The reading list and final exam questions for Paul Samuelson’s course on business cycles at M.I.T. that he taught during the second term of 1942-43 were posted earlier. In this posting I provide transcriptions for the reading list and final exam for the same course offered five years later. I have included a carbon copy of the first two questions that are different from the first two questions in the mimeographed copy. Maybe the carbon copy was preliminary, perhaps undergraduates and graduates received different questions. In any event the questions are different and clearly identified for the same examination date and same course. Note the tease in his illustration for Question 3 where he lists “in order of importance” “sunspots” and “anti-Keynesian” as Samuelson’s personal main theories.
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Reading Assignment, Economics 26
Spring Term 1948
- The student should buy J. M. Keynes, General Theory of Employment, Money and Interest; and if possible, G. Haberler, Prosperity and Depression (3rd revised edition).
- As background reading, the student may wish to consult J. A. Estey or E. Bratt on Business Cycles [James Arthur Estey, Business Cycles, New York: Prentice-Hall, 1941; Elmer Clark Bratt, Business Cycles and Forecasting, 3rd 1949] and Joan Robinson, Introduction to the Theory of Employment.
Reading Assignments
A
Wesley C. Mitchell, Business Cycles: The Problem and its Setting (1927), Chapters 1, 4.
A. H. Hansen, Fiscal Policy and Business Cycles, Chapters 1, 2
Wm. H. Beveridge, Full Employment in a Free Society, Appendix A.
J. A. Schumpeter, Business Cycles (1939), Chapters 4, 7C, 15G
S. Kuznets, National Income and its Composition, Vol. 1, Chapter 1
G. Haberler, Prosperity and Depression, Chapters 1, 9
Optional:
A. F. Burns and W. C. Mitchell, Measuring Business Cycles.
B
G. Haberler, op cit, Ch. 2, 3, 4, 5, 6, 7
A. H. Hansen, Business Cycle Theory, 1, 2, 4, 8
K. Wicksell, Interest and Prices, Introduction, Ch. 5, 7, 8, 11.
C
J. M. Keynes, General Theory
P. Samuelson, Ch. 13 on Savings and Investment in Economics
A. H. Hansen, Fiscal Policy, 6, 11, 12, 13, 14, 15
G. Haberler, Ch. 8, Part III
S. E. Harris, Postwar Economic Problems, Ch. 2, 5
S. E. Harris, Economic Reconstruction, Ch. 5
Selected Readings on Business Cycles, [Probably: American Economic Association. Gottfried Haberler, chairman of the selection committee. Readings in Business Cycle Theory. Philadelphia: Blakiston, 1944.] Lange, Clark, Tinbergen papers.
D
Financing American Prosperity. [Financing American prosperity : a symposium of economists. Editors: Paul T. Homan and Fritz Machlup. New York : The Twentieth Century Fund, 1945.] Read Ch. 1 and any other two
Federal Reserve Monograph No. 3. First Musgrave Article and Comments.
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Business Cycles
Ec 26 Examination
May 27, 1948
[from mimeographed copy]
20 minutes
- What postwar public policies should be followed in connection with business cycles? (If none, justify your answer.)
15 minutes
- Define in a paragraph or less:
acceleration principle
Say’s Law
marginal propensity to invest
“foreign trade multiplier”
Juglar cycle
15 minutes
- Next to each of the following writers fill in the appropriate letter and number (or numbers if more than one is called for).
Thus the correct answer for Samuelson might be as indicated:
Samuelson A 2 9
if his principal contribution occurred in the last 20 years; and if the theories of the cycle for which he is best known were (in order of importance) “sunspots” and “anti-Keynesian.”
| Time of Principal Contribution | Main Theory or Theories |
| A. Last 20 years | 1. monetary |
| B. Early 20th century (1900-27) | 2. sunspots and weather |
| C. 19th century or earlier | 3. underconsumption |
| 4. self-generating, endogenous | |
| 5. exogenous investment fluctuation | |
| 6. Say’s Law of Markets | |
| 7. eclectic (some truth in most theories) | |
| 8. overinvestment | |
| 9. anti-Keynesian |
|
Time of Principal Contribution |
Main Theory or Theories |
|
| Cassel |
_____ |
_____; _____ |
| Catchings |
_____ |
_____ |
| Dewey and Dakin |
_____ |
_____ |
| Fisher (I.) |
_____ |
_____ |
| Foster |
_____ |
_____ |
| Haberler |
_____ |
_____ |
| Hawtrey |
_____ |
_____ |
| Hansen |
_____ |
_____; _____ |
| Hobson |
_____ |
_____ |
| Hayek |
_____ |
_____; _____ |
| Jevons |
_____ |
_____ |
| Anderson |
_____ |
_____; _____ |
| Keynes |
_____ |
_____; _____ |
| Pigou |
_____ |
_____ |
| Lauderdale |
_____ |
_____ |
| Mitchell |
_____ |
_____; _____ |
| Mises |
_____ |
_____; _____ |
| Malthus |
_____ |
_____ |
| Spiethoff |
_____ |
_____ |
| Ricardo |
_____ |
_____ |
| Tugan-Baranowsky |
_____ |
_____; _____ |
| Schumpeter |
_____ |
_____ |
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Business Cycles
Ec 26 Examination
May 27, 1948
[from carbon copy]
20 minutes
- In retrospect what public policies seemed called for in the period between the two world wars in connection with “business cycles”?
15 minutes
- Define or describe in a paragraph:
natural rate of interest vs. real rate of interest
open market purchase
Kondratieff cycle
marginal efficiency of capital
Source: David M. Rubenstein Rare Book & Manuscript Library, Duke University. Paul A. Samuelson Papers: Box 33, Folder “14.451 Business Cycles, 1943-1955”.
Image Source: From the slideshow at the MIT Memorial Service for Paul A. Samuelson held on April 10, 2010.