to coffee control promises more hope of success than the methods used in the past? Explain your answer to this last question.
  3. Discuss what you consider to be the more important economic consequences of the land tenure system in Latin America.
  4. Write an essay on the principal topics discussed in your reading period selection.

 

Source:  Harvard University Archives. Harvard University. Final Examinations, 1853-2001. Box 9, Papers Printed for Final Examinations, History, History of Religions,…Economics,…, Military Science, Naval Science. June, 1944.

____________________

Enrollment 1948

[Economics] 14b. Assistant Professor Bradley.—The Economy of Latin America (Sp.)

Total 49: 1 Graduate, 24 Seniors, 16 Juniors, 6 Sophomores, 1 Business School, 2 Radcliffe.

 

Source: Harvard University. Report of the President of Harvard College, 1947-48, p. 89.

 

Enrollment 1949

[Economics] 114 (formerly Economics 14b). Assistant Professor Bradley.—The Economy of Latin America (Sp.)

Total 58: 1 Graduate, 26 Seniors, 23 Juniors, 4 Sophomores, 1 Public Administration, 1 Business School, 2 Radcliffe.

 

Source:Harvard University. Report of the President of Harvard College, 1948-49, p. 76.

 

____________________

“Short” Reading List

Economics 14b
Spring Term, 1949
[mimeographed copy]

Readings related to Latin American economic problems+

  1. Royal Institute for International Affairs, Republic of South America, Chs. 1 and 2.
  2. George Soule, Efron and Ness, Latin America in the Future World, Chs. 1-6.
  3. L. Schurz, Latin America, pp. 155-178.
  4. H. Barber, “Land Problems in Mexico,” Foreign Agriculture, Vol. III, pp. 99-120.
  5. M. McBride, Chile: Land and Society, Ch. 5.
  6. George Wythe*, Industry in Latin America, Part I, Part II—Choose one: Argentina, Brazil or Mexico, Part III.
  7. M. Phelps, Migration of Industry to South America, Chs. 2, 4, 7.
  8. T. Ellsworth*, Chile: An Economy in Transition.
  9. Triffin, R., “Central Banking,” Ch. 4 in Economic Problems of Latin America, ed. By S. E. Harris.
  10. Robert Triffin, Money and Banking in Colombia, pp. 1-33.
  11. C. Wallich, “Cuba: Sugar and Currency,” Ch. 14 in Economic Problems of Latin America.
  12. Central Bank of Argentina, Annual Reports(from 1935).
  13. Spiegel, H. W., The Brazilian Economy.

* To be purchased

+ Other readings of a more general nature may be assigned later.

[Note: the “short” reading list for 1948 was identical except for the last item by H. W. Spiegel that was not included.]

Source:  Harvard University Archives. Syllabi, course outlines and reading lists in economics, 1895-2003. Box 4, Folder “Economics, 1948-1949 (1 of 2).

____________________

“Long” reading list

Economics 14b
Spring Term, 1948
[carbon copy]

  1. Royal Institute for International Affairs, Republic of South America. [Chs. 1 and 2]
  2. M. McBride, Chile: Land and Society.
  3. L. Schurz, Latin America.
  4. George Soule, Efron and Ness, Latin America in the Future World. [Chs. 1-6]
  5. Foreign Agriculture, Vols. II, III.
  6. D. Wickizer, The World Coffee Economy.
  7. George Wythe, Industry in Latin America.
  8. Lloyd D. Hughlett, Industrialization of Latin America.
  9. W. Cooke, Brazil on the March.
  10. M. Phelps, Migration of Industry to South America.
  11. T. Ellsworth, Chile: An Economy in Transition.
  12. Economic Problems of Latin America, edited by S. E. Harris.
  13. N. Simpson, The Ejido.
  14. J. Brown, Industrialization and Trade.
  15. Olson and Hickman, Pan American Economics.
  16. Robert Triffin, Money and Banking in Colombia.
  17. Central Bank of Argentina, Annual Reports(from 1935).
  18. S. Tariff Commission, Foreign Trade of Latin America.
  19. American Advisory Economic Mission to Venezuela, Report to the Minister of Finance.
  20. G. Hanson, Utopia in Uruguay.
  21. Ernesto Galarza, Labor Trends and Social Welfare in Latin America.
  22. Virgil Salera, Exchange Control and the Argentine Market.
  23. S. Buchanan and Fred A. Lutz, Rebuilding the World Economy.
  24. L. Phelps, International Economic Position of Latin America.
  25. H. Williams, Argentine International Trade under Inconvertible Paper.
  26. Feuerlein and E. Hannan, Dollars in Latin America.
  27. M. Phelps, Economic Relations with Latin America.
  28. Cleona Lewis, America’s Stake in International Investment.
  29. F. Bain and T. T. Read, Ores and Industry in South America.
  30. Edgar Turlington, Mexico and Her Foreign Creditors.
  31. F. Rippy, Latin America and the Industrial Age.
  32. Fortune, March, 1933; December, 1935; January, 1942.
  33. Enke and V. Salera, International Economics.
  34. Triffin, Monetary and Banking Reform in Paraguay.

Source:  Harvard University Archives. Syllabi, course outlines and reading lists in economics, 1895-2003. Box 4, Folder “Economics, 1947-1948 (1 of 2).

____________________

Final exam, May 1948

1947-48
HARVARD UNIVERSITY
ECONOMICS 14b

Part I

Answer BOTH questions. One hour each.

  1. Develop the evolution of Argentine monetary policy in response to the course of the trade cycle in the period from 1936 to 1945. Evaluate the success or failure achieved through the execution of monetary policy and provide an explanation for the results attained.
  2. Write an essay on “the determinants of economic progress in Venezuela.” Extract from your discussion and state in summary fashion those economic principles which you believe constitute conditions of economic progress in all nations.

Part II

Choose TWO. 30 minutes each.

  1. Would you as the manager of a firm incorporated in the United States build a branch plant in Argentina, Brazil, or Chile? Base your answer upon an analysis of our experience with branch plants in that area. (Do notselect this question if you are a citizen of a Latin American country.)
  2. Would you as a citizen of Argentina, Brazil, or Chile favor or oppose the construction of additional branch plants owned by firms incorporated in the United States of America? Base your answer upon an analysis of the experience of those countries with branch plants. (Do notanswer this question unlessyou are a citizen of a Latin American nation.)
  3. Describe the problems encountered and the policies pursued in the Argentine securities market in the period 1936-1944.
  4. Analyze, as an economist, the objectives of Chilean Development (Fomentao) Corporation and the powers granted to the Corporation for the realization of those objectives.
  5. Explain in the most fundamental terms possible the economic significance of imports to any Latin American country now endeavoring to promote economic development.

 

Source:  Harvard University Archives. Harvard University. Final Examinations, 1853-2001. Box 15, Papers Printed for Final Examinations, History, History of Religions,…Economics,…, Military Science, Naval Science. May, 1948.

____________________

Final Exam, June 1949

1948-49
HARVARD UNIVERSITY
ECONOMICS 114b

(Three hours)

I.

Write on BOTH the following questions. One hour each.

  1. Compare the economic experiences and policies of two of the following countries in the period 1929-1934: Argentina, Brazil, Chile, and Colombia. Was recovery in any one of these nations to be imputed to the economic policies adopted? Include in your discussion a description of the forces which generated economic events during this period.
  2. Explain as fully as you can the causes of the difference between the rates of economic development in the United States and in any one major Latin American nation.

II.

Write on TWO of the following topics. Thirty minutes each.

  1. The justification for policies of monetary autonomy in Latin America. Choose one country for illustrative purposes.
  2. The present economic situation in Argentina is to be explained in terms of international factors.
  3. Government deficit finance as a method for increasing living standards in Latin America.
  4. The considerations that would guide you as a United States business man in deciding whether or not to do business in Latin America. Which country is the most attractive from this standpoint?

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

Categories
Curriculum Harvard Teaching Undergraduate

Harvard. Economics teaching responsibilities according to David Landes, 1955

Landes_David.jpg Prof. David Landes 7437 #36 11/1193 Photographer: Jane Reed

 

In the archived Columbia University graduate economics department papers one finds an extended discussion about a university administration initiative in 1955-56 to adjust teaching loads to meet a fiscal crisis. The economics chairman, Carl S. Shoup, asked the young economic historian on the faculty, David Landes, to brief him on the teaching situation at Harvard. The following “note to self” by Shoup offers an obiter dictum or two that one would not be able to glean from published Harvard catalogues alone, e.g., “This system is also well suited to a coeducational program.”

_________________

COLUMBIA UNIVERSITY
Interdepartment Memorandum

Date: February 18, 1955
Carl S. Shoup

Memorandum for Files
Record of Conversation with David Landes on Harvard
Technique of Handling Graduate and Undergraduate Classes

Landes tells me that at Harvard in economics, there are three kinds of courses. First is an elementary course for undergraduates in which there is one lecture a week before a class that may range from 50 to 300 students or perhaps even more. Another two hours a week is taken up with section work handled by graduate students who are somewhat below our instructors in terms of the amount of their responsibilities (I understand from Hart that in some of these elementary courses one lecture will be given by one professor, another professor will come along the following week and so on). This professor is a senior man whose chief interest is in the graduate field. Nevertheless, there seems to be considerable competition among the senior professors for the privilege of giving these big lectures. Not all senior professors give such lectures and not all are competitors for the task.

Then there are mixed courses containing 20 or 30 students or so, some of the students being undergraduate and some graduate.

Finally, there are the graduate seminars attended only by graduate students.

In no case does the graduate professor have to take care of the mechanics of grading undergraduate examination papers, taking attendance, etc. All these chores are handled by the young assistant.

As a result, there is no well-defined undergraduate faculty in economics as there is in Columbia. Landes thinks this system is undoubtedly the most economical, but it has the drawback that the undergraduate student who reads the catalogue and thinks he is going to get some big name to teach him in his beginning course finds that he does so only to the extent of sitting in a large group and listening to the professor without ever getting any personal contact with him.

This system is also well suited to a coeducational program.

 

Source:  Columbia University Libraries, Manuscript Collections, Columbiana. Department of Economic Collection, Box 5, Folder “Budget Meeting—1955-1956”.

Image Source:  The Harvard Gazette  August 30, 2013 photo of David S. Landes.

Categories
Funny Business M.I.T.

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

 

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.

  1. Marty Weitzman (Jeff Harris can do this perfectly. He will write his part).
  2. Jerry Hausman. Lecture to be given very fast. Stop after each point and grin.
  3. Frank Fisher. Obvious.
  4. 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.
  5. 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.

Categories
Economists Harvard Suggested Reading Swarthmore UCLA Wisconsin

Harvard. Syllabus for Economic Development taught by Robert Baldwin (Econ PhD 1950), 1956

 

The sequence I followed for preparing this post was that I first decided to transcribe the outline and readings for a course dealing with economic development (Economics 108) taught at Harvard in the spring term, 1956. To figure out who the instructor was, I then turned to the annual report of the president of Harvard College that provides enrollment figures as well as names of course instructors. Once I found the last name of the instructor “Baldwin”, I looked to see if perhaps there was a recent Harvard economics Ph.D. with that name since the course had been taught by an assistant professor. Bingo, Robert Edward Baldwin, a rising star in international economics at the time appeared indeed to be our man. I confirmed that he was on the faculty of Harvard at the time from his ca. 1997 c.v. at the NBER. Finally my search of the internet pulled up the Robert E. Baldwin’s obituary that I have copied and pasted as the last item below.

The post would not be complete without links to his offspring who have gone off on their own economics careers (Jean Grossman in Princeton and Richard Baldwin in Geneva). 

______________

Course Enrollment

[Economics] 108. Theories and Problems of Economic Development. Assistant Professor Baldwin. Half course. [Spring]

Total 42: 13 Graduates, 13 Seniors, 6 Juniors, 2 Sophomores, 4 Radcliffe, 1 Special

Source:  Harvard University. Report of the President of Harvard College 1955-1956, p. 76.

______________

Course Outline and Readings

HARVARD UNIVERSITY
Department of Economics
Spring Term, 1955-1956

Economics 108

  1. Theories of Economic Development
    1. Smith and Ricardo

Adam Smith, An Inquiry into the Nature and Causes of the Wealth of Nations, Book I, chs. 1-9; Book II, ch. 3.
David Ricardo, Principles of Political Economy and Taxation, chs. 2-6, 21.

    1. Marx

Karl Marx, A Contribution to the Critique of Political Economy, Preface.
M. M. Bober, Karl Marx’s Interpretation of History, chs. 1-3
OR
H. B. MAYO, Democracy and Marxism, chs. 2,3.
M. M. Bober, op. cit., chs. 9-13
OR
Joan Robinson, An Essay on Marxian Economics.

    1. The Neo-Classical System

Alfred Marshall, Principles of Economics, chs. 11-13.
Knut Wicksell, Lectures on Political Economy, Vol. 1, Part III.
Gustav Cassel, The Theory of Social Economy, ch. 1, Sections 4-6.

    1. Schumpeter

J. A. Schumpeter, Business Cycles, Vol. 1, chs. 3, 4.
J. A. Schumpeter, Capitalism, Socialism, and Democracy, Part II, chs. 11-14.

    1. The Stagnationists and the Post-Keynesian Growth Theorists

Alvin Hansen, “Economic Progress and Declining Population Growth,” American Economic Review, March 1939.
J. A. Schumpeter, Capitalism, Socialism, and Democracy, ch. 10.
Evsey Domar, “Expansion and Employment,” American Economic Review, March 1947.
W. J. Baumol, Economic Dynamics, ch. 4.

    1. A Survey of other Socio-Economic Theories

J. J. Spengler, “Theories of Socio-Economic Growth,” Problems in the Study of Economic Growth, National Bureau of Economic Research.

    1. A Comparison of Development Theories
  1. Accelerating Development in Poor Countries
    1. Basic Characteristics of Poor Countries
    2. Obstacles to Development
    3. General Requirements of Development
    4. Domestic and International Policy Issues

Required Reading

Buchanan and Ellis, Approaches to Economic Development, Part I and Part III.
W. Arthur Lewis, The Theory of Economic Growth, chs. 3-7

Suggested Reading

Baran, P., “On the Political Economy of Backwardness,” The Manchester School, January 1952.
Duesenberry, J., “Some Aspects of the Theory of Economic Development,” Explorations in Entrepreneurial History, December 1950.
M. Fleming, “External Economics and Doctrine of Balanced Growth,” Economic Journal, June 1955.
Frankel, S. H., The Economic Impact on Underdeveloped Societies, ch. 2.
Hoselitz, B. F., “Social Structure and Economic Growth,” Economia Internazionale, Vol. 6, No. 1, 1953.
Lewis, W. A., “Economic Development with Unlimited Supplies of Labour,” The Manchester School, May 1954.
E. S. Mason, Promoting Economic Development, chs. 2, 3.
Meier, G. M., “The Problem of Limited Economic Development,” Economia Internazionale, Vol. 6, No. 1, 1953.
Mikesell, R.F., “Economic Doctrines Reflected in U.N. Reports,” American Economic Review, Proceedings, May 1954.
Myint, H., “An Interpretation of Economic Backwardness,” Oxford Economic Papers, June 1954.
Nurkse, R., Problems of Capital Formation in Underdeveloped Countries
Singer, H., “The Distribution of Gains Between Investing and Borrowing Countries,” American Economic Review, Proceedings, May 1950.
Spengler, J. J., “Population Obstacles to Economic Betterment,” American Economic Review, Proceedings, May 1951.
Sweezy, P., “Duesenberry on Economic Development.” Explorations in Entrepreneurial History, Volume 3, February 1951.
United Nations Department of Economic Affairs, Measures for the Economic Development of Under-Developed Countries
Viner, J., International Trade and Economic Development, Ch. 3

  1. Maintaining Development in Rich Countries—the U.S. as an Illustration
    1. Continued Economic Growth as a Goal of U.S. Economic Policy
    2. The Changing Structure of the American Economy
    3. The Institutionalization of Economic Growth
    4. Possible Barriers to Continued Growth

Economic Report of the President, January 1956.
Galbraith, J. K., American Capitalism, ch. 1, 4-10
Hansen, A., “Growth or Stagnation in the American Economy,” Review of Economics and Statistics, November 1954.
Kaysen, C., “Looking Around—Book About Competition,” Harvard Business Review, May-June 1954.
Kuznets, S., Economic Change, chs. 9, 10.
Schumpeter, J. A., Capitalism, Socialism, and Democracy, Part II, chs. 28.
Slichter, S., The American Economy
Wright, D. M., Democracy and Progress, chs. 5-7, 12.

Source: Harvard University Archives. Syllabi, course outlines and reading lists in Economics, 1895-2003, Box 6, Folder “Economics, 1955-1956 (1 of 2)”.

______________

Mid-year and Course Final examinations

Posted here.

______________

Harvard Economics Ph.D. 1950

Robert Edward Baldwin, A.B. (Univ. of Buffalo) 1945, A.M. (Harvard Univ.) 1949.

Subject, Economics. Special Field, International Trade.
Thesis, “The Economics of Internal Migration in the United States, 1870-1940.”

 

Source:Harvard University. Report of the President of Harvard College, 1949-50, p. 195.

______________

Robert E. Baldwin
Education and Positions

1945: A.B., University of Buffalo
1945-46: Instructor, University of Buffalo
1950: Ph.D., Harvard University
1950-52: Instructor, Harvard University
1952-57: Assistant Professor, Harvard University
1957-62: Associate Professor, University of California, Los Angeles
1962-64: Professor, University of California, Los Angeles
1964-present: Professor, University of Wisconsin-Madison
1975-78: Chairman, Department of Economics, University of Wisconsin
1974-: F.W. Taussig Research Professor, University of Wisconsin
1960-61: Ford Foundation Foreign Area Training Fellowship, Federation of Rhodesia and Nyasaland
1963-64: Chief Economist, Office of Special Trade Representative, Executive Office of the President, Washington, D.C.
1967-68: Research Professor, The Brookings Institution, Washington, D.C.
1969-70: Ford Faculty Research Fellowship
1974-75: U.S. Department of Labor, Bureau of International Labor, Washington, D.C., Research Contract
1975 (Summer): United Nations Conference on Trade and Development (UNCTAD), Geneva, Switzerland, Consultant
1978-79: Consultant, World Bank, Washington, D.C.
1982-: Hilldale Professorship, University of Wisconsin-Madison
1982-: Research Associate, National Bureau of Economic Research
1986-1989: Chair, Social Systems Research Institute, University of Wisconsin-Madison
1988 (Summer): Shelby Cullom and Katheryn Davis Visiting Professor, The Graduate Institute of International Studies, Geneva
1994-: Research Associate, Centre for Economic Policy Research
1995-: Fellow, American Academy of Arts and Science

Source:  Robert Baldwin’s NBER c.v. that also included a list of publications to date (ca. 1997).

______________

Robert Edward Baldwin (1924-2011)
Obituary

Robert Edward Baldwin, born in Buffalo New York on July 17, 1924, died in Madison on April 7, 2011. He was Hilldale Professor of Economics, Emeritus, at the University of Wisconsin-Madison. A lifelong academic, Baldwin was one of the world’s most influential thinkers on international trade, an adviser to governments and international organizations, and an inspiring teacher much beloved by generations of students who carry forward his light as renowned scholars in their own right.

Graduating from the University of Buffalo, he enrolled in the Harvard and received his doctorate in 1950. In Cambridge, he married his lifelong soul mate, Janice Murphy, mother of his four children, two of whom were born while he was an Assistant Professor at Harvard. During this time, he published his best-known theoretical contribution – the “Baldwin Envelope” [“Equilibrium in International Trade: A Diagrammatic Analysis,” Quarterly Journal of Economics 62(5), (November, 1948), pp. 748-762.] – which has been taught widely for six decades and remains part of trade economists’ training even today. After Harvard, he moved to UCLA as an Associate Professor where his third and fourth children were born.

In 1960, he took the whole family for a year to Salisbury Rhodesia (now Harare Zimbabwe) while he worked on his theory of trade and development (published as the book “Economic Development and Export Growth: A Study of Northern Rhodesia, 1920-1960”). Soon after returning to UCLA, President Kennedy appointed him as Chief Economist of the newly formed Office of the Special Trade Representative. The family moved to Washington while he worked in the White House helping the US prepare for the GATT trade negotiations known as the Kennedy Round.

After his White House stint, he was appointed professor at the University of Wisconsin-Madison, a position that he held till his death (Emeritus since 1997). He was appointed Fellow of the American Academy of Arts and Sciences in 1995, the same year he was elected President of the Midwest Economics Association.

Baldwin was author or editor of 22 books (last one in December 2008) and over a hundred academic articles (the last one in December 2010). [list through ca 1997] His early contributions were mostly to mathematical trade theory, but he also made important contributions to the profession’s empirical understanding of global trade patterns. After his time in the Kennedy White House, he wrote several books and many articles on trade policy and trade politics. Throughout his professional life, his interest in trade was interwoven with an interest in and research on developing nations, with a special emphasis on the development-inhibiting effects of tropical diseases.

In addition to his academic positions, Baldwin engaged actively in the policy world. He was on the External Advisory Panel to the General-Secretary of the WTO (2001-03), and in that capacity attended the Ministerial Meeting in Doha Qatar that launched the WTO’s ongoing trade negotiations. He often testified before US Senate and House Committees on trade matters, and spent time at the US Department of Labour, the United Nations Conference on Trade and Development (Geneva), and the World Bank (Washington). In an effort to improve US trade statistics, he chaired the National Academy of Science’s Panel on Foreign Trade Statistics (1991-92). In his role as policy advisor, he was a member of the Council of Foreign Relations (1968-2011), the US Chamber of Commerce’s Committee for Economic Development and the Atlantic Council (1960s and 1970s), and more recently, the International Advisory Board for Ukraine’s Economics Education and Research Consortium (1999-2009).

He is survived by his wife Janice, his daughters Jean and Nancy, and his son Richard as well as grandchildren Shari, Dina, Leila, Elise, Robert, Ellen, Julia, and Nicky. He was predeceased by his oldest son, Robert, in 2007.

Baldwin was also an “academic father” to scores of students, inspiring them with his quiet but deeply held passion for combining academic rigor with real-world applicability. Many of his students have become professors in Universities across the world. His vocation is also carried on by his son Richard, and son-in-law Gene Grossman, both of whom are professors of economics specialising in international trade.

 

Source: Obituary for Robert E. Baldwin posted by the Cress Funeral Home, Madison, Wisconsin.

Image Source: Selection from photograph (ca. 1975) of Robert E. Baldwin from the University of Wisconsin Archives/The University of Wisconsin Collection/The UW-Madison Collection/UW-Madison Archives Images.