A graduate student’s application for candidacy for an economics Ph.D. provided information to the Dean of Harvard’s Division of History, Government, and Economics to establish the eligibility for taking the General Examination and it also then provided a check-list for the satisfaction of degree requirements — French and German language competency, acceptance of the Ph.D. thesis, and success in both the General and Special Examinations.
In addition to the application itself, this post includes the file correspondence and the Harvard course transcript for the future president of the American Economic Association (1949) and economics professor at Berkeley, Howard Sylvester Ellis (1898-1992). His most important contribution was perhaps the volume he edited and first published in 1948, A Survey of Contemporary Economics (11th printing in March 1966. The chronology of Ellis’ career has been included as well, following his Harvard graduate school record.
_______________________
HARVARD UNIVERSITY DIVISION OF HISTORY, GOVERNMENT, AND ECONOMICS
Application for Candidacy for the Degree of Ph.D.
[Note: Boldface used to indicate printed text of the application; italics used to indicate the handwritten entries]
I. Full Name, with date and place of birth.
Howard Sylvester Ellis. Denver, Colo. July 2, 1898.
II. Academic Career: (Mention, with dates inclusive, colleges or other higher institutions of learning attended; and teaching positions held.)
State University of Iowa, 1916-20.
Chicago, Summer 1920.
University of Michigan, 1920-1922. Half-time graduate work & Instructor of Economics.
Harvard University, 1922-3 [Thayer Fellow], Assistant in Economics 1923–.
III. Degrees already attained. (Mention institutions and dates.)
B.A. State University of Iowa, 1920 (June).
M.A. University of Michigan 1922 (March).
IV. General Preparation. (Indicate briefly the range and character of your under-graduate studies in History, Economics, Government, and in such other fields as Ancient and Modern Languages, Philosophy, etc. In case you are a candidate for the degree in History, state the number of years you have studied preparatory and college Latin.)
History: Medieval, 1 yr; Greek & Roman, 1 yr; United States, 1 yr; Modern European, 1 yr.; Social Reform, 1 semester. Economics: Principles, 1 yr.; Accounting, Banking, Business Administration, Hist. of Theory –summer session. See also under “Remarks”. Sociology: Principles, 1 yr.; Anthropology, 1 yr. Latin: 4 yrs. prep., 1 coll.; German: 4 yrs coll.; French: 2 yrs coll; Italian: 1 summer coll.
V. Department of Study. (Do you propose to offer yourself for the Ph.D., “History,” in “Economics,” or in “Political Science”?)
Economics.
VI. Choice of Subjects for the General Examination. (State briefly the nature of your preparation in each subject, as by Harvard courses, courses taken elsewhere, private reading, teaching the subject, etc., etc.)
Economic Theory and Its History. Course 11, Prof. Taussig; Seminary in Theory & History, Prof. Taylor at Michigan & his “Course 7”; courses with Prof. Knight at Iowa; Course 14, Prof. Bullock; teaching principles at Michigan & Harvard.
Industrial History: Courses 2a & b, Professor Usher & supplementary reading. Undergraduate concentration in history’.
Railroads. Course at Michigan, Prof. Sharfman. & Readings contemplated.
Public finance. Course 31, Prof. Bullock.
Political Theory. Course Gov’t 6, Prof. McIlwain.
Economic Theory & Its History.
(Historical subject now contemplated as subject for thesis and special examination)
VII. Special Subject for the special examination.
Historical subject in economic theory. Money and Banking with special reference to recent theory (note by H.H.B. 2/12/29).
VIII. Thesis Subject. (State the subject and mention the instructor who knows most about your work upon it.)
Recent German Monetary Theory.
IX. Examinations. (Indicate any preferences as to the time of the general and special examinations.)
Spring 1924. General Examination
X. Remarks
Preparation in fields indicated beside undergraduate courses.
Economics: Seminary in History of Theory & Theory, 2 yrs;
Advanced Theory, 1 set (F.M. Taylor); 1 yr (F.W. Taussig)
Railroads, 1 semester; Corporations, 1 semester;
Public finance, 1 yr (Bullock); Statistics, 1 yr;
Economic or Industrial History, 1 yr.;
Other courses currently.
Philosophy: History of Philosophy, 1 yr.; Metaphysics, 1 semester; Kant, seminary, 1 semester.
Special [Examination] Professors Taussig, Williams, Mason
Signature of a member of the Division certifying approval of the above outline of subjects.
[signed] T. N. Carver
* * * [Last page of application] * * *
[Not to be filled out by the applicant]
Name:Howard Sylvester Ellis
Approved: January 11, 1924
Ability to use Frenchcertified by C. J. Bullock, Apr. 11, 1923.
Ability to use Germancertified byC. J. Bullock, Apr. 11, 1923.
Date of general examinationMay 26, 1924. Passed. [F.W.T.]
Thesis receivedApril 1, 1929
Read by Professors Hawtrey, Taussig, Williams
Approved May, 1929
Date of special examination June 10, 1929 [F.W.T.]
Recommended for the Doctorate [left blank]
Degree conferred [left blank]
Remarks. [left blank]
* * * * * * * * * * * * * *
Certification of reading knowledge
of French and German for Ph.D.
HARVARD UNIVERSITY Department of Economics
Cambridge, Massachusetts
April 11, 1923
Dear Dean Haskins:
This is to certify that I have examined Mr. H. S. Ellis and find that he has such a knowledge of French and German as we require of candidates for the Ph.D. degree.
Very sincerely yours
[signed]
C. J. Bullock
Dean C. H. Haskins
* * * * * * * * * * * * * *
General Examination, date and
change of an examiner
[carbon copy]
22 May, 1924
My dear Professor Taussig:
This is to remind you that are chairman of the committee for the general examination of H. S. Ellis for the Ph.D. in Economics, to be held on Monday, 26 May, at 4 p.m., in Widener U. I enclose Mr. Ellis’s papers herewith. Professor Dewing is going to substitute for Professor Cunningham on the committee.
Very truly yours,
[unsigned copy]
Secretary of the Division
Professor F. W. Taussig
* * * * * * * * * * * * * *
General Examination, date and
change of an examiner
[carbon copy]
22 May, 1924
My dear Mr. Ellis:
This is to remind you that your general examination for the Ph.D. in Economics is to be held on Monday, 26 May, at 4 p.m., in Widener U. Professor Dewing is going to substitute for Professor Cunningham on the committee.
Very truly yours,
[unsigned copy]
Secretary of the Division
Mr. H. S. Ellis
* * * * * * * * * * * * * *
Passed General Examination
HARVARD UNIVERSITY Department of Economics
Cambridge, Massachusetts
May 28, 1924
My dear Haskins:
As chairman of the committee appointed to conduct the general examination of H. S. Ellis for the Ph.D. degree in Economics, I have to report that Mr. Ellis passed the examination to the satisfaction of the committee. While his showing at the examination was not without defects, his record on the whole made the case clear.
Very truly yours,
[signed]
F. W. Taussig
Dean C. H. Haskins
* * * * * * * * * * * * * *
Scheduling Special Examination,
Changing special field
to Money & Banking
HARVARD UNIVERSITY Department of Economics
H. H. Burbank
34 Holyoke Street
Cambridge, Massachusetts
February 12, 1929
Dear Miss Campbell:
I am confirming our telephone conversation of a few moments ago. The special field of Howard Ellis will be Money and Banking with special reference to recent theory.
Ellis wishes as late a date as possible and you have suggested as near June 10 as can be arranged. I will write Ellis and ask him to correspond with you.
Very sincerely,
[signed]
H. H. Burbank
* * * * * * * * * * * * * *
Thesis summary
UNIVERSITY OF MICHIGAN
ANN ARBOR Department of Economics
1327 Wilmot St.
April 18, 1929
Miss Glady E. Campbell,
Secretary of the Division of History, Government and Economics,
Harvard University, Cambridge, Mass.
Dear Miss Campbell:
Kindly find enclose a summary of my dissertation, and accept my thanks for calling the matter to my attention.
Very sincerely yours,
[signed]
Howard S. Ellis
* * * * * * * * * * * * * *
Passed Special Examination
HARVARD UNIVERSITY Department of Economics
Cambridge, Massachusetts
June 11, 1929
My dear Carver,
As chairman of the committee appointed to conduct the special examination Mr. Howard S. Ellis in economics I have to report that Mr. Ellis passed the examination.
Very sincerely yours,
[signed]
F. W. Taussig
Professor T. N. Carver
774 Widener Library
Cambridge, Massachusetts
* * * * * * * * * * * * * *
HARVARD UNIVERSITY (INTER-DEPARTMENTAL CORRESPONDENCE SHEET)
Cambridge, Massachusetts
Record of H. S. Ellis
in the
Graduate School of Arts and Sciences.
Grades
1922-23
Course
Half-Course
Economics 2a1
A
Economics 2b2
A
Economics 11
A
Economics 31
A minus
Economics 41
B plus
1923-24 (midyear grades)
Course
Half-Course
Economics 14
A minus
Government 6
A
[Note: a supplementary transcript of the record of H.S. Ellis dated May 18, 1929 reports a grade of “excused” for Economics 14 and Government 6 for the 1923-24 year]
Source: Harvard University Archives. Division of History, Government & Economics, Ph.D. Degrees Conferred 1929-30. (UA V 453.270), Box 09.
__________________________
Course Names and Instructors
1922-23
Economics 2a 1hf. European Industry and Commerce in the Nineteenth Century. Assistant Professor Usher.
Economics 2b 2hf. Economic History of the United States. Assistant Professor Usher.
Economics 11. Economic Theory. Professor Taussig.
Economics 31. Public Finance. Professor Bullock.
Economics 41. Statistical Theory and Analysis. Professors Young and Day.
1923-24
Economics 14. History and Literature of Economics to the year 1848. Professor Bullock.
Government 6. History of Political Theory. Professor McIlwain.
Source: Harvard University. Report of the President of Harvard College for 1922-23, 1923-24.
__________________________
Howard Sylvester Ellis Timeline of his life and career
1898. Born July 2 in Denver Colorado.
1916-20. State University of Iowa.
1920. A.B. State University of Iowa.
1920. Summer term, University of Chicago.
1920-1922. Half-time graduate work half-time instructor of Economics, University of Michigan.
1922. A.M. University of Michigan.
1922-23. Thayer Fellow, Harvard.
1923. Ricardo Prize awarded for the best essay written in a special examination held in economics. (Harvard Crimson, 9 June 1923)
1924. February. A.M. in economics, Harvard.
1923-24. Teaching section leader in Economics A (Principles of Economics), Harvard.
1924-25. Non-resident, Frederick Sheldon Travelling Fellowship, Harvard. Studied at the University of Heidelberg.
Image Source: Portrait of Howard S. Ellis (ca. 1925) in Marjorie C. Brazer “The Economics Department of the University of Michigan: A Centennial Retrospective” in Economics and the World aroundIt, edited by Saul H. Hymans (Ann Arbor: University of Michigan Press, 1980). Colorized at Economics in the Rear-view Mirror.
From time to time during my wanderings through internet archives I stumble upon material that is ideal content for Economics in the Rear-view Mirror and that is worth the effort of digitization. Some old published Calendars of the London School of Economics and Political Science can be accessed online and they provide much in the way of thick course descriptions and suggested readings.
This post is limited to the course offerings under the heading “Banking and Currency” that covers both domestic and international aspects of banking and money markets. In the academic year 1924-25 this field was covered by then Reader in Commerce, T. E. Gregory, and Assistant in Economics, Marjorie Tappan.
Almost all the readings listed for the courses have been successfully linked to on-line copies.
Other fields will be added in the near future, so do check back with Economics in the Rear-view Mirror!
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London School of Economics
and Political Science Calendar for Thirtieth Session 1924-25
* * * * * * * * * * *
Who, what, and when
The Banking and Currency Instructors:
T. E. Gregory, D.Sc. (Econ.) London; Sir Ernest Cassel Reader in Commerce in the University of London.
Bachelor of Science in Economics (B.Sc.Econ.)
Bachelor of Commerce (B.Com.)
Bachelor of Laws (LL.B.)
Bachelor of Arts (B.A.)
Higher Degrees, such as M.A., Ph.D., M.Sc. (Econ.), LL. M., LL.D., D.Sc. (Econ.), or D. Lit.
The Terms:
Michaelmas term (October 6 to December 12, 1924), Lent term (January 12 to March 20, 1925) and Summer term (April 27 to June 26, 1925) Terms M.T., L.T. and S.T., respectively
___________________________
BANKING AND CURRENCY.
The letter Y indicates that the course is a preparation for an Intermediate Examination, Z for a Final Pass Examination, and A for a Final Honours Examination.
The sign ¶ indicates a course beginning at 5.30 p.m. or later.
10. — Y. —Elements of Currency, Banking and International Exchange, a course of fourteen lectures by Miss Tappan, on Tuesdays, at 11 a.m., in the Lent and Summer Terms, beginning L.T. 17th February, S.T. 28th April.
[For B.Sc. (Econ.) Intermediate, B.Com. Intermediate (S.T. only) and B.A. Final Honours in Geography.]
Fee: —£1 15s.
¶ For evening students the same course of lectures will be given on Mondays, at 6 p.m., beginning 16th February.
Fee: — £1 3s. 4d.
Syllabus.
PART I. — The principles governing the existence and distribution of international trade. Statistical problems in the measurement of international trade. The organization and operation of international markets. The balancing of international indebtedness. The Foreign Exchanges.
PART II. — The functions of currency and the service of (a) money and (b) credit in their performance. The standard in a currency system and its relation to commodity prices. The elements of (1) The British Monetary System; (2) The British Banking System (a) pre-war; (b) at the present time. The influence of the Bank of England in the money and investment markets.
11. — Z and A. — Principles of Currency and Banking, a course of twenty lectures by Miss Tappan, on Wednesdays, at 12 noon, in Michaelmas and Lent Terms, beginning M.T. 8th October, L.T. 14th January.
[For B.Sc. (Econ.) Final and B.Com. Final Part I.]
Fee:— For the Course, £2 10s.; Terminal, £1 10s.
For evening students the same course will be given on Tuesdays, at 7 p.m., beginning 7th October.
Fee:— For the Course, £1 13s. 4d.; Terminal, £1.
Syllabus.
M.T.Metallic Currency. — The nature of money: recent discussions of the nature and adequate definition of money. The classification of monetary systems. The value of money: recent discussions of the problem. The return to sound money: deflation and devaluation. The social effects of rising and falling prices. Periodicity and anticipation in relation to monetary value.
L.T.Banking and the Money Market. — The functions and economic significance of banking. The general structure and methods of banking. The cheque system and the nature of deposits. Banking in relation to the price level. The functions of Central Banks. The regulation of Note-issues, and the Bank Acts. Comparison with foreign systems. Recent developments in banking.
12. — Z and — The Stock Exchange Speculative Markets, and Dealing, a course of six lectures by Dr. Gregory, on Tuesdays, at 11 a.m., in Summer Term, beginning 28th April.
[For B.Com., Group A, and B.Sc. (Econ.), Final — special subject.]
Fee:— 12s.
¶ For evening students the same course will be given on Tuesdays, at 7 p.m., beginning 28th April.
Fee:— 8.
Syllabus.
Markets, Valuation, and the Function of the Dealer. The Machinery of the Speculative Market. How far it requires organisation and regulation. The Stock Exchange as an example of the speculative market, and an indispensable adjunct of the banking system. Constitution of the London Stock Exchange. Methods of Dealing. The Settlement. Comparison with Foreign Markets. Promotion and Issue. The general causes affecting the value of securities.
13. — A. — The History of Currency and Banking, with special reference to England, a course sixteen lectures, by Dr. Gregory, on Thursdays, at 5 p.m., in Lent and Summer Terms, beginning L.T. 15th January, S.T. 30th April.
[For B.Sc. (Econ.), Final—special subject.]
Fee for the course: £2; L.T., £1 10s.; S.T., 15s.
Syllabus.
The monetary system in the Middle Ages. History of the English silver pound. The silver famine and the effects of the supplies from the American mines. The controversy on the export of bullion and the Act of 1663. The early goldsmith bankers and the rise of banking in England. The foundation and early history of the Banks of England, Scotland and Ireland. The recoinage of 1696. The guinea and its ratings. Sir Isaac Newton’s reports on the currency. The recoinage of 1774. The restrictions on the tender of silver, Lord Liverpool’s Report of 1805, and the adoption of the gold standard.The different developments of banking in England, Scotland and Ireland during the eighteenth century. The commercial expansion after 1763. The restriction of cash payments. The Bullion Committee. Lord Stanhope’s Act. The resumption of cash payments, and the various currency proposals made in connection with it by Ricardo, Baring and Huskisson.
The modifications of the privileges of the Bank of England, and the rise of the English joint stock banks. The Bank Acts of 1844 and 1845. Recent developments in Banking.
Throughout the course the attention of students will be specially directed to the study of important documents and to the sources of historical information generally.
14. — Z and A. — The Foreign Exchanges and International Banking, a course of five lectures by Dr. Gregory, on Thursdays, at 12 noon, in Summer Term, beginning 30th April.
[For B.Com., Group A, and B.Sc. (Econ.), Final—special subject.]
Fee:— 10s.
¶ For evening students the same course will be given on Thursdays, at 7 p.m., beginning 30th April.
Fee:— 6s. 8d.
Syllabus.
The concept of Foreign Exchange. Types of Bills of Exchange. Quotations and Markets. Bankers’ credits in relation to the Exchanges. The Discount Market and its relation to Finance Bills. Arbitrage. Forward purchases and sales of Bills. The regulation of Exchange rates by discount rate variations. The fundamental causes of Exchange movements, the purchasing power parity. The development of the theory of the Exchanges. The organisation of International Banking. Exchange in relation to trade. “Exchange dumping.”
15. — Z and A. — Banking and Finance in the Principal Countries, a course of forty lectures by Miss Tappan (T.) and Dr. Gregory (L.T.), on Tuesdays, at 12 noon, and Wednesdays, at 11 a.m., beginning M.T. 7th October, L.T. 13th January.
[For B.Com., Group A, and B.Sc. (Econ.), Final — special subject.]
Fee: — Sessional, £5; Terminal, £3.
¶ For evening students the same course of lectures will be given on Tuesdays, at 8 p.m., and Wednesdays, at 7 p.m., beginning 7th October.
Fee: — Sessional, £3 6s. 8d.; Terminal, £2.
(a) The U.S.A., South America and the Near East, twenty lectures by Miss Tappan, in the Michaelmas Term.
(b) Europe, twenty lectures by Dr. Gregory, in the Lent Term.
Syllabus.
This course will describe the main features in the evolution of the Currency and Banking Organisation of the countries concerned; the present position and the main problems of current interest.
* * * * * * * * * * *
16.¶ — Z and A. — Banking in the British Dominions, a course of nine lectures by Dr. Gregory, on Thursdays, at 7 p.m., in the Lent Term, beginning 15th January.
[For B.Com., Group A, and B.Sc. (Econ.), Final—special subject.]
Fee: — 18s.
Syllabus.
The legal position and present economic organisation of Banking and Currency in Canada, South Africa, Australasia and India.
* * * * * * * * * * *
17. — A. — Recent Monetary History and Monetary Controversies: an Introduction to the Monetary History of the Modern World, a course of six lectures by Dr. Gregory, on Wednesdays, at 5 p.m., in the Summer Term, beginning 29th April.
[For B.Com., Group A, and B.Sc. (Econ.), Final.]
Fee: —12s.
Syllabus.
The triumph of the gold standard in the last third of the 19th century. The re-opening of controversy; bimetallism, the gold exchange standard. The theoretical implications of the gold exchange standard. The revival of monetary mysticism. Knapp and his followers. The rise of prices and the suggested stabilisation of the value of money. Fisher’s Compensated Dollar. The spread of banking and the evolution of banking theory: was there a philosophy of Central Banking at all? The War and the ruin of the gold standard. Cassel’s theory of the Foreign Exchanges. The Monetary theories of the Brussels and Genoa Conferences Stabilisation and the Discount Rate.
* * * * * * * * * * *
18.¶ — Banking Class, for students taking B.Com., Group A. or taking Banking as their special subject for the Final B.Sc, (Econ.), by Miss Tappan, in the Michaelmas Term on Tuesdays. at 3 p.m., beginning 14th October (day students); and Mondays, at 8 p.m., beginning 13th October (evening students). This class will be held by Dr. Gregory in the Lent and Summer Terms; on Tuesdays at 3 p.m., beginning 20th January (day students), and Thursdays at 6 p.m. beginning 22nd January (evening students).
N.B. — Reference should also be made to the following courses:—
No. 1. Accounts I.
No. 2. Accounts II.
No. 132. Mercantile Law (I.).
No. 135. Law of Banking.
Paul A. Samuelson, end of 1960 or early 1961, seen here reading between the lines.
As the following documents show, by 1961 the M.I.T. administration fully appreciated the development of its department of economics from a humble source of curricular enrichment for engineers and natural scientists to a powerhouse of modern economic analysis that was a respected player in the academic major league. Indeed the hope was for political science, psychology, and linguistics to follow suit.
REPORT OF THE VISITING COMMITTEE 1960-61
DEPARTMENT OF ECONOMICS AND SOCIAL SCIENCE
In a well-attended, one-day meeting on April 27, 1961, the Visiting Committee of the Department of Economics and Social Science met with a representative group of the senior faculty of the department to discuss the progress of its teaching and research programs. Since the department embraces a number of distinct fields, key faculty members in those fields reported separately on their activities, plans, and problems. A summary of those reports is attached [Perhaps to be found elsewhere in the archives.], with an appended list of persons attending the meeting.
The Committee was favorably impressed by the past progress and the future prospects of the Social Sciences at M.I.T. The following highlights may be singled out for the consideration of the Corporation and the administrative officers:
The older Ph.D. program in Economics and the newer one in Political Science are both thriving. Fellowships are a continuing need at the graduate level, especially in fields such as these in which there are limited opportunities for teaching or research assistantships in the first two years. Economics has attracted many students with outside fellowships for their first year, and Political Science has a Carnegie Foundation grant which provides support for graduate students in the area of political development. This leaves an unfilled need for Economics fellowships in the second year and for Political Science fellowships in areas not covered by the Carnegie grant.
Now that the area of political development is as strong as it is, the Political Science Section’s next target is a comparable strength in the areas of government, science, and defense policy. This is an especially appropriate field for the Institute to cultivate, and it deserves support.
The undergraduate “double majors” in a combination of Economics or Political Science with a field of Science or Engineering are holding their own, but the department feels considerable difficulty in dramatizing the attractions of these courses to entering undergraduates — in contrast to its outstanding success in attracting graduate students.
An excellent start has been made toward the introduction of a new Ph.D. program in Psychology. The Institute already has considerable strength not only in that field but also in certain adjacent and supporting fields such as Biology, Mathematics, Linguistics, Communications, and Industrial Management. The next few years will be critical ones for this new graduate program.
When the Ph.D. program in Psychology is solidly established, consideration should be given toward adding the option of Psychology as an undergraduate major within the framework of Course XIV.
The Industrial Relations Section has been an active and constructive part of the department’s overall effort. We note with approval that preliminary steps have been taken to protect the Industrial Relations Fund against excessive drain in support of other departmental activities.
We learn with interest that the department has been experimenting with lectures in the introductory Economics course, as a means of exposing more beginning students to senior faculty. We recommend that other teaching aids also be considered, such as video-recorded lectures and demonstrations.
Since library facilities are so very important in the Social Sciences, continuing and enhanced support is recommended in this area.
The foregoing recommendations should be interpreted as tentative rather than definitive; for, in the nature of the case, your Committee’s visit consisted of a friendly hearing of the department’s point of view rather than a searching audit of its performance. At the same time, we should like to express our appreciation for the cooperation shown us by Dean Burchard, Professor Bishop, and the other department members who met with us.
Respectfully submitted,
James M. Barker
David F. Cavers
Jasper E. Crane
Davis R. Dewey
George P. Edmonds
Robert L. Moore
Willard L. Thorp
Teddy F. Walkowicz
Theodore V. Houser, Chairman
From the Annual Report of the President of M.I.T. for 1960-61
The Social Sciences
In the light of the concerns of the Centennial for the larger influences of science upon society, I think it appropriate to review this year the state of the social sciences at the Institute. That we should have become occupied with these areas was inevitable, and the Institute has a clear obligation to cultivate especially those that relate most directly to modern developments in engineering, science, and mathematics. M.I.T. has recognized this responsibility and has responded with strong and growing support to work in the social sciences in the School of Humanities and Social Science and elsewhere. These activities are giving to the Institute an entirely new dimension that few not associated intimately with M.I.T. yet appreciate.
It is a simple truth that the interests of the great physical and social sciences were never more interwoven than today. The overriding practical problems of our time — defense; disarmament; the economics of change; the politics of peace; the relationships among industry, science, and government — require joint technical and social analysis. The very progress of science is influenced by the broader social context, and the advances of engineering affect all our human institutions.
In our decision to encourage the growth of certain key social sciences at M.I.T., we determined not only to build on strength, but also to exploit particularly those that have special relevance to our central concerns with science and engineering. We hope to create more points of contact between the social and physical sciences and to foster more fruitful collaboration between them. In this way, in spite of enormous pressures for growth, we can delimit the domain of our interests and the way in which we allocate our resources to them.
We have given special attention to those fields in which mathematics and statistical techniques are playing an increasingly important role. This is, of course, completely compatible with our M.I.T. style, with our desire to be quantitative, the analytical, the mathematical. But by no means are we seeking to build our social sciences in the image of the physical. We recognize full well the many differences in set and attitude that distinguish them. An exaggerated insistence on emphases that are too narrow or criteria that are too rigid will only defeat our long-range objective of making the social sciences an integral part of the modern scientific university. Each field must be free to develop in its own way, to follow with complete freedom its own professional instincts.
From this point of view, the flowering of the social sciences at M.I.T. represents a new experience for us. Accustomed as we are to the demonstrable factual data of the physical sciences, we must accept the larger subjective element of judgment that enters into the social sciences in their present state. Since developments in many of these areas are open to a variety of interpretations, we must foster, within the limits of our aims and resources, a range of views and interests. The ultimate safeguard, however, lies not in seeking an impossible balance among modes of thought, but in recruiting a faculty of the highest intellectual power and integrity. This we have done.
In my report of a year ago I touched on a faculty survey of the social sciences which gave highest priority for development to fields of economics and economic history, political science, and psychology. I want now to comment briefly on the current status of these fields at the Institute and to examine in passing our commitments and our hopes in these areas.
ECONOMICS
The oldest social science at M.I.T., economics is still by a sizable margin the largest. The teaching of economics goes back to 1881 and Francis Amasa Walker. General Walker, the Institute’s third president and one of its great builders, was an authority on political economy — as economics was then called — and his understanding of the processes in American industrial development notably influenced his views on the education of engineers. He gave an outstanding lecture course on political economy and was the author of a distinguished text in the field. He also brought other economists to the Institute.
Yet, until well into the modern era of M.I.T., economics remained largely a service department for the School of Engineering. Only since World War II has the department matured and assumed a truly professional character. Today it is universally conceded to be among the most distinguished. Indeed, by any of the usual measures — the stature of its teachers, the quality of its research, the achievements of its graduates — it ranks in the small handful of leaders. This year the president of the American Economic Association and the presidents-elect of the Econometric Society and of the Industrial Relations Research Association are members of this department. This year, too, M.I.T. was selected as first choice by more Woodrow Wilson Fellows in economics — eighteen out of eighty — than any other school in the country. The strengths which have won this kind of recognition within the profession are substantial indeed. They were achieved, essentially, by encouraging Economics at M.I.T. to chart its own professional course; by the development of a distinguished graduate curriculum and of a major research program; and by insistence on the same standards of excellence we demand of our scientific and engineering departments. As a consequence, we have accomplished in economics the same kind of comprehensive renovation of purpose that Karl Compton undertook at an earlier date for the School of Science.
Economics at M.I.T. is also an important resource for other areas of teaching and research, and for the School of Industrial Management in particular. Management education at M.I.T. grew out of our teaching in economics, and today the teaching and research of the Department and the School reinforce one another more strongly than ever. Much of the research of the Department bears directly on the interests of the School — research on the economics of particular technologies; on the problems of measurement of productivity and output; on the contribution of technical progress to economic growth; on the origin and growth of new enterprises. Through this close relationship between the Department and the School, we also enjoy a fruitful interchange of theoretical and practical points of view.
The history and current role of economics at M.I.T. is the model for our development of other social sciences. We have now established sections of political science and of psychology within the Department of Economics and Social Science. Both are fields in which student and faculty interest is keen and in which we have unusual opportunities to make important contributions.
POLITICAL SCIENCE
Because of the interweaving of technology with all the affairs of the modern world, and especially with those of government, we have set high priority on the development of political science. It is an area in which we have been moving rapidly ahead. This June we awarded our first Ph.D. degrees in this field, and there are now about thirty doctoral candidates within the Section. In addition, some five hundred undergraduates take elective courses in political science each year.
The Section now offers courses in six fields of political science, all of which are related to other interests of the Institute: international relations and foreign policy, political communication, defense policy, government and science, political and economic development, and political theory and comparative politics. Besides providing opportunities for combining work in political science with a scientific or engineering field, the faculty of the Section maintain close ties with their colleagues in economics, psychology, industrial management, and city and regional planning.
In the past two years, we have developed superlative strength in the field of comparative politics of developing areas, and through the association of the Section with the Center for International Studies we probably have as strong a faculty as is to be found anywhere in the politics of development. In support of this work, the Institute received two notable gifts this year. One, the donation of $500,000 from Dr. Arthur W. Sloan and Dr. Ruth C. Sloan of Washington, D.C., establishes a professorship in political science with emphasis on African studies. Not only does this gift provide an important new endowed professorship, but it also recognizes in a most dramatic way the growing stature of political science at the Institute.
The second grant is one of $475,000 from the Carnegie Corporation for research in training on the politics of transitional societies. The grant will make possible expansion of our research on the problems of nation-building in transition countries such as the newly emerged African and Asian nations. It, too, gives substantial recognition to the quality of our program. The Carnegie grant, among other benefits, establishes graduate fellowships both for course work at M.I.T. and for field work towards the doctoral thesis. We are enthusiastic about the values to be derived from this aspect of the grant which will permit us to send our students overseas for on-the-spot research in developing areas.
We have enjoyed magnificent opportunities for field studies in other areas of our political science activities through the generous support of the Maurice and Laura Falk Foundation, the Ford Foundation, and the Rockefeller Foundation. The Ford Foundation has also underwritten much of our work on government and science, and the Rockefeller Foundation this year supported a new seminar on arms control. This seminar brought together some thirty individuals in the Cambridge academic community with strong interests in both the technological and political aspects of this subject. We very much hope that this may prove to be the beginning of a substantial new research program on defense policy.
This brief sampling of our progress in political science is intended only to suggest the vitality of this field at the Institute. It has grown quickly, but without overstretching itself. It has set high standards in research, and it has developed both its undergraduate and graduate courses in a most creative and constructive spirit. This new venture for M.I.T., in sum, has met with outstanding success.
PSYCHOLOGY
The example of political science has encouraged us to press forward even more vigorously with our plans to establish a psychology section within the Department of Economics and Social Science. The Institute already has great strength in psychology, both within the Department and elsewhere; and we have made marked progress this year in planning for a graduate program. This effort is being led by Professor Hans-Lukas Teuber, whose appointment I reported last year and who has now moved his research projects in physiological psychology from New York to Cambridge. Professor Teuber has brought with him a number of research associates and four postdoctoral fellows. In addition, we hope to make two additional faculty appointments in psychology soon.
To provide space for the new Section, the Institute has acquired the Central Scientific Company building at the corner of Amherst and Ames Streets. All three floors of this structure, which is located adjacent to our main academic group, will be devoted to an expansion of our teaching and research in psychology. When the necessary renovations are completed during the coming year, the building will be equipped with undergraduate and graduate laboratories, seminar rooms, animal quarters, and testing, observation, and office facilities.
The work of the Psychology Section will encompass three general areas: social and developmental; experimental; and physiological and comparative psychology. Our teaching in all three areas will put special emphasis on the experimental and the mathematical. And in our research we hope to create new opportunities for interdisciplinary cooperation. This hope reflects the fact that psychology, especially in its quantitative aspects, is already intimately associated with many areas of Institute activity.
The relations of our experimental group with other M.I.T. activities, for example, have already had an important influence on the development of experimental psychology in this country. Our collaborative efforts include studies in such fields as communication and coding theory, automatic pattern recognition, signal detection theory, computer simulation of intelligent behavior, and others. There are many psychologists at the Institute concentrating on problems of this kind, and there are more at Lincoln Laboratory who are also concerned with problems of perception and observation and man-machine interactions.
The new Section’s work in physiological and comparative psychology will have similar opportunities for collaboration with research in progress in the Department of Biology and in the Center for the Communication Sciences, where investigations in communication biophysics are focused on the principles of organization of the central nervous system and on biophysical information handling. There are also a number of psychologists in the School of Industrial Management, and it is to be hoped that the work of the Section in social and developmental psychology will develop complementary ties with this management group. The latter is working on problems of morale and motivation, of executive leadership, and of creativity in the industrial setting; while the former is primarily concerned with the process of socialization.
Even a cursory review of the sites of interest in psychology at M.I.T. is impressive. The discipline has prospered on this campus, even though we have taken few systematic steps in the past to promote its growth. It has insisted upon recognition, really, and we are now committed to a sound program of development. No one here doubts the wisdom of this decision. The chief problem, indeed, will be to achieve a sense of professional unity among our psychologists without weakening those productive interdisciplinary ties that have given M.I.T. psychology a stamp and style that is all but unique.
LINGUISTICS
The decision was also made this year to offer a program leading to the Ph.D. in linguistics beginning in the fall of 1961, and we are in the process of establishing appropriate new sequences of work in linguistics for both undergraduate and graduate students. This work will be directed by the Department of Modern Languages, which has been carrying out important basic research in linguistics for a number of years. It is significant that among the first students we have accepted for this graduate program are majors in mathematics and physics as well as in linguistics.
Our concern with linguistics actually derives from the efforts of Professors Norbert Wiener and Claude Shannon in their pioneering work on the mathematical theory of communication. The study of the logical relationships within languages employs mathematical techniques comparable to those used in the general area of information theory. Moreover, recent developments in computer design, switching theory, and other similar areas are of first importance in the field of applied linguistics and in linguistic analysis.
It is not surprising, therefore, that much of our research in linguistics has taken place in the Center for the Communication Sciences, where linguists work in close association with mathematicians, electrical engineers, and physicists as well as with biologists and psychologists. This cooperative research has been carried forward in both theoretical and applied linguistics. We have a central concern with the structure and logic of language. We have also undertaken a number of promising applied projects, including work on mechanical translation and on machine perception and synthesis of human speech. These examples are typical of the kind of research through which M.I.T. has gained an international reputation in linguistics. Now, with our new doctoral program, the prospects for the rapid further development of this field at the Institute are exceedingly bright.
For the most part today’s artefact speaks for itself. It is another historical economics program brochure added to the growing Economics in the Rear-view Mirror collection.
I entered Yale College as a freshman in the academic year 1969-70 so the Yale brochure digitized below was printed just about two decades before I became an apprentice economist. Now in my senior years two decades does not seem to be all that long but it would appear that the development of the Yale economics department from 1950 to 1970 was about as dramatic as my own from infant to college student over the same time period.
Preparing this post, I was struck by the genuinely small scale of the graduate economics program at Yale in 1950, that “microeconomics”/“macroeconomics”/“econometrics” were not yet words to be found in the course descriptions, further that the history of economic theories was a visible part of the curriculum, and finally that institutional nuts-and-bolts (as well as economic history) did receive relatively greater emphasis in 1950. I was delighted at the “sight” of four of my professors (Healy, Tobin, Lindblom, and Dahl) found in the list of the graduate economics faculty of 1950, an indication that two decades is really not all that long after all within the context of a healthy human life span.
GRADUATE CURRICULUM AND DEGREE REQUIREMENTS
IN ECONOMICS
DEPARTMENT OF ECONOMICS YALE UNIVERSITY NEW HAVEN, CONNECTICUT 1950
DEPARTMENT OF ECONOMICS Graduate Faculty
CHAIRMAN: Professor Kent T. Healy.
DIRECTOR OF GRADUATE STUDIES: Professor Lloyd G. Reynolds.
PROFESSORS: E. Wight Bakke, Edgar S. Furniss, John P. Miller, Eugene V. Rostow (Law), Ray B. Westerfield.
ASSOCIATE PROFESSORS: Neil W. Chamberlain, Klaus E. Knorr (International Relations), Charles E. Lindblom, Richard Ruggles, James A. Tobin.
ASSISTANT PROFESSORS: Robert A. Dahl (Political Science), Challis A. Hall, Jr.
INSTRUCTOR: Robert G. Link.
THE GRADUATE PROGRAM IN ECONOMICS
The objective of the graduate program is to equip students with the theoretical and statistical tools of economic analysis, to broaden their historical and institutional knowledge, and to develop judgment in applying economic analysis to issues of public policy. The wide variety of research institutes and activities at the University, in addition to strengthening the teaching program, enables interested students to gain research experience at an early stage of their careers. Students are also encouraged to acquaint themselves with the techniques of other social sciences through course work in the relevant departments.
The number of graduate students admitted each year is limited, which makes possible an unusual degree of individual instruction and guidance. The fact that the number of students is small relative to the research and teaching activities of the University also enables a large proportion of the student body to be self-supporting after the first year of graduate study.
Preference in admission is given to students who plan to proceed toward the Ph.D. degree. The M.A. degree is awarded on successful completion of one year of course work (no thesis requirement), and most Ph.D. candidates take this degree as a matter of course at the end of their first year.
EMPLOYMENT OPPORTUNITIES AND FINANCIAL ASSISTANCE
BEGINNING GRADUATE STUDENTS. There are available each year several graduate fellowships, varying in amount from $450. to $1,000. It is possible also for a considerable number of students to earn between $200. and $300. per year by grading examinations in undergraduate courses.
ADVANCED GRADUATE STUDENTS. Students who do work of high quality during their first year have numerous additional opportunities during their second and subsequent years of study.
(1) The Sterling Fellowships of $1,500. each, competition for which is open to graduate students in all departments of the University.
(2) Appointment to a teaching position in Economics 10 (Principles of Economics). Advanced graduate students may be permitted to teach a maximum of six hours per week while continuing work toward their degree. Appointments are also sometimes given to students who transfer to Yale after completing one year or more of graduate study at another University and who have had satisfactory teaching experience.
(3) Appointment as a research assistant. There are several research institutes in the University, including the Conservation Center, the Committee on National Policy, the Committee on Transportation, the Institute of Human Relations, the Institute of International Studies, and the Labor and Management Center. In addition, members of the Department have individual research programs in progress on a variety of subjects, including decision-making in the business firm, market structure and price determination in the non-ferrous metal industries, wage differentials under collective bargaining, population growth in the United States, the cyclical behavior of cost-price relations in manufacturing, economic planning in selected countries of Western Europe and the determinants of personal savings and consumption decisions. A considerable number of graduate students are employed each year as part-time research assistants while continuing their graduate study. Compensation for this work is in line with that for members of the teaching staff.
(4) There are occasional opportunities for part-time teaching in other colleges in and near New Haven, and for research assistantships in other departments of the University.
REQUIREMENTS FOR THE DEGREE OF
DOCTOR OF PHILOSOPHY
In addition to the general requirements of the Graduate School, students in Economics are expected to meet the following requirements.
PRELIMINARY QUALIFICATIONS: An undergraduate major in economics is normally required. A student whose major was in another field will be admitted in exceptional cases, but may be required to take more than the usual two years of course work. Students preparing for graduate work in economics are strongly advised to take undergraduate courses in economic theory, mathematics (at the level of differential calculus), statistics, French and German. Courses in psychology, history, and the other social sciences will also be of material benefit to the student in his graduate work.
BASIC TRAINING: Before admission to candidacy for the Ph.D. degree the student must have completed at least sixteen semester courses of a graduate character, of which eight must have been taken at Yale. Some of these courses may be taken in other departments or schools of the University.
GENERAL EXAMINATIONS: A certification of competence is required in the use of quantitative methods, including the statement of hypotheses and theorems in quantitative form, the use of symbolic methods in economic reasoning, and the principal statistical tools used in modern economic research. This requirement will normally be met by the satisfactory completion of the courses, Economics 103a and b, during the first year of graduate study, and must be met by the end of the second year.
At least one year before the student expects to take his degree, his general competence in economics will be tested by a written and by an oral examination. The written examination will test (a) knowledge of all aspects of economic theory, its current status and historical development, (b) knowledge of European and American history with special emphasis on the development of economic institutions in modern times, (c) ability to use theoretical tools, together with historical materials and current factual information, in analyzing issues of economic policy. Preparation for the examination will be provided not only by course work but by study of readings suggested by the department.
The oral examination, to be held within a few days of the written examination, will test for intensive grasp of two specialized fields of economics, one of which will normally be the dissertation field. The fields will be determined in consultation with the Director of Graduate Studies.
Before May 1 or October 1 (as the student elects) in the calendar year prior to that in which he expects to get his degree, the student shall provide the Director of Graduate Studies with six copies of a prospectus, setting forth the subject of his proposed dissertation, the questions it proposes to answer, its potential contribution to economic science, and the research techniques and sources to be used.
COURSE OFFERINGS
Each student is expected to plan his work in consultation with the Director of Graduate Studies in Economics, Mr. Reynolds.
Economics 100, General Economic Theory. Mr. Reynolds, Mr. Ruggles.
Economics 101, Development of Economic Thought. Mr. Miller.
Economics 102, Modern Economic History.
Economics 103a, Economic Statistics. Mr. Tobin.
Economics 103b, Introduction to Mathematical Economics. Mr. Tobin.
Economics 110, Aggregate Economics and Cycle Theory. Mr. Tobin.
Economics 112b, Distribution of Wealth and Income. Mr. Reynolds.
Economics 113a, Price Systems and Resource Allocation. Mr. Ruggles.
Economics 114a, National Income Theory and Measurement. Mr. Ruggles.
Economics 114b, Types of Quantitative Research in Economics. Mr. Ruggles. Economics 120, Money, Credit, and Banking. Mr. Westerfield.
Economics 122, Public Finance. Mr. Hall.
Economics 123b, Public Control of Industrial Organization. Mr. Rostow.
Economics 124, Business Firm and Market Behavior. Mr. Miller.
Economics 125, The Labor Movement and Collective Bargaining. Mr. Chamberlain.
Economics 126, Critique of Industrial Relations Theory. Mr. Bakke.
Economics 127a, Regulatory Labor Legislation. Mr. Lindblom.
Economics 127b, Protective Labor Legislation. Mr. Lindblom.
Economics 128, Critique of Economic Planning. Mr. Lindblom, Mr. Dahl.
Economics 129, International Trade and Finance. Mr. Link.
Economics 135, The Structure of the American Economy. Mr. Ruggles.
Economics 200, Individual Research and Consultation. Department Faculty. International Relations 140, International Economic Problems. Mr. Knorr.
Transportation 102, Transportation Economics. Mr. Healy.
Related Courses:
American Studies 151, American Thought & Civilization, 1620 to the present. Mr. Gabriel.
Anthropology 109a, Culture and Personality. Mr. Linton.
Anthropology 114b, Primitive Economics. Mr. Linton.
Conservation 101b, Seminar in Conservation. Mr. Sears.
Forestry 180b, Forest Economics and Policy. Mr. Zumwalt.
Forestry 128a, Economics of the Forest Products Industries. Mr. Garrett.
Geology 150, Economic Geology. Mr. Bateman.
Geology 153, Seminar in Economic Geology. Mr. Bateman.
Government 134, Constitutional Law and Public Policy. Mr. Cahill.
Government 135, National Government and the Problems of Federalism. Mr. Key.
Government 136, American Political Parties – An Introduction to the Study of Political Behavior. Mr. Key.
History 125, Mediaeval Commerce and Capitalism. Mr. Lopez.
History 154, Liberal & National Movements in Modern Europe. Mr. Kent.
History 191, American Intellectual History in the Early Twentieth Century, Mr. Gabriel.
Mathematics 42, Statistics. Mr. Ore.
Source for text and image: This 1950 graduate economics curriculum brochure was found at the hathitrust.org archive.
M.I.T., home of the heretic Paul Samuelson, proved to be ground zero of this anti-Keynes reaction. This story is well-known now thanks to Yann Girard. The artifact transcribed for this post is a short essay published by Ralph Freeman who was head of the M.I.T. economics department from 1933 to 1958. In it Freeman defended the honor of his department much as Lloyd Reynolds’ essay did for Yale economics.
Thank you for the Atlantic Monthly with McGeorge Bundy’s article which I have. I wish that his defense could have a wider circulation than it received in the Atlantic.
The Buckley book concerns me mainly because of its attack on Samuelson’s text and because of the wide distribution the Buckley book is receiving it is going to stir up a lot more people.
I venture to send you some of the things that come to my desk simply by way of keeping, you informed of the steady bombardment on Paul Samuelson’s text. This bombardment has been increasing in intensity. Yesterday a member of the Corporation came to see me about it. He had not previously had contact with the book, but he had been approached by various business people who were bitterly critical of the book and who brought to him a publication issued down south which raked over the old Namm comments [Benjamin Namm, “Would You Enter a Door Marked ‘Socialism’?” in Collier’s Weekly (April 29, 1950), pp. 34-49] upon the book.
I have just received a copy of the Brooking Institution study, “A Survey of Economic Education” by McKee and Moulton. I am afraid that the comments made in this study on page 17 in regard to economics textbooks will still further stir people up despite the qualifications which the authors carefully include in their statement.
I hasten to reassure you that despite the mounting criticism I stand no less steadfastly behind Samuelson’s right to take the point of view that seems right and proper to him. I think our best defense against criticism is the one that I repeatedly make, and which I assume to be wholly true, and that is that in our own teaching of economics at the Institute we do not follow any line, that we seek to present a balanced point of view and to give the student the tools so that he can reach his own conclusions. I was interested in Bundy’s statement in his Atlantic article that in attacking Mr. Buckley’s book, he did not wish to maintain that Yale was perfect and that “it is possible that Yale…..would benefit from the appointment of a strongly right-wing economist.
I am sure that so long as we can show that our own teaching of economics is not distorted in any direction and that we are not subtly indoctrinating students with any biased point of view, that we have an unimpregnable and sound position.
Yours cordially,
J. R. Killian, Jr.
JRK: mh
* * * * * * * * * *
Department Chair to President “We’re cool kids, really”
Massachusetts Institute of Technology Department of Economics and Social Sciences
Cambridge, Mass.
November 19, 1951
President James R. Killian
Room 3-208
Dear Jim:
As I indicated to you in a recent conversation, a group of the Department staff is preparing a new book of readings to supplement the textbook which we use in Economic Principles (14.01 and 14.02). I have been delaying writing you about this until final decision has been made as to the contents of this new book. However, a tentative table of contents is now available and I enclose it herewith.
As you will observe, the projected book of readings aims to present a variety of points of view ranging from radical to conservative, from Marx and Engels to Pope Leo XIII. There are also readings from classical economists such as Adam Smith, Ricardo and Bastiat. Articles criticizing recent government policies are included as well as various opinions on the economics of the defense program. The use of this book will enable us to do on a large scale what we are already doing with a limited number of collateral readings.
I should like to emphasize once more that the members of the Department as a group range around the center in their economic thinking. There are no extreme radicals or extreme conservatives among us. We try to take a view toward economic problems which is balanced and objective, and in class we try to present both sides of the controversial problems that come up for discussion.
From some of the attacks aimed at Samuelson’s book, I get the impression that economists are to be condemned if they do not unequivocally approve of everything now being done in the name of private enterprise. This attitude, of course, is absurd. If the economic system is to be kept in working order it must be subjected to a critical analysis. In fact it is the job of the economist to do just this.
Some of the more extreme conservatives who are today attacking the teaching of economics are inclined to adopt an ostrich-like attitude. After all we do live in a mixed economy — one that is partly private enterprise and partly government control. This is a fact. Should this fact be hidden from students? The answer is clear. But some of our critics talk as though any discussion of what they regard as undesirable trends should be eliminated or reduced to a minimum.
I can assure you that no member of this Department is trying to undermine the system of freedom. In fact, it is quite the reverse. We are all trying to understand it with a view to making it work better and last longer. Though there is disagreement amongst us on particular issues, we are in agreement on that basic issue.
I am not sure there is much more that I can say. We would be glad to meet any of our critics face to face in a friendly discussion of any points on which they think we are in error. We do not claim to have all the answers. Our analysis might well be improved as the result of more exchange of ideas with intelligent business men.
Yours sincerely,
[signed] Ralph
Ralph E. Freeman
REF:rw
[in pencil]
Copies of this letter sent to:
Mr Gray [Daniel M. Gray?] of Stoner Mudge [Stoner-Mudge Co., Inc. of Pittsburgh]
Bradley Dewey [Life Member of MIT Corporation, 1932-74]
Dr. Warner, Pres. Carnegie Tech [John Christian Warner (1897-1989), President 1950-65]
Donald Carpenter [Life Member of MIT Corporation, 1943-95]
John Hancock [Member of MIT Corporation, 1949-55]
Walter Beadle [Life Member of MIT Corporation, 1943-88]
* * * * * * * * * *
President to Department Chair
“Be like Yale.”
November 28, 1951
Professor Ralph E. Freeman
Economics Department
Dear Ralph:
Professor Shultz sent me a copy of an article by Lloyd G. Reynolds entitled “The State of Economics at Yale.” This article seemed to me to be a first-rate exposition of the philosophy and methods of the department at Yale. The material is set forth not in a defensive manner at all, and to me was fairly convincing.
This is the kind of statement that I have been hoping that someone might prepare on our own department program here. I think it would be of great help to the Visiting Committee and to the department and the administration in supporting the interests of the department.
I have returned the Reynolds article to Professor Shultz. If you haven’t seen it, you may be interested in borrowing it from him.
Yours cordially,
J. R. Killian, Jr.
JRK: mh
* * * * * * * * * *
Department Chairman to President “You asked for it.”
Massachusetts Institute of Technology Department of Economics and Social Sciences
January 17, 1952
Dr. James R. Killian
Room 3-208
M.I.T.
Dear Jim:
I have had sent to you a little article entitled
“Economies at M.I.T.” You may recall that you suggested I try my hand at an article of this sort.
I hope it will be of some help in dealing with correspondence regarding the operations of the Department. Several others of the staff have read and expressed general approval of the contents. It has been suggested that it might be submitted to The Technology Review which might be willing to supply us with some reprints.
I welcome any criticisms or suggestions for additions or omissions.
Yours sincerely,
[signed:] Ralph
Ralph E. Freeman
REF: TW
cc: Dean Burchard
Source: Massachusetts Institute of Technology. Office of the President, Records, 1930-1959, Box 93, Folder “8. Freeman, R.E., 1945-54”
__________________________
Note: the following is a transcription of the printed article found in the archive with Freeman’s letter. The typed draft sent to M.I.T. President Killian is identical, only minor editorial changes were made for publication.
Economics at M.I.T.
[1952]
The Economics Staff, with Diverse Backgrounds and Views, Aims to Impart a Technique of Logic for Solving Economic Problems in a Complex Society
By Ralph E. Freeman
One of the most difficult problems confronting the professional teacher of economics is the competition he meets from other and more effective teaching agencies. The writer refers to the educational impact of the home, the press, and the radio, as well as the propaganda coming from special-interest groups of one kind or another. These agencies have a competitive advantage. The teacher may be in contact with his class for only two or three hours a week for a part of a year, while his nonacademic competitors have been working on these students since their early childhood.
This disadvantage may seem to raise the question as to whether the economist can really teach the subject at all. Doubts on this score are further increased by the unsettled condition of the world during the last decade — a state of affairs that has created many uncertainties for the individual. A student worried about his future can hardly be blamed for indifference toward a subject which often seems dull and remote from his immediate interests. Another disadvantage is the youth and inexperience of the average college student. Favorable experience with the veterans who came to the Institute after World War II indicates that maturity is a great advantage in the study of economics. All these difficulties in the way of the teacher tend to make him humble when appraising the impression he leaves on the minds of the younger generation.
These obstacles, however, are also a challenge to the economist to improve his teaching techniques. The Economics staff at the Institute has been continually experimenting with new materials and methods and, though it is not fully satisfied with the results, progress has been achieved. We have tried to keep up with the increasing mass of quantitative data becoming available and to keep abreast of improvements in analytical techniques and of shifts in emphasis resulting from changing economic conditions.
An interesting example of such a shift is to be found in the treatment of unemployment and price levels. Prior to the 1930’s, these problems were of secondary interest to most economists. A great deal of what they wrote and taught was based on the assumption of full employment and relatively stable prices. The attention of economists was directed mainly to the way in which productive agencies were allocated among various industries and enterprises. The leading problem was to discover that distribution of human and material resources which would best promote the material well being of the people.
In recent years the economist’s inquiry has focused on economic fluctuations. Unemployment of resources has thus become a major problem for investigation along with a study of changes in the level of prices. Because ups and downs in employment and periods of inflation and deflation are associated with changes in income available to purchase goods and services, the spotlight has been turned on income analysis. The study of national income has been stimulated by the publication of improved statistics emanating chiefly from the Federal Government and by the development of new and better techniques of analysis.
These statements are not meant to imply that the traditional subjects have been abandoned. The economist is still trying to explain what the economic system is and how it operates. He is still concerned with the role of prices and profits in organizing economic activity and with the functions of money and markets in assigning labor and capital to their more productive uses. What has happened is a reorientation of these traditional inquiries around the problems of income, employment, and price levels. This new approach seems to have brought the study of economics nearer to the daily lives of people and closer to the problems with which businessmen are most vitally concerned.
The fact that the beginner in economics is normally young and inexperienced makes it necessary for the teacher to spend a good deal of time describing the facts of economic life. National income, for example, only becomes meaningful as it is broken down into components and expressed in quantitative terms. It is usually desirable, therefore, to start with a discussion of the income of individuals, corporations, and governments. How is the total income of the nation divided among families and groups? How are corporations organized? How do they compute their earnings? What is the role of government and what changes are taking place in the relation of the government to the individual and to business? These are among the questions with which the student of economics is confronted in the early stages of his study. In addition, in most of the subjects offered, time is devoted to describing various institutions such as banks, labor unions, and farmers’ organizations which help determine the nature and direction of economic activity.
The main objective of economic education, however, is not to fill the minds of students with facts and statistics, but to impart to them a technique of thinking by means of which they can analyze and solve economic problems for themselves. General principles must be developed that are applicable to a broad range of situations. Among these principles are those that can be applied in understanding changes in the price of goods, changes in wages, interest, and profits, in the general price level and in the national income.
The economist is concerned, for example, not so much with what the price of wheat is or has been, as he is with the forces that interact to determine the price of wheat or any other commodity. Though he may study past changes in national income, he is primarily interested in the reason why the national income shifts from one level to another. In other words, he tries to develop an integrated theoretical framework which can be used in the analysis of economic problems.
At M.I.T., the economist is regarded as a teacher, not a preacher. His function is not to radiate his own political views nor to propagandize for his own particular social philosophy. His job is to encourage students to form their own opinions. He is not too concerned with what these opinions are. His main job is to ensure that the opinions, whatever they may be, are reached through a logical process of thought, rather than as a result of prejudice or hearsay.
The Economics staff of about 30 full-time members has been recruited with this objective in view. When a new man is taken on, we ask two main questions. Is he equipped by training, experience, and intelligence to carry on creative, scholarly work in his chosen field? Is his personality such as to hold out the promise that he will be a competent teacher and a congenial and co-operative colleague? As the result of this method of selection, the group we now have includes no freaks or extremists. Though there is a broad diversity of view on many of the controversial issues of our times, all of the members of the Department share a desire to preserve and improve the free institutions of America. These men rank high in the profession and compare very favorably with economists in other leading institutions.
Some people may find it hard to accept the idea that divergence of opinion should be regarded as a healthy condition. Why, it may be asked, should I tolerate a colleague who disagrees with me on government controls, the merits of labor unions, taxation, monetary policy and other questions? My answer would be that differences of opinion give rise to a lively interchange of ideas which is an important element in the educational process. Progress in economics, or in any other scientific discipline, would be stifled if an effort were made to enforce conformance to a single pattern of thought.
No matter how firmly we may believe that a given policy is the correct one, there is always a good chance that the man with a different opinion may have something meritorious to propose on his side. A story is told of Al [Alfred E.] Smith who was traveling in upper New York State with two companions, a Protestant and a Catholic. It was early on a bitterly cold Sunday morning when the two Catholics arose to attend mass. Looking at the Protestant sleeping peacefully in his warm bed, Al Smith said to his friend: “Wouldn’t it be awful if he were right and we were wrong!”
The chance that the other fellow may be right, or partly right, makes it inadvisable to strive for unanimity of thought and opinion. Tolerance of diversity is necessary for the preservation of the spirit of free inquiry which is the breath of life of an institution devoted to education and research. Such tolerance is one of the main features distinguishing a democratic from a totalitarian society.
As indicated above, this concept is applied in the Institute’s educational practices. In all courses, whether they are offered to undergraduates or graduates, the Department of Economics and Social Science tries to present contrasting views and opinions. In the beginning course in Economic Principles, which has been required of all students at the Institute, this procedure is subjected to severe time limitation. But even here this practice is followed. For several years we have been using supplementary readings presenting divers points of view and a new collection of such readings to accompany the textbook has just been prepared — a compilation that includes extracts from economic writings of all sorts, ranging from Karl Marx to the National Association of Manufacturers.
Besides this course in Economic Principles, there are many others, both on the undergraduate and the graduate level. These include several in the fields of labor relations, statistics, finance, theory, and international economics. There are courses in business cycles, technological innovation, and in the economics of particular industries. The Department also offers courses in psychology and international relations. As the name implies, the Department of Economics and Social Science is one that covers a wide field. It is a part of the School of Humanities and Social Studies and has close ties with the activities of historians and others who come under the same administrative direction. The bringing together of a number of different social studies exerts a broadening influence on both staff and students. It tends to make us look at human beings as members of an ever-changing, complex society subject to many influences in addition to those of an economic nature.
Virtually every student at the Institute takes economics at some point in his program. In addition to those subjects included in the Humanities Program, designed for the Institute as a whole, other subjects are tailored to fit the needs of professional courses such as those offered by the Department of Business and Engineering Administration. The Department also offers a four-year curriculum for undergraduates — Course XIV — leading to a bachelor’s degree in Economics and Engineering. Through emphasis on relationships among engineering, economics, and human relations problems, this Course aims to provide students with an understanding of both technical and non-technical aspects of our industrial society.
There is also a graduate division. There are about 50 students in this group, most of whom are candidates for the Ph.D. degree. Many of these men have come to M.I.T. from liberal arts colleges. They go into government, business, labor unions, and teaching as professional economists.
Because the training of the professional economist, normally requiring about seven years, is spent mainly in the classroom and the library, his knowledge of actual business practices is more limited than if he were actively employed in industry. This limitation of experience is a handicap of which the men on the Department’s staff are acutely conscious. We do not have as much direct contact, as might be desired, with what goes on in the factories, banks, railroads, public utilities, and other business enterprises whose activities we study.
Efforts are being made to bridge the gap between economic theory and business practice. Graduate students are encouraged to find summer employment in industry. Some of the staff members have had temporary jobs in business or government. Others have had an opportunity to get into close touch with industry through research projects. In recent years they have undertaken investigations in textiles, shoes, coal, housing, electronics equipment, and a variety of other industries. Several of our instructors act as consultants to business firms and have had ample opportunity to rub shoulders with businessmen and get a better idea of their operations and problems.
The Department also brings in businessmen to meet with classes and join in round-table discussions. The system of Visiting Committees is also helpful in getting the staff into touch with leaders in industry, finance, and the professions. But more of these contacts are needed. If we are to keep our feet on the ground, we must have the counsel and criticism of men of practical affairs.
The development of the new School of Industrial Management should be of material assistance in strengthening our contacts with leaders in the business world. Though the Department of Economics and Social Science will not be administratively a part of this School, it will be housed in the same building and will co-operate in carrying out its educational and research program. E. P. Brooks, ’17, Dean of the School, who is now in charge, is consulting with business leaders and hopes to enlist their aid not only in planning the project but also in executing the plans. The Department of Economics and Social Science should benefit, at least indirectly, from these extensive outside relationships.
We are grateful to the Alumni and other friends of the Institute who have taken an interest in our work. The Department is indebted to the companies which have supported our Industrial Relations Section, and have helped finance graduate fellowships and research activities; it hopes for a continuation of this interest and support. Such support will be needed if the Department is to maintain its position and to improve and expand its operations.
The number of students being graduated from Course XIV is now relatively small. and the demand for their services is high; but in the future we hope to increase the enrollment, and employment conditions are not likely to continue as favorable as they are today. This Course is new and therefore not yet widely known. Because it combines basic education in engineering and science, as well as in economics, and other social studies, its graduates have a broad background that should make them useful in a wide variety of jobs.
This spring the Department of Economics and Social Science expects to move into the recently acquired Sloan Building along with the School of Industrial Management. Readers of this article are invited to come and visit us in our new quarters. We will show you our Industrial Relations Library and our Psychological Laboratory. We will tell you about the Scanlon Plan that is making a valuable contribution to the betterment of employer-employee relations. We will describe research projects under way and point with pride to a growing list of publications by members of the Department. We would like to discuss with you the plans we have for future development in psychology and political science. The reader may be interested in meeting some of the staff or in talking to groups of students and if he can bear it, we will also tell him about some of our trials and tribulations. And perhaps he may have something on his mind he would like to tell us. If so, we will gladly listen. Our new address will be 50 Memorial Drive.
Image Source: This portrait of Ralph Freeman can be found in the 1950 yearbook. The copy used here comes from the MIT Museum website where it no date has been provided. Colorized by Economics in the Rear-view Mirror.
The chairman of Yale’s economics department in 1951, Lloyd G. Reynolds, found his department in the crosshairs of alumni enraged by the charge of collectivist indoctrination leveled by young William F. Buckley, Jr. (Yale ’1950) in his book that was a call-to-action for religious and individualist alumni of Yale to voice their opposition to the influence of atheism and collectivism on campus. Paul Samuelson’s textbook Economics was offered as Exhibit No. 1 of the collectivist rot found in the Yale economics department. Buckley’s bottom-line was explicit though not specific.
Image Source: PBS, American Masters. S38 EP3: The incomparable Mr. Buckley.
“I shall not say, then, what specific professors should be discharged, but I will say some ought to be discharged. I shall not indicate what I consider to be the dividing line that separates the collectivist from the individualist, but I will say that such a dividing line ought, thoughtfully and flexibly, to be drawn. I will not suggest the manner in which the alumni ought to be consulted and polled on this issue, but I will say that they ought to be, and soon, and that the whole structure of Yale’s relationship to her alumni, as has been previously indicated, ought to be reexamined.
Far wiser and more experienced men can train their minds to such problems. I should be satisfied if they feel impelled to do so, and I should be confident that the job would be well done.”
And so, in the interest of damage control, Reynolds found himself out on the stump speaking to alumni and other potential donors. This post gives us Reynold’s response to youthful calumny from the future darling of the extreme conservative fringe in the U.S.
Lloyd G. Reynolds, a scholar who shaped the fields of labor and economic development and transformed Yale’s Department of Economics, died April 9 at his home in Washington, D.C., after a series of strokes.
He was 94 years old.
Born and raised on a frontier settlement in the Canadian province of Alberta, Reynolds earned a B.A. at the University of Alberta, an M.A. at McGill University and a Ph.D. at Harvard University. He held an instructorship at the latter institution before becoming a professor at Johns Hopkins University.
During World War II, as federal spending increased at a furious pace, Reynolds took leave from Johns Hopkins to serve in 1942-1943 as chief economist of the War Manpower Commission, and in 1943-1945 as a public member of the Appeals Committee for the National Labor Relations Board. At these institutions, he successfully labored to prevent wartime budget deficits from turning into price and wage inflation.
During and after the war, Reynolds served widely in governmental and private agencies as labor mediator, consultant, officer and committee member, lending his analytic, organizational and administrative skills to the Bureau of the Budget, the Agency for International Development, the Industrial Relations Research Association, the Ford Foundation, the National Bureau of Economic Research and the American Economic Association.
In 1945, Reynolds joined the Yale faculty, where he remained for 35 years until his retirement in 1980. In 1951, he became chair of Yale’s Department of Economics. In the next eight years, he increased the number of faculty in economics from 31 to 65, including such notable scholars as William Fellner, Tjalling Koopmans, John Montias, Hugh Patrick, Gustav Ranis, James R. Tobin, Robert Triffin and Henry Wallich. Two later won Nobel Prizes. A third Nobel Laureate, Simon Kuznets, was soon wooed back to Harvard.
In later years, Yale President Kingman Brewster liked to tell the story of meeting Reynolds on Martha’s Vineyard. Brewster remembered asking Reynolds, “Would you take me out behind the barn some day and tell me how it is you turned one of the worst departments in the country into one of the best?”
“I don’t have to take you out behind the barn,” replied Reynolds. “It’s very simple — just be willing to hire people who are brighter than you are.”
Early in his term as chair, Reynolds confronted the firestorm caused by the publication of “God and Man at Yale,” in which William Buckley criticized “the hot collectivist turn taken by the [economics] faculty after the war” and argued that such faculty should be fired. “Whit Griswold [Brewster’s predecessor as Yale president] sent me out on the road,” he liked to recall, “with the football coach, to talk to the alumni. Usually the coach spoke first, and after that … the alumni didn’t much want to hear about the economics department.”
Twice during the 1950s, Reynolds took brief leaves from Yale to direct the Ford Foundation’s new program of support for developing countries. At the end of that decade, he convinced Ford to donate $15 million to establish the Yale Economic Growth Center, where he served as founding director until 1967. The center annually brings together about 30 faculty and visiting economists studying the growth process.
When Reynolds retired from Yale, the Graduate School minutes recorded a tribute which reads in part: “[I]n the early 1950s, he was able to convert a spirited defense of the department against right wing critics into an occasion for the substantial infusion of outside resources. It was his great capacity to recognize talent in others which helped attract a first-rate faculty, including the move of the Cowles Commission to Yale.”
In 1949, Reynolds published “Labor Economics and Labor Relations” (Prentice Hall). Now in its 11th edition, this textbook is widely credited with creating the field of labor economics. Over the course of a half century, Reynolds published 10 scholarly books and dozens of articles in the fields of labor economics, economic development and comparative economic systems. He published five introductory economics texts, trying his ideas out first on Yale’s undergraduates. Reynolds was an institution at Yale graduations, where for more than 30 years, as senior fellow of the college, he carried the Berkeley mace as he led the seniors into the Old Campus.
Reynolds had a lifelong fascination with mountaineering, a passion that took him to the summit of Mt. Blanc at age 23, and to the top of Kilimanjaro at age 41. In his 50s, on three Nepal treks with his wife, he reached the Mt. Everest Base Camp and the Annapurna glacier.
Reynolds was married for 63 years to Mary Trackett Reynolds, who died August 28, 2000. He is survived by three children, Anne Skinner of Williamstown, Massachusetts, Priscilla Roosevelt of Washington, D.C., and Bruce Reynolds of Charlottesville, Virgina; as well as seven grandchildren and eight great-grandchildren. He was a member of the Century Club of New York, the Cosmos Club in Washington and the West Bend (Wisconsin) Country Club.
A memorial service in Reynolds’ honor will be held at 1:30 p.m. on Saturday, June 11, in Battell Chapel, corner of Elm and College streets.
By Lloyd G. Reynolds, Chairman of the Department of Economics.
The following paper was delivered by Mr. Reynolds at the meeting of the Alumni Board on October 20th. During the meeting the Board passed a unanimous resolution that it should be published in the November issue of Y.A.M.
AMERICAN economists in 1951 are doing about the same things they have been trying to do for the past hundred and fifty years. First, we aim to present a clear picture of what the economic system looks like and how it operates. How many business concerns, big and little, are there in the United States? How are they organized and managed? How much money do they take in and pay out, and for what purposes? How many people work for a living in the United States? What work do they do and how much are they paid for doing it? A great deal of economics is concerned simply with providing an accurate description of our economic institutions and how they have changed over the course of time.
Economic Analysis
BUT economists are not content to operate only at the level of description. We are interested always in the question of why things happen as they do in the economy. Why does one kind of work pay 80 cents an hour and another $1.50? Why does wheat sell for $2.50 a bushel and cotton for 33 cents a pound? Why has the retail price level risen by 10 per cent since June 1950? In order to answer this sort of question one needs not only a knowledge of facts but methods of arranging and thinking about the facts — in short, what we call economic theory or economic analysis. Theory is not just day — dreaming or idle opinion. It plays much the same role in economics as in physical science. It is a way of organizing and focussing facts to explain and predict economic events.
Economics aims to be, and is steadily becoming, a factual, quantitative science. It aims to get behind mere opinion to a solid basis of truth. The tests of an economist are these: is he thoroughly grounded in the facts and the history of our economic system? Has he mastered the methods of analysis which economists have gradually been developing over the past century and more? Can he use these methods with skill and good judgment to explain and predict actual developments in the economy? If he cannot pass these tests, it does him no good to come around claiming that he is a warmhearted fellow who wants to improve the lot of the workingman, or that he is a sound conservative and a hundred per cent American. If he cannot pass the tests, we would not trust his judgment, we would not give him an advanced degree in economics, we would not employ him for the Yale faculty.
I want to make it clear that economics and politics are quite different things. The study of economics can of course be applied to political issues — it would not be of much use otherwise. Our courses involve discussion of taxation systems, tariffs, the federal budget, labor laws, social security, foreign economic aid, agricultural price supports, and a host of other issues. But the job of an economist with respect to these issues is not to say what policies should be followed. His task is to discover and point out the consequences of different possible policies. Ideally, economics should be able to say what will happen if the tariff on pottery is reduced by ten per cent or the federal minimum wage is raised ten cents an hour. Whether the public, or our students, like and approve what will happen is up to them. Economics is not politics, and it is not up to us to sway people in one political direction rather than another.
Ground Rules
ECONOMISTS are also human being of course, and I see nothing wrong with an economist occasionally expressing his personal opinion on a political issue. But he should be careful to point out when he is stepping out of his shoes as a scientist and speaking as a plain citizen. He should also be mindful of contrary opinions, and should not strive just to convert his hearers to his own point view. I believe that these ground rules are well observed in the teaching of economics at Yale. I don’t think there is much political preaching in our courses and if there is some it is certainly not all on the same side. The department includes everything from Roosevelt Democrats to Hoover Republicans, and our students have ample opportunity for exposure to different points of view.
This brings me to my main point — the state of the Yale Department of Economics and its prospects for the future. I note first a substantial strengthening of our senior staff since the end of the war. In the first year after the war, we had nine teaching members of the department in the rank of assistant professor and above. Today we have sixteen men in the professorial ranks. The newcomers to the department have been most carefully chosen from among dozens of a candidates whom we have considered in the last five years. They are men of whom Yale can well be proud, not only scholars but as individuals. They are highly regarded by their colleagues in New Haven and by their fellow-economists throughout the United States — so much so that we are constantly fending off raids from other institutions which want to hire them away from us.
Our two most recent appointments are Professor Henry Wallich, who comes to us from the Federal Reserve Bank of New York, where he has been chief of research and has also acted as consultant to several of the Latin American countries in the revision of their banking systems; and Professor Robert Triffin, who has had a distinguished career with the Federal Reserve Board, the International Monetary Fund, and as American representative on the governing board of the European Payments Union. These men, both excellent economists with a wealth of practical background, have at one stroke put us ahead of any university in the country in the area of international finance and international trade.
Research and Teaching
NOW a word about the job which we are trying to do here. As scholars, we are all concerned with trying to push back the frontiers of knowledge in our chosen field. During the last two years alone, members of the department have published ten books on subjects as diverse as the pricing of military supplies, the effect of federal taxation on executive compensation and retirement systems, the history and structure of the American cigarette industry, and the human relations problems of a large public utility company. We have other studies currently in process, some of which I will mention in a moment. I do not think that any department of economics in the country excels the Yale department in terms of the quality and significance of its research work.
Our main responsibility in the University, however, is for teaching. How are we doing on this front? Judging from the comments of the students who come though my office, and from other reliable sources of student opinion, I would say that about half of our undergraduate courses are excellently taught. The other half are good solid courses but not outstanding, and we may even have one or two which are a bit on the dull side. The department has currently under way a thorough study of our course offering and degree requirements in the College, and we are of course seeking continuously to strengthen the teaching staff in areas of weakness. We expect that these efforts will bear fruit in a steady increase in the quality of our teaching work.
Our most difficult teaching problem has been the course in elementary economics, Economics 10. It is enormously difficult to cover all aspects of the economic system in a year’s time and to arrange the material in the best possible way. No one textbook or combination of textbooks is ever fully satisfactory. I can assure you that the Department has given much prayerful thought to this matter over the past five years. We have changed both the structure of the course and the reading assignments almost every year. The course is still not ideal — it never will be — but it is a good deal better than the course we were giving four or five years ago.
An even more serious problem in this course has been to find enough fully qualified instructors. We were faced just after the war with the largest enrollment in the history of the University. In the peak year we had almost fifty divisions of Economics 10, requiring a staff of 20 to 25 instructors. There are just not that many good economists, even at Yale. We were forced to take on a considerable number of partially-trained men from the graduate school as teaching assistants, often on very short notice. Some of these men turned in an excellent teaching job but we also drew a few lemons who had to be dropped after a short time.
This phase is now happily behind us. Enrollments have declined to a more normal level, and we are much better staffed to handle them. Of the nine men teaching in Economics 10 this year, only one is without previous teaching experience; and this man is a mature individual who in fact owned and operated a profitable business for several years before coming here for graduate study.
The central purpose of our teaching work is to give students an understanding of the history and present operation of American economic institutions, and to train them to think systematically about the economic issues of the day. We hope to develop habits of reflection and careful analysis which will stand our students in good stead as they emerge to take their place as citizens and as leaders of public opinion.
We are not trying to sell the American economic system to our students as one might sell a package of breakfast food. We believe that such an approach is both futile and unnecessary. We have found from experience that, if our economic institutions are carefully explained and thoroughly understood, the great majority of students will support them of their own accord. They will support them, not in a spirit of blind adherence to a fixed creed, but with an understanding of why they prefer our system to any sort of totalitarian regime. They will seek to perpetuate American institutions, not by freezing them into a fixed mold, but by striving constantly to improve them over the years to come. This outlook, which I would term intelligent conservatism, is characteristic of most of our faculty members and most of our student body.
How do our students come out from this sort of training? If you could read the departmental examinations which our economics majors write at the end of the senior year, I believe you would find that most of them show a good grounding in economic facts and economic analysis. They also show a healthy diversity of political viewpoint. We do not and should not turn out students whose minds are tailored to a particular pattern. If a student is intellectually honest, accurate in his use of facts, willing to state his basic premises, capable of reasoning logically from those premises — then I respect him. Let him come out where he will, politically speaking. I believe this is good American doctrine and sound educational policy.
I realize that some people hold a contrary point of view. They believe that the function of an economics department should be to propagandize students for a particular political and economic creed, that only professors willing to swear allegiance to this creed should be allowed to teach, and that students should be carefully protected against contrary opinions. This totalitarian outlook, though it has had much success in Europe, seems to me completely at variance with American traditions. The members of the economics department at Yale would, I am sure, be unalterably opposed to the establishment of any official party line on economic questions. I do not see how a free university in a democratic country can take any other view.
Now before closing I want to admit in all humility that there are many things wrong with our understanding of economics and our teaching of it. A great deal of the economics currently taught in universities is undoubtedly unrealistic, ivory-tower, out of touch with the facts of economic life. Too many of the books which we read and teach were written strictly in the library. Too many of our teachers of economics have had no contact with practical affairs.
I want to assure you that this ignorance of the real world is not deliberate on the part of the professors. It comes about mainly because of the way in which young economists are trained and employed. On finishing college, a prospective economist is usually advised to go directly into graduate school to work toward the hallowed Ph.D. without which his future career is hopeless. If he is a really good student he may receive a fellowship to support him in his studies. This phase lasts at least three or four years, during which time he spends his life mainly in the classroom and the library. As he hears the end of his graduate training, he begins to cast about for a job and, if he is capable and lucky, he lands an instructorship somewhere. But he is now being paid to educate students, and only incidentally to educate himself. He is not especially encouraged to wander outside the academic walls. If he does so on his own initiative and tries to learn something about business operations, he may quite possibly be rebuffed by executives who are busy with their own affairs or worried at the idea of stray professors wandering around the plant.
I am very conscious, and I believe any economist who has had much contact with industry is conscious, of how much economists have to learn about the facts of life and how wide a gap still exists between economic theories and business practice. I have given much thought to the question of how young teachers in their formative years can gain more experience of practical affairs, and have a few ideas on the subject. The difficulty, is that all of my ideas would cost money and money is not the most plentiful thing on the University scene.
We are not taking a defeatist view of this problem. We have already made some beginnings toward building bridges between industry and the University community. Professor Healy’s work in transportation has brought him into close contact with the largest railroad systems in the country. Professor Bakke’s studies of human relations in industry have included a thorough analysis of the management structure of a large New England Company, and he is going on from this to similar studies in other companies. I am currently working, along with my colleague Professor Miller, on a study of top management organization and policy which will involve discussions with the top officers of a dozen or so companies. Professor Westerfield, who has been in charge of our teaching of money and banking for many years, is president of a highly successful savings and loan association. Professor Wallich, I am sure, will not neglect his banking contacts in New York because of his move to New Haven.
We believe in this sort of thing and hope to develop it increasingly in the future. We consider that the factories, stores and offices of the country are the laboratories in which a real science of economics can be developed. There are difficulties, of course, in using these laboratories without upsetting normal business operations, but we are confident that these difficulties can be overcome. We believe that in this way the practical experience of men of affairs can be gradually translated into economics textbooks and economics teaching. If some of you can take a little time from your businesses to educate us, we shall stand a better chance of educating our students. Until both you and we have done more in this direction, economics will continue to be too largely an ivory tower subject.
I have tried to give a realistic picture of our present situation, not simply a rosy one. We are certainly doing a better job than we were doing five years ago, and five years ahead we expect to be doing still better. But we are not complacent about our progress. We realize that we have still a long way to go and will never do the job perfectly. We welcome advice and suggestions on what we are doing. We hope for sympathetic interest and support.
Source: Yale Alumni Magazine (November 1951), pp. 18-20. A copy of this article was provided to Economics in the Rear-view Mirror directly by the Yale AlumniMagazine. On behalf of the history of economics community I thank the executive editor, Mr. Mark Branch for his help.
It was fifty years ago this September that I entered the graduate program in economics at M.I.T. This is why the brochure outlining the graduate program as of the academic year 1974-75 is something I am particularly delighted to add as the newest digitized artifact to Economics in the Rear-view Mirror.
In other news, I just realized that I am now older than everyone seen on the faculty portrait taken in 1976.
_______________________
Most of the faculty members of the MIT department of economics on the steps of the Sloan Building (E52) in 1976.
Graduate study in economics began at M.I.T. in 1941 and has since developed to its present size of some 110 full-time students and 33 faculty members. Its major emphasis is on the training of doctoral candidates in a broad program of advanced study and research for professional careers in universities or colleges, in governmental and private research organizations, or in business or financial concerns. At the present time the demands on a professional economist are such that the depth and breadth of the doctoral program have become indispensable training for a successful career. The Department, therefore, ordinarily admits to full-time graduate study only candidates for the Ph.D. In order to maintain a close and continuing contact between students and faculty, the entering class is normally held to 30.
The doctorate normally requires the full-time concentration of the student for three or four years. Formal requirements are limited in number. The candidate must (1) demonstrate a mastery in five fields of study in economics, one of which is economic theory, both micro and macro; (2) achieve a specified level of competence in economic history, econometrics, and statistics; (3) submit and defend a dissertation that represents a contribution to knowledge; and (4) be in residence for a minimum of two years.
These requirements are met not merely by passing some appropriate set of subjects, but through an over-all preparation of subject matter and techniques that goes beyond course work. Candidates may differ in their rate of progress toward the satisfaction of these requirements, depending on their background, preparation, and interests. Normally, however, the satisfaction of requirements, other than the dissertation, is completed by the end of the second year.
The dissertation is a test of the candidate’s ability to conduct independent research — to formulate a significant topic and to bring to bear on it the analytic and quantitative tools of economics. The dissertation is prepared under the direction of departmental committee. Upon submission of the completed thesis, the candidate is examined orally by the thesis committee.
The Department has no general foreign language requirements. When a foreign language is essential for full access to the literature in the field of the student’s major interest (for example, European Economic History, Communist Economies) or to his thesis research, a language requirement will be imposed by the Department upon the recommendation of the Thesis Supervisor or the Graduate Registration Officer. Such a requirement will be administered by the Department of Foreign Literatures and Linguistics, and can be met by satisfactory course work at other schools, at M.I.T., or by examination.
Occasionally students may desire a program that overlaps more than one department, but which in content and depth meets doctoral standards. At the initiative of the student, and with the approval of faculty members of each department, arrangements can be made to have the Dean of the Graduate School appoint a committee to guide the entire Ph.D. program. For details see the Graduate Student Manual. One such program, for instance, has been worked out with the Department of Urban Studies and Planning.
In very special and rare cases, students are admitted for study programs leading to the M.S. in Economics. This is awarded upon the satisfactory completion of a program, approved by the Graduate Registration Officer, of a year’s full-time study, including the presentation of a satisfactory thesis. The master’s program usually involves completion of the Department’s core requirements (see below), a semester of econometrics, and two semesters of a special field, in addition to the thesis.
To be admitted into the program, a student must hold a Bachelor’s degree or its equivalent from an accredited college or university. It is not essential that the undergraduate degree be in economics. Graduate students entering the Department have had a wide variety of major background preparation varying from literature to physics. Some preparation in undergraduate economics, especially in economic analysis, is almost a necessity. Candidates who, upon admission, are deficient in mathematics are strongly urged to take mathematics in the summer before entering the program or work on a recommended self-study program in calculus to prepare for 14.102 Mathematics for Economists.
Completed application forms for admission must be submitted to the Admissions Office at M.I.T. by January 15 of the calendar year in which the applicant wishes to enter. In addition to the Institute application forms, the Department expects each applicant to submit a statement (one or two pages) explaining his interest in economics. An informal questionnaire is provided for his general guidance. Entrance is normally in September. February entrance is granted only under exceptional circumstances, since many subjects given in the spring are continuations of work given in the fall.
All applicants are urged to take the Graduate Record Examinations no later than the January preceding the September in which they wish to enter. They should take the quantitative and verbal aptitude tests as well as the test in economics. (Information can be obtained by writing to Graduate Record Examinations, Educational Testing Service, Box 955, Princeton, New Jersey 08540. Students in western states or in eastern Asia or the Pacific should write to 1947 Center Street, Berkeley, California 94704.)
Decisions regarding admission are the responsibility of the Departmental Graduate Admissions Committee, which bases its judgment on the undergraduate academic record of the applicant, both in general and with respect to particular subjects, on the letters of recommendation, and on the Graduate Record Examinations. Further information may be secured by writing to the chairman of the committee. Notices of acceptance are sent out by April 1, and candidates have until April 15 to notify the Department of their choice.
Fellowships, Scholarships, and Financial Assistance [Table of Contents]
While in the past virtually all graduate students received financial aid through scholarships, fellowships, or assistantships, the financial situation has changed to such an extent that complete support can no longer be assured. Moreover, the outlook is so uncertain that no definite statement is possible, even about minimum aid. Every effort will be made within the limits of our financial resources to support students who perform effectively. In view of this uncertainty, the Department is making efforts to expand the number of research assistantships, but students should expect to earn or borrow a larger proportion of their support than has been true in the past.
The sources of financial support are varied. (1) Many students are assisted by fellowships for which there is a national competition, such as those given by the National Science Foundation (NSF), the Ford Foundation, the Danforth Foundation, the Canada Council, and by foreign governmental agencies. Applications for such fellowships must be made directly to the appropriate foundation or agency, and an application for admission must also be made to M.I.T. (2) Awards of scholarships or fellowships are also made from M.I.T. funds or endowments. These include the Hicks Fellowship in Industrial Relations, the Graduate Economics Alumni Fellowships, endowed Institute fellowships, and a limited number of departmental awards. (3) A third group of students is supported by part time teaching and research assistantships and instructorships. In the past, research and teaching assistantships have been limited to candidates who have passed their general examination and are engaged in thesis research. However, in the light of the present financial stringency, these rules may be relaxed somewhat with respect to limited research assistantships for second year students. (4) Finally, students in good standing can avail themselves of loans through the Office of Financial Aid. U.S. citizens who are planning to be teachers may avail themselves of an NDEA loan, a substantial portion of which is forgiven upon entry into and continuance in teaching. They are also eligible for government-insured loans that are partially subsidized. Foreign students. however, may borrow only through the Graduate Loan Fund at the prime interest rate.
Entering students should apply for financial aid not later than January 15 of the calendar year in which they plan to enter. First-year awards are made on April 1, and applicants are given until April 15 to accept. Departmental awards for second and subsequent years are made in June. It is entirely appropriate for students to apply both for national awards and to M.I.T., since the outcome of national competitions is known before our awards are announced. Fellowships normally will include some cash payment toward living expenses, up to $2,000 for a single or married person without dependents, made in two equal installments at the beginning of each term. In offering scholarships and fellowships, the Department takes into account need as well as professional promise.
Remuneration for research assistantships varies, but in 1974-75 is normally at the rate of $6,585 per academic year for half-time work, out of which tuition of $3,350 must be paid. A half-time teaching assistantship in 1974-75 covers the tuition and pays $3,510 for the academic year — a total of $6,860. A very few half-time instructorships, for students who have demonstrated conspicuously effective teaching as an assistant, cover tuition plus $4,345 for living expenses — a total of $7,695 for the academic year.
As a supplement to academic-year appointments, both interdepartmental and departmental research groups are possible sources of full-time summer employment.
The academic performance of the student body is periodically reviewed to determine whether or not normal academic progress is being made. Failure to maintain normal progress may result in reduction or withdrawal of financial support. Students are invited at all times to discuss academic problems with their graduate registration officer, and the Department makes every effort to accommodate the needs of individual students.
The Department has always welcomed foreign graduate students. They have typically constituted a significant portion of the student body. Some M.I.T. fellowships are available to entering foreign students, though the number is limited and the competition severe. Foreign students have an additional burden of transportation expense to cover and for this reason it is highly desirable to try to obtain at least partial support from other sources as well.
General information on scholarships, grants and travel can be obtained from the Institute of International Education, 809 United Nations Plaza, New York, New York, 10017, or from the Cultural Affairs Officer or the United States Information Service Office nearest the student’s place of residence.
Foreign applicants are required to submit evidence of their ability to carry on studies in English. Applicants whose native language is not English are required to take the test of English as a Foreign Language (TOEFL). Students whose schooling has been in English may request a waiver from the Advisor to Foreign Students at M.I.T. TOEFL is administered by the Educational Testing Service, Princeton, New Jersey, 08540; registration material and information about the test may be obtained by writing to the above address.
The Department is located in the Sloan Building, which, along with the adjoining Hermann Building, contains contiguous faculty offices, classrooms and seminar rooms, and student and faculty lounges. This complex also houses the Sloan School of Management, the Department of Political Science, and the Center for International Studies. The Dewey Library occupies two floors of the Hermann Building and contains the social science collection at M.I.T., reading rooms, and carrels to which thesis writers are assigned individually.
On-campus housing for graduate students is limited. Applications should be sent to the On Campus Housing Office, Room E18-307, M.I.T. Help in securing off-campus housing is given by the Community Housing Service, E18-306, M.I.T. Students should be alerted to the fact that Cambridge rental units are limited and in heavy demand. Transportation is convenient; the Sloan Building is located one block from the Kendall Square subway station.
The Graduate Economics Association, composed of all graduate students, is a lively organization that sponsors monthly seminars and social events, and is one of the channels through which mutual student-faculty problems are discussed. The seminars permit discussions of current research by distinguished economists and occasional dialogues between faculty members. They are often followed by small dinners to which graduate students and faculty are invited, permitting more discussion among visitors, students and faculty. The Association annually elects nine student representatives to participate as voting members in Department meetings and other Department committees. Student representatives are full participants in all matters except those involving specific, identifiable individuals, or undergraduate matters. This policy at present excludes the discussion of details, but not the general policy, of tenure decisions, review of non-tenure faculty, new appointments, review of student performance, admissions and financial support.
The Black Graduate Economics Association provides a forum for the development and utilization of economic tools for solving the problems faced by Black people, encourages policies and programs which help increase the supply of highly qualified Black economists, opens lines of communication with other Black graduate students, Black economists, and the Black community, stimulates academic excellence, and provides outlets for various social activities. The BGEA has helped develop audio-visual aids now in use in many Black colleges’ economics departments, engaged in Institute recruiting projects, and participated in conferences of Black economists and administrators of Black colleges and universities. An econometric model of income and expenditures in Black communities is in its initial stage of development as a research project.
Students who complete the Ph.D. program should have a thorough understanding of the existing principles of economic theory and of the economic structure; an ability to think systematically about, and apply quantitative methods to, economic problems. The program gives roughly equal emphasis to these two goals, with formal courses and examinations to meet the first, and seminars, workshops, papers and the dissertation to meet the second. The student spends most of his first two years attempting to understand the existing ideas of economics. A basic principle of the program is that these ideas are sufficiently worthwhile so that their study is a necessary prelude to their use or criticism.
Throughout the program, there are formal provisions for students to engage in original work. During the first two years, term papers are often required. During the second year each student prepares a research paper as part of the requirement in econometrics. Second-year students are also encouraged to take part in workshops in their fields of primary interest. After passing the general examination, at the end of the second year or earlier, students spend full time in their own independent, original work. Their only formal obligation is to participate actively in the weekly meetings of the workshops in their fields of research.
The core in economic theory consists of two subject-years equally divided between microeconomics (14.121-14.124) and macroeconomics (14.451-14.454). These subjects are described in Section III of this report. The material is divided into half-semester subjects. The microtheory sequence starts in the fall term and runs through the first year, while the macrotheory sequence starts in the spring term and continues through the fall term of the second year. A qualifying examination on these subjects is offered three times a year — in September, December-January, and May — that must be passed in order to satisfy this part of the core requirement. The examination will cover each of the eight portions of the theory core, and a syllabus is available for each.
When a student feels sufficiently well qualified in the subject matter of any of the theory core subjects, he may take the qualifying examination, either before or after a particular set of lectures is offered. Only a passing grade is recorded when the examination is taken in advance of the lectures. If he fails to pass, he can then enroll for that particular section of theory and take the examination again at the end of that term. Should he pass some portion of theory by the preliminary examination, he could substitute a subject in advanced economic theory in the half-term in which he would have taken the basic theory subject. In principle, it is possible to pass all eight units of the theory core in this way and to proceed directly to more advanced work.
The Schedule for the Qualifying Examination in Theory is as follows:
The minimal core requirement in mathematics is calculus and linear algebra. Calculus is required for Statistics (14.381). While not stated as a formal prerequisite for the core theory subjects, it is virtually a necessity for mastering them.
If a student’s preparation in calculus were inadequate to satisfy the prerequisite for 14.102 Mathematics for Economists, the completion of the statistics and economics core requirements would be postponed a year. Econometrics (14.382 and 14.383 and most advanced theory subjects (14.141-14.149) require linear algebra. Students who have had a year of calculus and who want more mathematical training normally would take Mathematics for Economists (14.102) in the first term.
The econometrics and statistics core requirement can be satisfied by (1) Statistics (14.381); (2) either Econometrics (14.382 and 14.383) or Applied Econometrics (14.388); and the completion of a piece of empirical research the equivalent of a term paper. This paper is due by the end of the fall term of the second year.
Entering students who lack calculus, and cannot take 14.102 in the first term, have two choices: either to postpone the three-term sequence: 14.381, 14.382, and 14.383 — to their third through fifth terms, or to take the two-term sequence, 14.381 and 14.388, in their third and fifth terms.
The core requirement in economic history is the satisfactory completion of one subject in American Economic History (14.731), European Economic History (14.733), or Russian Economic History (14.781).
In addition to the satisfactory completion of the core requirements, competence in four special fields must be demonstrated, two by passing a general examination and two by either satisfactory course work or a general examination. Preparation for a field examination normally consists of a year’s course work. Satisfaction of a field by course work alone requires the achievement of a grade of B or better in each of the two terms of subject matter. (The econometrics and history requirements can be satisfied with a grade of B-.) The areas in which the Department offers specialization are: advanced economic theory, international economics, labor economics, economic development, urban economics, monetary economics, fiscal economics, statistics and econometrics, economic history, industrial organization, comparative economic systems, Russian economics, human resources and income distribution, and, outside the Department, finance, production, transportation, and operations research. It is possible to use econometrics as a field without preparation beyond the core requirements. Economic history can be offered as a field by adding a second subject to the one satisfying the core requirement.
Students normally demonstrate competence in all four fields by the end of their second year. That is, they normally finish their required course work and general examinations by that time. In the event that scheduling or other difficulties interfere with this timing, one field other than theory or econometrics (including the paper — see II.B.3 above), or one subject in a field and in history, may be postponed until the third year. Before making such a deferment, students should consult with their Graduate Registration Officer.
Students planning to take the general examination before the end of the second year — the usual time — should consult in advance with their Graduate Registration Officer. In any case, such students would still be held to the above schedule.
*The minimal number of subjects to satisfy the special field and history requirements depends on whether history or econometrics is offered as a special field. If neither are offered, 9 subjects are required; if history, 8 subjects; if econometrics, 7 subjects; if both, 6 subjects.
Upon satisfaction of the core and field requirements, the Ph.D. candidate embarks on original research culminating in a completed dissertation that is defended orally. Thesis writers are required to participate in the workshop most germane to the subject of their thesis over the period of time they are working on it. Upon agreement on a topic with a primary thesis supervisor, a secondary thesis supervisor will be chosen by the student, subject to the approval of the Graduate Committee. A third faculty reader will be appointed by the Graduate Committee in consultation with the candidate when a final draft of the thesis will reasonably be expected to be completed within six months. The third faculty reader will have as his main function the unitary reading of the complete final draft of the thesis. These three faculty members will be the candidate’s thesis committee and are responsible for its acceptance and final defense.
In order to give adequate time for the final thesis review and revision, the completed draft must be submitted for final review a month before the Institute dates for submission of the dissertation. In 1975 the formal Institute dates are January 5, May 2, and August 11.
Introduction to the theory of resource allocation and the price system. Emphasis on the use of efficiency prices as a guide to decentralized decision making.
Economic ideas developed by different groups of economists in recent times.
R. L. Bishop,
P. A. Samuelson
14.141
General Equilibrium Theory
Prereq.:14.124
Units
Year: G(1) (2nd half of term)
2-0-4
General equilibrium. Existence and stability of competitive equilibrium. The core of an economy. (Not offered in 1974-75)
F. M. Fisher
14.142
Mathematical Programming and Economic Theory (A)
Prereq.:14.122
Units
Year: G(2) (1st half of term)
2-0-4
A rigorous treatment of linear and non-linear programming with applications to economic model building, including activity analysis and input-output.
M. L. Weitzman
14.143
Advanced Theory of the Market III (A)
Prereq.: 14.122
Units
Year: G(2) (2nd half of term)
2-0-4
Oligopoly and product differentiation, advertising, equilibria with seasonal or cyclical demand shifts.
R. L. Bishop
14.144
Applied Price Theory
Prereq.:14.122
Units
Year: G(1) (1st half of term)
2-0-4
Applications of price theory treated topically. Selected topics in price theory, with focus changing from year to year. Current emphasis is on the economics of exhaustible and renewable natural resources.
R. M. Solow
14.145
Economics of Uncertainty
Prereq.:14.124
Units
Year: G(2)
3-0-9
Individual behavior under uncertainty. Equilibrium and welfare under uncertainty. Search and information.
J. A. Hausman,
P. A. Diamond
14.148
Advanced Topics in Microeconomic Theory (A)
Prereq.:14.124
Units
Year: G(2)
Arr.
14.149
Advanced Topics in Microeconomic Theory (A)
Prereq.:14.124
Year: G(2)
Arr.
Advanced topics in microeconomic theory of current interest.
Staff
14.151
Mathematical Approach to Economics (A)
Prereq.:14.122
Units
Year: G(2)
3-0-6
The use of mathematical methods in all the fields of economics.
P. A. Samuelson
14.191
Economics Seminar (A)
Prereq.:14.121, 14.122
Units
Year: G(1)
3-0-6
14.192
Economics Seminar (A)
Prereq.:14.121, 14.122
Year: G(2)
3-0-6
Special economic problems. In 1974-75, 14.192 — Economics of Public Sector.
J. Rothenberg
14.193
Seminar: Topics in Economics (A)
Prereq.:14.121, 14.451
Units
Year: G(1)
3-0-6
14.194
Seminar: Topics in Economics (A)
Prereq.:14.122, 14.452
Year: G(2)
3-0-6
Topics in economics of current interest.
Staff
14.195
Reading Seminar in Economics (A)
Prereq.:14.122
Units
Year: G(1)
Arr.
14.196
Reading Seminar in Economics (A)
Prereq.:14.122
Year: G(2)
Arr.
Reading and discussion of special topics in economics. (Open to advanced graduate students by arrangement with individual numbers of the staff.)
Staff
14.197
First-Year Graduate Seminar (A)
Prereq.: 14.04
Units
Year: G(1)
2-0-6
Seminar limited to first-year graduate students. Discussion of projects of students, professional literature, methodology, economic policy, extending beyond regular curriculum.
Problems in Industrial Economics (A)
Prereq.: 14.04
Units
Year: G(1)
3-0-6
Small and large enterprises in the American economy; market structures; degrees of monopoly and competition; requisites of public policy.
M. A. Adelman
14.272
Government Regulation of Industry (A)
Prereq.: 14.271
Units
Year: G(2)
3-0-6
Follows 14.271. Development of anti-trust policy, generally and in specific cases. “Public utility” price fixing, government ownership as alternative.
P. L. Joskow
14.291
Industrial Economics Seminar (A)
Prereq.:14.271
Units
Year: G(1)
3-0-6
14.292
Industrial Economics Seminar (A)
Prereq.:14.271
Year: G(2)
3-0-6
Readings, discussions, reports on such topics as industrial price policies, government regulation of industry, competitive practices, and similar problems in industrial economics.
A compact one-term course in elementary probability and statistical Inference. Axiomatic probability, random variables, distribution functions, mathematical expectation, generating functions, transformations of random variables, simple correlation and regression models, the normal distribution, sampling theory, point and interval estimation, maximum likelihood, least squares, testing statistical hypotheses. The exposition is somewhat more mathematical than
14.381.
H. A. Freeman
14.373
Time-Dependent Probability (A)
Prereq.: 14.371 or 18.303
Units
Year: G(2)
3-0-6
Markov chains and Markov processes, the relevant ergodic theorem, Kolmogorov equations, time series theory; spectral density functions, harmonic representation, autoregressive models.
H. A. Freeman
14.374
Design and Analysis of Scientific Experiments (A)
Prereq.: 14.381
Units
Year: G(2)
3-0-6
Application of statistical theory to the design and analysis of scientific experiments. Factorial and fractional factorial designs. Applications to experimentation in the physical, chemical, biological, medical, and social sciences.
H. A. Freeman
14.381
Statistical Method in Economics (A)
Prereq.: 14.101 or 18.02
Units
Year: G(1)
4-0-8
Self-contained introduction to probability and statistics which serves as a background for advanced econometrics. Elements of probability theory, sampling theory, asymptotic approximations, decision theory approach to statistical estimation focusing on regression, hypothesis testing and maximum likelihood methods. Illustrations from economics and application of these concepts to economic problems.
J. A. Hausman
14.382
Econometrics I (A)
Prereq.:14.102, 14.381
Units
Year: G(2)
4-0-8
14.383
Econometrics II (A)
Prereq.:14.382
Year: G(1)
4-0-8
Theory and economic application of the linear multiple regression model. Identification and structural estimation in simultaneous models. Analysis of economic policy and forecasting in macroeconomic models. A term paper involving substantive original empirical research is required in 14.383.
R. F. Engle, R. E. Hall, J. A. Hausman
14.386
Advanced Topics in Econometrics (A)
Prereq.: 14.383
Units
Year: G(2)
3-0-6
Selected topics including specification error, non-linear estimation, simulation, aggregation, and the derivation of economic policy models. (Not offered in 1974-5)
R. F. Engle, R. E. Hall, J. A. Hausman
14.388
Applied Econometrics (A)
Prereq.: 14.102, 14.381
Units
Year: G(1)
3-0-9
Theory and practice of econometrics. The linear regression model, tests of hypotheses, generalized least squares, distributed lags, and simultaneous equations. Emphasis on applications. A term paper required.
R. F. Engle
14.391
Workshop in Economic Research (A)
Prereq.:14.124, 14.454
Units
Year: G(1)
2-0-10
14.392
Workshop in Economic Research (A)
Prereq.:14.124, 14.454
Year: G(2)
2-0-10
Designed to develop research ability of students through intensive discussion of dissertation research as it proceeds, carrying out of individual or group. research projects, and critical appraisal of current reported research. Workshops divided into various fields, depending on interest and size.
Macroeconomic analysis of general equilibrium. Financial markets and investment. Intertemporal equilibrium and growth models.
S. Fischer
14.452
Macroeconomic Theory II (A)
Prereq.: 14.451
Units
Year: G(2) (2nd half of term)
2-0-4
Determination of aggregate output, employment, and prices under static conditions. Keynes and alternate theories. The Phillips Curve. Inflation in the short and long run.
R. E. Hall
14.453
Macroeconomic Theory III (A)
Prereq.: 14.452
Units
Year: G(1) (1st half of term)
2-0-4
Quantitative macroeconomics. Consumption, investment, and other components of aggregate demand. Structure of complete econometric models of the U.S. economy
Advanced Topics in Macroeconomic Theory (A)
Prereq.: 14.454
Units
Year: G(1)
Arr.
14.459
Advanced Topics in Macroeconomic Theory (A)
Prereq.: 14.454
Year: G(2)
Arr.
Advanced topics in macroeconomic theory of current interest.
Staff
14.462
Monetary Economics I (A)
Prereq.: 14.122, 14.452
Units
Year: G(2)
3-0-6
Examination of sources and determinants of supply of money with special attention to roles of commercial banks, Federal Reserve System, and Treasury. Discussion of nature of demand for money. Role of monetary policy in determination of level of economic activity. (Not offered in 1974-5; substitute 15.432 Capital Markets and Financial Institutions)
F. Modigliani
14.463
Monetary Economics II (A)
Prereq.: 14.122, 14.452
Units
Year: G(1)
3-0-6
General equilibrium theory of money, interest, prices, and output; portfolio problems, cost of capital, and the effects of monetary phenomena on investment and accumulation of wealth with special reference to problems arising from uncertainty.
S. Fischer
14.471
Fiscal Economics I (A)
Prereq.:14.122, 14.452
Units
Year: G(1)
3-0-6
14.472
Fiscal Economics II (A)
Prereq.:14.122, 14.452
Year: G(2)
3-0-6
Examination, both theoretic and quantitative, of governmental fiscal institutions and behavior: the budget process, taxation, expenditure, pricing, and debt activities.
P. A. Diamond, A. F. Friedlaender
14.482
Income Distribution Economics (A)
Prereq.: 14.124
Units
Year: G(1)
3-0-9
Modern theories and empirical studies of the determinants of the distribution of income and wealth.
L. C. Thurow
International, Interregional, and Urban Economics [Table of Contents]
14.572J
Regional Economic Analysis (A)
Prereq.: 14.03 or 14.05
Units
Year: G(2)
3-0-6
Analysis of regional economies with emphasis on the sources, characteristics, and implications of spatial concentrations of economic activities. Urban development in its regional setting is examined and the special problems of lagging areas in both developing and developed countries. Methods of integrating national and regional planning.
J. R. Harris
14.573J
Urban Economic Analysis I (A)
Prereq.: 14.03 or 14.05
Units
Year: G(1)
3-0-6
Patterns and processes of growth and structural change within metropolitan areas. The land use market and the spatial structure of the metropolitan community. The housing market: demand and supply, growth, aging, and renewal. The urban transportation system and its problems. Models of the metropolis. In each of these topics, emphasis on the resource allocation process, its efficiency and implications for income distribution.
W. C. Wheaton
14.574J
Urban Economic Analysis II (A)
Prereq.: 14.573J
Units
Year: G(2)
3-0-6
Continuation of 14.573J. The nature and problems of government decision-making in metropolitan areas. The economies of segregation, congestion, and pollution in the metropolitan area. Urban-suburban relations; market and government. Welfare economics and the normative theory of local public policy. Applied normative analysis: criteria for public expenditures; cost benefit analysis. Examination of public policy issues in current urban problems; poverty, race, the spatial form of the city, optimal land use patterns, growth and renewal, development and new communities.
J. Rothenberg
14.581
International Economics I (A)
Prereq.: 14.04, 14.06
Units
Year: G(1)
4-0-8
Theory of international trade and applications in commercial policy.
J. N. Bhagwati
14.582
International Economics II (A)
Prereq.: 14.581
Units
Year: G(2)
4-0-8
Adjustment in international economic relations with attention to foreign exchange markets, balance of payments, and the international monetary system.
Primary emphasis on the structure of labor markets and the determinants of wage levels, unemployment, the distribution of income and employment opportunity. Special attention will also be given to the impact of unions on both wage and non-wage elements of collective bargaining in the light of the characteristics and objectives of particular unions. Other special topics growing out of recent research in labor economics.
M. J. Piore,
C. A. Myers
14.672J
Public Policy on Labor Relations (A)
Prereq.: 14.64, 15.663
Units
Year: G(1)
3-0-6
Major trends in legislation and other government activities affecting the work place. Topics include wage and price controls, equal opportunity employment, and government regulation of union organization, collective bargaining, industrial disputes, wages and hours of work, and work-place health and safety. The broad economic and social questions raised by these trends also explored.
M. J. Piore
D. Q. Mills
14.674J
Comparative Systems of Industrial Relations and Human Resource Development (A)
Prereq.: 14.64, 15.663
Units
Year: G(2)
3-0-6
International and comparative analysis of industrial relations systems and systems of human resource development. Concentration on an examination of selected issues involving interest groups and the strategies of economic development, including discussion of the nature and functions of labor and management organization in different contexts; the role of the state in establishing procedures and in shaping the substance of industrial relations; the participation of interest groups in the formulation of economic and social policy: manpower and economic growth in the context of comparative systems of human resource development; worker participation in management, and other topics.
Research Seminar in Industrial Relations (A)
Prereq.:14.671J or 14.672J
Units
Year: G(1)
3-0-6
14.692J
Research Seminar in Industrial Relations (A)
Prereq.:14.14.691J
Year: G(2)
3-0-6
Discussion of important areas for research in industrial relations, frameworks for research, research techniques, and methodological problems. Centered mainly on staff research and the thesis research of advanced graduate students
C. A. Myers
14.672J
Public Policy on Labor Relations (A)
Prereq.: 14.64, 15.663
Units
Year: G(1)
3-0-6
Major trends in legislation and other government activities affecting the work place. Topics include wage and price controls, equal opportunity employment, and government regulation of union organization, collective bargaining, industrial disputes, wages and hours of work, and work-place health and safety. The broad economic and social questions raised by these trends also explored.
Survey of the beginnings of American industrialization, emphasizing a quantitative approach and the nineteenth century. Topics include effects of government economic policies, such as land distribution and tariffs, the importance of railroads, profitability of slavery.
A comparative study of the major problems in Russian economic history prior to 1917 both for their own sake and as a background for understanding of the events of 1917 and of the Soviet policies since. The topics covered vary yearly depending on the interests of the participants, but the land and peasant problems and industrialization methods emphasized.
Development of the European economy since 1750 and, especially since 1850, with emphasis on growth and slowdown, the transition from local to national and European-wide institutions, and extra-European relations.
C. P. Kindleberger
14.734
Problems in Economic History (A)
Prereq.: 14.731, 14.732, or 14.733
Units
Year: G(2)
3-0-6
Analysis of problems of industrial society, concentrating on the century after 1860 and on the American experience. Topics vary yearly and include effects of wars on welfare and growth, the nature of the long deflation of the late nineteenth century, the contrast in international relations before and after 1914, the depression of the 1930’s.
Problems of Economic Development (A)
Prereq.: 14.122, 14.452
Units
Year: G(1)
3-0-6
Analysis of problems of the rural sector in developing countries, urban-rural migration, unemployment, sectoral balance and efficiency of private resource allocation.
R. S. Eckaus
14.772
Theory of Economic Development (A)
Prereq.: 14.122, 14.452
Units
Year: G(2)
3-0-6
Analysis of problems of international trade and development; study of structure and use of planning models for development policy and use of cost benefit analysis.
J. N. Bhagwati
14.773
Optimal Growth Theory (A)
Prereq.: 14.124, 14.454
Units
Year: G(2)
3-0-9
The optimal growth problem, duality theory, development and application of the maximum principle. The behavior of optimal trajectories for a variety of situations. (Alternate years. Offered 1974-75.)
M. L. Weitzman
14.774J
Transfer and Adaptation of Technology in Developing Countries (A)
Prereq.: Permission of Instructor
Units
Year: G(2)
3-0-6
Consideration of the problems of transferring and adapting technologies originating and used in the richer countries of the world to the developing nations. Specific topics include: political, institutional, economic, and engineering issues involved in the transfer of technology.
R. S. Eckaus, F. Moavenzadeh, N. Choucri
14.782
Capitalism, Socialism and Growth (A)
Prereq.: 14.122, 14.452
Units
Year: G(1)
3-0-6
A comparative study of capitalist and socialist economies mainly from the point of view of development and growth, and with major emphasis on the economy of the Soviet Union.
Multilevel planning. Decomposition principles and their application. Planning with prices and with quantities. Materials balancing and input-output. Applications of inventory theory. The problems posed by non-convexities. (Alternate years. Not offered 1974-75.)
Even a superficial local history of one department can contain anecdotal nuggets of interest to historians of economics. This one for Amherst College was written by the University of Chicago trained economic historian George Rogers Taylor (Ph.D. 1929) whose Amherst faculty career spanned four decades. He tagged along when Paul Douglas took leave to teach at Amherst.
____________________
One Hundred Years of Economics
[1832-1932]
at Amherst College by George Rogers Taylor
ALTHOUGH economics is one of the oldest of the so-called social sciences, it may come as a surprise to some to learn that in one form or another this subject has been taught at Amherst probably since the founding of the college. At first no separate courses were given in economics, but it was a recognized part of the more general subject then known as moral philosophy. It will be remembered in this connection that Adam Smith himself was professor of moral philosophy at the University of Glasgow and came to his interest in economics from that more general subject. As early as 1827-28 “political economy” — now known as “economics” — was listed as required for seniors, but it is not known how much work was done or what member of the faculty directed it. Quite possibly Pres. Heman Humphrey, who held the chair of professor of mental and moral philosophy, may have done some regular teaching in economics.
One hundred years ago, during the school year 1832-33, political economy became a definitely recognized part of the curriculum, and Hon. Samuel C. Allen [a trustee of the Amherst College Corporation] was appointed to the faculty as lecturer in political economy [First term of Senior Studies “Say’s Political Economy” (p. 14); “ Lectures on Political Economy and Legislation will be delivered by the Hon. Samuel C. Allen” (p. 15)]. It is reported that he volunteered his services for this purpose and received by way of compensation “the thanks of the trustees.” He lectured only during this one year. Though political economy continued to be taught, there probably were no further formal lectures in the subject until 1835. In that year Hon. William B. Calhoun of Springfield [A.M. “Lecturer on Political Economy”, Nov 1836 Catalog (p. 5)], one of the trustees, was appointed lecturer in political economy [Third term, Senior year. Nov 1836 Catalog (p. 16)]. He continued to hold that position until 1849 [sic, 1835-1850 according to Amherst records]. Then, for a little more than a decade, there was no faculty representative definitely in this field; but the course continued as part of the curriculum and, at least in some years, regular lectures were given. Apparently this teaching was allotted to the professor of intellectual and moral philosophy.
One other lecturer in political economy was appointed before 1876. Amasa Walker [Note: Father (!) of Francis Amasa Walker] held that position from1860 to 1869. Like Allen and Calhoun, Walker came to his teaching with the background of one interested in public affairs. In addition to holding state offices, all three men were members of the United States House of Representatives. Both Calhoun and Walker carried on their work at Amherst College while serving in Congress. All of these early teachers of political economy at Amherst were unquestionably able, public spirited, and deeply religious men.
The economics taught in these early lectures followed in general the lines laid down by the English classical school. The popular translation of Say’s “Political Economy” was used as a textbook until 1838, when it was replaced by Wayland’s “Political Economy” — an American restatement and simplification of the classical doctrine. But it must not be concluded that these men were dry-as-dust expositors of the “dismal science.” Nor were they among those of the period who have been so often accused of using classical economics primarily as a device for defending the status quo. All were men of liberal tendencies, much interested in the progressive movements of their day. Allen, who started out as a Congregational minister, afterwards becoming a Unitarian, was a Democrat and an ardent champion of free trade. William B. Calhoun is described as one who dealt with social and political problems more in the spirit of a philosopher than a politician. He left former political allegiances to become a strong anti-slavery Whig and was a leader in the temperance movement of the time. Amasa Walker also was an active leader in the reform movements of his day. He gave generously of his time and ability to the temperance, anti-slavery, and peace movements.
Of the three, Walker is the only one who was primarily an economist. He was generally recognized in his day as an authority in finance and has left writings, particularly in the field of currency and finance, which may still be read with profit by the economist and the historian. In 1866 he published his chief work, “The Science of Wealth.” His chapters on money and currency are particularly able. He was much in advance of his time in the use of statistics and graphical methods. Even in the more theoretical parts of the subject, Walker was vigorous and questioning. American conditions with which he was acquainted, not only as a business man but also as a legislator, led him to question Malthus’s famous law of population and to differ with Ricardo on certain important points of rent theory.
The present phase of economics at Amherst College began with the appointment of Anson D. Morse as instructor in political economy in 1876. The subject became now much more than an appendage to moral philosophy and the lectures were no longer given by ministers or practical men of affairs. From now on the teachers were professional students of social science, trained as such, and among those who were called to the chair of professor of economics were men who are numbered among the ablest in the American field.
Professor Morse [Anson D. Morse Papers at the Amherst College Archives] began his many years of fruitful teaching at Amherst in 1876 as an instructor of political economy. But his main interest was history, and before many years he had shifted completely over to that department. It is history, therefore, rather than economics, which has primary claim upon this man who is remembered not only as a scholar but as one of Amherst’s most stimulating teachers.
From 1885 down to the World War, three outstanding teachers left their impress on economics, not only by their teaching at Amherst College but also through their writings. Two of these, John Bates Clark [see also; also this post] and his son, John Maurice Clark, have made major contributions to the economic thought of the time. The elder Clark is known for contributions to economic theory that are regarded by many as the most significant which America has produced. His son has taken his place as one of the ablest and most original of American economic writers of today. The third, James W. Crook, [see also] was primarily a teacher, beloved by two generations of Amherst students.
In more recent years, the professors of economics at Amherst have continued to be men of outstanding ability and national prominence. Among those who were in the department long enough to leave a definite mark on the life of the College must be listed Walton Hale Hamilton, Walter W. Stewart, Paul Howard Douglas, and Richard Stockton Meriam.
Until 1880 only one course was given in economics. This was apparently comparable to the principles or introductory course of more recent years. It is interesting to note that the first course to be added (1880) was one in the history of socialism. As time went on other courses appeared and disappeared, but usually they were substantially in one of the four fields now covered by advanced courses — finance, labor, economic history, and advanced theory.
It will be noted that two tendencies in the teaching of college economics which have been increasingly prominent in the United States during the last twenty years have been completely avoided at Amherst. The first is that toward the multiplication of courses. In fact, Amherst has gone to the extreme in the other direction. A study¹ of a large number of American colleges made in 1928 brought out the fact that only three colleges offered fewer courses in economics than Amherst, and the average number of subjects per instructor was smaller at Amherst than at any other college.
In the second place, the trend toward the introduction of business subjects has not affected the Amherst course of study. Economics, as taught here for one hundred years, has been given from the cultural and not from the professional point of view. In fact, the early courses in moral philosophy, which included at least some economics, were in so far as they were especially designed for students preparing for the ministry, possibly more professional than are the present courses in economics which are designed for the student who is to enter any walk of life.
The first hundred years of economics at Amherst College has witnessed many changes. A distinguished line of teachers has come and gone. The subject matter of the courses has been somewhat altered and expanded. In the early days economics was a compulsory course during part of the senior year. As time went on the department was enlarged but study in the department was made optional. Since 1927 the introductory course has been open to sophomores. The advanced student has now four courses in the department from which he may choose: economic history of the United States, labor problems, theory of credit, and development of economic thought, and additional individual work is offered for those taking honors in economics. But though many changes have taken place, the purpose of the work has remained essentially what it has always been, to fit the student to take his place in the world as a cultured man and a good citizen.
Recalling my active days in the rat race of academia, a cold shiver runs down my spine at the thought of departmental rankings in the hands of a Dean contemplating budgeting and merit raise pools or second-guessing departmental hiring decisions.
But let a half-century go by and now, reborn as a historian of economics, I appreciate having the aggregated opinions of yore to constrain our interpretive structures of what mattered when to whomever.
Research tip:sign up for a free account at archive.org to be able to borrow items still subject to copyright protection for an hour at a time. Sort of like being in the old reserve book room of your brick-and-mortar college library. This is needed if you wish to use the links for the Keniston, Carter, and Roose/Andersen publications linked in this post.
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1925 Rankings
R. M. Hughes. A Study of the Graduate Schools of America (Presented before the Association of American Colleges, January, 1925). Published by Miami University at Oxford, Ohio. (See earlier post that provides the economics ranking from the Hughes’ study)
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.
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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.
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
Image Source: PBS, American Masters. S38 EP3: 
