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Chicago Exam Questions

Chicago. First quarter of price theory. Midterm and final exams. Harberger, 1957

Arnold Harberger

 

A copy of the reading list for the first quarter of price theory at the University of Chicago taught by Arnold Harberger in the autumn quarter of 1955 has been transcribed and posted earlier. That copy was found in Milton Friedman’s papers at the Hoover Institution Archives. Copies of the two mid-term exams and the final exam for the same course in 1957 were found in Zvi Griliches’ papers in the Harvard University Archives. While not a perfect match, some items might have been added/subtracted to the later course, price theory à la Harberger in the mid-1950sis better reflected in these two posts together now.

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Economics 300A
Hour Examination
November 5, 1957

(60 points)

  1. True, False, or Uncertain. In each case write a paragraph explaining your answer. Your grade will depend heavily on your explanation.
    1. The price elasticity of demand for a good will be higher, the higher is the income elasticity of demand for that good.
    2. If X and Y are substitutes, a decline in the price of X can lead to an increase in the amount of Y demanded only if Y is an inferior good.
    3. If a particular producer of grapefruit produces 10 percent of the total supply of grapefruit, the elasticity of demand facing that producer must be at least -10.
    4. If the cross-elasticity of demand for X with respect to the price of Y is .5, the cross elasticity of demand for Y with respect to the price of X will also be .5.
    5. The demand curve for a commodity which includes the “income effect” is necessarily more elastic than the demand curve for the same commodity which includes only the substitution effect.
    6. Food and “all other commodities” cannot be complements.

(15 points)

  1. Derive the expression for the elasticity of demand facing a particular producer in terms of the elasticity of “total demand” in the market and of the elasticity of “other supply”.

(25 points)

  1. Using indifference curves, derive the supply curve of labor as A function of real wages. Distinguish between the “income effect” and the substitution effect. State what, if any, will be the circumstances under which a rise in real wages will lead to a reduction in the quantity of labor offers.

*  *  *  *  *  *  *  *  *  *  *  *  *  *  *  *  *

Economics 300A
Hour Examination
4 December 1957
Mr. Harberger

(48 points)

  1. True, False or Uncertain. In each case write a few sentences explaining your answer.
    1. If the firms in the coal industry were to merge into one single firm, the demand curve for coal miners would become more elastic.
    2. Marginal cost exceeds average cost wherever marginal cost is rising.
    3. In the case in which factors combine in fixed proportions to produce a product X, the elasticity of demand in industry X for a factor will be greater, the larger is the fraction of the total costs of producing X which is spent on hiring the factor in question.
    4. A firm having monopsony power in the market for its labor will hire workers up to the point where their wage is equal to their marginal value product (marginal physical product times marginal revenue), not to the value of their marginal physical product.
    5. If, at a point in a homogeneous production function, the marginal product of A is rising, the marginal product of B will be negative. (Consider A and B as the only two factors.)
    6. If, at a point in a homogeneous production function, the marginal product of B is negative, the marginal product of A will be rising. (Consider A and B as the only two factors.)

(34 points)

  1. Discuss and comment on Marshall’s four rules of derived demand

(18 points)

  1. Discuss the relationship between short run and long run cost curves. Is a shorter run marginal cost curve always more elastic than a longer run marginal cost curve going through the same point on the long run average cost curve

 

*  *  *  *  *  *  *  *  *  *  *  *  *  *  *  *  *

Final Examination
Economics 300A
Autumn, 1957

(70 points)

  1. True, False, or Uncertain. In each case write a few sentences explaining your answer. Your grade will depend heavily on your explanation.
    1. If the United States exports one tenth of its coal, the elasticity of supply of domestic coal being unity, the elasticity of supply of U.S. coal exports must be at least 10.
    2. If the price of X rises while the price of X stays constant, the amount of Y demanded will always increase, so long as X and Y are substitutes. (Assume money income and other prices remain unchanged.)
    3. The own-price elasticity of demand for a commodity must always equal or exceed, in absolute value, the cross elasticity of demand for that commodity with respect to the price of any other commodity.
    4. The own-price elasticity of demand for a commodity must always equal or exceed, in absolute value, the marginal propensity to consume that commodity.
    5. When the production function is such that factors of production combine with each other in fixed proportions to produce a product, the own price elasticity of demand for the use of any of the factors in the production of the product must be less than the price elasticity of demand for the product. (Assume that the production of the product in question is competitive.)
    6. The income elasticity of demand for a commodity is the marginal propensity to consume that commodity divided by the average propensity to consume that commodity.
    7. The elasticity of demand for labor in the production of automobiles will be lower in the case in which the quantities of other factors are given than in the case in which the prices of other factors are taken as given.
    8. The elasticity of demand facing a monopolist will be lower than the elasticity of demand facing the same industry if it were competitive.
    9. The welfare cost of a 5 percent tax on automobiles is the same as the welfare cost of a 5 percent subsidy on all goods and services other than automobiles.
    10. The welfare cost per dollar of tax receipts of a 5 percent tax on automobiles is the same as the welfare cost per dollar of tax receipts of a 5 percent tax on all goods and services other than automobiles.
    11. If, at a point in a production function which is homogeneous (of degree 1), the marginal product of factor B is negative, the marginal product of factor A will be rising (in the sense that the marginal product of A will be higher when the proportion of factor A to factor B is slightly increased). Assume that A and B are the only two factors.
    12. The supply curve of labor can be backward bending only if leisure is an inferior good.
    13. The demand for the services of a factor of production in a particular industry will be more elastic, the larger is the share of that factor in the total costs of the industry in question.
    14. All short run average cost curves are tangent at (at least) one point to the long run average cost curve.

(15 points)

  1. Outline the economics of the fishing industry. What resemblance, if any, do you see between the economics of the fishing industry under conditions of competition and the economics of monopolistic competition.

(15 points)

  1. Indicate, using supply and demand diagrams, what is the welfare cost of a tariff. Assume that the tariff is on a product (woolen cloth) in which the domestic demand is partly met by domestic supplies and partly met by imports. The tariff, of course, is a tax only on the imports. Assume that the imported product and the domestic product are for all relevant purposes homogeneous. What role does the elasticity of domestic demand for woolen cloth play in your measure of welfare cost? The elasticity of domestic supply of woolen cloth? The ratio of domestic supply to domestic demand?

Source: Harvard University Archives. Papers of Zvi Griliches, Box 130, Folder “Syllabi and exams, 1955-1959”.

Image Source: Arnold C. Harberger, 1957 Fellowship in Economics from the John Simon Guggenheim Memorial Foundation. Colorized by Economics in the Rear-View Mirror.

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Exam Questions Harvard Socialism Suggested Reading Syllabus

Harvard. Methods of Social Reform. Enrollment, description, linked reading list, final exam. Carver, 1904-1905

Economics professor Thomas Nixon Carver was the second in a long line of Harvard professors who exposed their students to the doctrines of anarchism, socialism, and communism (among other -isms). Carver came to bury the well-intentioned but ill-conceived doctrines, not to praise them. 

Strange Political Bedfellow: An earlier post provides Thomas Nixon Carver’s link to the U.S. publicist of the Protocols of the Elders of Zion, 1921.

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Material from earlier years:

Exams and enrollment figures for economics of socialism and communism taught by Edward Cummings (1893-1900),
Socialism and Communism (with Bushée), 1901-92,
Methods of Social Reform, (Carver), 1902-03.

Material from later years:

Short Bibliography of Socialism for “Serious-minded students” by Carver (1910),
Thomas Nixon Carver (1920),
Edward S. Mason (1929),
Paul Sweezy (1940),
Wassily Leontief  (1942-43),
Joseph Schumpeter (1943-44),
Overton Hume Taylor (1955).

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Course Enrollment
1904-05

Economics 14b 2hf. Professor Carver. — Methods of Social Reform. Socialism, Communism, the Single Tax, etc.

Total 79: 10 Graduates, 25 Seniors, 26 Juniors, 13 Sophomores, 5 Others.

Source: Harvard University. Report of the President of Harvard College, 1904-1905, p. 75.

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Course Description
1904-05

14b 2hf. Methods of Social Reform. Socialism, Communism, the Single Tax. Half-course (second half-year). Tu., Th., at 1.30. Professor Carver.

Open only to students who have had Course 14a.
The purpose of this course is to make a careful study of those plans of social amelioration which involve either a reorganization of society, or a considerable extension of the functions of the state. The course begins with an historical study of early communistic theories and experiments. This is followed by a critical examination of the theories of the leading socialistic writers, with a view to getting a clear understanding of the reasoning which lies back of socialistic movements, and of the economic conditions which tend to make this reasoning acceptable. A similar study will be made of Anarchism and Nihilism, of the Single Tax Movement, of State Socialism and the public ownership of monopolistic enterprises, and of Christian Socialism, so called.
Morley’s Ideal Commonwealths, Ely’s French and German Socialism, Marx’s Capital, Marx and Engels’s The Communist Manifesto, and George’s Progress and Poverty will be read, besides other special references.
The course will be conducted by means of lectures, reports, and class-room discussions.

Source: Harvard University. Faculty of Arts and Sciences. Division of History and Political Science Comprising the Departments of History and Government and Economics, 1904-05 (May 16, 1904), p. 46.

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[Library stamp: Mar 7, 1905]

Economics 14

Topics and References
Starred references are prescribed

[Note: Identical to reading list of 1902-03]

COMMUNISM

A
Utopias
1. Plato’s Republic
2. *Sir Thomas More.   Utopia.
3. *Francis Bacon.   New Atlantis.
4. *Tommaso Campanella.   The City of the Sun. (Numbers 2, 3, and 4 may be found in convenient form in Morley’s Ideal Commonwealths.)
5. Etienne Cabet.   Voyage en Icarie.
6. Wm. Morris.   News from Nowhere.
7. Edward Bellamy.   Looking Backward.

 

B
Communistic Experiments
1. *Charles Nordhoff.   The Communistic Societies of the United States.
2. Karl Kautsky.   Communism in Central Europe in the Time of the Reformation.
3. W. A. Hinds.   American Communities.
4. J.H. Noyes.   History of American Socialisms.
5. J. T. Codman.   Brook Farm Memoirs.
6. Albert Shaw.   Icaria.
7. G.B. Landis.   The Separatists of Zoar.
8. E.O. Randall.   History of the Zoar Society.

 

SOCIALISM

A
Historical
1. *R. T. Ely. French and German Socialism.
2. Bertrand Russell. German Social Democracy.
3. John Rae. Contemporary Socialism.
4. Thomas Kirkup. A History of Socialism.
5. W. D. P. Bliss. A Handbook of Socialism.
6. Wm. Graham. Socialism, New and Old.
7. [Jessica Blanche] Peixotto. The French Revolution and Modern French Socialism.

 

B
Expository and Critical
1. *Albert Schaeffle. The Quintessence of Socialism.
2. Albert Schaeffle. The Impossibility of Social Democracy.
3. *Karl Marx. Capital.
4. *Karl Marx and Fredrick Engels. The Manifesto of the Communist Party.
5. Frederick Engels. Socialism: Utopian and Scientific.
6. E. C. K. Gonner. The Socialist Philosophy of Rodbertus.
7. E. C. K. Gonner. The Socialist State.
8. Bernard Shaw and others. The Fabian Essays in Socialism.
9. The Fabian Tracts.
10. R. T. Ely. Socialism: An Examination of its Nature, Strength, and Weakness.
11. Edward Bernstein. Ferdinand Lassalle.
12. Henry M. Hyndman. The Economics of Socialism.
13. Sydney and Beatrice Webb. Problems of Modern Industry.
14. Gustave Simonson. A Plain Examination of Socialism.
15. Sombart. Socialism and the Social Movement in the Nineteenth Century.
16. Vandervelde. Collectivism [and Industrial Evolution].

 

ANARCHISM

1. *Leo Tolstoi. The Slavery of Our Times.
2. William Godwin. Political Justice.
3. Kropotkin. The Scientific Basis of Anarchy. Nineteenth Century, 21: 238.
4. Kropotkin. The Coming Anarchy. Nineteenth Century, 22:149.
5. Elisée Reclus. Anarchy. Contemporary Review, 45: 627. [May 1884]

 

RELIGIOUS AND ALTRUISTIC SOCIALISM

1. Lamennais. Les Paroles d’un Croyant.
2. Charles Kingsley. Alton Locke.
3. *Kaufman. Lamennais and Kingsley. Contemporary Review, April, 1882.
4. Washington Gladden. Tools and the Man.
5. Josiah Strong. Our Country.
6. Josiah Strong. The New Era.
7. William Morris, Poet, Artist, Socialist. Edited by Francis Watts Lee. A collection of the socialistic writings of William Morris.
8. Ruskin. The Communism of John Ruskin. Edited by W. D. P. Bliss. Selected chapters from Unto this Last, The Crown of Wild Olive, and Fors Clavigera.
9. Carlyle. The Socialism and Unsocialism of Thomas Carlyle. Edited by W. D. P. Bliss. Selected chapters from Carlyle’s various works. [Volume 1; Volume 2]

 

AGRARIAN SOCIALISM

1. *Henry George. Progress and Poverty.
2. Henry George. Our Land and Land Policy.
3. Alfred Russell Wallace. Land Nationalization.

 

STATE SOCIALISM

An indefinite term, usually made to include all movements for the extension of government control and ownership, especially over means of communication and transportation, also street lighting, etc.

1. R. T. Ely. Problems of To-day. Chs. 17-23.
2. J. A. Hobson. The Social Problem.

 

WORKS DISCUSSING THE SPHERE OF THE STATE IN SOCIAL REFORM

1. Henry C. Adams. The Relation of the State to Industrial Action.
2. *D. G. Ritchie. Principles of State Interference.
3. D. G. Ritchie. Darwinism and Politics.
4. *Herbert Spencer. The Coming Slavery.
5. W. W. Willoughby. Social Justice.

Source:  Harvard University Archives. Syllabi, course outlines and reading lists in economics, 1895-2003. Box 1, Folder “Economics, 1904-1905”.

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ECONOMICS 14b
Year-end Examination, 1904-05

  1. So far as you have studied them, were the failures of communistic experiments due to the fact that they were carried out on too small a scale, to unfavorable outside conditions, or to inherent weaknesses in their internal organization? Give at least three illustrations.
  2. Give an outline of one Utopian scheme or ideal commonwealth which you have studied, and point out its strong and its weak features.
  3. Give an account of the origin of the German Social Democratic Party.
  4. Is there any essential difference between the income of the capitalist and that of the landlord? Explain your answer.
  5. Discuss the question, Is labor the sole creator of wealth?
  6. Discuss the question, Is there any relation between the inequality in the distribution of talent and the inequality in the distribution of wealth under the competitive system.

Source: Harvard University Archives. Harvard University, Examination Papers 1873-1915. Box 7, Bound volume: Examination Papers, 1904-05;  Papers Set for Final Examinations in History, Government, Economics,…,Music in Harvard College (June, 1905), p. 33.

Image Source: “The trouble, my friends, with socialism is that it would destroy initiative” by Udo J. Keppler. Centerfold in Puck, v. 66, no. 1715 (January 12, 1910). Library of Congress Prints and Photographs Division Washington, D.C.

Illustration shows a large gorilla-like monster with human head, clutching clusters of buildings labeled “Public Utilities, Competition, [and] Small Business” with his right arm and left leg, as he crushes a building labeled “Untainted Success, Initiative, Individualism, Independence, [and] Ambition” with his left hand, causing some citizens to flee while others plead for mercy. He casts a shadow over the U.S. Capitol, tilting in the background.

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Distribution Exam Questions Harvard

Harvard. Enrollment, description, final exam. Distribution of Wealth. Carver, 1904-1905

1904

 

In this course Harvard professor Thomas Nixon Carver was wearing his economic theorist cap. The first semester of the academic year 1904-05 was the first time he taught this one-semester course at Harvard. One notes (disapprovingly) that the course title apparently confounds income and wealth. On the other hand, strictly speaking, so did the title of Adam Smith’s magnum opus, Wealth of Nations.

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Course Enrollment
1904-05

 Economics 14a 1hf. Professor Carver. — The Distribution of Wealth.

Total 52: 5 Graduates, 23 Seniors, 12 Juniors, 6 Sophomores, 6 Others.

Source: Harvard University. Report of the President of Harvard College, 1904-1905, p. 75.

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Course Description
1904-05

[Economics] 14a 1hf. The Distribution of Wealth. Half-course (first half-year) Tu., Th., at 1.30. Professor Carver.

This course begins with a review of the theory of value and the laws which govern the exchange of commodities. The study is then carried into the field of distribution, and the attempt is made to find out the laws which actually, under existing conditions, determine the shares in the products of industry, such as wages, interest, rent, and profits. Finally the question of justice in distribution is considered.
The course will be conducted by means of lectures and classroom discussions.
This course is a necessary preliminary to 14b.

Source: Harvard University. Faculty of Arts and Sciences. Division of History and Political Science Comprising the Departments of History and Government and Economics, 1904-05 (May 16, 1904), pp. 45-46.

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ECONOMICS 14a
Mid-year Examination, 1904-05

  1. What is the relation between the value of an article and the labor which produced it?
  2. Explain what is meant by the elasticity of demand.
  3. Explain and elaborate the following passage: “In a trade which uses very expensive plant, the prime cost of goods is but a small part of their total cost; and an order at much less than their normal price may leave a large surplus above their prime cost.” (Marshall, Principles of Economics, 4th ed, p. 447.)
  4. Fill out the blank columns in Table I and point out where the law of increasing returns stops and the law of diminishing returns begins.
    Table I, showing the amount of corn (in bushels) which could be produced on an assumed farm of 100 acres by varying numbers of laborers employed in its cultivation:—

No. of laborers.

 Total product. Average product per laborer. Marginal product. Total wages as based on marginal product. Total rent.

Rent per acre.

1

 1000
2 3000

3

 4000
4 4800

5

 5500
6 6000

7

 6300
8 6400

  1. Reverse Table I by filling out Table II.
    Table II, derived from Table I, showing the amount of corn which 8 laborers could produce on varying amounts of land:—

No. of acres.

 Total product. Average product per acre. Marginal product per acre. Total rent as based on marginal product of land. Total wages.

Wages per laborer.
  1. How would the withdrawal of a given piece of land from cultivation affect the total product of industry in the community.
  2. Can you apply the theory of joint demand to the problem of the relation of capital to wages?
  3. How does it happen that a piece of capital will normally produce more during its lifetime than it is worth at any one time? What bearing has your answer upon the problem of the source of interest?
  4. In what important particulars do interest and rent resemble one another, and in what do they differ?
  5. Is risk productive? Is there any relation between risk and profits?

Source: Harvard University Archives. Harvard University, Examination Papers 1873-1915. Box 7, Bound volume: Examination Papers, 1904-05;  Papers Set for Final Examinations in History, Government, Economics,…,Music in Harvard College (June, 1905), pp. 34-35.

Image Source: Harvard Square (1904) from the Brookline Public Library, Brookline Photograph Collection at the Digital Commonwealth website. This work is licensed for use under a Creative Commons Attribution Non-Commercial No Derivatives License (CC BY-NC-ND).
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Exam Questions Harvard Methodology

Harvard. Course enrollment, description, final exam. Economic Research Methods. Carver, 1904-1905

Thomas Nixon Carver (ca. 1916)

 

With this post we add Professor Thomas Nixon Carver’s exam questions for a graduate course on methods of economic investigation to our larger data base of economics examination questions. This was the fourth time that Carver offered this particular course at Harvard. The scope of his teaching portfolio was by far the broadest of the department, ranging across economic theory, sociology, schemes of economic reform, and agricultural economics so it is hardly surprising that he would have judged himself competent to teach/preach methodology too. 

The last question reveals his trinity of economic methods: historical, statistical and analytical. Judging merely from Carver’s exam questions here, I would hazard a guess that this course might have been considered a “snap” course. I have no explanation for the relatively low enrollment figures, that is unless he assigned significant amounts of German language texts. Taussig did that earlier.

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“Methods of Investigation”
in other years

Economics 13 (Scope and Methods) in 1895-96, Taussig.

Economics 13 (Scope and Methods) in 1896-97, Not Offered.

Economics 13 (Scope and Methods) in 1897-98, Ashley.

Economics 13 (Methods) in 1898-99, Taussig.

Economics 13 (Methods) in 1899-1900, Not Offered.

Economics 13 (Methods) in 1900-01, Carver.

Economics 13 (Methods) in 1902-03, Carver.

Economics 13 (Methods) in 1903-04, Carver.

Economics 12 (Scope and Methods) from 1914-15, Carver.

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Course Enrollment
1904-05

‡Economics 13 1hf. Professor Carver. — Methods of Economic Investigation.

Total 4: 2 Graduates, 2 Seniors.

Source: Harvard University. Report of the President of Harvard College, 1904-1905, p. 75.

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Course Description
1904-05

[Economics] ‡*13 1hf. Methods of Economic Investigation. Half-course (first half-year). Tu., Th., at 2.30. Professor Carver.

Course 13 will examine the methods by which the leading writers of modern times have approached economic questions, and the range which they have given their inquiries; and will consider the advantage of different methods, and the expediency of a wider or narrower scope of investigation. These inquiries will necessarily include a consideration of the logic of the social sciences. Methods of reasoning, methods of investigation, and methods of exposition will be considered separately, and the sources and character of the facts which are essential to economic science will be examined. Cairnes’ Logical Method of Political Economy and Keynes’ Scope and Method of Political Economy will be carefully examined. At the same time selected passages from the writings of Mill, Jevons, Marshall, and the Austrian writers will be studied, with a view to analyzing the nature and scope of the reasoning.

Course 13 is designed mainly for students who take or have taken Course 2 or Course 15; but it is open to mature students having a general acquaintance with economic theory.

Source: Harvard University. Faculty of Arts and Sciences. Division of History and Political Science Comprising the Departments of History and Government and Economics, 1904-05 (May 16, 1904), p. 49.

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ECONOMICS 131
Year-end Examination, 1904-05

  1. Discuss the question of the subdivisions of economics.
  2. Is it possible to discuss economic questions without passing ethical judgements? Explain and give examples.
  3. Of what use are mathematical formulae and diagrams in economics?
  4. Compare the historical and the analytical methods in their applicability to the following questions: (1) Is the world likely to become over populated? (2) Would communism tend to increase the rate of multiplication?
  5. Is there any relation between the theory of probabilities and any class of economic laws? Explain.
  6. By what logical method is it possible to distinguish the product of a given factor from that of a number of coöperating factors of production?
  7. Do economists make use of pure hypotheses such as are used in the physical sciences? Give reasons for your answer.
  8. What do you conceive to be the true relation of the historical method, the statistical method and the analytical method to one another.

Source: Harvard University Archives. Harvard University, Examination Papers 1873-1915. Box 7, Bound volume: Examination Papers, 1904-05;  Papers Set for Final Examinations in History, Government, Economics,…,Music in Harvard College (June, 1905), p. 33.

Image Source: Thomas Nixon Carver photograph from the November 11, 1916 issue of the Harvard Illustrated Magazine, p. 110.Colorized by Economics in the Rear-view Mirror.

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Columbia Exam Questions

South Carolina and Columbia College. Political Economy Exams. Francis Lieber, 1855, 1863

Francis Lieber (1800-1872)

What is a curator of Economics in the Rear-view Mirror to do when he stumbles across college exams in political economy from 1855 and 1863? Of course, there is no choice but to stop everything and post the material immediately. I had no reason to either like or dislike Francis Lieber when I started this post, but the more I see of him (not all posted here…yet), the more I get to like him as a scholar.

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Specimens of Francis Lieber’s Examinations

The numbers at the [left] of the questions in Sections A and B represent the point values of the questions.

A. South Carolina College.
Junior Class in Political Philosophy, 18551

The Juniors stand on Paley’s Elements of Political Knowledge, to Chap. VII, and five lectures.

  1. [35 points] What is absolutism or an absolute Government: What is an absolute Monarchy, and what is absolute Democracy? Why is an absolute Democracy one of the worst governments? Compare the reality of power and the responsibility of the power-holder in the absolute Monarchy with those in the absolute Democracy.
  2. [20 points] Define Obedience and state whether obeying is passive submission or an attribute of rational beings and free agents. Show how man is familiarized with the idea of authority before he becomes an active citizen, and show, moreover, how it is that we ought to obey laws which were made generations before us, and, in the making of which, consequently, we have no direct or indirect share.
  3. [25 points] What is meant by the theory of the civil compact, implied or positive? Give the most serious objection to this theory.
  4. [20 points] Give the first and the last division of the general classification of all governments and politics, written in such a way as to show the subordination of the different parts.

1Printed copy in Lieber papers, Columbia University Libraries. A handwritten note at the bottom reads: “N. B. These refer to a course which commenced Oct. 1, and ended Nov. 10. F. L.”

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B. South Carolina College.
Senior Class in Political Economy, 18552

The Seniors stand on the entire annual course of Political Economy, including a course of lectures and the whole of Say’s Political Economy, except the Book on Distribution.

Subjects.

  1. [25 points] Louis the Fourteenth was in the habit of saying that royal profusion is the charity of kings, or, that lavish governments are a blessing to the people. Show what is meant by this assertion and its grave error.
  2. [10 points] Define the term “Itinerant Merchant” or Pedlar. Does the Itinerant form an essential link in the long chain of commerce?
  3. [30 points] Enumerate the characteristics of a sound acceptable tax, according to Mr. Say, and also the characteristics as your teacher has given them — adding to each characteristic an explanatory note or two, in order to show what is meant by it.
  4. [15 points] Is machinery objectionable on the ground that it saves labor? If this were so, would the objection apply to machinery alone?
  5. [30 points (sic, perhaps only 20?)] A hotel or bridge is built for a capital, say, of $100,000. The undertakings prove failures in spite of the prudent management of the concern either, because the buildings were erected on an extravagant plan, or because the number of people making use of them, falls short of that calculated upon. The hotel, or the bridge, is sold for $25,000 and now the number of boarders in the hotel, or of the passengers over the bridge, is sufficient to pay for the interest of the latter sum, as well as for all other outlays, and yields a fair profit. Hereupon the general remark is made: “Well, the capitalist who first undertook the thing is ruined, it is true, but the people,” or “the community at large have gained by it; for, here, they are living in this fine hotel,” or “here is the bridge still standing.” Similar remarks are made on large, yet unprofitable, under takings, of governments, with this difference that, generally, it is added, “There is no harm in the original outlay, although it proves unprofitable, inasmuch as the capital laid out has returned to the people.” For instance, one hundred millions of dollars laid out by government for a railway to the Pacific, would be no loss, although the railway should yield no profit, nor even pay for the interest of the capital, because the whole amount of the capital, would have returned to the people, by the laying of the road itself.

You meet with this argument every day in the debates in Congress, as well as in common life. Show its utter fallacy, or which amounts to the same thing, answer the question: Can the capitalist who pays for a work, be ruined by it, yet the community, or people at the same time be benefitted? And is there any difference in point of political economy, whether government, or a private individual be the capitalist? And also, whether there be any difference if the iron, in the case of the railway, be American iron, or purchased abroad?

2A printed copy is in the Columbia University Libraries.
Lieber elaborated the answer to the main part of the fifth question in his Some Truths Worth Remembering, Given as a Recapitulation, in a Farewell Lecture to the Class of Political Economy of 1849, Published by the Class.

“No enterprise, failing by its own unprofitable nature, can be, at the same time, ruinous to the adventurers, yet advantageous to the community. If a railway cost $500,000, and shares fall to $25 in the hundred, because travelling and freight pay a fair interest of $100,000 only, in that case the community has for ever lost the value of $400,000, and the passengers and freight are carried at the regular and fair price plus the interest of $400,000 proportionately divided in the course of the year. Nothing is more common than to hear that a hotel or a canal has been ruinous to the adventuring individuals, but that the people have reaped the advantage of it. This cannot be. The case applies to government undertakings. They cannot be advantageous to the whole (as far as productive effects are concerned), although they would be ruinous to individuals.”

________________________

Columbia College.
Senior Class in Political Economy, 18633

  1. Definition of Money.
  2. Immigration Into the U. States considered in an economical point of view.
  3. Error of Montesquieu concerning Money.
  4. Define direct and indirect taxation.
  5. How does a Bill of Exchange become a commodity?
  6. Communism and Socialism.
  7. Enumerate the characteristics of an acceptable tax.
  8. The N[ew] York Clearing House.

3In Lieber papers, Columbia University Libraries.

Source:  Appendix to “Francis Lieber: German Scholar in America,” reprinted in the collection of essays by Joseph Dorfman and R.G. Tugwell, Early American Policy: Six Columbia Contributors (New York: Columbia University Press, 1960), pp. 339-341. The article was originally published without the above appendix in Columbia University Quarterly, Vol. 30 (Sept. and Dec.), 1938, pp. 159-90; 267-93.

Image Source: Thomas Sergeant Perry, editor. The Life and Letters of Francis Lieber (Boston, 1882).

Categories
Exam Questions Harvard Theory

Harvard. Second year economic theory. Readings and exams. Leontief, 1960-1961

 

 

The following Harvard course outline with reading assignments and semester final exams are from the year 1960-61. Wassily Leontief taught the second graduate course in economic theory.

I have highlighted in blue boldface additions to the reading assignments in the 1960-61 course when compared to the 1956-57 version of the same course. Items omitted are listed at the end of the post.

Comparing the structure of the mid-year and year-end exams, I would conjecture that one or more of Koopmans’ Three Essays on the State of Economic Science was assigned for the first term’s reading period, though the title does not appear on the printed reading list for the course.

__________________________

Wassily Leontief

HARVARD UNIVERSITY
Ec. 202a
ECONOMIC THEORY
Fall Term 1960-61

The following outline covers the first semester of the two semester course.

I.     Analysis of Production and the Theory of a Firm:

  1. Costs; total, average, marginal.
    Theory of the multiple plant firm.
    Revenue; total, average, marginal.
    Long and short run analysis
    Supply under competitive and monopolistic conditions.
  2. Production function, marginal productivity, increasing and decreasing returns.
    Stocks and flows.
    Joint products.
    Demand for factors of production.
    Discontinuous relationships and non-marginal analysis (Linear Programming).
    Internal and external economies.

Reading assignments:

Oscar Lange, “The Scope and Method of Economics,” Review of Economic Studies, Vol. XIII, (1), 1945-46, pp. 19-32.

H. Simon, “Theories of Decision Making in Economics,” American Economic Review, June 1959.

E. A. G. Robinson, Structure of Competitive Industry, Chs. II, VII, VIII, pp. 14-35, 107-133.

R. C. Heimer, Management for Engineers, Chs. 3-17.

K. E. Boulding, Economic Analysis, (revised edition, 1948) Chapters 20-26, 31, and 32; or (3rded., 1955) Chapters 23-29, 34, and 35.

E. H. Chamberlin, “Proportionality, Divisibility, and Economies of Scale,”Quarterly Journal of Economics, February, 1948, pp. 229-262.

K. E. Boulding, “The Theory of the Firm in the Last Ten Years,” The American Economic Review, Vol. XXXII, No. 4, December 1942, pp. 791-802.

A. Lerner, Economics of Control, Chs. 15, 16, 17, pp. 174-211.

W. W. Cooper, “A Proposal for Extending the Theory of the Firm,” Quarterly Journal of Economics, February 1951, pp. 87-109.

R. Solow, “Technical Change and the Aggregate Production Function,” Review of Economics and Statistics, August 1957.

Robert Dorfman, “Mathematical or ‘Linear’ Programming,” American Economic Review, December 1953, pp. 797-825.

Dorfman, Samuelson and Solow, Linear Programming and Economic Analysis, Ch. 2.

H. M. Wagner, “The Simplex Method for Beginners,” Operations Research, March-April 1958.

R. Dorfman, “Operations Research,” American Economic Review, September 1960, pp. 575-623.

G. Katona, “Business Expectations in the Framework of Psychological Economics,” in M. J. Bowman, ed., Expectations, Uncertainty and Business Behavior.

II.    Theory of the Household:

  1. Theory of utility and indifference lines analysis.
    Individual demand, prices and income.
    Dependent and independent, competing and complementary, superior and inferior goods.
  2. Measurability of utility.
    “Marginal utility of money,” Consumer surplus.
    Interpersonal interdependence in consumers’ behavior.
    Economic theory of index numbers.
    Choices involving risk.

Reading assignments:

J. Hicks, Value and Capital, Part I, Chs. I-III, pp. 1-54.

K. E. Boulding, Economic Analysis, (Revised edition, 1948) Chapters 33, 34; or (3rd ed., 1955), Chapter 36 and 37.

Duesenberry, Income, Saving and the Theory of Consumer Behavior, Chapters I-III, pp. 1-46.

Modigliania and Brumberg, “Utility analysis and the Consumption Function,” in Kurihara, Post Keynesian Economics.

S. S. Stevens, “Measurement, Psychophysics and Utility,” in Churchman and Ratoosh (ed.) Measurement: Definitions and Theories, pp. 18-63.

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

D. Ellsberg, “Classic and Current Notions of ‘Measurable Utility’,” Economic Journal, September 1954.

H. Simon, Models of Man, Part IV, pp. 196-206.

III. Theory of Market Relationships:

  1. Pure competition; individual and market supply and demand curves.
    Stability of market equilibrium, statics and dynamics.
    Monopoly and price discrimination.
  2. Monopolistic competition.
    Duopoly, oligopoly, bilateral monopoly, etc.
    “Theory of games.”

Reading assignments:

A. Marshall, Principles of Economics, Book V, Chs. III, V.

E. H. Chamberlin, The Theory of Monopolistic Competition, Chs. II, III, IV, and V.

Joan Robinson, The Economics of Imperfect Competition, Chs. 15 and 16.

Robert Triffin, Monopolistic Competition and the General Equilibrium Theory, Chs. I and II.

William Fellner, Competition Among the Few, Chs. II-V.

W. H. Nicholls, Imperfect Competition within Agricultural Industries, Ch. 18.

F. Modigliani, “New Developments on the Oligopoly Front,” JPE,  June 1958.

Leonid Hurwicz, “The Theory of Economic Behavior,” American Economic Review, December, 1945, pp. 909-925.

D. Ellsberg, “The Theory of the Reluctant Duelist,” American Economic Review, December 1956.

T. C. Schelling, “An Essay on Bargaining,” American Economic Review, June 1956.

IV.  General equilibrium theory:

  1. Basic Concepts of a General Equilibrium Theory.
    Data and variables. Price system and general interdependence. Linear model of a general equilibrium system.
  2. Theory of Rent and Factor Prices

Reading assignments:

O. Lange, The Economic Theory of Socialism, pp. 65-72.

Cassel, The Theory of Social Economy, Vol. I, Ch. IV, pp. 134-155.

R. G. D. Allen, Mathematical Economics, pp. 314-325.

E. H. Phelps Brown, Framework of the Pricing System, in particular chapters dealing with general equilibrium theory.

T. W. Schultz, Agriculture in an Unstable Economy, Ch. I, pp. 60-70; Ch. IV, pp. 128-137.

R. S. Eckaus, “The Factor Proportion Problem in Underdeveloped Areas,” The American Economic Review, September 1955, pp. 539-565.

N. Georgescu-Roegen, “Economic Theory and Agrarian Economics,” Oxford Economic Papers, February 1960, pp. 1-40.

___________________________

Mid-year Examination
1960-1961 (Jan. 1961)

HARVARD UNIVERSITY
1960-1961
ECONOMICS 202

PLEASE WRITE LEGIBLY

Answer one question from each group, four questions in all.

GROUP I

  1. Demonstrate that the assumption that the marginal utility of one of the goods purchased by a consumer is constant is more restrictive than the assumption that its utility is independent of the quantity of any other good.
    How could the knowledge of the constancy of its marginal utility help to assess the effect of an income tax on the demand for the good in question?

GROUP II

  		1.  Amount Needed Per Unit of Activity Factor Supply
    Activity 1 Activity 2 Activity 3

    Factor 1

    		 6 1 2 12
    Factor 2 2 2 1

    10

    Factor 3

    		 1 5 20

    200

    Market Value Per Unit of Output

    		 15 3 8

    A firm with a fixed supply of three factors has three possible activities, each of which produces a different product selling for a different price. The factor requirements, factor supplies and the product prices are given in the table above. Find the level of activities, including disposal activities, which maximize the firm’s revenue.
    Supplemental information which can be used to shorten computation: In the solution of the “dual”, only factor 1 turns out to have a positive imputed price.

  2. A farmer has fixed amounts of two different kinds of land. He can grow two kinds of product, the prices of which are given. The only other input is labor. Its total available amount is also fixed. The amount of land and of labor required per bushel of each one of the two crops on each type of land is known.
    Set up the linear programming problem which the farmer would have to solve to maximize the value of his output.

GROUP III

4. (a) Discuss the differences and similarities of the following types of analysis:

      1. The derivation of a household’s demand curve for a commodity.
      2. The derivation of a firm’s demand curve for a factor of production.

4. (b) Demonstrate that,

        1. A household can have a positively sloping demand curve for the commodities it buys.
        2. A firm cannot have a positively sloping demand curve for any of the factors of production it buys, if it sells its product in a perfectly competitive market.
  1. A self-sufficient farmer lives on produce that he grows himself under conditions of decreasing average returns. The length of his working time can be explained in terms of a utility maximizing choice between agricultural produce and leisure.
    Among the (real) wage rates which could induce him to quit farming and become a hired worker, one necessarily must be lower than any other. If this minimum wage rate were actually offered to him, and he became a hired worker would the length of his working time a) remain the same b) become shorter or c) become longer than it was when he gained his livelihood as a self-sufficient farmer?

GROUP IV

  1. What is the principal contribution of the theoretical approach described in Koopman’s State of Economic Science?
    Write a critical essay on methodology, rather than substance, except where a discussion of the latter is necessary to a discussion of the former.

Source: Harvard University Archives. Social Sciences. Final Examinations, January 1961. (HUC 7000.28), Vol. 131 of 284.

___________________________

Wassily Leontief

ECONOMICS 202b
ECONOMIC THEORY
Spring Term, 1960-61

V.  Economics of Welfare

  1. Individual maximum and social welfare.
  2. Efficiency and distributive justice.
  3. Efficiency of the purely competitive system.
    Monopoly and economic welfare.
    External economies.
  4. Pricing and allocation for public enterprise.

READING ASSIGNMENTS:

J. Hicks, “The Foundation of Welfare Economics,” Economic Journal, December 1939, pp. 696-712.

Meade and Hitch, An Introduction to Economic Analysis and Policy, Part II, Chs. VI-VII, pp. 159-220.

Francis Bator, “The Anatomy of Market Failure,” Quarterly Journal of Economics, Vol. LXXII, August, 1958, pp. 351-379.

T. Scitovsky, “The State of Welfare Economics,” The American Economic Review, Vol. XLI, June 1951, pp. 303-315.

J. De Graaf, Theoretical Welfare Economics.

Mishan, E. J., “A Survey of Welfare Economics, 1939-1959,” The Economic Journal, Vol. LXX, No. 278, June, 1960, pp. 197-265.

VI. Capital and Interest

  1. Stock and Flow Concepts.
    Productivity of Capital.
    Period of production and “turnover” of capital.
  2. Theory of saving.
    Risk and uncertainty.
  3. Partial equilibrium theory of interest.

READING ASSIGNMENTS:

Robert Eisner, “Interview and Other Survey Techniques and the Study of Investment,” in Problems of Capital Formation, Studies in Income and Wealth, Vol. 19, National Bureau of Economic Research 1957, pp. 513-583. 

Irving Fisher, The Theory of Interest, Chs. VII, VIII, IX, X, XI, XVI, XVII, and XVIII. 1930.

Hirschleifer, “On the Theory of Optimal Investment Decision,” Journal of Political Economy, August, 1958.

Readings in the Theory of Income Distribution (Blakiston, 1946)

F. Knight, “Capital and Interest,” pp. 384-417.
Keynes, “The Theory of the Rate of Interest,” pp. 418-424.
D. H. Robertson, “Mr. Keynes and the Rate of Interest,” pp. 425-460.

Friedrich & Vera Lutz, The Theory of Investment of the Firm, 1951.

Joel Dean, Capital Budgeting, 1951, Chs. VI, VII.

Eckstein, “Investment Criteria for Economic development and Intertemporal Welfare Economics,” Quarterly Journal of Economics, Feb., 1957.

VII: Principles of Dynamics

  1. Change over time.
    Period analysis.
    Continuous change
  2. Dynamic stability and instability.

READING ASSIGNMENTS:

W. Baumol, Economic Dynamics, Chs. I-VII, pp. 1-136.

P. Samuelson, “Dynamics, Statics and Stationary State,” The Review of Economics and Statistics, February 1943, pp. 58-68 (also reprinted in Readings in Economic Analysis, Vol. 1, edited by N. V. Clemens).

K. J. Arrow, “Toward a Theory of Price Adjustment,” in The Allocation of Economic Resources, pp. 41-51, Stanford, California, 1959.

Erik Lindahl, Introduction to the Study of Dynamic Theory, pp. 21-73 in Studies in the Theory of Money and Capital.

Dorfman, Samuelson, Solow, Linear Programming and Economic Analysis, pp. 265-281.

VIII: Economic Development and Accumulation of Capital

  1. Dynamic interrelation of income, investment and the rate of interest.
  2. Linear theory of economic development.
    Non-linear theory of economic development.

READING ASSIGNMENTS:

Bresciani-Turoni, “The Theory of Saving,” Economica; Part I, Feb. 1936, pp. 1-23; Part II, May 1936, pp. 162-181.

Schelling, “Capital Growth and Equilibrium,” American Economic Review, Dec. 1947, pp. 864-876.

Harrod, “An Essay in Dynamic Theory,” Economic Journal, March 1939, pp. 14-33.

Stern, “Capital Requirements in Progressive Economies,” Economica, August 1945, pp. 163-171.

Robert M. Solow, “A Contribution to the Theory of Economic Growth,” Quarterly Journal of Economics, Vol. LXX, February, 1956, pp. 65-94.

Arthur Smithies, “Productivity, Real Wages and Economic Growth,” Quarterly Journal of Economics, May, 1960, pp. 189-205.

Also, Baumol, see above under VII.

IX: Keynesian Theory and Problems

  1. Over-all outlines of the General Theory.
    Wage and price “stickiness.”
    Demand for money.
  2. Saving and “oversaving.”
    Multiplier principle.

READING ASSIGNMENTS:

A. P. Lerner, The Economics of Control, Chs. 21, 22, and 25.

A. P. Lerner, “The Essential Properties of Interest and Money,” Quarterly Journal of Economics, May 1952, pp. 172-93.

J. M. Keynes, General Theory of Employment, Interest and Money, Chs. 1, 2, 8, and 18.

G. Haberler, Prosperity and Depression, Ch. 8.

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

Hicks, “A Rehabilitation of ‘Classical’ Economics?” Economic Journal, June, 1957.

Reading Period Assignment (spring):

Trygve Haavelmo, A Study in the Theory of Investment, Chicago, 1960.

OR

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

Source:  Harvard University Archives, Syllabi, course outlines and reading lists in Economics, 1895-2003. Box 8, Folder “Economics, 1960-1961 (2 of 2).

___________________________

Year-end Examination
1960-1961 (June 1961)

HARVARD UNIVERSITY
1960-1961
ECONOMICS 202

PLEASE WRITE LEGIBLY

Answer one question from each of the four groups, four questions all together.

GROUP I

  1. Consider a two commodity, two consumer group economy run along socialist principles. The government fixes the quantities of A and B produced in any one year, fixes ruble incomes going to consumer groups I and II and also fixes ruble prices so that the total income distributed can exactly buy the amounts produced.
    Assume that the collective behavior of a consumer group can be described as one of reaching the highest of a set of group indifference curves under collective income and market constraints.
    (a) Using the box diagram technique, show what additional
    conditions prices must satisfy if the market is to be cleared.
    (b) assume that equilibrium is not established at official prices and that the State decides to ration the available amount of the short commodity between the two groups.The rationing is done in such a way that both groups get less than they wish to buy at official prices.  Show how one can explain the resulting equilibrium.
    (c) Starting from this equilibrium, will the two groups necessarily find some advantage in exchanging commodities on the black market? Will the black market equilibrium be better or worse (in terms of conventional welfare criteria) than that obtained when prices fixed by the government are chosen so as to clear the market?
  2. It has been established that the annual cost of distributing electricity in an Indian city would be 100,000 rupees in capital charges plus one rupee per kilowatt consumed. The following proposal is put to a vote in a city referendum: “To build the system, charge a price of one rupee per kilowatt and tax the public 100,000 rupees to cover capital charges. The proposal is unanimously rejected. The city fathers then undertake a market survey and find that the tax could be reduced to 50,000 rupees, the price increased to 1.5 rupee and all costs still be exactly covered. They adopt this second proposal without further consultation.
    Assuming a homogeneous population and equal taxation, can you derive from the above information a preferential ordering of the following alternatives in terms of social welfare:

(a) Charging 1 rupee and raising 100,000 in taxes.
(b) Charging 1.5 rupee and raising 50,000 in taxes.
(c) Not building the system at all.

GROUP II

  1. A profit maximizing enterprise possesses a fixed plant and uses as its variable inputs a raw material (fixed amount per unit of output) and labor. Its finished product is sold and the raw material is purchased on perfectly competitive markets. On the labor market, however, the enterprise is the only employer; the workers are not organized and thus compete with each other.
    What factual information would you require and what theoretical construction would you use to explain the level of that enterprise’s output if,

(a) labor is hired on the basis of straight hourly wages.
(b) labor is hired at a flat hourly wage for the first eight, and a 50% higher overtime hourly rate for two additional hours, the workers being free to choose whether they want to work eight or ten daily hours.
(c) labor is paid flat piecework rates.

To simplify the problem, you are permitted to assume that the preference functions (real income vs. leisure) of all workers are identical.

  1. The growth of a certain kind of tree requires λ man-hours for planting and entails no other costs. The volume of wood represented by a tree increases at a constant growth rate:
    V = EXP(rt). Two alternative assumptions are made with respect to the tree market:

(A) Trees are sold by volume at a price p per volumetric unit.
(B) Trees are sold by volume at a price p’ now depending on the length of the tree. Observing that length is related to age, traders use the formula
p’= α SQRT(t), where α is a constant and t the age of the tree.

(a) Given the amount L of man-hours available per year, describe a “full employment” production process that guarantees constant profits, year after year.
(b) Under each market assumption, discuss the empirical possibility and operational usefulness of measuring the capital stock and its marginal productivity.
(c) Money can be lent and borrowed without limits at an interest rate i, which is larger than r. At what age should the trees be cut under assumption (B) if the grower wishes to establish a stationary production process that maximizes his utility over time?

GROUP III

  1. A conventional partial equilibrium theory explains the prices and the quantities — produced and consumed — of all goods on the assumption that a supply and a demand curve is given for each market.
    In what sense can it be said that, from the point of view of a general equilibrium theory, at least some of such given demand and supply curves must be either incompatible with each other or redundant? In answering this question, please use equations, graphs, or both.

GROUP IV

  1. To what extent does Haavelmo or the Lutz’s — whomever you have chosen to read — rely on purely technological specifications and considerations in describing and analyzing the role of capital in the operations of an individual enterprise and of the economy as a whole? And to what extent do they use definitions and measurements which “engineers” would not employ in their professional work?
    Illustrate your answer by specific examples.

Source: Harvard University Archives. Social Sciences, Final Examinations, June 1961 (HUC 7000.28, Vol. 134 of 284).

___________________________

Reading assignments in the 1956-57 reading list that were dropped from the 1960-61 reading list:

I.     Analysis of Production and the Theory of a Firm:

E. H. MacNiece, Production, Forecasting, Planning and Control, 292 pp.

R. Frisch, “Alfred Marshall’s Theory of Value,” Quarterly Journal of Economics, Vol. LXIV, No. 4, November 1950, pp. 495-524.

National Bureau of Economic Research, Cost Behavior and Price Policy, Ch. VII, pp. 142-169; Appendix C, pp. 321-329.

A. G. Hart, Anticipations, Uncertainty and Dynamic Planning, reprinted 1951, 98 pp.

II.     Theory of the Household:

J. R. Hicks, A Revision of Demand Theory, Parts I and II, also the summary and conclusion.

G. Katona, Psychological Analysis of Economic Behavior, Part II, #1-7, pp. 63-149.

III. Theory of Market Relationships:

No titles dropped.

IV. General Equilibrium Theory:

No titles dropped.

V.  Economics of Welfare

Coase, “Note on Price and Output Policy,” Economic Journal, Vol. LV, April 1945, pp. 112-113.

Samuelson, “Evaluation of Real National Income,” Oxford Economic papers, Jan. 1950.

VI. Capital and Interest

Edward F. Denison, “Theoretical Aspects of Quality Change, Capital Consumption, and Net Capital Formation,” in Problems of Capital Formation, Studies in Income and Wealth, Vol. 19, National Bureau of Economic Research 1957, pp. 215-260.

John Rae, John, New Principles of Political Economy, 1834, Chs. I-V.

Irving Fisher, Nature of Capital and Income, Chs. I, IV, V, XIV, XVII, Macmillan, 1906.

VII: Principles of Dynamics

K. E. Boulding, A Reconstruction of Economics, Ch. I, pp. 3-26.

VIII: Economic Development and Accumulation of Capital

Pigou, Economic Progress in a Stable Economy,” Economica, August 1947, pp. 180-188.

A. Sweezy, “Secular Stagnation?” in Harris, Postwar Economic Problems, McGraw-Hill, New York, 1943, pp. 67-82.

Hansen, “Economic Progress and Declining Population Growth,” American Economic Review, March 1939, pp. 1-15.

IX: Keynesian Theory and Problems

No titles dropped.

cf. The earlier post for Economics 202 in 1956-57.

___________________________

Image Source:  Wassily Leontief in Radcliffe Yearbook 1964, p. 98. Colorized by Economics in the Rear-view Mirror.

Categories
Exam Questions Harvard International Economics

Harvard. Enrollment, course description, and final exam for international trade and payments. Sprague, 1904-1905

Puck. 13 March 1901.

At the beginning of the 20th century international economics was covered within a single semester course. Now it is at least a two semester sequence for international trade and international payments, respectively…and one such sequence at the undergraduate and again at the graduate level. The banking specialist, Oliver Mitchell Wentworth Sprague, would have been more interested in the payments part of the course, but the top dog in the department, Frank W. Taussig, left a strong tradition with a focus on real trade theory and commercial policy as can be seen in the exam questions below.

__________________________

Course Enrollment
1904-05

Economics 12a 2hf. Asst. Professor Sprague. — International Trade.

Total 18: 5 Graduates, 7 Seniors, 3 Juniors, 1 Sophomore, 2 Others.

Source: Harvard University. Report of the President of Harvard College, 1904-1905, p. 75.

__________________________

Course Description
1904-05

[Economics] 12a 2hf. International Trade. Half-course (second half-year) Mon., Wed., and (at the pleasure of the instructor) Fri. at 10. Asst. Professor Sprague.

Course 12a begins with a careful study of the theory of international trade, and of the use and significance of bills of exchange. The greater portion of the time will be devoted to an analysis of the foreign trade of the United States and Great Britain in order to distinguish the various factors, permanent and temporary, which determine the growth and direction of international commerce. With this purpose, also, a number of commodities important in foreign trade and produced in more than one country will be studied in detail. Each student will be given special topics for investigation which will familiarize him with sources of current information upon trade matters, such as trade journals, consular, and other government publications. In conclusion, certain topics of a general nature will be considered, among which may be mentioned, foreign investments, the effects of an unfavorable balance of payments under different circumstances, and colonial trade.

Source: Harvard University. Faculty of Arts and Sciences. Division of History and Political Science Comprising the Departments of History and Government and Economics, 1904-05 (May 16, 1904), p. 45.

__________________________

ECONOMICS 12a
Year-end Examination, 1904-05

  1. “The tendency of commerce is to bring about a more equal distribution of industry all the world over, and to give more and more importance to purely geographical conditions.” — Chisholm.
    Explain and illustrate.
  2. The extent to which coal supplies seem to determine the localization of industries in England, in Germany, and in the United States.
  3. Analyze carefully the effects upon the foreign trade of a country of a large increase in its production of gold.
  4. May free trade under any circumstances cause a decline in the population of a country?
  5. Why have commercial treaties proved an ineffective means of securing greater permanent freedom of trade?
  6. Discuss the policy and effects of “dumping.”
  7. The character and significance of the iron and steel exports of the United States.
  8. The purely commercial aspects of shipping subsidies.

Source: Harvard University Archives. Harvard University, Examination Papers 1873-1915. Box 7, Bound volume: Examination Papers, 1904-05;  Papers Set for Final Examinations in History, Government, Economics,…,Music in Harvard College (June, 1905), pp. 31-32.

Image Source: “Weighed and Not Wanting.” From Puck (March 13, 1901). Library of Congress Prints and Photographs Division Washington, D.C.

Categories
Economic History Exam Questions Harvard

Harvard. Mediaeval and Modern Economic History of Europe. Enrollments, descriptions, exam. Gay, 1904-1905

An assistant professor gotta do what an assistant professor has gotta do. Edwin Francis Gay was 37 years of age by the 1904-05 academic year with courses covering nearly a millennium of European economic history.  His biographer (and former student) Herbert Heaton described this period as being a strenuous time for Gay (pp. 64-65).

___________________________

Related posts

A brief course description for Economics 11 plus the exams from 1902-03.

Exams for 1903-04.

A short bibliography for “serious students” of economic history  assembled by Gay and published in 1910 has also been posted.

__________________________

Course Enrollment
1904-05

Economics 10 1hf. Asst. Professor Gay. — Mediaeval Economic History of Europe.

Total 1: 1 Graduate.

Source: Harvard University. Report of the President of Harvard College, 1904-1905, p. 75.

*  *  *  *  *  *  *  *  *  *  *  *  *

Course Description
1904-05

[Economics] 10 1hf. The Mediaeval Economic History of Europe. Half-course (first half-year). Tu., Th., and(at the pleasure of the instructor) Sat., at 9. Asst. Professor Gay.

After a preliminary examination of early economic and social institutions, this course aims to give a general view of the economic development of society during the Middle Ages. Among other topics, the following will be considered: mediaeval agriculture and serfdom; the manorial system and the economic aspects of feudalism; the beginnings of town life and the gild-system of industry; and the Italian and Hanseatic commercial supremacy.
A thesis will be required from each student, and occasional oral reports and discussions may be expected, but the work is conducted mainly by lectures with supplementary reading.
It is desirable that students should possess some acquaintance with mediaeval history and some reading knowledge of Latin.

Source: Harvard University. Faculty of Arts and Sciences. Division of History and Political Science Comprising the Departments of History and Government and Economics, 1904-05 (May 16, 1904), p. 44.

No printed exam at mid-year for this course was found in the Harvard archives
(but of course only one student)

________________________

Course Enrollment
1904-05

Economics 11. Asst. Professor Gay. — Modern Economic History of Europe.

Total 7: 3 Graduates, 2 Seniors, 1 Junior, 1 Sophomore.

Source: Harvard University. Report of the President of Harvard College, 1904-1905, p. 75.

*  *  *  *  *  *  *  *  *  *  *  *  *

Course Description
1904-05

[Economics] 11. The Modern Economic History of Europe. Tu., Th., and (at the pleasure of the instructor) Sat., at 10. Asst. Professor Gay.

This course, while Course 10 may usefully precede it, will nevertheless be independent, and may be taken by those who have not followed the history of the earlier period.
At the outset a survey will be made of economic and social conditions in the chief European countries at the close of the Middle Ages. The history of trade, industry, and agriculture in the succeeding periods down to the nineteenth century will then be treated in some detail, together with the corresponding forms of social life and the advance in economic thought. England will receive the emphasis due to its increasing importance during this period.
A considerable amount of supplementary reading will be expected and two thesis subjects will be assigned.

Source: Harvard University. Faculty of Arts and Sciences. Division of History and Political Science Comprising the Departments of History and Government and Economics, 1904-05 (May 16, 1904), p. 44.

*  *  *  *  *  *  *  *  *  *  *  *  *

ECONOMICS 11
Year-end Examination, 1904-05

  1. Explain briefly:—
    (1) lettre de maîtrise
    (2) métayage
    (3) the Steelyard
    (4) goldsmith’s notes
    (5) enumerated commodities
    (6) Merchant Adventurer’s
  2. What are the chief facts you associate with the names of
    (1) Bodin, (2) Colbert, (3) Paterson, (4) Law?
  3. (1) Who were the Fuggers? What type of company organization do they represent?
    (2) Describe the development in the company organization of the English East India Company. How and why did this company’s history differ from that of the Dutch East India Company?
  4. Enumerate the forms of indirect taxation in use in England in the seventeenth century.
  5. How do you distinguish the domestic system of industry from the handicraft and factory systems? Give some examples of different forms of the domestic system.

Take one of the following questions.

  1. It is stated that the total value of exports and imports for England and France were as follows for the years here given:
England
£		 France
livres
1613   4,628,586
1750 20,471,120 1750 355,202,357
1800 62,639,398 1789 758,104,000

Are these figures of equal statistical value? What are the sources of error?

  1. (1) In 1655 a London merchant shipped raisins and oil to Hamburg, but finding this market not so good as the English desired to ship the goods back to England in the same ship that carried them to Hamburg, paying customs and excise on the reimportation. He petitioned the Council for license to do this. State precisely why.
    (2) In 1665 a Dutch merchant desired to send to England from Amsterdam a lading of silk and linen cloth, loaf sugar, paper (all of Dutch manufacture), Bordeaux wine, tobacco and pepper. Could he do this, and if so, how?

Source: Harvard University Archives. Harvard University, Examination Papers 1873-1915. Box 7, Bound volume: Examination Papers, 1904-05;  Papers Set for Final Examinations in History, Government, Economics,…,Music in Harvard College (June, 1905), pp. 30-31.

Image Source: Edwin F. Gay, seated in office, 1908. From Wikipedia. Colorized by Economics in the Rear-view Mirror

Categories
Exam Questions Harvard Industrial Organization

Harvard. Enrollment, Course description, Final exam. Economics of Corporations. Ripley and Custis, 1904-1905

William Zebina Ripley

In 1904-05 Professor William Zebina Ripley of Harvard co-taught his course on the economics of corporations with his dissertation student Vanderveer Custis, who went on to teach economics at the University of Washington and later at Northwestern University where he attained professorial rank. The economics of corporations course was at least implicity paired to a course on labor problems (material found in the previous post). The common thread through the sequence would have been the study of market power through combination of laborers (trade unions) on the one hand and corporations (trusts) on the other.

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Other Corporations/Industrial Organization Related Posts
for William Z. Ripley

Problems of Labor and Industrial Organization, 1902-1903.

Economics of Corporations, 1903-1904.

Economics of Corporations, 1914-1915.

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Course Readings

Cases for the course are most certainly found in Trusts, Pools and Corporations (1905), edited with an introduction by William Z. Ripley. From the series of Volumes Selections and Documents in Economics, edited by William Z. Ripley published by Ginn and Company, Boston.

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Course Enrollment
1904-05

Economics 9b 2hf. Professor Ripley and Mr. Custis. — Economics of Corporations.

Total 190: 17 Graduates, 31 Seniors, 95 Juniors, 34 Sophomores, 1 Freshman, 12 Others.

Source: Harvard University. Report of the President of Harvard College, 1904-1905, p. 75.

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Course Description
1904-05

[Economics] 9b 2hf. Economics of Corporations. Half-course (second half-year) Tu., Th., Sat., at 11. Professor Ripley.

The work of this course will consist of a discussion of the problems connected with the fiscal and industrial organization of capital, especially in the corporate form. The principal topic considered will be industrial combination and the so-called trust problem. This will be treated in all its phases, with comparative study of the conditions in the United States and European countries. The growth and development of corporate enterprise, promotion, capitalization and financing, publicity of accounting, the liability of directors and underwriters, will be Illustrated fully by the study of cases, not from their legal but from their purely economic aspects; and the effects of industrial combination and integration upon efficiency, profits, wages, the rights of investors, prices, industrial stability, the development of export trade, and international competition will be considered in turn.

The course is open to those students only who have taken Economies 1. Systematic reading and report work will be assigned from time to time.

Source: Harvard University. Faculty of Arts and Sciences. Division of History and Political Science Comprising the Departments of History and Government and Economics, 1904-05 (May 16, 1904), pp. 43-44.

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ECONOMICS 9b
Year-end Examination, 1904-05

  1. In what respect did the English Company Law of 1900 fall short of providing an adequate remedy for abuses which had developed?
  2. What was the gist of the Federal decision in the Knight (Sugar Trust) case; and how does it bear upon the present situation?
  3. What is the form of the Anti-Trust laws of the different states? Discuss the feasibility of this remedy.
  4. What are Meade’s final propositions as to the need and nature of reform in corporate management?
  5. Compare the two principal methods of administering corporate sinking funds.
  6. Outline three important cases showing the attitude of the English common law toward monopoly.
  7. What appears to you as the most serious social evil in the present situation? Distinguish carefully between economic, social, and political aspects.
  8. How has economy in the matter of freights been sought by industrial combinations, and with what success?

Source: Harvard University Archives. Harvard University, Examination Papers 1873-1915. Box 7, Bound volume: Examination Papers, 1904-05;  Papers Set for Final Examinations in History, Government, Economics,…,Music in Harvard College (June, 1905), p. 30.

Image Source: Harvard University Archives.  William Zebina Ripley [photographic portrait, ca. 1910], J. E. Purdy & Co., J. E. P. & C. (1910). Colorized by Economics in the Rear-view Mirror.

Categories
Economists Exam Questions Harvard Labor

Harvard. Enrollment, Course description, Final exam. Problems of Labor. Ripley and Custis, 1904-1905

Professor William Zebina Ripley of Harvard had comfortably settled in his fields of statistics, labor problems and corporate finance/industrial organization by 1904-05. In that year he co-taught his labor course with his dissertation student Vanderveer Custis, who went on to teach economics at the University of Washington and later at Northwestern University where he attained professorial rank.

Fun fact: According to the 1907 University of Washington yearbook Tyee (p. 22), Assistant Professor of Economics Vanderveer Custis was a lineal descendant of Martha Custis Washington.

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Other Labor Related Posts
for William Z. Ripley

Problems of Labor and Industrial Organization, 1902-1903.

Problems of Labor, 1903-1904.

Short Bibliography of Trade Unionism, 1910.

Short Bibliography of Strikes and Boycotts, 1910.

Trade Unionism and Allied Problems, 1914-1915.

Problems of Labor, 1931.

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Vanderveer Custis
[1878-1961]

Chicago, June 17. Vanderveer Custis, Emeritus Professor of Economics at Northwestern University, died today in a rest home in Arlington Heights. He was 82 years old.

Mr. Custis studied at Harvard University, where he took degrees of Bachelor of Arts [1901], Master of Arts [1902] and Doctor of Philosophy [1905].

He taught economics at the University of Washington from 1905 until 1922, when he went to Northwestern as Associate Professor of Economics. He was made a full professor in 1937 and retired in 1944.

Source: New York Times (18 June 1961).

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Vanderveer Custis
Ph.D. exams

Special Examination in Economics, Wednesday, June 7, 1905.
General Examination passed May 20, 1904.
Committee: Professors Taussig (chairman), Ripley, Bullock, Sprague, and Wyman.
Academic History: Harvard College, 1897-1901; Harvard Graduate School, 1901-04; A.B. (Harvard) 1901; A.M. (ibid.) 1902.
Special Subject: Industrial Organization.
Thesis Subject: “The Theory of Industrial Consolidation.” (With Professor Ripley).

Source: Harvard University Archives. Harvard University, Examinations for the Ph.D. (HUC 7000.70), Folder “Examinations for the Ph.D., 1904-1905”.

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Course Enrollment
1904-05

Economics 9a 1hf. Professor [William Zebina] Ripley and Mr. [Vanderveer] Custis. — Problems of Labor.

Total 128: 10 Graduates, 29 Seniors, 59 Juniors, 23 Sophomores, 7 Others.

Source: Harvard University. Report of the President of Harvard College, 1904-1905, p. 75.

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Course Description
1904-05

[Economics] 9a 1hf. Problems of Labor. Half-course (first half-year). Tu., Th., Sat., at 1.30. Professor Ripley.

The work of this course will be concerned mainly with the economic and social questions relating to the relations of employer and employed, with especial reference to legislation. Among the topics included will be the following, viz.: methods of remuneration, profit sharing, cooperation, collective bargaining; labor organizations; factory legislation in all its phases in the United States and Europe; strikes, strike legislation and legal decisions, conciliation and arbitration; employers’ liability and compulsory compensation acts; compulsory insurance with particular reference to European experience; provident institutions, friendly societies, building and loan associations; the problem of the unemployed; apprenticeship, and trade and technical education.

Each student will be expected to make at least one report upon a labor union, from the original documents. Two lectures a week, with one recitation, will be the usual practice.

Source: Harvard University. Faculty of Arts and Sciences. Division of History and Political Science Comprising the Departments of History and Government and Economics, 1904-05 (May 16, 1904), p. 43.

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ECONOMICS 9a1
Year-end Examination, 1904-05

  1. State two objections to a general policy of insurance against unemployment, as tried in Switzerland.
  2. What peculiar trade conditions may make the National Union outweigh the locals in importance? Illustrate.
  3. State the two principal grounds on which employees were first denied damages for injuries about 1837.
  4. As a commercial venture how does compulsory insurance, as in Germany, differ from ordinary insurance, as it exists in the United States.
  5. What is the present status of the “closed shop” before English and American courts?
  6. In what respects does the British Trades Union Congress differ from the Annual Convention of the British Federation of Labor?
  7. What were the main causes of the downfall of the Knights of Labor? How is the American Federation protecting itself in these regards?
  8. How far has arbitration in labor disputes by governmental agency proceeded in the United States?

Source: Harvard University Archives. Harvard University, Examination Papers 1873-1915. Box 7, Bound volume: Examination Papers, 1904-05;  Papers Set for Final Examinations in History, Government, Economics,…,Music in Harvard College (June, 1905), pp. 29-30.

Image Source: The 1907 edition of the University of Washington yearbook, Tyee.