Category: Exam Questions

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Exam Questions M.I.T.

M.I.T. General exams in money and banking, 1952 and 1956

 

 

In this post we find transcriptions of three exams from the M.I.T. economics department for 1952 and 1956. The date of the second of the three is somewhat uncertain, with only a handwritten note “Spring 1956 (?)” at the top indicating the likely date. Since the question involving changes in bank balance sheets is identical with that in the September 1956 exam, it seems plausible that the dates of the second and third exams were close.

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GENERAL EXAMINATION IN MONEY AND BANKING

Monday, May 12, 1952
9:00-12:00 m.

  1. “We have arrived at a fairly deflation proof monetary framework.” What does this statement mean?
  2. Explain the gold standard as it functioned prior to World War I and discuss this standard as a practical policy for our times.
  3. Explain briefly the credit control instruments available to the federal reserve authorities and indicate how their control may be modified by political and other institutional conditions.
  4. “There must be some quantity of cash assets which would just suit each household and business firm in the economic system.” What determines this quantity? What happens when the actual cost [sic, should read “cash”] held does not match this quantity?
  5. Explain the proposal for 100 per cent money. What is the purpose of the plan and its shortcomings?
  6. Write a short exposition of what you consider to be the proper goal of monetary policy.

_____________________

General Examination in Money
[handwritten note:  “Spring 1956(?)”]

Total Time:  3 hours.

I

60 minutes

Compare the essential features, similarities and differences in so far as they relate to the setting of Central Banking policy of

(1) The Bank of England, as set up under the Bank Act of 1844;
(2) the National Banking system prior to the Federal Reserve Act;
(3) the Federal Reserve system as initially enacted, and
(4) The Federal Reserve system as amended in its present form.

Show how the essential changes in the structure of the Central Bank reflected the development of and changes in the underlying theories of Central Bank policy and of the role of money in the economy.

II

30 minutes. Answer both questions.

  1. Define what is meant by the “expansion coefficient” of the banking system. Using your definition, estimate this coefficient for the U.S. banking system. Note: In defining your coefficient, you will also have to define what you mean by “banking system”.
  2. Suppose that over a given period, the following changes are noted:
Increase in Federal Reserve Credit 1000
Decrease in Float 50
Increase in Money in Circulation 200
Increase in Commercial Bank Capital 150
Decrease in Treasury Currency outstanding 100
Increase in Currency holdings of Commercial Banks 80

What is the resulting change in member bank reserves? Assuming commercial banks to be loaned up, with a reserve ratio of 20%, what is the resulting change in money supply held by the public? Show how each of the itemized changes enters into the picture.

III

30 minutes. Write briefly on two out of the following three questions.

  1. Consider the main issues involved in U.S. experience with legislation against concentration in the field of commercial banking.
  2. Consider the main issues involved in bank examinations.
  3. What are the main fields of Federal credit policy now conducted outside the Federal Reserve system? Should they be placed under the Federal Reserve? Why or why not?

IV

30 minutes. Write on one of the following two questions.

  1. Forgetting about the politics of debt management, consider some of the essential problems of a theory of debt management, conceived as part of a broader framework of liquidity and monetary theory.
  2. Much has been said and written in recent years about the “rebirth” of monetary policy. Discuss and appraise the factors behind this development, allowing for both theoretical and policy aspects.

V

30 minutes. Write on one of the following two questions.

  1. “Looking back over the development of monetary theory, the three outstanding landmarks are Wicksell’s concept of the natural rate, Fisher’s treatment of velocity and Keynes’ concept of liquidity preference. All three are necessary parts of a complete system of monetary theory and need be considered if one wishes to understand the role of money in the economy.” Explain and discuss. Do you agree with the statement?
  2. Discuss the issues involved in the controversy between the “liquidity preference” and the “loanable funds” approach to interest theory. Do you think that the two can be reconciled? If so, how?

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GENERAL EXAMINATION IN MONEY AND BANKING

September 12, 1956

Answer any five questions.

  1. Describe and contrast the “Cambridge cash balance” approach to the “quantity theory of money” with that of Fisher. What have been the historical trends of economists’ views toward the quantity theory? Interpret and evaluate the cause behind these trends, giving the present status of that theory.
  2. Evaluate the current weapons of American monetary policy in terms of their importance and effectiveness. Illustrate by concrete experiences.
  3. “Debt management is part of fiscal policy and also of monetary policy. It involves the interrelations of asset theory with income flow theory, and can only be understood in terms of various theories of liquidity and loanable bonds.” Comment on this theme.
  4. What have been the important evolutionary changes in the American banking system and related financial institutions? Contrast with the U.K. or other countries.
  5. Synthesize the “pure-theory” aspects of capital and interest with the “monetary, effective demand, uncertainty” aspects of the problems. Resolve controversies where you can.
  6. Suppose that over a given period, the following changes are noted:
Increase in Federal Reserve Credit 1000
Decrease in Float 50
Increase in Money in Circulation 200
Increase in Commercial Bank Capital 150
Decrease in Treasury Currency outstanding 100
Increase in Currency holdings of Commercial Banks 80

What is the resulting change in member bank reserves? Assuming commercial banks to be loaned up, with a reserve ratio of 20%, what is the resulting change in money supply held by the public? Show how each of the itemized changes enters into the picture.

  1. Write a half hour essay on the interrelations of fiscal and monetary policies.

 

Source:  Duke University. David M. Rubenstein Rare Book and Manuscript Library. Economists’ Papers Archive. Paul Samuelson Papers, Box 33, Folder “Teaching Exams 1952, 1956”.

Image Source: M.I.T. Technology Review, March 1914.

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Exam Questions Harvard Undergraduate

Harvard. Undergraduate general examination in economics, 1953

 

In a recent series of posts Economics in the Rear-view Mirror has provided transcriptions of undergraduate comprehensive examinations in economic for Harvard (1931), Wesleyan (1931), Princeton (1929 and 1932), and Swarthmore (1931).  The general examination for Harvard (1939) was posted even earlier.

Found in John Kenneth Galbraith’s papers with his Harvard tutorial materials is the following A.B. general examination from April 29, 1953. Students had to answer five questions, having considerable room for maneuver among and within fields.

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DEPARTMENT OF ECONOMICS
GENERAL EXAMINATION

(Three hours)

Please note on the front cover of your bluebook the number of each question upon which you write, in the order followed in your book, and HONORS or NON-HONORS.

PART I
(One hour)
Economic Analysis

HONORS candidates answer ONE question taken from questions 1-4.

  1. “Depressions are caused by the exhaustion of investment opportunities and the rigidity of saving.” Discuss.
  2. “Keynes’ theory may have undermined the neo-classical theory of the price level but it has left intact the neo-classical theory of relative prices.” Discuss.
  3. “The basic criteria of anti-trust policy with respect to product markets are the same whatever the competitive structure of labor markets may be.” Discuss.
  4. “Despite all the changes that have taken place in economic theory the profit motive continues to occupy the central role which it had in Ricardo’s theory.” Discuss the role of profit in (a) Ricardo, (b) neo-classical theory, (c) Schumpeter’s theory.

NON-HONORS candidates answer ONE question taken from questions 5-8.

  1. “Future historians may well write the epitaph of our civilization as follows:

From freedom and science came rapid growth and change.
From rapid growth and change came economic instability.
From instability came demands which ended growth and change.
Ending growth and change ended science and freedom.”

Discuss this alleged conflict between economic growth and measures to secure economic stability. In your answer refer to the views of some of the great economists for examples, Schumpeter and Keynes, on this problem.

  1. In explaining business cycles most economists place crucial emphasis on fluctuations in investment or capital goods.
    Discuss the determinants of investment and the manner by which these factors operate upon investment to produce fluctuations in National Income.
  2. The basic economic questions any society must somehow answer are: (1) What consumer and capital commodities shall be produced and in what quantities? (2) How shall the goods be produced, i.e., by whom and with what resources? (3) For whom are goods to be produced, i.e., how is the national product to be distributed among individuals? Outline the way in which these questions are answered in a perfectly competitive, free enterprise economy.
  3. In addition to wages, interest, and rent, economists often talk about a fourth category of income: profit. What do economists mean by this return? What are the causes of profit and its function in a capitalist system?

PART II
(Two hours)

All students are required to choose TWO of the four fields in Part II of this examination and to answer TWO questions in each selected field. Thus a total of four questions are to be answered in Part II with an allowance of a half hour per question.

A. Economic History

  1. “The very increases in the possibilities of unrestrained competition of the past seventy-five years, through developments in transport, technology, the size and organization of firms, etc.—may in themselves partly explain some of the restraints on price competition that have appeared in this century.” Discuss both the developments and their alleged effects.
  2. “In the past 150 years the United States economy has radically altered its relationship to the world economy and at intervals has been a seriously disturbing factor.” Discuss, including references to periods in the 19th as well as the 20th.century.
  3. “In spite of the waste, apparent exploitation, and graft, the railroads more than paid for themselves in terms of American economic growth.” Discuss.
  4. Why did Hamilton favor a central banking system? What was the subsequent history in the 19th century of the issue that he poses? How satisfactory, in terms of the needs of an expanding economy, were the alternatives to a centralized banking system that existed prior to 1912.

B. Money and Finance

  1. What are the relations between a country’s balance of payments and its internal monetary and fiscal policies?
  2. From a fiscal policy standpoint, what do you consider would be the best budgetary policy for the federal government to adopt in order to combat a growing deflationary trend?
    Indicate the relative advantages and disadvantages involved in the policy you propose.
    Indicate practical as well as theoretical considerations.
  3. “Classical economists tended to view the amount of taxes paid by the private sector of the economy as measuring the amount of ‘burden’ which the government imposed on the private sector.” Do you agree with this view? If you do, what is the justification for your position? If you do not, what are some possible alternative ways of measuring the “burden” of the government on the economy, and for what purposes can they be used?
  4. “Older business cycle theories emphasized fluctuation in prices while modern ones emphasize fluctuations in income.” What is the theoretical and empirical justification for this change in emphasis?
  5. What role did the Federal Reserve System play in financing the Second World War?
    Discuss the impact of this experience upon money and banking in the United States.

C. Market Organization

  1. The spread between prices paid farmers for products used as food and prices paid for these foods at retail was 55% of the consumer’s dollar spent for food in 1910-14. It was 54% in 1952. Account for the failure of this spread to increase in spite of the great increase in processing, services, and transportation sold with the food.
  2. Although price discrimination generally is regarded as being contrary to the public interest, it is expressly sanctioned in railroad rate-setting under another name: the “value-of-service” principle. What cost and market characteristic of railroads might lead you to justify the use of discriminatory pricing in their case?
  3. Bituminous coal is a “sick” industry. What are the causes of this “sickness”? What attempts have been made to impose “healthier” conditions on the industry?
  4. Various techniques are used by oligopolistic industries in attaining stable and desirable price and production conditions. Explain at least three (3) of these techniques and discuss the possible reasons for using any one over another.

D. Labor Economics

  1. What role did the courts play in labor-management relations in the latter part of the nineteenth century? How far was this situation changed subsequent to 1930?
  2. What is collective bargaining? Is it a process of communication and education leading to agreement based upon mutually accepted and recognized goals and standards, or is it a temporary truce based upon balance of power with conflicting basic objectives?
  3. Has organized labor “distorted” the wage structure and wage level of the country at the expense of the unorganized or the weakly organized and at the expense of the recipients of other functional shares?
  4. How would you handle the problem of national emergency disputes?

April 29, 1953.

 

Source:  John F. Kennedy Presidential Library. John Kenneth Galbraith Personal Papers, Harvard University File, 1949-1965, Box 528, Folder “Tutorial 9/15/51-9/57”.

Image Source:  Harvard Album 1946.

 

Categories
Exam Questions Harvard Suggested Reading Syllabus

Harvard. Graduate economic analysis and public policy. Hansen and Slichter, 1946-47

 

While the paired Harvard graduate economic courses Economics 106a and 106b shared a common title “Economic Analysis and Public Policy”, it appears as though Alvin Hansen taught a course in macroeconomic analysis and his colleague Sumner Slichter taught a topics in public policy course (parallel play). Hansen’s course attracted 59 students while Slichter’s course had 25 enrolled students, so the two courses were hardly connected at the hip. For the first term course (Hansen) we have a detailed outline, reading list and exam questions, I could only find a rough outline (more of a course description), a very incomplete set of reading assignments, and the final exam for the second term course (Slichter).

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Course Enrollment
Fall term

[Economics] 106a. (fall term) Professor Hansen.—Economic Analysis and Public Policy

Total 59:  22 Graduates, 25 Public Administration, 3 Radcliffe, 9 Others.

Source:  Harvard University. Report of the President of Harvard College for 1946-1947, p. 70.

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ECONOMICS 106a
ECONOMIC ANALYSIS AND PUBLIC POLICY
1946-1947

General Outline of Course

  1. Concepts and Statistical Measures of Aggregate Income and Its Component Parts:

    1. Gross National Product.
    2. Net National Product.
    3. National Income.
    4. Income Payments.
    5. Factor Costs.
    6. Component Parts of National Income.

  2. Over-all Determinants of National Income:

    1. Consumption and Savings Functions: Investment and its Determinants; Acceleration and Multiplier Principles; Consumption and Income Distribution.
    2. The Interest Rate and the National Income.
      1. Classical vs. Monetary Interest Rate Theories: Loanable Fund Theory vs. Liquidity Preference.
      2. The Role of the Interest Rate: In Investment, Consumption, Income Distribution, etc.
      3. The Interest Rate and Economic Stability; The Case for
        1. Fluctuating Rates;
        2. Stable Rate;
        3. Declining Rate.
      4. The Interest Rate and Income Velocity of Money.
      5. The Role of Central Bank Credit in Income Formation.
    3. Costs and Profits.
      1. Wage Policy: Wages as Costs, and Wages as Purchasing Power; Wage Rates and Degrees of Utilization of Plant Capacity; Wages and Value of Output at Different Employment Levels.
      2. Price Policy: Profits and the Over-all Economy; Profits and Monopoly; Profits and Income Distribution; Profits and the Inducement to Invest; Profits and the Savings Function.
    4. The Role of the Government in Income Formation.
      1. Monetary Policy: Neutral vs. Positive Program.
      2. Tax Policy.
      3. Borrowing; Public Debt.
      4. Expenditure Policy; Standard Services; Developmental Outlays; Compensatory Spending.

  3. Income, Output, and Prices:

    1. Income Flows and the General Level of Prices.
    2. Income Elasticity and Price Elasticity in Different Industries.
    3. The Effect of Over-all Shifts in Income on Demand in Different Industries; Demand Schedules; Indifference Maps.
    4. The Effect of Over-all Shifts in Income on Supply.
      1. The Economics of the Firm: Marginal, Average, and Total Unit Cost Curves.
      2. The Economics of an Industry: Differential Cost; Increasing, Decreasing, and Constant Cost.
    1. Monopoly and Monopolistic Competition: Marginal Revenue and Marginal Cost; Monopoly and Efficiency; Administrative Prices.
    2. Income Flows, Distributive Shares, and Income Distribution.
    3. Full Employment and the Problems of Wage Inflation.
    4. Planning vs. Automatic Adjustments in a Free Market.

 

Economic 106b: Public Policy Decisions: Analysis of the Effect of Public Policy Decisions Upon the Over-all Economy, Upon Various Producing Groups, and Upon Other Sectors of the Population.

Source:  Harvard University Archives. Syllabi, course outlines and reading lists in economics. 1895-2003.(HUC 8522.2.1) Box 4, Folder “Economics, 1946-1947 (2 of 2)”.

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ECONOMICS 106[a]
READING ASSIGNMENT

  1. Concepts and Statistical Measures of Aggregate Income and Its Component Parts:

    1. Required Reading:
      1. Hicks and Hart—The Social Framework of the American Economy, chapters 13-17.
      2. Livingston, S. Morris—Markets After the War, Bureau of Foreign and Domestic Commerce.
      3. Hansen, Alvin H.—Economic Policy and Full Employment, Chapters III-IV, (McGraw-Hill, 1946).
      4. Hansen and Perloff—State and Local Finance in the National Economy, (Norton, 1944), pp. 223-227.
      5. Basic Facts on Employment and Production, U.S. Senate Committee on Money and Banking, Print No. 4, 79th Congress, First Session.
      6. Survey of Current Business:
        1. May, 1942; pp. 9-13 (Gross National Product, 1929-1941).
        2. February, 1946; pp. 1-32 (The Economy of War and Transition).
      7. British White Paper on War Finance, British Government White Paper (Cmd. 6520) presented to Parliament on April 1944 (Reprinted in Federal Reserve Bulletin, July 1944, pp. 655-669).
      8. Federal Reserve Bulletin, August 1946 (Current Price Developments), pp. 833-843.
    2. Suggestions for Additional Reading:
      1. Clark Colin—The Conditions of Economic Progress, 1940.
      2. Kuznets, Simon—National Income and its Composition, 1919-1938, 1941.
      3. Martin, Robert F.—National Income in the U.S., 1799-1938, National Industrial Conference Board, 1939.
      4. The National Income of Principal Foreign Countries. The Conference Board Economic Record, August 3, 1939, Volume I, No. 4.
      5. Bowley, A. D.—Studies in the National Income, 1924-1938, 1942.
      6. Lindahl, Dahlgren, and Koch—National Income of Sweden, 1861-1930, 1937.
      7. Articles:
        1. Stone, Richard—“National Income in the United Kingdom and the United States”, Review of Economic Studies, Winter 1942-43, Volume X, No. 1.
        2. Kalecki, M.—“The White Paper on the National Income and Expenditure in the Years 1938-43”, Oxford Institute of Statistics Bulletin, July 1, 1944, Volume 6, No. 9.
        3. Dacey, W.M.—“The 1944 White Paper on National Income and Expenditure”, Economic Journal, June-September, 1944.
        4. Gilbert and Jaszi—“The 1945 White Paper on National Income and Expenditure”, Economic Journal, December 1945.

  2. Over-all Determinants of the National Income:

    1. Required Reading:
      1. Keynes, J.M.—General Theory of Employment, Interest and Money, (1936), Chapter 3, pp. 96-106; Chapters 9, 10, 13, 15, 18, 24.
      2. Meade and Hitch—Economic Analysis and Policy, (1938) Part I, Chapters 1-2; 5-9.
      3. Lerner, A. P.—The Economics of Control, (1944), Chapters 22, 23, 24.
      4. Robertson, D. H.—Essays in Monetary Theory, (1940), Chapter 1.
      5. British Government White Paper on Employment Policy, (Reprinted by MacMillan Co. as pamphlet entitled “Employment Policy”), 1944.
      6. Slichter, S. H.—“The Conditions of Expansion”, American Economic Review, March 1942.
      7. Hansen, Alvin H.—Fiscal Policy and Business Cycles, (Norton, 1941), Part III, Chapters 11-15.
    2. Suggestions for Additional Reading
      1. Beveridge, Sir William—Full Employment in a Free Society, (1944).
      2. Haberler, G.—Prosperity and Depression, (1941), Chapters 8, 13.
      3. Cassel, Gustav—On Quantitative Thinking in Economics, (1935), Chapter 4.
      4. Robinson, Joan—Introduction to the Theory of Employment.
      5. Hicks, J. R.—Value and Capital, (1938), Chapters 20, 21, 22.
      6. Hansen and Perloff—State and Local Finance in the National Economy, (1944), Chapters 9, 11.
      7. Hansen, Alvin H.:
        1. Full Recovery or Stagnation, (Norton, 1938), Chapters 1, 2, and Appendix.
        2. Economic Policy and Full Employment, (McGraw-Hill, 1946).
      8. Harris, S. E. (Editor):
        1. Economic Reconstruction, (McGraw-Hill, 1945), Chapters 10-16.
        2. Postwar Economic Problems, (McGraw-Hill, 1943).
      9. Jobs and Markets, de Chazeau, Hart, and Others, Committee on Economic Development, (McGraw-Hill, 1946).
      10. Financing American Prosperity; A Symposium of Economists, Twentieth Century Fund, 1945.

  3. Income, Output and Prices; Economics of the Firm; Economics of an Industry; Monopoly and Monopolistic Competition, etc.

    1. Required Reading:
      1. Meade and Hitch—Economic Analysis and Policy, Part II, Competition and Monopoly, Chapters 1-8; Part III, The Distribution of Income, Chapters 1-5; Part IV, The Supply of the Primary Factors of Production, Chapters 1-4; Appendix on Graphs, pp. 411-424; Charts I, II (end of book).
      2. Boulding, K. E.—Economic Analysis, pp. 421-470; 485-509; 596-634; 658-663; (1941).
      3. Chamberlin, E. H.—The Theory of Monopolistic Competition, 1942, Chapters 4, 5, 8.
      4. Hicks, J.R.—Value and Capital, Chapters 1, 2, 3.
      5. Wicksell, K.—Lectures, Volume I, Part III.
    2. Suggestions for Additional Reading:
      1. Stigler—The Theory of Competitive Price.
      2. Robinson, E.A.G.—Monopoly, (Cambridge Series), Chapters 1-3; 6; 8-9;12.
      3. Burns, Arthur—Decline of Competition.
      4. Walker, E.R.—From Economic Theory to Policy, (University of Chicago Press), Chapters 1, 3, 4, 10, 12.
      5. Purdy, Lindahl, and Carter—Market Organization and Price Policy, Prentice-Hall.
      6. Hitch and Hall—Oxford Economics Papers, Volume I, Business Pricing Policy.

Source:  Harvard University Archives. Syllabi, course outlines and reading lists in economics. 1895-2003.(HUC 8522.2.1) Box 4, Folder “Economics, 1946-1947 (2 of 2)”.

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1946-47
HARVARD UNIVERSITY
ECONOMICS 106a

Final. January, 1947

(Write on any THREE questions)

    1. Explain what is meant by Gross National Product including in your discussion the following:
      1. Distinguish and compare Gross National Product, Net National Product, National Income, Income Payments, Disposable Income.
      2. Outline and discuss the component parts of the Gross National Product from two viewpoints: (a) Income-generation or outlays; (b) Disposal of income.
    2. State the savings-investment problem and show clearly the role of the consumption function (propensity to consume schedule) with respect to this problem. With respect to savings and investment discuss the ideas of Robertson and Keynes.
    3. Give an explanation of cost curves (marginal, variable and total unit costs) and show how this type of cost analysis throws light on the problem of inflation under conditions of full employment.
    4. Write an essay (about one hour) on any one (or two if you prefer) of the following:
      1. Keynes: General Theory of Employment, Interest and Money.
      2. Beveridge: Full Employment in a Free Society.
      3. Lerner: Economics of Control.
      4. Chamberlin: The Theory of Monopolistic Competition.
      5. Hansen: Fiscal Policy and Business Cycles, or Economic Policy and Full Employment.

Source:  Harvard University Archives. Final Examinations, 1853-2001.Box 13, Papers Printed for Final Examinations. History, History of Religions, … , Economics, … , Military Science, Naval Science. January, 1947.

________________

Course Enrollment
Spring term

[Economics] 106b. (spring term) Professor Slichter.—Economic Analysis and Public Policy

Total 25:  10 Graduates, 11 Public Administration, 1 Radcliffe, 3 Others.

Source:  Harvard University. Report of the President of Harvard College for 1946-1947, p. 70.

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READING ASSIGNMENT FOR ECONOMICS 106b
February 18, 1947

Pigou—Economics of Welfare

(Second Edition) Part III

Ch. XIV, pp. 520-542
Ch. XVI, pp. 553-566
Ch. XVIII, pp. 572-578

(Third Edition) Part III

Ch. XIV, pp. 548-571
Ch. XVII, pp. 592-604
Ch. XIX, pp. 611-617

(please post on bulletin board)

Source:  Harvard University Archives. Syllabi, course outlines and reading lists in economics. 1895-2003.(HUC 8522.2.1) Box 4, Folder “Economics, 1946-1947 (2 of 2)”.

________________

March 19, 1947

Please put on reserve for Economics 106

Review of Economic Statistics, May 1938
American Economic Review Proceedings, May 1945
American Economic Review, September 1940
American Economic Review, December 1946

Sumner H. Slichter

Source:  Harvard University Archives. Syllabi, course outlines and reading lists in economics. 1895-2003.(HUC 8522.2.1) Box 4, Folder “Economics, 1946-1947 (2 of 2)”.

________________

[Final] May 19, 1947
Economics 106[b]
Economic Analysis and Public Policy

(Three Hours)

I

(a) Discuss the effect of increase in employment upon the size of the workforce.

(b) So long as there are substantial amounts of additional resources, increases in expenditures may be counted upon primarily to produce increases in employment rather than increases in prices. Discuss the validity of this statement.

II

“A wage structure based upon ability to pay would prevent the best distribution of men and resources among enterprises and would thus limit the output of industry.” Do you agree? Explain.

III

History shows that the price level has been subject to great fluctuations. The cost of living, for example, has risen 50 percent since 1940. Wholesale prices have risen even farther. Within several years after the First World War there was a substantial drop in the price level. In view of the history of prices, do you regard original cost as a fair guide for determining the rate base for public utilities?

IV

“A progressive income tax tends to reduce the attractiveness of risky ventures to investors more than the attractiveness of less risky ventures.” Do you agree? Can this effect be prevented? How? If two ventures offer an even chance of a return above 5 percent and below 5 percent, how would you determine which is the more risky?

V

It is asserted that import duties fall in part upon the foreigners who consume the goods exported by the country levying the duty. Analyze this proposition and point out its limitations.

 

Source:  Harvard University Archives. Final Examinations, 1853-2001. Box 13, Folder “Final examinations, May 1947 ( 3 of 9)”.

Image Source:  Hansen and Slichter from Harvard Class Album, 1947.

Categories
Exam Questions Undergraduate

Wesleyan. Comprehensive undergraduate economics exam, 1931

 

Over the past few days Economics in the Rear-view Mirror has posted comprehensive undergraduate economics exams around 1930 from Harvard, Princeton, and Swarthmore. Today I add an economics comprehensive exam from Wesleyan University to round out this cross-section.

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Comprehensive Examination in Economics
Wesleyan University, 1931

Part I

(Two hours)
Answer TWO of the following questions.

  1. Snowden of the British Exchequer in explaining his land value tax proposal in the House of Commons, on May 4, 1931, said:

“By this measure we assert the right of the community to ownership of the land. If private individuals continue to possess a nominal claim to land they must pay a rate to the community for the enjoyment of it. They can not be permitted to enjoy the privilege to the detriment of the community.

“Land differs from all other commodities in various respects. Land was given to us by the Creator, not for the private use of the dukes but for the equal use by all His children. Restriction of freedom in the use of land is a restriction on human liberty.

“To restrict the use of land by arbitrary will, the owner enhances its price, raises rents, hampers industry and prevents municipal development and the increase of amenities. Every increase in population, every expansion in industry, every scientific development, every improvement in transportation, every child that is born, increases the rent of land. Rent enters into the price of every article produced, into the cost of every public service.”

What economic principles are involved in the above analysis? What was the position of the classical economists with reference to the various problems involved?
To what extent do you agree with Mr. Snowden’s analysis and what are the reasons that contribute to your present conviction?

  1. Write a brief essay on the subject “Laissez Faire in Economic Theory: Its Past Significance and Its Applicability to the Present American Economic Order.”
    In your essay show how economists of the past regarded laissez faire, the reasons for their attitude, and the adequacy of this philosophy for the problems of the present.
  2. What is the basis for the assertion that we have an acquisitive society? Indicate the strong and the weak points of such a society. Outline in general terms, the nature of a so-called functional society. Present the case for and against such a social order.
    Indicate your conclusion as to the relative merits of these two types of societies as applied to past eras and as applied to the present period.
  3. (a) Enumerate and describe each of the important wage theories that has been suggested in the evolution of classical economic doctrines.
    (b) Indicate what wage theories were held by each of the authors you have studied and explain why he advocated the theory in question.
    (c) What do you regard as valid and what invalid in all these wage theories? Present and defend your own explanation for the general wage level.

 

Part II

(Two and one-half hours)
Answer THREE of the following questions.

  1. (a) What are the causes of the present economic depression in the United States and the rest of the world?
    (b) What agencies, if rightly directed, can contribute toward the elimination of business fluctuations? Explain in what manner and to what extent each of these agencies may be expected to assist.
  1. Contrast Russia and the United States at the present time as to the organization of economic institutions, the direction of production and the distribution of wealth.
    Give and explain your opinion as to the relative merits of the two systems.
  2. Compare the conditions of farming and industry that make for a special agricultural problem in the United States.
    Evaluate the measures that have been suggested for the solution of this problem.
  3. The Labor Government is in power in Great Britain. A collectivist system supported by the industrial wage earner exists in Russia while organized labor in the United States is relatively weak and ineffective. Discuss and explain these contrasts.
  4. (a) The late President Hadley believed that public utilities should be subjected to no more regulation than any private enterprise. Can you suggest any arguments in support of such a position? What are the arguments on the other side?
    (b) What do you consider necessary as a means of insuring adequate regulation of public utilities and how would you proceed to the attainment of this objective.
    Outline in detail some of the things that you would prescribe.

(Each student will be examined orally as per schedule already announced.)

  1. [The consumer pays $10 for a given goods. Four of the $10 go to the manufacturer. What important economic problems are suggested by this situation? Indicate and defend a program for meeting these problems.]

 

[Note: question 6 of part II of this exam was not included followed by the note “Question presented elsewhere”. In the list of 65 selected questions for review in the cited source below, there was a single optional 50 minute question. I have included that question in square brackets above, but this represents only an educated guess on my part.]

 

Source:  Edward S. Jones. Comprehensive Examinations in the Social Sciences, Supplement to the December, 1933 Bulletin of the Association of American Colleges,pp. 36-38.

Image Source: Olin Memorial Library at Wesleyan University, built in 1925-27 and dedicated in 1928. From Wikipedia entry “Wesleyan University”.

Categories
Exam Questions Swarthmore Undergraduate

Swarthmore. Senior comprehensive economics exam, 1931

 

The two previous posts provided undergraduate comprehensive examinations for Harvard and Princeton from the early 1930s that were published in the Bulletin of the Association of American Colleges (December, 1933). The cross-section of comprehensive economics exams is now expanded with this post to include Swarthmore College’s economics department.

A decade later Swarthmore College brought in external examiners (many of whom recruited from Wolfgang Stolper’s network of Harvard graduate buddies), e.g.

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Senior Comprehensive Examination in Economics

Swarthmore College, 1931

  1. a. Why have railroads been subject to an unusual amount of regulation?
    b. Appraise reproduction cost as a basis for the valuation of public utilities.
    c. Explain the operation of the principle of joint costs in the determination of rates for specific services.
  2. Discuss:
    a. “One of the unions’ chief errors is restriction of output, which is always against the social interest and even fruitless for the workers.”
    b. “To the extent that employee representation seems to the worker to be just an employer’s weapon against trade unionism, it will be still less popular in the future than today and even its good points will be ignored.”
  3. Is it necessary to make goods in order to make money? Give the answers of T. N. Carver, S. & B. Webb, F. M. Taylor, T. Veblen, Adam Smith, R. H. Tawney, and Alfred Marshall. Why have these scholars come to such contrary conclusions after examining the facts? Is it possible that both groups are right; that neither one is right? How so? If not, which group is right and why?
  4. a. Since it is understood that all kinds of money in this country are to be maintained at a parity of value with standard money, would not inconvertible paper money issued by our government be quite as acceptable and useful as any kind? Explain.
    b. In the United States there are many kinds of money. What are they, and what is the security behind each one? Does Gresham’s Law operate? Why, or why not.
  5. a. It is said that the United States is evolving into a commission form of government; that the government set up by the Constitution is gradually delegating its duties to “expert commissions.” Bearing in mind the frailty of commissioners and their staffs, do you believe this is a wise movement? Why? Be specific.
    b. Giving generous reference to the history of governmental regulation in the United States, what do you believe will be the position of the government as a regulator of business twenty-five years hence?
  6. According to present estimates, the federal government will complete this fiscal year, June 30, 1931, with a deficit of nearly one billion dollars. Outline, in detail, the causes of this deficit. Suggest, with reasons, the fiscal program which the government should adopt, for the coming year, in view of this deficit.
  7. Philip Snowden, British Chancellor of the Exchequer, has proposed the imposition of a tax on the site value of land as a means of balancing the British budget. It is argued that such a tax would have less of a repressive effect upon industry than any other type of tax which might be imposed. Give in detail the reasoning which supports this position.
  8. Give an historical account of the currency agitation and legislation from the end of the Civil War to the end of the last century. What issues were involved and how did they arise? On the whole, do you think that our currency history of this period refutes or verifies the quantity theory of money?
  9. a. Imagine yourself a Congressman in the year of 1828 and make a brief argument for the high tariff policy adopted in that year. Would you argue in the same way today? If not, why not? Is your supposed speech that of a representative from South Carolina or Pennsylvania? Give reasons.
    b. Briefly comment upon what you regard as three important causes or factors in the present industrial depression.
  10. a. How important for price theory and for practical life are differences in the elasticity of demand for commodities? Illustrate, using diagrams.
    b. Translate, and if necessary, correct the following popular statements into the more exact language of economic theory:

(1) “We produce too much coal and people freeze to death; we raise too much cotton and people go naked.”
(2) “Great Britain’s foreign trade is in a bad way; she has an extremely unfavorable balance.”
(3) “The price of corn is low because you can buy good corn land so cheaply.”
(4) “Depressions are due to over-production, and by this I mean that more goods are produced than can be sold, for two reasons; rich people save too much, and the workers do not get high enough wages.”

(Answer five questions. Use the first half-hour to study and select your questions. Then devote about thirty minutes to answering each question.)

 

Source:  Edward S. Jones. Comprehensive Examinations in the Social Sciences, Supplement to the December, 1933 Bulletin of the Association of American Colleges, pp. 41-43.

Image Source: Parrish Hall, Swarthmore College  .

 

Categories
Exam Questions Princeton Undergraduate

Princeton. Two undergraduate comprehensive exams in economics, 1929 and 1932

 

Another catch in my trawling for exams, we have below two undergraduate comprehensive examinations from Princeton (1929 and 1932).  These exams were selected and published in a supplement to the Bulletin of the Association of American Colleges dedicated to the subject of comprehensive exams. The style of the questions is rather different from those seen for Harvard from 1931 that were transcribed for the previous post.

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Senior Comprehensive Examination
Princeton University, 1932

Part I
Use a separate book for each question

I
(20%)

  1. Contrasting the England of 1700 with the England of the Middle Ages, R. H. Tawney states: ” Opinion ceased to regard social institutions and economic activity as amenable, like personal conduct to moral criteria.”
    How far was this true (1) of price; (2) of the money reward for human labor? Give the reasons.
  2. Compare Henry George’s theory of rent with Ricardo’s theory of rent.

II
(40%)

  1. What was the Marxian theory of “surplus value”? Discuss the present price and wages policy in Russia in the light of the Marxian theory.
  2. “Socialization will proceed, step by step, from one industry to another, according as circumstances in each country may permit. Objectionable as private profit-making enterprise is to Socialists, they will refrain from destroying it in any industry until they are in a position to replace it by a more efficient form of organization.” (From a resolution of the Labor and Socialist International.)
    What is the “more efficient form of organization” proposed for the “nationalized industries,” as illustrated in the Webb Constitution for the Socialist Commonwealth of Great Britain? Would it be more efficient than “private profit-making enterprise” in these industries? Give your reasons.

III
(40%)

Answer one of the three following questions: A, B, or C.

A

Discuss the Interstate Commerce Commission in its present status as a regulator of interstate commerce. Is it lacking any powers which it should possess? Should it be deprived of any powers that it now has? Are there any powers it should retain which could be made more effective by legislation? Give reasons for your answers.

B

At the time of the Napoleonic Wars the following statement was made as to the ability of Great Britain to make remittances to the continent to support her armies and subsidize her allies:

“A favorable balance of trade is a very probable consequence of large drafts on Government for foreign expenditure; an augmentation of exports, and a diminution of imports, being promoted and even enforced by the means of such drafts.”

A few weeks ago, in a discussion of the payments of inter-allied debts, it was stated:

“The essential fact about war debt payments is that they are foreign payments. Many people seem to think that the French Government may tax its citizens, deposit the money in the Bank of France, and then either draw a check upon the Bank of France to pay the United States on war debts, or use the same money for armament expenditures. The essential difference is that a check drawn in francs by the French Government upon the Bank of France to the credit of the American Treasury is of no value to us until it is transferred into dollars.”

On the basis of these statements, discuss critically the topic, “Divergent Views on the Payment of International Obligations,” laying particular emphasis on the economic principles which are involved. Where possible, use historical illustrations in your discussion.

C

A certain industrial corporation has outstanding common stock of par value of $10,000,000; also a first mortgage bond issue, amply secured by the plant, of $2,000,000.

Below is a list of five possible methods of voluntarily revising the capital structure of this company.

  1. The issuance of convertible bonds,
  2. The declaration of a stock dividend,
  3. The declaration of a privileged stock subscription,
  4. The purchase of the company’s own stock in the open market,
  5. The formal reduction of the corporation’s capital by amendment of the certificate of incorporation.

Discuss thoughtfully four of these five methods.

While it is not desirable to lay down any rigid plan to be adhered to in discussing all of these methods, your answer should explain (1) what is involved in the use of the method in question, (2) the objective or objectives ordinarily sought to be attained by its use, (3) what conditions other than those stated in the first paragraph should prevail in order to justify the use of the method, and (4) any special disadvantage which might be suffered.

__________________________

Senior Comprehensive Examination
Princeton University, 1929

Examination in Special Field I

I

Case A

During the latter part of the period of inconvertible paper currency in this country (1862-1879) trade dollars (a silver coin somewhat heavier than the standard silver dollar and possessing at that time the right of free coinage) began to appear in circulation alongside the greenbacks, although the trade dollar was intended for use only in foreign trade.

Case B

In Russia, the chervonetz, a paper monetary unit issued in 1923, kept at a high value by relative limitation of quantity and backed by a considerable gold reserve, quickly drove the Soviet paper rouble, an enormously depreciated paper monetary unit, out of circulation.

Case C

In Germany, in 1923, foreign gold standard currencies appeared in considerable volume in ordinary commercial transactions, which up to that time had for years been carried on almost entirely with highly depreciated paper marks.

In all these cases “bad” money not only did not drive out good but the reverse was more nearly true. Explain each case and state Gresham’s Law so as to make it universally applicable.

II

Suppose that the United States in 1893 had abandoned the gold standard, taken from gold the legal tender quality and made all paper currency redeemable in silver dollars which were no longer freely coined.

(a) What would have been the upper and lower limits on the exchange rates of the dollar against gold standard currencies?

(b) What influences would have affected the gold value of the dollar?

(c) How, if at all, would the gold price of silver have been affected?

(d) Could the rise in prices, which took place after 1896, have been prevented under the monetary system outlined above? Reasons.

III

Compare the check and deposit system of banking, such as prevails in Anglo-Saxon countries, with the French system where checks are little used and practically the whole of the circulating medium is issued by the Bank of France which shares its profits with the government of the republic.

Your answer should attempt to assess, from the point of view of the general interest, the relative virtues and vices of the two types of banking, showing specifically and precisely in what manner advantages or disadvantages accrue under the one or the other system.

IV

Assume that in any given country:

(a) central bank reserves are very high;

(b) exports are increasing relative to imports;

(c) stock speculation has been and continues rampant and stock prices have risen greatly;

(d) commodity prices are stable.

What policy do you think the central bank should pursue, and why?

V

Spain is now on an inconvertible paper monetary standard. Suppose that political disturbances lead to a sharp decline in confidence with regard to Spain’s economic prospects, that present foreign lenders to Spain seek to withdraw their capital and that further loans are refused. Trace through the resulting movement of exchange rates the probable course of trade and industry in Spain up to the point of restoration of a stable economic equilibrium. Assume no further inflation of the Spanish currency.

VI

  1. Give a brief description of the Dawes Plan of reparations payments, criticizing adversely where such criticism seems to you to be warranted.
  2. Compare the economic effects on both paying and receiving countries of reparations in cash and reparations in kind.

 

Source:  Edward S. Jones. Comprehensive Examinations in the Social Sciences, Supplement to the December, 1933 Bulletin of the Association of American Colleges, pp. 38-41.

Image Source:John E. Sheridan, Princeton Poster, c. 1901  . Library of Congress Prints and Photographs Division Washington, D.C. 20540 USA.

 

Categories
Exam Questions Harvard Undergraduate

Harvard. Three economics subject exams from divisional comprehensives, 1931

 

Being a scavenger for old economics exams, I just had to transcribe the following three comprehensive subject examinations from the Harvard Division of History, Government, and Economics battery of comprehensive exams from 1931.  These exams were selected and published in a supplement to the Bulletin of the Association of American Colleges dedicated to the subject of comprehensive exams. The subjects examined were History of Economic Thought, Public Finance, and Labor Problems.

For some strange reason two of the questions were omitted, with a note that the questions were presented “elsewhere”. I have identified what I think to be the likely missing questions from a list of 65 questions discussed earlier in the monograph. These two questions are placed in square brackets in the public finance and labor problems examinations.

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History of Economic Thought

Harvard University, 1931
(Three hours)

Answer either FOUR or FIVE questions, including TWO from each group. If you answer FOUR questions, write about an hour on one of them and mark your answer “Essay.” This question will be given double weight.

A

Use a separate blue book for the questions in this part.

  1. Discuss the economic policies of one of the following in the light of theory and contemporary conditions: Colbert, Hamilton, Turgot, Bismarck, Andrew Jackson, Gladstone, Cromwell.
  2. Compare the part played by economic theories in the French Revolution and the Russian Revolution.
  3. In what ways do you think the economic thought of the Greeks reflects the social, intellectual, and political conditions of the period?
  4. Discuss the influence of economic fallacies upon public policy during the past hundred years.
  5. To what extent do you think the social and economic organization of medieval towns is reflected in the economic views of medieval thinkers?
  6. “Mercantilism is, in substance, the sum of all efforts to bring about a self-sufficient empire.” Discuss.
  7. How did contemporary writers explain the price revolution of the sixteenth century? Were these new or already accepted doctrines?
  8. Discuss the importance of economic theory for an understanding of British colonial policy during the period from 1783 to 1867.

B

Use a separate blue book for the questions in this part.

  1. What were some of the more widely held theories of wages during the nineteenth century?
  2. Discuss one of the following topics: The Medieval Doctrine of Just Price; The “Dismal Science”; Economic Stages.
  3. “Though the real problem of Distribution was sometimes approached by the Classical Economists, it was never properly presented, nor was an attempt made at its solution.” Discuss.
  4. What were the chief contributions to economic thought of one of the following writers: Senior, J. B. Clark, Walker, Cantillon?
  5. Explain the meaning of three of the following terms and tell with what writer or group they are chiefly associated: produit net, lucrum cessans, preventive check, productive forces, non-competing groups.
  6. ” There are no terms in economics which bear about them more palpable traces of the conflicts through which they have gone than ‘production’ and ‘productive.'” Discuss.
  7. What were the principal doctrines of the Austrian school of economics?
  8. Discuss the relation between the work of one of the following writers and the work of earlier thinkers: Smith, J. S. Mill, Marshall.

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Public Finance

Harvard University, 1931
(Three hours)

Part I
(About one hour)

  1. White an essay on one of the following topics:

(a) The general property tax,
(b) British budget principles since 1860,
(c) The sales tax,
(d) Postal rate problems in the United States,
(e) Financial problems of highway construction and maintenance.

Part II
(About one hour)

Answer TWO questions only.

  1. Do you think it wise for a government to exempt its own bonds and notes from taxation? Why, or why not?
  2. Indicate the nature and significance of the “grant in aid” in British public finance.
  3. Discuss recent tendencies in state and municipal expenditure.
  4. Discuss the fiscal aspects of a system of protective tariff duties.
  5. [In what ways do the problems of government finance affect currency systems and the control of currency?]

Part III
(About one hour)

Discuss THREE of the following quotations.

  1. “Modern taxation or tax making in its most characteristic aspect is a group contest in which powerful interests vigorously endeavor to rid themselves of present or proposed tax burdens.”
  2. “Though differential rents of land have complete ability to bear taxation directly imposed upon them, and cannot shift such taxation, they cannot be reached by a tax imposed upon their produce.”
  3. “To tax investment income at a higher rate would seem to be trebly unjust; for ‘savings’ are first taxed as ‘earned income’; the income derived from them is then taxed as ‘investment income’; and, thirdly, a portion of the invested capital, is confiscated by the ‘death duties’—a triple penalty upon thrift.”
  4. “It must not be supposed that a government’s safe borrowing power is anything like its national wealth, for the wealth belongs to the people and can be taken from them only by law and the laws are made by the people indirectly and eventually.”
  5. “Taxes should fall proportionately to the wealth of the taxed, that is, the sacrifice should be equally felt by all. This rule is easy to keep when taxation is light; but when taxation must be heavy, the rule is difficult to keep.”

[Note: Part II, Question 6 has been identified from a list of 65 questions as likely. It was appears to be the better “fit” of  two optional, 20-minute public finance questions.]

__________________________

Labor Problems

Harvard University, 1931

Part I
(About one hour)

  1. Write an essay on one of the following topics:

(a) the legal status of trade unions in Great Britain,
(b) unemployment and the business cycle,
(c) standard wage rates,
(d) the family allowance system,
(e) the policy of organized labor towards new machinery.

Part II
(About one hour)

Answer TWO questions only.

  1. To what extent does welfare work contribute to the solution of the labor problem?
  2. What is a sweated industry? What are the best correctives for this abuse?
  3. Compare the policies of the trade unionists in any two of the following countries:

(a) United States,
(b) France,
(c) Germany,
(d) Australia.

  1. Discuss the policy and objectives of the British Labor Party.
  2. Discuss the tendencies of judicial interpretations of “liberty of contract” in labor cases in the United States.

Part III
(About one hour)

Discuss THREE of the following questions.

  1. “Only the most formal conception of the idea of equality and the most unrealistic attitude toward groups in our community could think of the ordinary forms of labor legislation as class legislation.”
  2. “If no general fund exists which can be diverted from some other form of surplus income into wages, trade unionism becomes a mere device for adding to certain well organized groups of workers a scarcity wage paid by less favorably placed workers.”
  3. “Wages are more of a question for business than they are for labor. Low wages will break business far more quickly than they will labor.”
  4. “Scientific management, properly applied, normally functioning, should it become universal, would spell the doom of effective unionism as it exists today.”
  5. [“As long as there is liberty there will be strikes, for a strike is nothing more or less than liberty to stop work and to wait for a bargain.”]

 

[Note: Part III, Question 11 has been identified from a list of 65 questions as an optional optional labor question for about 20 minutes and that fits the discuss the quotation format]

 

Source:  Edward S. Jones. Comprehensive Examinations in the Social Sciences, Supplement to the December, 1933 Bulletin of the Association of American Colleges, pp. 33-36.

 

Categories
Columbia Exam Questions

Columbia. Microeconomic theory exam. Becker, 1965.

 

The following set of Gary Becker’s microeconomic theory examination questions (found in a folder in the Milton Friedman papers at the Hoover Archives) does not have an institution identification. According to the copy of Gary Becker’s c.v. buried in the website at the Institute of Labor Economics (IZA) in Bonn, Germany, we can be reasonably confident that this course was taught while Becker was still a professor at Columbia University. 

__________________

Final Examination
G6213x
Prof. G. S. Becker
January, 1965

THREE HOURS—Persons whose native language is not English can have an additional 45 minutes.

  1. (40 points) Answer each of the following as true, false or uncertain and justify your answer in the space provided.
    1. Over time in the U.S. since 1929 output of the service industries rose at about the same rate as that of goods. Since the price of services rose at least as rapidly as that of goods, the income elasticity of demand for services would be greater than that for goods.
    2. A weighted average of all price elasticities must add up to one.
    3. Suppose the excise tax on bus travel was reduced and not on plane, train or other travel. This would reduce the use of buses if such travel was a sufficiently strong inferior good relative to other kinds of travel.
    4. The ability of firms of very different sizes to survive in an industry means that the long run marginal cost curve is horizontal over the range of firm sizes that survive.
    5. If an increase in the output of any firm lowered the marginal cost curves of other firms in the same industry (external economies) a competitive industry as a whole might show increasing returns; i.e., have a negatively inclined supply curve.
    6. Short run marginal costs can never be below long run marginal costs.
    7. Suppose that a competitive firm maximizes not income but its sales subject to the constraint that it does not make any losses. Then reduction in the demand for its product might not lead it to reduce output.
    8. Goods X and Y are either substitutes, complements, or independent if an increase in the amount of X either reduces, raises or leaves unchanged the marginal utility of Y.
    9. If the price of a good competitively produced was free to vary and yet did not change much between a seasonal low and a seasonal high in demand, this means that the industry’s long run marginal cost curve was very elastic.
    10. An ad valorem tax, with a tax rate proportional to producer’s price, on a competitive industry that yielded the same revenue at the initial output as a specific tax, fixed amount per unit, would reduce output less than the specific tax.

 

  1. (20 points) Treat charitable contributions as a commodity entering the utility functions or indifference curves systems of the contributor. Assume, as is largely true, that contributions can be deducted from income in arriving at taxable income. Assume a proportional tax rate equal to t.
    1. What would be the effect of an increase in the tax rate for any one person alone on his contributions? How does your analysis compare with the traditional analysis for commodities?
    2. Is he more likely to increase or decrease his contributions?
    3. Suppose now the tax rate increased for everyone. Would your answers to a. and b. be significantly different?

 

  1. (20 points) Suppose the traffic department would like to enforce parking regulations in an efficient way. Assume that each person has the choice of parking illegally or legally; the latter costs X dollars per “day” and the former, if one is caught, causes a fine equal to F dollars per time caught.
    1. Assume first that the sole aim of the traffic department is to discourage illegal parking at minimum cost. Assume also that all drivers simply try to maximize expected money income. How frequently should the traffic department inspect parking in order to achieve its aim?
    2. If all drivers maximized expected utility and had diminishing marginal utility of income, (but there is no utility or disutility from disobeying the law), how would this affect your answer? If they had increasing marginal utility of income?
    3. Suppose the traffic department received all the fines and desired just to maximize its expected income. How would your answer to 1. be affected?
    4. How does your answer to a. and c. depend on F, the size of the fine, and X, the cost of legal parking?

 

  1. (20 points) Suppose the earnings of military personnel were set below the price that would make the number of volunteers equal to the demand by the military, and that draft calls were sent out strictly at random to males aged 18-26 to bring the number entering up to demand

a.

1. How would the composition of drafted personnel compare with those that would enter if military earnings were raised sufficiently to make the number of volunteers equal to demand?

2. How would the total tax burden and its distribution among the population compare?

b. Assume now that drafted personnel could buy a substitute or substitute for someone else (as during the Civil War) instead of entering as a draftee. Assuming the capital market for substitutes works well, in equilibrium

1. How would the composition of men entering and the tax burden compare with that under a drafted and a fully voluntary system?

2. What determines the price that substitutes can get?

 

Source: Hoover Institution Archives.  Milton Friedman Papers, Box 80, Folde.r “University of Chicago, Student doctoral thesis and papers”.

Image Source:  Gary S. Becker from University of Chicago Photographic Archive, apf7-00059, Special Collections Research Center, University of Chicago Library.

Categories
Economic History Exam Questions Harvard Suggested Reading Syllabus

Harvard. History of Commerce to 1750. Usher, 1929-30

 

This post provides the course description, enrollment figures, reading assignments, and final examination questions for Abbott Payson Usher’s course “History of Commerce: 1450-1750” that he taught at Harvard in 1929-30.

The economic historian, Abbott Payson Usher (1883-1965), received his A.B. (1904), A.M. (1905), and Ph.D. (1910) all from Harvard. He taught ten years at Cornell and two years at Boston University before returning to his alma mater in 1922 where he remained on the faculty for the rest of his career. Usher was a visiting professor of economics at the University of Wisconsin in 1949-51 and 1955-57.

A bibliography of Usher’s writings is included in the Festschrift for him, Architects and Craftsmen in History (1956).

A memorial essay written by Thomas M. Smith was published in Technology and Culture, vol. 6, no. 4 (Autumn, 1965), pp. 630-632 [gated].

A few other Abbott Payson Usher artifacts from courses at Harvard already transcribed at Economics in the Rear-view Mirror:

Economic History to 1450 [1934]
Modern Economic History [1937-41]
European Economic History [1921]

 ___________________

From Usher’s report to the Harvard Class of 1904
(15th anniversary, 1919)

ABBOT PAYSON USHER

Born: Lynn, Mass., Jan. 13, 1883. [Died: June 18, 1965]
Parents:  Edward Preston Usher, Adela Louise Payson.
School: High School, Grafton, Mass.
Years in College: 1900-1904.
Degrees:  A.B. 1904; A.M. 1905; Ph.D. 1910.
Married: Miriam Shoe, Grafton, Mass., Sept. 3, 1914.
Children: Eunice, Sept. 8, 1915.
Business: Teacher.
Address:  (home) 108 Linden Ave, Ithaca, N.Y. (business) 260 Goldwin Smith Hall, Ithaca, N.Y.

My contribution for the war was the preparation of a special report for Colonel House’s committee.

Publications: “The Technique of Medieval and Modern Produce Markets.” Journal of Political Economy, xxiii, p. 365, 1915. “Germanic Statecraft and Democracy.” Unpopular Review, vol. iv, p. 27, 1915. “Generalizations in Economic History.” Journal of Sociology, vol. xxii, p. 474, 1916. “Influence of Speculative Marketing on Prices.” Economic Review, vol. vi, p. 49, 1916. “England’s Place in the Sun.” Unpopular Review, vol. vi, p. 311, 1916. “The Parisian Bill Market in the Seventeenth Century.” Journal of Political Economy, vol. xxiv, p. 985, 1916. “The Government, the Speculators and the Food Supply.” Cornell Countryman, vol. xiv, p. 726, 1917. “The Content of the Value Concept.” Quarterly Journal of Economics, vol. xxxi, p. 711, 1917. “The Unions and the Labor Problem.” Unpopular Review, vol. viii, p. 168, 1917. “Science and Learning in France.” Chicago: Society for American Fellowships in French Universities, 1917, p. 287-290.

[Reviews of] “Customary Acres and Their Historical Importance,” by F. Seebohm. American Acad. of Polit. and Social Science, lvii, p. 342, 1915. “Oxford Studies in Social and Legal History”; edited by P. Vinogeradoff. Vol. iv. Same, lvii, p. 343, 1915. “History of Commerce and Industry,” by C.A. Herrick. American Economic Review, vol. viii, p. 101, 1918.

Member: Ithaca Country Club.

Source:  Harvard College Class of 1904. Fifteenth Anniversary Report (1919), pp. 408-9.

___________________

Announcement of Usher joining Harvard Faculty in 1922 as Assistant Professor in economics

Abbott Payson Usher ’04, Professor of Economics at Boston University, has accepted an appointment at the University as Assistant professor of Economics and tutor in the Division of History, Government, and Economics.

Professor Usher took the degree of A.M. at the University in 1905, served as assistant and instructor in Economics until 1910, and in the latter year took the higher degree of Ph.D. For the next ten years he taught at Cornell, first as instructor in Economics and later as Assistant Professor. In 1920 he has called to Boston University as a full Professor and this year he is serving also as lecturer in Economics at Harvard.

Source: The Harvard Crimson, June 10, 1922 .

___________________

Course Description
1929-30

[Economics] 10a 1hf. The History of Commerce, 1450-1750

Half-course (first half-year). Mon., Wed., Fri., at 12. Associate Professor Usher.

A study of the expansion of Europe approached as a consequence of the great discoveries. The age of discovery is studied with special regard to the influence of improvements in the technique of ship-building and navigation. Changes in the physical volume of commerce and consumption will be studied by quantitative methods. The commercial policies and colonial systems of the leading countries will be studied.

Source:  Division of History, Government and Economics, 1929-30. Official Register of Harvard University, vol. 26, No. 36 (June 27, 1929), p. 70.

___________________

Course Enrollment
1929-30

[Economics] 10a1hf. Associate Professor Usher.—History of Commerce, 1450-1750.

Total 5:  4 Graduates, 1 Junior, 2 Others.

Source: Report of the President of Harvard College, 1929-30, p. 78.

___________________

Course Readings

Economics 10a.
1929-30
History of commerce: 1450-1750.

  1. The great discoveries. To be completed, Oct. 21.

Beazley, C.R. Prince Henry the Navigator, pp. 1-123, 138-46, 160-78.
Olivera Martins, J.P. The golden age of Prince Henry the Navigator, pp. 61-84, 169-231.
Nunn, G.E. The geographical conceptions of Columbus, pp. 31-53.
Vignaud, H. Toscanelli and Columbus, pp. 52-74, 243-73.

  1. Portugal, Spain, and Holland. To be completed, Nov. 15.

Whiteway, R.S. The rise of Portugese power in India, pp. 1-57, 128-79.
Haring, C.H. Trade and navigation between Spain and the Indies, pp. 3-45, 96-200.
Day, C. The policy and administration of the Dutch in Java, pp. 39-82.
Moreland, W.H. From Akbar to Arungzeb. pp. 1-188.

  1. England and France. To be completed, Dec. 23

Thomas, P.J. Mercantilism and the East India Company. pp. 1-47, 67-166.
Scott, W.R. The history of the Joint Stock companies, vol. I, pp. 1-15, 105-28, 326-52, 439-73.
Unwin, George. Studies in economic history, pp. 133-220.
Weber, Max. General economic history, pp. 275-301, 315-51. pp. 275-301, 315-51.

  1. Reading period.

Lyall, A. History of British India, chapters 2-11.
or
Dodwell, Henry Dupleix and Clive. pp. 3-269.

 

Source:Harvard University Archives.Syllabi, course outlines and reading lists in Economics, 1895-2003. Box 2, Folder “Economics, 1929-1930”.

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Final Examination, 1930

1929-30
HARVARD UNIVERSITY
ECONOMICS 10a1

Answer SIX questions.

  1. Sketch the history of geographical science from the death of Prince Henry the Navigator to the death of Mercator.
  2. Describe the place of the “Mesta” in the economic life of Spain in the fifteenth and sixteenth centuries.
  3. What were the distinctive features of Dutch colonial policy in Java?
  4. Describe and discuss the status and obligations of the natives to the government and to the Spanish settlers in the Spanish possessions in the New World in the sixteenth century.
  5. Sketch the development of the free trade policy in England in the seventeenth century, with special reference to the relation of the arguments of the Free Traders to analysis of international trade.
  6. What were the characteristic differences between the Regulated Company and the Corporation?
  7. What influence was exerted upon economic policy by Machiavelli’s treatise “The Prince”?
  8. Sketch the career of Dupleix or Clive.

Source:  Harvard University Archives. Examination Papers—Finals, 1930(vol. 72). Papers Printed for Final Examinations, History, New Testament,…Economics, …,Military Science, Naval Science (January-June, 1930).

Image Source: Harvard Class Album, 1934.

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Exam Questions Harvard

Harvard. Final exam for international trade and finance. Leontief, 1934

 

International Trade and Finance was a course taught by Wassily Leontief during the second semester of his second year on the Harvard economics faculty (1933-34).    

Course description, final exam, and enrollment for Economics 39,  International Trade and Finance, taught by Leontief in 1932-33 have been posted earlier.

The exam questions from both years provide some light on the actual course content.

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Course Enrollment

[Economics] 55 2hf. (formerly Economics 39). Asst. Professor Leontief.—International Trade and Finance.

Total: 6 of which 5 Graduates, 1 Radcliffe.

Source: Harvard University. Report of the President of Harvard College, 1933-34, p. 86.

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1933-34
HARVARD UNIVERSITY
ECONOMICS 552

Answer three out of the four questions

  1. What are the terms of trade? Indicate the factors which effect their change; describe the methods of their statistical measurement.
  2. Give a critical discussion of the purchasing power parity theory.
  3. Under which conditions can an import duty be beneficial?
  4. Discuss what is in your opinion the fundamental difference between Taussig’s and Ohlin’s approach to the problems of international trade.

 

Source: Harvard University Archives. Examination Papers. Finals 1934 (HUC 7000.38, vol. 76).

Image Source: Wassily Leontief in Harvard Class Album, 1934.