Based on what we see of the first few weeks of the content of this first graduate economics theory course at Columbia taught by Albert Gailord Hart (Chicago PhD, 1939) in 1955, it appears that the level of analysis in the course barely attained that of a contemporary average intermediate course in micro- or macroeconomics. Jumping to the end of this post, we find that Hart’s poll of the students in his class revealed that one-third of the aspiring graduate students in economics brought with them no math skills beyond what was taught in high-school (calculus was not taught in high-schools in the US at that time). Only one-third had been economics majors at college. One third had either zero economics or could not even recall the name the textbook that was used in their principles of economics class.
One can imagine the fare of Alfred Marshall, George Stigler and Kenneth Boulding would have been hard to digest for many, if not the majority, of Hart’s first-year graduate students.
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Course Announcement
Economics 101-102—Economic Analysis. Professor Hart and Dr. Mosak.
Section 1—2:10-4. Dr. Mosak. 201 Fayerweather.
Section 2—M. W. 12. Professor Hart. 201 Fayerweather.
Detailed analysis of the reactions of producing units (firms) and consuming units (households); determination through the market of resource allocation, outputs, prices, and incomes; capital and interest; theories of general equilibrium (Walrasian and Keynesian); introduction to “dynamics.”
Students who have not completed Economics 101 are admitted to Economics 102 only with the permission of the instructor.
Source: Announcement of the Faculty of Political Science for the Winter and Spring Sessions 1955-1956. From the Columbia University Bulletin of Information. Fifty-fifth Series, No. 25 (June 25, 1955), p. 34.
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ECONOMICS 101 (Section 2), autumn 1955
AGH 10/3/55
101-1
Role of the course is basic training in theoretical analysis.
- This is today’s version (though differently arranged) of the traditional “value and distribution” course – staple of the graduate curriculum, and counterpart of the key section of “Principles” courses.
- The two “sections” are independent courses aim to provide this basic training; interchangeable as prerequisites for later work, but not guaranteed interchangeable in January 1956.
- Prerequisites for 101 are simply some previous economics (minimum: a “Principles” course) and high-school mathematics.
- Because of the wide range of backgrounds, the course opens each topic at an elementary level, and then pushes the topic to a professional level. All questions are welcome.
Books:
- Contrary to most fields, theoretical analysis boasts several textbooks that are first-hand jobs by productive men in the field and belong in personal working libraries. Students in the course should own either:
- Stigler, THEORY OF PRICE, 2nd ed., or
- Boulding, ECONOMIC ANALYSIS, 3rd ed.
Choice is a matter of temperament.
- All economists should own Alfred Marshall, PRINCIPLES OF ECONOMICS (8th ed.) – obsolescent for over 40 years, never superseded.
- Stigler & Boulding (eds) READINGS IN PRICE THEORY has several items we will use; so does
- American Economic Association, READINGS IN THE THEORY OF DISTRIBUTION.
Plan of the Course will be shaped partly by background of its members; to start:
Introduction, Oct. 3, 5.
Read introductory chapters of Marshall, Boulding Stigler.
Preliminary supply-and-demand analysis, Oct. 10, 12, 17, 19.
Read Marshall, Book V; examine Boulding’s first part as attempt to deal at this level.
Next stage (starting about October 24) we’ll be on the theory of the firm and Marshallian industry (short-run).
Place of theoretical analysis in economics is to my mind central.
- Economic theory is a logic of economic quantity-networks.
- By general consent, economics is about problems of scarcity.
- To mitigate any one scarcity requires substitution – which intensifies some other scarcity. (Example: wartime petroleum.)
- Therefore scarcity situations interlock.
- Characteristic problems are of the sort represented by simultaneous equations. (Example: oil-rich sheik. [See note below for 10/5/55])
- A widespread skepticism about the theoretical tradition must be recognized.
- There is very proper skepticism about people who claim to have applicable knowledge a priori–an offense of which theorists can sometimes be convicted. (Example: fish [sic] taxonomy.)
- As maybe seen from curricular tendencies in general social science courses, the “basic social science” group aspire to build an adequate social analysis without drawing on our theoretical tradition.” (Background on this at next meeting.)
- In many departments, theory is taught as a parlor accomplishment, or at best as a tool on a par with historical or statistical methods.
- My claims for theoretical analysis are ambitious:
- Proposed substitutes for theory can so far not touch things it can do.
- While some economic topics lack historical or statistical angles, none lack scarcity-and-substitution angles.
ECONOMICS 101 (Section 2), autumn 1955
AGH 10/5/55
101-2
Economic Theory in Social Science is not such an anomaly as it might seem if you relied on (say) a sociologist’s interpretation.
- The basic difficulty is that economic theory is about the inter-relations of economic quantities, while social science is supposed to be about the inter-relations of people.
- The economist’s first answer is that one of the most pervasive social relationships is that of markets and division of labor, which cannot be understood without a logic of economic quantities.
- At a slightly more fundamental level, the economist must insist on the human content of his economic quantities and his patterns of relationship among them.
- The focus of economic analysis is choice (alias decision); in setting up our models, we take account of the psychology of individual and group decisions.
- Behind choices lie estimates of future consequences; our models take account of human fallibility, and of the way people learn from experience.
- Even such apparently mechanical relations as a “production function” have human content.
- We visualize the production function as a table of figures (or an algebraic formula), designed so that if we know the inputs we can look up or calculate the output.
- It is tempting to look at such a table or formula as embodying a set of impersonal “natural laws” of physics, chemistry and biology.
- But insofar as such “natural laws” come in questions, what counts is not the ultimate truth but the understanding held by the decision-maker; thus the production function for steel has changed from one using charcoal to one using coke.
- Many of the quantities involved are intensely human—especially the overwhelmingly important quantity called labor input.
- Input-output relations hinge on patterns of cooperation among workers and between workers and management.
- Thus the human content is not drained out of economics by adopting the economic-quantity approach.
- At the same time, it is worth remembering that economists as such are not expert on many relevant aspects of human relations, and can profit from criticism.
* * * * * * * * * * * *
Data on the oil contract with the Arab potentate: The executive negotiating the contract agreed tentatively to deliver 2500 gallons weekly at his oasis. Engineers report that a tank-truck’s round trip requires 0.09 gallons of gasoline per pound of loaded weight at the start, and that the truck will weigh 2½ tons plus 10 pounds for each gallon of capacity.
Then (1) G = 2500 + 0.09W and (2) W = 5000 + 100.
ECONOMICS 101 (Section 2), autumn 1955
AGH 10/10/55 (compilation of 5/5/55[possibly “65”]
101-3[?]-c[?]
Demand Data for Fruits and Vegetables
To test the presumption that price and quantity-demanded of individual commodities are negatively related, a promising experiment is to locate an array of price-quantity data where supply is apt to have changed erratically enough to give a variety of experiences, and where price structure, tastes, income and expectations can be supposed similar.
The adjacent years 1951-52 happen to lie close in other characteristics than chronology. Price averages rose about 2%, without great changes in general structure; population rose about 2% real income per capita, after taxes, rose about 1%. The years being adjacent, drastic changes in tastes are unlikely.
A promising body of price-quantity data is the list of 32 types of “truck” and 10 kinds of fruit for which output and price are reported in Statistical Abstract of the United States (1953 volume, pp. 668-669). For the 20 items whose output-change exceeded 10% up or down, data run as follows:
Commodity |
% change in output |
% change in price |
[comment] |
| Shallots | +45% | -22% | |
| Artichokes | +35% | -12% | |
| Broccoli | +27% | -9% | |
| Eggplant | +26% | -1% | Weak or mildly parallel relation |
| Mint (for oil) | +25% | -4% | |
| Corn, sweet | +19% | +0.5% | Weak or mildly parallel relation |
| Cucumbers | +13% | +11% | Strong failure of inverse relation |
| Lettuce | +10% | -8% | |
| Garlic | -11% | +88% | |
| Beets | -12% | +11% | |
| Beans (snap) | -14% | +15% | |
| Tomatoes | -16% | +12% | |
| Spinach | -17% | +11% | |
| Apples | -18% | +31% | |
| Peas, green | -20% | +1% | Weak or mildly parallel relation |
| Pimientos | -20% | +8% | |
| Prunes | -21% | +28% | |
| Brussels sprouts | -31% | +6% | |
| Plums | -40% | +64% | |
| Honeyball melons | -46% | +36% |
ECONOMICS 101 (Section 2), autumn 1955
AGH 10/12/55
101-4
Topic I
Note on Class’s Background from preliminary tabulation of data slips:
- Only about 1/3 were economics majors as undergraduates. In view of the plea in the catalogue to get background rather than over-concentrate, it is my business to see that non-majors are not penalized.
- About 1/3 have had no formal economics, or a “weak principles”—meaning that they can’t identify the text, in many cases! Recommended they have one of the stronger elementary texts for review & reference.
- Mathematical background of 1/3 includes nothing beyond high school level—distributed rather evenly over economics background. Those who are weak both in previous economics and in math may need extra time for the course.
- In view of this state of the class’s background, do not shy off from raising a question that bothers you for fear it is too elementary!
Assignment:
In Stigler: Read chapters 1, 2, and 4 (treating 3 as a reference work).
Work out to your own satisfaction his exercises no’s 2-4 on p. 67.
In Boulding: Read chapters 7-8 (3rd ed.)
Work out to your own satisfaction his exercise no. 1 on pp. 165-166.
Source: Columbia University Archives. Albert Gailord Hart Collection, Box 62, Folder “TEACHING: Sec. 4 ColUniv 1955/56. Ec 101/2 MICRO”.
Image Source: Albert Gailord hart, Economist, Dead at 88. Columbia University Record. Vol. 23, No. 5 (October 3, 1997).