Copies of the examinations for Evsey Domar’s business cycles course at Johns Hopkins University offered during the 1948-49 academic year can be found in his papers at the Economists’ Papers Archives at Duke University but also in the archived collection of economics exams in the departmental papers at the Johns Hopkins archive. While Domar was fairly reliable in keeping copies of his course outlines and exams, I have yet to discover a course outline for any year. Perhaps he lent his sole copy to a colleague once?
Three sets of examination questions for 1951, 1952, and 1954 are also posted.
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Course Announcement
Business Cycles 617-618. Associate Professor Domar. Two hours weekly through the year.
Statistical descriptions of fluctuations in economic activities and a systematic survey of past and present cycle theory.
Source: Catalogue Number of The College of Arts and Sciences; The School of Engineering; The School of Business in Johns Hopkins University Circular. New Series 1948, Number 3. Whole Number 579 (March, 1948) p. 85.
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THE JOHNS HOPKINS UNIVERSITY
FINAL EXAMINATION
Economics 617
Dr. Domar
Wednesday, January 26, 1949—9 a.m. Three hours
ANSWER ALL QUESTIONS. THEY CARRY EQUAL WEIGHTS. I AM MOST INTERESTED IN YOUR REASONING.
I.
In the last days of the OPA, it was emphatically asserted by various quarters that the best cure against inflation lay in increased production. Assume than an increase in output was actually possible. Would not increased production, however, result in larger money incomes and thus produce an inflationary effect, or at least counteract the deflationary effect of the increase in output?
Analyse this problem. The quality and depth of your analysis will count more than its quantity.
II.
Mr. Ayzenshtadt, whose paper was read in class, has this to say about Keynes’ system:
“Even the greatest admirers of Keynes and of this theory that loan capital is the main propeller of the industrial cycle, do not see anything new in it….Keynes himself thinks that the ‘novelty’ of his system lies in the equilibrium formula of the economic process, in which the independent and dependent variables are arranged as follows:
Independent variables
- Propensity to consume
- Marginal efficiency of capital
- Rate of interest
- Liquidity preference
Dependent variables
- Saving
- Investment
- Level of employment.”
Comment. Be specific.
III.
“In spite of his claims to the contrary, Keynes did not succeed in proving the possibility of underemployment equilibrium if wages and prices were assumed to be flexible. That a long period of unemployment could persist as a result of wage and price rigidity we had known long before Keynes.”
Comment on this statement and show what effects would flexible prices and wages have on elimination of unemployment (in a depression) and stabilization of the price level (in an inflation). Indicate clearly every step in your analysis. What practical recommendations follow from your discussion?
IV.
Write for thirty – forty minutes on any subject covered in the course which is of interest to you, but is not included in the preceding questions and not studied in your term paper. Make sure you have something worthwhile to say.
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The Johns Hopkins University
Final Examination
Economics 618
Dr. E. D. Domar
May 25, 1949. Three hours
Answer all questions. They carry equal weight.
I.
The following statement appeared in the National City Bank Monthly Letter (Jan. 1944) regarding government spending as a means of raising the level of income and employment:
“Government spending tends to be like a drug, in that it takes larger and larger doses to get result, and all the time debt and taxes get higher and higher.”
Can a somewhat similar statement be made regarding private investment as an instrument for achieving and maintaining a high level of employment? Discuss the problem thoroughly.
II.
Examine the monetary equations (Nos. 3.10, 3.11, 3.12 in Klein’s Model III. (You should have his paper with you.)
[Klein, Lawrence R. “The Use of Econometric Models as a Guide to Economic Policy.” Econometrica 15, no. 2 (1947): 111-51. ]
- Give a thorough analysis of their meaning and structure.
- Explain the function which they perform or are supposed to perform in the system taken as a whole.
- State your criticism of them and present your positive suggestions.
III.
A Congressional Committee is holding hearing to determine (a) the causes of depressions and, (b) the methods for their elimination. Mr. Hayek and Mr. Marx are testifying. (You may use Mr. Paul Sweezy instead of Mr. Marx if you don’t want to get involved with ghosts).
Present:
- A brief statement of each witness’ views on points (a) and (b).
- Your criticism and evaluation of these statemtns.
- Your own statements on points (a) and (b).
Make sure that your position is well taken because both the witnesses and the members of the Committee (not to say anything about your instructor) can attack you on any point. Be precise and specific.
IV.
Evaluate critically the present day business cycles theory and research. Present your positive suggestions for their improvement. In what direction should the study of business cycles, in your opinion, develop? Be specific.
Source: Duke University. David M. Rubinstein Rare Book and Manuscript Library, Economists’ Papers Archive. Evsey Domar papers, Box 16, Folder “Final Exams: Johns Hopkins, Stanford, U of Michigan”.
Image Source: College yearbook portrait of Evsey [Domashevitsky] Domar from the 1939 UCLA yearbook.