Tag: Friedman

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Chicago Courses Suggested Reading Syllabus

Chicago. Hayek’s Seminar “Equality and Justice”, 1950-51

 

When Friedrich Hayek came to the University of Chicago in 1950, he organized a faculty seminar to run for two consecutive quarters on the subject “Equality and Justice”. A draft of his letter announcing the seminar as well as its schedule and suggested bibliography are transcribed below. I have added in brackets any handwritten additions found in this material that otherwise was typed.

_____________________

Hayek’s Seminar Announcement to Colleagues

To

Walter J. Blum ✓

Ronald S. Crane ✓

Aaron Director ✓

Milton Friedman ✓

Robert M. Hutchins ✓

Harry Kalven Jr. ✓

Wilber C. Katz ✓

Frank H. Knight ✓

Edward H. Levi ✓

Hans J. Morgenthau ✓

Charner M. Perry ✓

Max Rheinstein ✓

Leo Strauss ✓

W. Allen Wallis ✓

 [handwritten additions]

Peter H. von Blanckenhagen [sp?] ✓

Daniel J. Boorstin ✓

John U. Nef ✓

Robert Redfield ✓

Edw. Shils

Yves R. Simon ✓

James R. Smith ✓

Abram L. Harris

 

October 23, 1950

            The first meeting of the seminar on “Equality and Justice”, which I shall be conducting for the Committee on Social Thought, will be held on Wednesday, October 25, at S.S.302. For the following few weeks the seminar will be held on alternate Wednesdays at the same time and place (alternating with Mr. T.S. Elliot’s seminar) and from November 22 on each Wednesday during the Fall, Winter, and Spring quarters.

A provisional program for the discussions of the seminar is enclosed.

It is my hope that the seminar can be conducted with the participation of members of all the various departments concerned, particularly a number of lawyers, economists, and philosophers, and that the discussion will be to some extent a iscussion among faculty members in front of the students, though of course without excluding the students from active participation. My belated arrival in Chicago has unfortunately made it impossible for me to discuss this plan with all those I had hoped personally to invite, and I can thus only at this very late moment inform you of the plan and say that I very much hope that you will be sufficiently interested to take part and that I shall be greatly honored by your presence.

(F.A.Hayek)

_____________________

COMMITTEE ON SOCIAL THOUGHT
Seminar
on
Equality and Justice

Provisional Outline of Program (Oct. 18, 1950)

1) Oct. 25

 Introduction: The problems and outline of program [Hayek]

A. Historical

2) Nov. 8

 The Classical and Scholastic Tradition: Commutative and Distributive Justice [Simons]

3) Nov. 22

[3a) Nov. 29]

 The Egalitarianism of the American and French Revolutions [Boorstin & Simon]
[Rousseau, Kant & the Utilitarians (Bentham & J. S. Mill)]

B. Systemic

(a) Ethical (The Morals of Equality)

4)

 The Meanings of Equality [Hayek]

5)

 Value Judgments and the Analysis of Conflicts of Value Tests of Moral Rules [What is the Test of a desirable Society? Shils]

6)

 Does Justice Presuppose Abstract Principles? The “feeling of right” and the Logic of the Law

(b) Legal (The practice of equality)

7)

 Equality before the law, the Rule of Law (Government of Laws not of Men), Certainty of the Law

8)

 Safeguards: Rights of Men, Division of Powers, Due Process

9)

 The Continental Tradition of the “Rechtsstaat” [, “Verwaltungsrecht”, Common Law, Case Law, (illegible phrase)     Rheinstein]

10)

 Natural Justice and Positive Law [Strauss]

(c) Economic (The Effects of Equality)

11)

 “Equality of Opportunity,” “Equal Starting Point” [Equality & Education]

12)

[12a]

 Equality and Incentives, “Equal Pay for Equal Work”
[Equal Bargaining Power]
“Equalising Wages”
[(I.L.O.) F.E.P.C., “Parity”, Whole Produce of Labour, Equality and Progress, Technological Change, Capital Formation]

13)

 “Just Price” [Knight]

14)

 Equality and the Family, Inheritance, Effects of Property on Inequality, “Unearned Income”

15)

 Progressive Taxation

16)

 Equality and Trade Unionism (Corporativism) [Director]

17)

 The Contribution of Welfare Economics [Friedman]

18)

 International Aspects of Equality, esp. Migration.

[Property and Inheritance]

[1) Reward & Merit]

_____________________

COMMITTEE ON SOCIAL THOUGHT
SEMINAR ON “EQUALITY AND JUSTICE”
(1950-51)

Bibliography

Lord Acton, The History of Liberty, 1904.
C. Bouglé, Les idées égalitaires, 1899.
E. F. Carrit, “Liberty and Equality,” Law Quarterly Review, 56, 1940.
F. S. Cohen, Ethical Systems and Legal Ideals, 1933.
A. V. Dicey, Relation between Law and Public Opinion, 1904.
F. D. Graham, Social Goals and Economic Institutions, 1945.
J. B. S. Haldane, The Inequality of Man.
F. A. Hayek, The Road to Serfdom, 1944 (esp. Chapt. VI).
“          Individualism and Economic Order, 1948 (First Essay)
“          “Scientism and the Study of Society,” Economica, 1942-44.
A. Huxley, Proper Studies, (Essay on Equality).
F. H. Knight, The Ethics of Competition, 1936.
“          Freedom and Reform, 1948.
J. S. Mill, Liberty, 1859.
“          Utilitarianism. 1863. (Chapt. on Justice).
Roscoe Pound, Spirit of the Common Law, 1921.
H. Sidgwick, Elements of Politics.
H. C. Simons, Economic Policy for a Free Society, 1948.
T. V. Smith, The American Philosophy of Equality, 1927.
J. F. Stephen, Liberty, Equality and Fraternity, 1874.
J. Stone, The Province and Function of Law, 1950.
R. H. Tawney, Equality, 1931.
A. de Tocqueville, Democracy in America, 1835.
“          Ancient Regime and the Revolution, 1856.
A. T. Williams, The Concept of Equality in the Writings of Rousseau, Bentham and Kant, 1907.
D. M. Wright, Democracy and Progress, 1948.

_____________________

COMMITTEE ON SOCIAL THOUGHT
Seminar on “Equality and Justice”
(Wednesday 8-10 p.m., SS 302)

PART II: Winter Quarter 1951

Provisional Date

Jan. 3

1. THE MEANINGS OF EQUALITY
D. Thompson, Equality, Cambridge University Press, 1949
R. H. Tawney, Equality, 3rd ed. London (Allen & Unwin) 1938
H. Rashdall, The Theory of Good and Evil, Oxford 1907, vol. I, ch. VIII
E. Brunner, Justice and the Social Order, New York (Harper) 1945
C. Bouglé, Les idées égalitaires, Paris 1899
G. Roffenstein, “Das soziologische Problem der Gleichheit”, Schmoller’s Jahrbuch, XLV, 1921

Jan. 17

2. VALUE JUDGMENTS AND SCIENCE. ANALYSIS OF CONFLICTS OF VALUE. TESTS OF DESIRABILITY OF SOCIAL SYSTEMS.
Max Weber, On the Methodology of the Social Sciences, ed. E. Shils, 1949.
Jan. 24

3. PRINCIPLES AND MORAL JUDGMENT. MORAL SENSE AND THE “FEELING OF JUSTICE”
J. H. Muirhead, Rule and End in Morals, Oxford 1932
J. Bonar, Moral Sense, London (Allen & Unwin) 1930
E. Riezler, Das Rechtsgefühl, Berlin (Walter de Gruyter) 1921
G. Ryle, “Knowing how and knowing that”, Proceed. Aristot. Soc., N.S. 46, 1945
Jan. 31 4. THE ETHICS OF SOCIALISM AND OF LIBERALISM
J. A. Hobson, Economics and Ethics (D. C. Heath) 1929
W. B. Gallie, “Liberal Morality and Socialist Morality”, Philosophy, XXIV, 1949
F. Tönnies, “Ethik und Sozialismus”, Archiv für Sozialwissenschaft, 1905
K. Pearson, The Moral Basis of Socialism. London 1885
Feb. 7 5. NATURAL JUSTICE AND POSITIVE LAW. CONCEPTS OF LAW AND JUSTICE
M. R. Cohen, Law and Social Order, 1933
J. Maritain, The Rights of Man and Natural Law, New York 1943
F. R. Bienenfeld, Rediscovery of Justice 1947
L. Duguit, Manuel de Droit Constitutionel, 1923
G. del Vecchio, La Guistizia, 1924 (trsl. Die Gerechtigkeit, Basel 1940)
F. S. Cohen, Ethical Systems and Legal Ideas, 1933
Feb. 21 6. THE “RULE OF LAW” (“RECHTSSTAAT”, “ETAT DU DROIT”, “STATO DI DIRITTO”) EQUALITY BEFORE THE LAW. GENERALITY OF THE LAW (“RELEVANT DISTINCTIONS”). CERTAINTY OF THE LAW
J. Stone, The Province and Function of Law, Harvard Univ. Press 1950
W. I. Jennings, The Law and the Constitution, 3rd ed. 1943
W. Friedman, Legal Theory, 2nd ed. London 1949
F. A. Hayek, The Road to Serfdom, 1944
A. V. Dicey, Law of the Constitution, 7th ed. 1908
R. Gneist, Der Rechsstaat, Berlin 1872
F. Darmstaedter, Grenzen der Wirksamkeit des Rechtsstaates, 1930
F. Battaglia, “Stato Etico e Stato di Diritto”, Rivista Internationale di Filosofia di Diritto, XVII
G. Leibholz, Die Gleichheit vor dem Gesetz, Berlin 1925
C. A. Emge, “Sicherheit und Gerechtigkeit”, Abh. d. preuss. Akad. d. Wissenschaften, Phil.-Hist. Klasse, 1940, No. 9
H. W. R. Wadem, “The Concept of Legal Certainty”, Modern Law Review, IV, 1941
Feb. 28 LAW AND THE COURTS: DIVISION OF POWERS, APPLICATION AND CREATION OF THE LAW. DUE PROCESS
Literature as under 5 and 6
Mar. 7 8. ADMINISTRATION AND DISCRETION
J. Dickinson, Administrative Justice and the Supremacy of the Law, Harvard University Press, 1927
W. Robson, Justice and Administrative Law
J. Roland Pennock, Administration and the Rule of Law, New York, Farrar & Rinehart 1941

 

Source:  Hoover Institution Archives. Papers of Friedrich A. von Hayek. Box 112, Folder 16.

Image Source: University of Chicago Photographic Archive, apf1-02719, Special Collections Research Center, University of Chicago Library.

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Chicago Economists

Chicago. Simons urges the recruitment of Milton Friedman, 1945

Simons

 

 

The atomic bomb dropped on Nagasaki was less than two weeks history and the declaration of the surrender of Imperial Japan only five days old. Nothing says “back to business as usual” at the university better than active lobbying on behalf of one’s preferred candidate for an upcoming vacancy, as we see in the following memo for the 33 year old Milton Friedman written by Henry C. Simons to the Chicago economics department chair, Simeon E. Leland. The copy of this memo comes from the President’s Office at the University of Chicago. Simons’ grand strategy was to seamlessly replace the triad Lange-Knight-Mints with his own dream team of Friedman-Stigler-Hart. He feared that outsiders to the department might be tempted to appoint some convex combination of New Dealer Rexford Tugwell and trust-bustin’ George W. Stocking Sr., economists of the institutional persuasion who were swimming on the edges of the mainstream of the time.

Economics in the Rear-view Mirror also has transcribed excerpts from an earlier 77 page (!) memorandum (10 April, 1945) to President Robert M. Hutchins from Simeon E. Leland entitled “Postwar Plans of the Department of Economics–A Wide Variety of Observations and Suggestions All Intended To Be Helpful in Improving the State of the University”.

____________________________

 

Henry C. Simons Urges his Department Chair to Recruit Milton Friedman

August 20, 1945

To: Simeon E. Leland           Economics

From: Henry C. Simons        Economics

 

If Lange is leaving, we should go after Milton Friedman immediately.

It is a hard choice between Friedman and Stigler. We should tell the administration that we want them both (they would work together excellently, each improving what the other did), Friedman to replace Lange, Stigler to replace Knight and to be with us well ahead of Knight’s retirement. We might also say that we want Hart to replace Mints at Mints’s retirement, and also to be with us in advance, but are happy to have him financed by C.E.D. [Committee for Economic Development] for the present.

Yntema evidently is thinking of getting Friedman shortly. We should exploit this possibility. Milton has now a great yen for a University post and would probably turn down an offer from C.E.D., even at much financial sacrifice, if a good academic post were the alternative (as it might be, at Minnesota or elsewhere). He is rather footloose—not anxious to go back either to the Treasury or to the National Bureau. We should grab him now, offering temporary joint appointment with C.E.D. and full-time, permanent appointment when he is through with C.E.D.

Friedman is young, flexible, and available potentially for a wide variety of assignments. He is a first-rate economic theorist, economic statistician, and mathematical economist, and is intensely interested over the whole range of economic policy. He has been outstanding in every organization where he has worked—here with Henry Schultz, at the National Bureau, at the Treasury, and now recently in the Army project at Columbia. Moreover, he is one of those rare cases of able young men who have enjoyed large experience and responsibility in Washington without being at all disqualified thereby for academic work.

The obvious long-term arrangement is a joint appointment with the Cowles Commission. Marschak would, I’m sure, like to have him; and Milton would like to settle into a major project of empirical research, e.g., on enterprise size and productional efficiency. Bartky may be expected strongly to support the appointment, for its strengthening of the University in statistics. The School of Business could well use Milton, to give its few advanced courses in statistics, if Yntema continues to price himself out of the University. Moreover, Milton probably would be delighted to work partly in the Law School, and be extremely useful there. In the Department, he would be available for statistics, mathematical economics, pure economic theory, taxation, and almost any field where we might need additional courses.

If University officers want outside testimony, they could get it from Randolph Paul or Roy Blough (as regards the Treasury), from Arthur F. Burns (National Bureau), from Abraham Wald, Allen Wallis, and Barky (as regards war research), and from Bunn at Wisconsin (as regards possible usefulness to the Law School)—not to mention George Stigler, Harold Groves, Wesley Mitchell, Simon Kuznets, Erwin Griswold, et al.

Perhaps the best thing about Milton, apart from his technical abilities, is his capacity for working as part of a team. He is the gregarious kind of intellectual, anxious to try out all his ideas on his colleagues and to have them reciprocate. He would doubtless be worth his whole salary, if he neither taught nor published, simply for his contribution to other people’s work and to the Department group as a whole. But he is also intensely interested in teaching, and far too industrious not to publish extensively. Our problem would be not that of finding ways to use him but that of keeping him from trying too many tasks and, especially, of leaving him enough time for his own research.

It would, I think, be good policy and good tactics to submit a major program of appointments, including [Frank W.] Fetter, Friedman, Stigler, Hart, and an economic historian (Innis or Hamilton), in the hope of getting them all within a few years, some on joint appointments with, notably, the Cowles Commission, the Law School, the School of Business (?) and, temporarily, the C.E.D. Research Staff. Such a program would serve to protect us against administration pressure for less good appointments (e.g.,  Stocking [George Ward Stocking, Sr., Ph.D. Columbia, 1925]), and from Hutchins’s alleged complaint that, while he wanted to consider major appointments in economics, the Department simply would not make recommendations. We should, in any case, err on the side of asking for more appointments than we can immediately get. Otherwise, available funds may go largely elsewhere—e.g., into Tugwell-like, lame-duck appointments, and into Industrial Relations, Agricultural Economics, and other ancillary enterprises, at the expense of the central field of economics.

There is, I trust, substantial agreement within the Department, on the men mentioned above. This fact, if fact it is, should be made unmistakably clear to the administration.

Incidentally, if we are going to explore possibilities of an appointment in American economic history (and I’m probably alone in opposing), we should do so only in co-operation with the History Department and with (from the outset) joint plans for joint appointments.

 

HCS-w

 

Source: University of Chicago Archives. Office of the President. Hutchins Administration. Records. Box 73, Folder “Economics Dept., 1943-45”.

Image Source: University of Chicago Photographic Archive, apf1-07613, Special Collections Research Center, University of Chicago Library.

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Courses Suggested Reading Syllabus Wisconsin

Wisconsin. Milton Friedman’s Reading Assignments in Economic Theory, 1940-1

 

 

In the previous post we have the syllabus for the summer course Economics 150 (Economic Theory) taught by James S. Earley in 1940. It is interesting to compare that syllabus with the reading assignments transcribed below for the same course as taught by Milton Friedman at the University of Wisconsin sometime during the academic year 1940-41 when Earley was on leave from the university. We see significant overlap but there are differences (e.g. Smith and Mill were added by Friedman). It is also interesting to compare this to the course “The Structure of Neoclassical Economics” taught by Milton Friedman in 1939-40 at Columbia.

_____________________

Reading Assignments in Economics 150
Instructor: Milton Friedman

*Recommended but not required.

Alfred Marshall, Principles of Economics, Book III, ch. 2, 3, 4; Book V, ch. 1, 2.
F. H. Knight, Risk, Uncertainty and Profit, ch. 3.
Frederic Benham, Economics, pp. 89-100.
*J. R. Hicks, Value and Capital, pp. 11-37.
Marshall, Book V, ch. 3, 4, 5, 12, Appendix H.
A. L. Meyers, Elements of Modern Economics, ch. 5, 7, 8, 9.
Joan Robinson, Economics of Imperfect Competition, ch. 2.
J. M. Clark, The Economics of Overhead Cost, ch. 9.
Jacob Viner, “Cost Curves and Supply Curves”, Zeitschrift fuer Nationaloekonomie, Bd. III (Sept., 1931), pp. 23-46 (in English)..
Edward Chamberlin, The Theory of Monopolistic Competition, Ch. 3, sec. 1, 4, 5, 6; ch. 5.
*M. Abramovitz, “Monopolistic Selling in a Changing Economy”, Q.J.E., Feb., 1938, pp. 191-214.
R. F. Harrod, “Doctrines of Imperfect Competition”, Q.J.E., May 1934 sec. 1, pp. 442-61.
Marshall, Book V, ch. 6.
J. B. Clark, The Distribution of Wealth, Preface, ch. 1, 7, 8, 11, 12, 13, 23.
John Stuart Mill, Principles of Political Economy, Book II, ch. 14.
J. R. Hicks, Theory of Wages, ch. 1-6.
Adam Smith, The Wealth of Nations, Book I, ch. 10.
Marshall, Book VI, ch. 1-5.
Simon Kuznets and Milton Friedman, “Incomes from Independent Professional Practice”, Bulletin 72-3, National Bureau of Economic Research, sec. 5, appendix.
F. H. Knight, “Interest,” in Encyclopedia of the Social Sciences, also in Ethics of Competition.
J. M. Keynes. General Theory of Employment, Interest and Money., ch. 11-14.

Source: Hoover Institution Archives. Papers of Milton Friedman. Box 76, Folder 6 “University of Chicago Econ. 150 [sic, “University of Wisconsin 1940-41” is correct].

Image Source: Columbia University, Columbia 250 Celebrates Columbians Ahead of Their Time.

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Chicago Columbia Economists

The Collected Works of Milton Friedman Website

 

Link to: COLLECTED WORKS OF MILTON FRIEDMAN

Formerly known as Milton and Rose Friedman: An Uncommon Couple

This website is dedicated to the work of Nobel laureate and Hoover Institution fellow Milton Friedman. It contains more than 1,400 digital items, spanning seventy-seven years, including:

  • Transcripts from the Collected Works of Milton Friedman Project, a collection of material housed at the Hoover Institution Archives compiled and edited by Deputy Director Emeritus of the Hoover Institution Charles Palm and former Hoover National Fellow Robert Leeson
  • Text, streaming video and audio, and personal images from Friedman’s personal papers and other Hoover Archives collections
  • Links to Milton Friedman content hosted on other websites

Visitors to the site can access articles and other writings by both Milton and Rose Friedman; stream the entirety of Friedman’s groundbreaking PBS series Free to Choose; and listen to hundreds of his speeches and lectures, including 206 episodes of the Economics Cassette Series, Friedman’s biweekly commentary on economic events. The site also includes links to Friedman’s writings on other websites, bibliographic citations for works by Friedman that are not currently available on the web, and more than a hundred articles and videos created in memory of Friedman on the occasion of his death in 2006 and in celebration of his hundredth birthday in 2012.

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Chicago Economists Wing Nuts

Wing-nuts. Rose Wilder Lane on Stigler and Friedman, 1946

 

Visitors to Economics in the Rear-view Mirror today have a special treat: the very first artifact in a gallery of this virtual museum dedicated to the many wing-nuts who have felt a calling to reveal the true error(s) in the ways of economists. 

At the Hoover Archives I found some fascinating letters written to the Foundation for Economic Education’s chief economist, Vervon Orval Watts  (1898-1993). Watts received his Ph.D. from Harvard in 1932 with the doctoral thesis “The Development of the Technological Concept of Production in Anglo-American Thought”.  The letters transcribed below were written by the daughter of Laura Ingalls Wilder (author of Little House on the Prairie), Rose Wilder Lane, who was asked if she would review the famous Friedman-Stigler pamphlet published by the Foundation for Economic Education in 1946, “Roofs or Ceilings? The Current Housing Problem”.

From the Stigler-Friedman correspondence scholars have been long aware of the difficulties the FEE editors had with Friedman and Stigler’s use of the word “rationing” in the context of market allocation and their willingness to discuss income distribution policy at all.  George Stigler was absolutely outraged and puzzled at such an attempt at editorial control. I am sure he would have been at least as amused as shocked by the accusations that he and Milton Friedman had been found guilty of writing a “most damnable piece of communist propaganda”.

 

On Vervon Orvall Watts:

V. Orval Watts’ obituary in the Los Angeles Times (April 1, 1993).

Watts’ 1952 Book Away from Freedom: The Revolt of the College Economists was republished by the Ludwig von Mises Institute (Auburn, Alabama) in 2008. “This book had a powerful impact on a generation — a kind of primer on Keynesian fallacies that still pervade the profession if not by that name.“

On Rose Wilder Lane:

Judith Thurman, “A Libertarian House on the Prairie, The New Yorker, August 16, 2012.

Judith Thurman, “Wilder Women: The Mother and Daughter behind the Little House Stories”, The New Yorker, August 10 & 17, 2009.

Ayn Rand’s Reception

For Ayn Rand’s reception of Rents and Ceilings, see Jennifer Burns. Goddess of the Market. Ayn Rand and the American Right. (2009), pp. 116-8.

 

____________________

From Rose Wilder Lane letter to V. Orval Watts
October 11, [1946]

“…I have re-read RENTS AND CEILINGS with the intention of reviewing it. I am appalled, shocked beyond words. This is the most damnable piece of communist propaganda I have ever seen done. And I can prove that it is, sentence by sentence and page by page. What is the Foundation doing, good God, and WHY? Honest American writers in this country are hungry and desperate, blacklisted by the solid communist front holding the publishing field; why in decency (or lack of it) does the Foundation feed a couple of borers-from-within?…the Foundation writes checks for two of the most damnably clever communist propagandists that I’ve read for a long time. I’m physically sick about it.”

 

From Rose Wilder Lane’s letter to Orval Watts,
October 22, 1946

“…As to ROOFS OR CEILINGS, I think, from internal evidence, that the authors are consciously collectivists; I suspect, from the same evidence, that they intentionally did a piece of propaganda, a piece of “infiltration.” I did not see any of this at first; it seems clear to me now. If you will remember the pictures we used to see when we were children, a picture of trees and flowers that you suddenly saw was a picture of faces or of animals, that was the change in this piece of writing. I think those two men are dangerous. I have no other evidence, I know nothing whatever about them; I am convinced that they have had communist training. I say this confidentially at present, because I have only the internal evidence of this pamphlet.

I can of course explain in detail, and will if necessary. It is a laborious job, however, to analyze and explain the argument hidden under the surface argument and to put it so clearly that you will see it, when it is done to be concealed and in so skillfully done that it is concealed and works into a reader’s mind only by its implications. It is this skill which convinced me that it was not done accidentally, that it was done by trained men. The training is intended to defeat persons like me. It does; and I am not too hopeful that it won’t, in this instance. If you feel that you can ask Ayn Rand to do this job for you, I am sure she can do it much better than I.”

Source: Hoover Institution Archives. Papers of V. Orval Watts, Box 13.

Image Source: Rose Wilder Lane, 1942. Herbert Hoover Presidential Library Museum, in Boston Globe series “Little Libertarians”.

 

 

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Chicago Courses Exam Questions Suggested Reading Syllabus

Chicago. International Trade and Finance. Jacob Viner, 1933.

 

The first four pages of written notes taken by Milton Friedman for Jacob Viner’s course, International Trade and Finance, provide something of a course syllabus and list of suggested reading assignments. The notes are undated but in his civil service job applications, Friedman provided a list of courses by university, semester or quarter and course instructor. Milton Friedman took Jacob Viner’s course during the Winter quarter (January to mid-March) of 1933. Generally Friedman’s handwriting is easy to read, knowing the context, though some checking of authors’ names was required. I provide one sample from a particulary difficult five or six lines and welcome any alternative readings. Otherwise I am extremely confident in my transcription.

Elsewhere in his files, Milton Friedman had what appears to be a later photocopy of an exam for this course. The folder is labelled “Biographical: Class Exams circa 1932-1938”. “University of Chicago” and “Milton Friedman” are handwritten on the photocopy of the original typed copy of the exam.

Don Patinkin took the same course that was still taught by Viner in 1944: the course outline, readings and some exam questions are available in an earlier post.

_____________________________

International Economic Relations: Course Description

[Economics] 370. International Trade and Finance.—This course deals with the theory of international values, the mechanism of adjustment of international balances, foreign-exchange theory, the international aspects of monetary and banking theory, and tariff theory. Prerequisite: Economics 301 or its equivalent. Winter, Viner.

 

Source: University of Chicago. Announcements. Arts, Literature and Science, vol. XXXII, no. 12 (for the sessions of 1932-33), p. 361.

_____________________________

From Milton Friedman’s Course Notes

✓Mun England’s Treasure Ch. 2, 3, 4, 5, 20, 21

✓Hume Essays Moral & Political. Vol I—Essays (of Commerce/of the Balance of Trade)

✓Viner   Early English Theories. J.P.E. June & Aug, 1930. All of June article. pp. 418-431, 442-448 in Aug. article.

 

Bullionist Controversy

✓Silbering, Fin[ancial] & Mon[etary] Policy [of Great Britain During the Napoleonic Wars] Qu. Jour of Ec 1924

✓Angell ch III & Appendix A

✓Ricardo High Price of Bullion in works also in Gonner. Ricardo’s Essays

✓Viner Canada’s Balance, pp. 191-20[last digit smeared, might be “4”]

J.P.E. Oct 1926 pp. 600-608

✓J.S. Mill Principles Bk III Ch XXIV

✓Walker Money. Ch XIX & XX

Mill Principles Book III, Ch XIX, XX, XXI, XXII

Taussig, International Trade. Ch XVII, XVIII

 

1) Canada’s Balance pp. 202-212, 145-190

Angell pp. 170-174, 505-510

2) Ohlin. Is the Young Plan Feasible? Index Feb 1930

3) Angell-Q.J.E. May 1928

Rogers in Recent Ec. Changes Vol. II, Ch. II
Taussig, Int. Trade 325-332

4) Moulton on War Debts in Schanz Festgabe [Festgabe für Georg von Schanz zum 75 Geburtstag. Tübingen: J. C. B. Mohr. 1928. 2 vols. Papers by Beckerath, Lotz, Jèze, Einaudi, Stamp, Moulton, and others.]

____________________

with respect to 1) find answer:

  1. to what factor does Viner assign & to what factor does Angell says Viner assigns the immediate responsibility for the rise in prices. Also to what fact[or] he assigns it.
  2. What role does Viner assign & what role does Angell say Viner assigns & what role does Angell assign to the expansion of Canadian Bank loans.
  3. What is order of priority acc[ording] to Viner & acc[ording] to Ang[ell] of fluctuation in Canada bank demand liabilites & outside reserves.
  4. (cf. th[eory] by Mill or Tau[ssig]) If outside reserves was held as gold in Canada what role in the mechanism would the classical theory assign to them

 

Comparative Costs

Ricardo-Principles ch 7

Viner Welt-Archiv Oct, 1932

____________________

Manoïslesco Theory of Protection [Reviewed by Viner in JPE, Feb. 1932, pp. 121-125]

Grunzel Joseph. Handbuch der internationalen Handelspolitik (probably)]

Cherbuliez [, Antoine] Précis de la Science E., pp. 375-391

Walras “Théorie du Libre Échange. Revue d’Économique Politique XI (1897) pp. 651-664

or ‘Études d’Éc. Pol. Applique, pp. 286-304 [1898 reprint of previous article].

Pareto-Cours

Angell

Taussig. Int. Trade

Weber, Alfred. “Die Standortslehre und die Handelspolitik Archiv für Sozial. XXXII (1911) 667-688
____________________
Choose one & in about 10 days give appraisal thereof.

J.S. Mill Principles Bk III Ch XVII XVIII

Marshall. Money Credit & Commerce Bk III Ch VI, VII, VIII Appendix J[?] pp. 330-342

Terms of Trade

Taussig: Int. Trade see Index under Barter Terms of Trade.

Yntema Ch. 5.

Wilson Capital Imports, Ch 4.

Depreciated Paper

Taussig, Int. Trade 336-408

Graham Exchange Prices & Prod. in Germany. 97-99; 117-149

Cassel Money & Foreign Exchange after 1914, pp. 137-186

Cassel The Treatment of Price Problems. Ec J. Dec 1928

Ohlin International Trade Relations. Index Aug 1930

Bastable. Theory of Int’l Trade Ch 6.

League of Nations. [Financial Committee] Report of Gold Delegation, 1932 [Official no.: C.502.M.243.1932.II.A]

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Read letter in last issue of Economica of a letter on the true something or other.

 

Source: Hoover Institution. Milton Friedman Papers, Box 120, Bound notes (Economics 370/J. Viner/10 a.m. S.S.B. 107).

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Final Exam Questions Winter Quarter 1932-33

Economics 370

  1. Write notes on the following:
    1. “Increasing Returns” and the Comparative Cost Doctrine
    2. The “Law of Reciprocal Demand” and the “Equation of International Exchange.”
    3. The possibilities of partial specialization under free trade.
  1.       a.  Discuss the part played by international shifts in money incomes in adjusting balances of payments to international capital movements.
    b.  Explain briefly the part played in the lending country in connection with the same process by bank deposits and by bank loans.
  2. “The principles governing the rate of exchange may be illustrated by the following mechanical example. Represent two countries by two cisterns, and their stock of legal tender money by water, so that the depth of the water in either cistern may be taken to be the general level of prices in the corresponding country. If water cannot pass from either cistern to the other any divergence of depth may be produced at will by adjusting the respective quantities of water in them. This corresponds to the case of countries with independent currencies. If, however, the water can flow through a pipe leading from the base of one cistern to the base of the other, the depths in the two cisterns will always be identical.”
    Hawtrey, Good and Bad Trade, 1913, pp. 109-110.
    Comment briefly.

 

Source: Hoover Institution. Milton Friedman Papers, Box 115, Folder 13. “Biographical: Class Exams circa 1932-1938”.

Categories
Chicago Courses Syllabus

Chicago. Graduate Price Theory. Economics 300A. Harberger, 1955

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Thus far Economics in the Rear-View Mirror has been able to provide syllabi for the following four professors who had taught the first core price theory course at the University of Chicago spanning nearly a quarter of a decade during the middle third of the 20th century:

Today I add the syllabus for Arnold Harberger (a.k.a.”Triangle Man”, see the photo credit below). Note: chapters from Samuelson’s Foundations are only recommended readings, not yet required.

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Economics 300A
Mr. Harberger
Autumn 1955

 

Texts:

  1. Alfred Marshall, Principles of Economics, 8th
  2. George Stigler, Theory of Price, revised ed.
  3. H. Knight, The Economic Organization

 

Supplementary material (Purchase not required):

  1. American Economic Association, Readings in Price Theory
  2. Milton Friedman, Essays in Positive Economics
  3. Milton Friedman, Notes on Lectures in Price Theory (mimeographed)

Students are expected to be familiar with the materials in Stigler’s Theory of Price before entering the course. Readings marked with an asterisk (*) are recommended, not required.

 

Reading List

 

  1. Introduction:

Knight, The Economic Organization, pp. 1-37
Stigler, Theory of Price, Chs. 1-3
Friedman, “The Methodology of Positive Economics” in Essays in Positive Economics

  1. Demand:

Stigler, Theory of Price, Chs. 4-5
Marshall, Book III, Chs. 2-4, Book V, Chs. 1-2
Knight, Risk, Uncertainty and Profit, Ch. 3
Hicks, Value and Capital, pp. 11-52
Working, “What do Statistical Demand Curves Show?” Quarterly Journal of Economics
*Samuelson, Foundations of Economic Analysis, Ch. 5

  1. Supply:

Stigler, Theory of Price, Chs. 6-8
Marshall, Book V, Chs. 3-5, 12, Appendix H
Robinson, Joan, Economics of Imperfect Competition, Ch. 2
Clark, J.M., Economics of Overhead Costs, Ch. 9
Viner, “Cost Curves and Supply Curves”, Zeitschrift fuer Nationaloekonomie, Book III (Sept 1931) pp. 23-46, reprinted in Readings in Price Theory, pp. 198-232
*Samuelson, Foundations of Economic Analysis, Ch. 4

  1. Market Organization:

Stigler, Theory of Price, Chs. 9-13
Stigler, “Monopolistic Competition in Retrospect” in Five Lectures on Economic Problems
Harrod, “Doctrines of Imperfect Competition”, Quarterly Journal of Economics, May 1934, pp. 442-461
Chamberlin, The Theory of Monopolistic Competition, Chs. 3, 5
*Robinson, E.A.G., The Structure of Competitive Industry
*Robinson, E.A.G., Monopoly.

  1. Utility and Welfare Economics:

Alchian, “The Meaning of Utility Measurement”, American Economic Review, March 1953, pp. 26-50
Friedman and Savage, “The Utility Analysis of Choices Involving Risk”, Journal of Political Economy, August 1948, pp. 279-304. Reprinted in Readings in Price Theory, pp. 57-96
Scitovsky, “The State of Welfare Economics”, American Economic Review, June 1951, pp. 303-315
Hicks, “The Four Consumers’ Surpluses”, Review of Economic Studies, XI (1943-44), pp. 31-40
*Hotelling, “The General Welfare in Relation to Problems of Taxation and of Railway and Utility Rates,” Econometrica (VI) (1938), pp. 242-269
*Samuelson, Foundations of Economic Analysis, Chs. 5-7

 

Source: Hoover Institution Archives. Papers of Milton Friedman, Box 77, Folder “77.1 University of Chicago Econ 300 A & B”.

Image Source: “[Arnold] Harberger strips down to reveal himself as “Triangleman” at the University of Chicago Economics Christmas Party, probably December 1970”. Robert J. Gordon’s website.

Categories
Chicago Fields Regulations

Chicago. Doctoral Field Exams Schedule for the Friedmans, Stigler, Wallis. 1935

Milton Friedman, Rose Friedman née Director, George Stigler, and W. Allen Wallis all took some of their doctoral field examinations at the University of Chicago in the Spring Quarter of 1935. The names of the examiners and the other examinees can be seen from the mimeographed page I found in George Stigler’s papers at the University of Chicago Archives. I have included in this post the field examination requirements for doctoral students in economics from the annual Announcements published for the 1934-35 academic year.

______________________

 Three Field Examinations for Doctorate

“The candidate is expected to have general training in the important fields listed below and to specialize in three fields, one of which must be Economic Theory, including Monetary and Cycle Theory, and another must be the field of his thesis. The fields to be chosen (in addition to Economic Theory) may be taken from (1) Statistics; (2) Accounting; (3) Economic History; (4) Finance and Financial Administration; (5) Government Finance; (6) Labor and Personnel Administration; (7) Trusts and Public Utilities; (8) International Economic Relations; (9) some other field proposed by the candidate. A field proposed by the candidate may be in Economics or in another social science, the arrangement in either case being made with the Department of Economics. It is desired to develop that program of work which best meets the needs of the individual student. This usually involves the election of some courses in other departments and possibly the development of a field in another social science as a substitute for one of the fields in economics.

“The candidate’s grasp of his three fields of specialization is tested by preliminary written examinations which must be passed to the satisfaction of the Department before admission to candidacy. The final oral examination is on the field of concentration and on the thesis. The written examinations can be taken in one quarter or they can be divided between two quarters, not necessarily consecutive quarters, at the option of the candidate. The written examinations are given in the sixth, seventh, and eighth weeks of the Autumn, Spring, and Summer quarters. The written examination in general economic theory, including monetary and cycle theory, is in two parts and will require five hours in all. The written examination in each of the other fields requires from three to four hours. Notice of intention to take any written examination must be filed with the Department at least three weeks before the examinations begin. In written examinations for the doctorate the questions cover both the theoretical and administrative aspects of the field.”

 

Source: Announcements. The University of Chicago. The College and the Divisions for the Sessions of 1934-35, pp. 283-4.

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DEPARTMENT OF ECONOMICS

SCHEDULE FOR PRELIMINARY EXAMINATIONS FOR THE DOCTORATE

Spring Quarter, 1935

The schedule below shows the preliminary examinations requested for the current quarter. Will the Chairman of each Committee please be responsible for turning in the complete examination by at least one week before the date on which it is to be given?

Dates Examinations Committees Students Enrolled
Saturday, May 11
8:30, S.S.R. 417		 Economic Theory
(New Plan)		 Viner, Chairman
Schultz
Yntema
Knight		 Friedman, M.
Shohan, C.J.
Stigler, G.J. (Brookings)
Wallis, W.A.
1:30, S.S.R. 417 Monetary and Cycle Theory Mints
Cox
Saturday, May 18
8:30, S.S.R. 417		 Financial System and Financial Administration Mints, Chairman
Cox
Meech
Gideonse		 Curtis, C.H.
Shohan, C.J.
Saturday, May 18
8:30, S.S.R. 417		 Government Finance Leland, Chairman
Simons		 Stigler, G.J. (Brookings)
Saturday, May 18
8:30, S.S.R. 417		 Statistics Schultz, Chairman
Cover
Yntema		 Director, R.
Friedman, M.
Jacoby, N.H. (Springfield)
Saturday, May 25
8:30, S.S.R. 417		 Economic History Wright, Chairman
Nef
Knight		 Ostrander, F.T. (Williams)
Shohan, C.J.

 

Source: University of Chicago Archives, George Stigler Papers Addenda, Box 33, Folder “1935 Univ. of Chicago, Class Notes (Gray binder)”.

Image Source: Rose and Milton Friedman. From The Prodos Blog.

 

Categories
Chicago Economists

Chicago. Talent-Scouting for New Faculty, Joint Appointments and Visiting Faculty, 1945

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On April 10, 1945, the chairman of the University of Chicago’s economics department, Professor Simeon E. Leland, submitted a 77 page (!) memorandum to President Robert M. Hutchins entitled “Postwar Plans of the Department of Economics–A Wide Variety of Observations and Suggestions All Intended To Be Helpful in Improving the State of the University”.

In his cover letter Leland wrote “…in the preparation of the memorandum, I learned much that was new about the past history of the Department. Some of this, incorporated in the memorandum, looks like filler stuck in, but I thought it ought to be included for historical reasons and to furnish some background for a few of the suggestions.” 

In recent posts I have provided a list of visiting professors who taught economics at the University of Chicago up through 1944 (excluding those visitors who were to receive permanent appointments) and supporting tables with enrollment trends and faculty data (ages and educational backgrounds).

In this post we have three lists of names for economists who in 1945 could be taken into consideration for either permanent economics, joint appointments with other department or visiting appointments at the University of Chicago. Many names are immediately recognisable, others less so, and other known names left unnamed. Instead of observing the actual choices of the department, we have, so to speak, an observation of the “choice set” as perceived by the department.

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          The following list of possible additions to the staff of the Department of Economics represents an enumeration of suggestions made by various members of the Department. It, of course, does not include all of those whom the Department would like to invite as permanent members of the University staff. Many of those whom we would most like to have, it is well-known, are not available; nor can the Department be sure that those listed below would favorably consider an invitation to join our staff. Likewise, this list must not be construed as nominations for membership in the Department. Some members of the staff are known to object to the inclusion of some of the names listed below. But if unanimous consent were required before suggestions could be made, little progress in building a Department would be possible. In its present state, the list is only an enumeration of suggestions warranting further inquiry. The fields of interest of many of the potential candidates overlap and the appointment of some individuals would make it undesirable, or at least uneconomic, to appoint others. Nevertheless, the list does given an idea of some persons who might be considered for future appointments. This list, like any other enumeration, is subject to constant revision, both in the addition or subtraction of names.

Name

 Present Location

Field of Interest or Specialization
Abraham (sic) Bergson University of Texas Wages and Wage Theory
Robert Bryce Ottawa, Canada
Norman Buchanan University of California Public Utilities, Corporation Finance, Business Cycles (also possible interest in United States Economic History)
Earl Hamilton Northwestern University Economic History
Albert G. Hart C.E.D., Chicago Theory, Finance, etc.
J. R. Hicks University of Manchester, England Economic Theory
Harold A. Innis University of Toronto Economic History
Maurice Kelso University of Wisconsin Land Economics
Tjalling Koopmans Cowles Commission Statistics; Mathematical Economics; Business Cycles; Shipping
Simon Kuznets University of Pennsylvania National Income; Historical Statistics
Sanford Mosk University of California Economic History
Charles A. Myers Massachusetts Institute of Technology Labor; Industrial Relations
Walter Rostow Columbia University Economic History (XIX Century)
Leonard Salter University of Wisconsin Land Economics
T. Scitovszky London School of Economics; U.S. Army Theory of Capital and Interest; Theory of Tariffs
Arthur Smithies University of Michigan; Bureau of the Budget, Washington, D. C. Fiscal Policy; Theory; Money and Banking
Eugene Staley School of Advanced International Studies (Washington, D.C.) International Economics; Foreign Trade
George Stigler University of Minnesota Theory and Foreign Trade
R. H. Tawney London School of Economics Economic History
Allen Wallis Stanford University Statistics

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Joint Appointments

The Department of Economics shares an interest in many fields with other departments, schools and divisions of the University. It recognizes that most problems of the Social Sciences have economic aspects, and other aspects as well. Many of the fields embraced within particular disciplines are explained by accident or tradition, not always by logic. No one department can, therefore, assert a valid claim for the exclusive staffing of fields of interest held in common with other branches of knowledge. It seems wisest to develop these common grounds through joint appointments. Not only does this enable us to attract to the University more outstanding scholars than the fellowship of one department might provide, but it should also place at the disposition of those interested in promoting joint fields, perhaps, larger resources than either acting alone could command.

Joint appointments, too, will tend to integrate the Social Sciences with the other schools and departments affected, as well as contribute to the unity of the University as a whole. The Department of Economics, therefore, ventures to suggest joint appointments in the following fields:

Fields Units Affected
Trusts and Monopolies Business, Law, Economics
Railroads and Transportation Business, Economics
Public Utilities Economics, Political Science, Law
Social Control of Business Business, Law, Political Science, Economics
Advanced Applied Mathematics and Statistics Economics, Mathematics, Business, Institute of Statistics, other departments interested in statistics
Urban Planning (or the Utilization of Land) Geography, Political Science, Economics, Law, Business, Sociology
Social Legislation, particularly affecting Labor Business, Sociology, Social Service Administration, Law, Political Science, Economics

[…]

Among those who might be proposed for joint appointments are the following:

Name Present Location Field of Interest Appropriate Appointment
Charles L. Dearing Brookings Institution and U.S. Government Transportation Economics, Business
Corwin D. Edwards Northwestern University Trusts, Monopolies, Control of Business Political Science, Law, Economics
Milton Friedman Columbia University Economic Theory, Public Finance, Monetary Policy Economics, Institute of Statistics
Homer Hoyt Regional Plan Association, Inc., New York, N.Y. Land Planning Economic Geography, Political Science
David E. Lilienthal T. V. A. Public Utilities Political Science, Law, Economics
Abraham Wald Columbia University Applied Mathematics, Statistics Mathematics, Economics
Allen Wallis Columbia University Applied Mathematics, Statistics Mathematics, Economics
Samuel S. Wilks Princeton University Applied Mathematics, Statistics Mathematics, Economics

Visiting Professorships

Each department needs to diversify its courses. Too frequently the attempt at diversification is made by adding permanent members to the regular staff. The need can best be met by the appointment of visiting professors.

[…]

A list of some who might be invited to the University as Visiting Professors is as follows:

Name Present Location Fields of Interest
John D. Black Harvard Agricultural Economics
(J.) Roy Blough U. S. Treasury Public Finance
Kenneth Boulding Iowa State College Economic Analysis; Theory of Capital
Karl Brandt Food Institute, Stanford U. Agricultural Economics
Harry G. Brown University of Missouri Economic Theory, Public Finance
J. Douglas Brown Princeton University Industrial Relations
Edward H. Chamberlain(sic) Harvard Economic Theory; Monopolistic Competition
J. M. Clark Columbia University Economic theory
J. B. Condliffe California International Trade; International Commercial Policy
Joseph S. Davis Food Institute, Stanford U. Agricultural Economics
Milton Gilbert Office of Price Administration, Washington, D.C. Economic Theory; Price Control
T. Haavelmo Norwegian Shipping Administration, New York, N.Y. Econometrics
Alvin Hansen Harvard Economic Theory; Fiscal Policy
F. A. Hayek London School of Economics and Political Science History of Social Thought; Economic Theory; Monetary Policy
J. R. Hicks University of Manchester Economic Theory
George Jaszy U. S. Dept. of Commerce National Income; Business Analysis
O. B. Jesness University of Minnesota Agricultural Economics
Nicholas Kaldor London School of Economics Theory of the Firm; Imperfect Competition; Money; Business Cycles
M. Kalecki Institute of Statistics of University of Oxford, England Economic Fluctuations; Expenditure Rationing
M. Slade Kendrick Cornell University Public Finance; Farm Taxation
Arthur Kent San Francisco Attorney-at-Law Taxation
J. M. Keynes Cambridge University Fiscal and Monetary Policy
Simon S. Kuznets National Bureau of Economic Research; University of Pennsylvania Statistics; National Income and Its Problem
A. P. Lerner New School for Social Research Economic Theory; Fiscal Policy; Public Finance
Edward S. Mason Harvard University Economic Theory; International Trade and Trade Practices
Wesley C. Mitchell Columbia University Money and Prices
Jacob Mosak Office of Price Administration, Washington, D.C. Economic Theory; Statistics; Control of Prices
R. A. Musgrave Federal Reserve Board, Washington, D. C. Public Finance
Randolph Paul Lord, Day and Lord, Attorneys-at-Law Taxation
Paul A. Samuelson Massachusetts Institute of Technology Economic Theory; Money and Banking; Fiscal Policy
Lawrence H. Seltzer Wayne University Money and Banking; Public Debts; Fiscal Policy
Carl S. Shoup Columbia University Public Finance
Sumner H. Slichter Harvard University Business Economics
Richard Stone England Statistics; National Income
R. H. Tawney London School of Economics Economic History
Abraham Wald Columbia University Mathematics and Statistics
John H. Williams Harvard University Money and Banking

In the past, the Department has supplemented its staff by the appointment of visiting professors, but the invitations have ordinarily been restricted to the Summer Quarter in order (1) to relieve the regular staff from summer teaching and (2) to provide “window-dressing” to make the Summer Quarters more attractive to new students. The potentialities of the visiting professorship can hardly be realized when the practice is applied only to the Summer Quarter. That it has made that Quarter more attractive would seem to be indicated by the outstanding economists who have been guests of the University of Chicago.

[…]

The practice of inviting outstanding men to the University of Chicago seems to have been more prevalent in the early years of the University than it is today. Visiting appointments also declined with the strained finances of the University during the late depression. The Department is anxious to develop a program of instruction and research based upon the policy of the regular employment of visitors. A sum, equal to the stipend of a full professor, if used to finance a program of regular visitors, would add greater content and prestige to the Department than could be secured in any other way.

Source: University of Chicago Library, Department of Special Collections. Office of the President. Hutchins Administration Records. Box 73, Folder “Economics Dept., “Post-War Plans” Simeon E. Leland, 1945″.

Categories
Chicago Curriculum Fields

Chicago. Gordon, Fischer and Friedman Memos on Money Core Courses. 1972

When Milton Friedman went on leave from the University of Chicago in 1971-72, two assistant professors who had received their Ph.D.’s from M.I.T. were left minding the two core courses in “money” (a.k.a. “macroeconomics”) at Chicago. In this post I first provide the course listings and staffing for the core fields and then the transcription of an exchange of memos between Robert J. Gordon and Stanley Fischer (the two assistant professors just mentioned) on the one hand and their senior colleague Milton Friedman on the other.

The (then) young colleagues have tread most gingerly in the matter of overhauling the Chicago money courses. Friedman for his part has given them a “revise-and-resubmit” sort of response for their efforts. Perhaps Economics in the Rear-View Mirror will get lucky and receive a comment from Messrs. Gordon and Fischer about their memos’ ultimate impact on the Chicago core.

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Graduate Courses in 1971-72
Core Fields and Faculty

PRICE THEORY

300. Price Theory. McCloskey.
301. Price Theory. Becker, Evenson, Harberger.
302. Price Theory. Becker, H. Johnson
303. General Equilibrium Theory. Mundell.
307. Mathematical Methods in the Social and Administrative Sciences. Theil.
309. The Theory of the Allocation of Time. Ghez, Becker.

 

THEORY OF INCOME, EMPLOYMENT, AND THE PRICE LEVEL

330. Money: The Supply Side. Gordon
331. Money. Fischer, Telser.
332. Theory of Income, Employment, and the Price Level. Sjaastad, Zecher.
337.  Special Topics in Monetary Theory. Fischer.

 

 

 

Becker, Gary (Ph.D., Chicago, 1955; John Bates Clark Medal Winner, 1967). University Professor of Economics (at Chicago since 1970).
Recent research: Investment in human capital; the allocation of time; household production functions and non-market behavior; marriage and fertility; law and economics.

Evenson, Robert E. [visiting faculty] (Ph.D., Chicago, 1968; Associate Professor of Economics, Yale).
Recent research: economic development and agriculture.

Fischer, Stanley (Ph.D., M.I.T., 1969). Assistant Professor of Economics (at Chicago since 1969).
Recent Research: Monetary growth models; lags and stabilization policy; trade and capital flows.

Friedman, Milton [on leave, 1971-72] (Ph.D., Columbia, 1946; John Bates Clark Medal Winner, 1951; President of A.E.A., 1967). Paul Snowden Russell Distinguished Service, Professor of Economics (at Chicago since 1946).
            Recent Research: The optimum quantity of money; secular and cyclical changes in money and income; a theoretical framework for monetary analysis.

Ghez, Gilbert (Ph.D., Columbia, 1970). Assistant Professor of Economics (at Chicago since 1969).
Recent Research: A theory of life-cycle consumption; consumption and labor force participation; effects of education on consumption patterns.

Gordon, Robert J. (Ph.D., M.I.T., 1967). Assistant Professor of Economics (at Chicago since 1968).
Recent Research: Labor market theory and inflation; econometric models of wage and price determination; problems in measurement of capital.

Harberger, Arnold C. (Ph.D., Chicago, 1950). Professor of Economics (at Chicago since 1953).
Recent Research. Applied welfare economics; measurement of social opportunity costs of labor, capital, and foreign exchange; taxation and resource allocation.

Johnson, Harry G. (Ph.D., Harvard, 1958). Professor of Economics (Joint appointment with London School of Economics) (at Chicago since 1959).

Recent Research: Theory of international inflation; theory of effective protection; the two-sector model of general equilibrium; Keynesianism and monetarism.

McCloskey, Donald (Ph.D., Harvard, 1970). Assistant Professor of Economics (at Chicago since 1968).
Recent Research: Topics in the application of economics to British economic history; the Old Poor Law as a negative income tax; the economic effects of Britain’s move to free international trade.

Mundell, Robert (Ph.D., M.I.T., 1956). Professor of Economics (at Chicago since 1965).
Recent Research: Monetary systems and economic development; world inflation and unemployment; African currency systems; global trade policy.

Sjaastad, Larry A. (Ph.D., Chicago, 1961). Associate Professor of Economics (at Chicago since 1962).
Recent research: Project evaluation in underdeveloped countries; economics of research.

Telser, Lester (Ph.D., Chicago, 1956). Professor of Economics (at Chicago since 1958).
Recent research: Theory of competitive markets; game theory; the theory of the core; economics of information; determinants of the returns to manufacturing industries; equilibrium price distributions.

Theil, Henri (Ph.D., Amsterdam, 1951). University Professor of Economics (at Chicago since 1965).
Recent research: Econometric methodology and applications; mathematical and statistical methods in other social and administrative sciences.

Zecher, Joseph Richard (Ph.D., Ohio State, 1969). Assistant Professor of Economics and Director of the Undergraduate Program (at Chicago since 1968).
Recent research: Models of commercial banking; interest rates and expectations.

 

Source: Economics at Chicago (Departmental Brochure, 1971-72), p. 23, 26-30. This copy of the brochure found in the Hoover Institution Archives. Papers of Milton Friedman. Box 194, Folder 4.

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UNIVERSITY OF CHICAGO

May 22, 1972

 

To: Department of Economics Faculty
From: R. J. Gordon

Re: First Year Money Sequence

Stan Fischer, Dick Zecher, and I would like to propose the following reorganization of the topics taught in the first year graduate money-macro sequence. We have long felt that the present organization is suboptimal because (1) the student is taught two approaches to static income determination, one in 331 and one in 332, without sufficient coordination and integration of the two approaches, and (2) the separation between money supply in 330 and money demand in 331 does not work well, because money demand is involved in most of the topics covered in 330. The following reorganization puts static income determination of both the Quantity Theory and Keynesian varieties into course no. 1, in the sequence, then combines the money demand theory from the present 331 with the most important topics in the present 330 in course no. 2, and creates a third course devoted to dynamic topics.

We would like reactions, suggestions, and ideas. Presumably each course would be given twice on a staggered schedule.

 

COURSE NO. 1, to be called 331
taught in Fall and Winter

Static Income Determination in the style of Bailey and Patinkin
Elements of National Income Accounting
Doctrinal history and issues: General Theory, Patinkin vs. Friedman, Leijonhufvud
Theory of Consumption Function
Theory of Investment Behavior from Wicksell to Jorgenson

 

COURSE NO. 2, to be called 330
taught in Fall and Spring

Money demand theory
Tobin-Markowitz approach to portfolio allocation
Money supply theory
Financial intermediaries
Term structure and debt management
Modigliani-Miller and other issues in capital market theory

 

COURSE NO. 3, to be called 332
taught in Winter and Spring

Neoclassical nonmonetary growth models
Monetary growth models in the style of Foley-Sidrauski
Optimum Quantity of Money and welfare economics of inflation
Stability of inflation in Cagan-Mundell-type models
Multiplier-accelerator cycle models, simple inventory models
Models of Labor Market and Inflation
Simple models of open economies (could go in course no. 1)

 

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UNIVERSITY OF CHICAGO

Date: July 20, 1972

To: Professor Robert J. Gordon, Department of Economics
From: Milton Friedman, Department of Economics

In re: Your Memo of May 22 on First-Year Money Sequence

 

I have been hesitant to react to your schedule of topics both because I believe a teacher must decide for himself what he is going to teach but also because my reactions naturally derive from my own experience in teaching these courses and I have not re-thought the question afresh, particularly not in the light of 330.

Nonetheless for what they are worth, let me give my offhand reactions. The basic thing that disturbs me about all three courses is that they are set up as a series of separate topics with no organizational structure in them. For both the monetary approach and the income expenditure approach there is a clear logical structure which it seems to me it is desirable to use in organizing the material. For money as for price theory the obvious structure is the demand for money, the supply of money and the equilibrium produced by their interaction. In Course 2 called 330 you have the elements of money demand theory and money supply theory, but they are put in as if they were on the same level as approaches to portfolio allocation, financial intermediaries, term structures, and the like. Obviously they are not. If financial intermediaries have any relevance to the theory of money it is because they partly enter into the money supply process; it is partly because they may affect the demand for money. Similarly, the Tobin-Markowitz approach to portfolio allocation is simply a fuller exploration of the individual decisions that underlie the demand for money. Similarly, in the income expenditure approach the logical organization has to do with aggregate demand on the one hand and aggregate supply on the other side and their interactions. Consumption theory and investment theories of income then become components of aggregate demand.

I can understand elements of national income accounting and institutional and descriptive material about the monetary and banking system coming early in the courses and preceding the kind of formal theoretical apparatus that I have been talking about, but I find it hard to see the optional history and issues coming where they do in your outline. It seems to me that the desirable thing in these courses is to teach, as best we can, the substance of what we know and believe to be the correct theory. The history of the thought enters in both in introducing and motivating the discussion; also it has always seemed to me desirable that so far as possible we should use the writings of the great men in the field to develop the points that remain valid out of their writings, and finally at the very end I can see where in discussing where we go from here and what the open issues are it is desirable to bring out the question of current and past controversies.

In connection with Course 3, that also seems to be a collection of topics. It is very hard for me to see the organizational structure that underlies it. Presumably what really is in the back of this is the notion that Courses 1 and 2 will deal with static equilibria opposition and Course 3 will deal with dynamic change. But yet that doesn’t quite fit the role of the optimum quantity of money and the welfare economics of inflation. What precisely is a logical structure underlying this? Indeed let me repeat that question for all three courses.

Needless to say, there is more than one organization that would be logically coherent and would be effective in teaching the material within these three courses, so I don’t mean to put any special weight on the one I outlined above, but I do believe that you need to bring the skeleton of your organization more clearly in the open than it is brought in the list of topics in these three courses. Incidentally, one minor item is that I do not see anywhere in any of the topics where quantity equations à la Irving Fisher, Marshall, and the early Keynes would be discussed at all.

(Dictated but not read)

MF:gv

______________________________

 

UNIVERSITY OF CHICAGO

Date: July 26, 1972

To: Milton Friedman, Department of Economics
From: Bob Gordon and Stan Fischer, Department of Economics

In re: First Year Money Sequence

Thanks for your memo to Bob of July 20th. Before reacting to your comments in more detail, let us attempt to restate the aims of the proposed revision. There were two major problems with the previous arrangement: (i) overlap of material in 330 and 331, (ii) 332 as a separate course was taught either as a hodge-podge of topics or as Keynesian multipliers run riot – by the time students had got through 331 the excuse for a separate income-determination course was slim.

The basic organizational structure, which the memo admittedly did not spell out, is based on the use of a common static model, as in Patinkin, Bailey, and equations (9) – (14) of your 1970 piece – as a starting point for discussion of both monetary and income-expenditure approaches (in 331). Once the basic issues are discussed in the framework of the common model – and this will occupy much of the 331 course – the examination of the building blocks of the model will begin. Since more time is needed for the building blocks than remains in 331, some pieces had to be placed in another course and it seemed sensible to separate out money supply and money demand. This makes 330 a self-contained course with the unifying principle that each topic contributes to a model of the monetary and financial markets, whereas the building blocks allocated to 331 are those of the commodity market. The placement of the labor market in the third course is the most arbitrary decision; it should probably be shifted to 331 so that the interaction between aggregate supply and demand can be adequately developed. (Incidentally, we apologize for giving the impression that each topic mentioned is to be given equal weight – we had in mind precisely the considerations mentioned in the second half of your second paragraph in writing, for instance, “Money demand theory” followed by “Tobin-Markowitz….”)

The idea in course 3 is indeed to emphasize dynamic elements. Here the intention is to use a simple common dynamic model, which has naturally to involve expectations and intertemporal maximization, and examine its behavior under a variety of assumptions on expectations etc. This leads naturally into the other topics mentioned in 3 – with the exception of the multiplier-accelerator and inventory models which tend to be sui generis and hard to fit into the overall scheme. (The open economy models also do not fit in very well.)

On your specific comments:

  1. We also realize that each teacher decides what he wants to teach, but in view of the facts that these are the basic money courses and that students take them from different people, we feel it important to try to have some uniformity of coverage.
  2. On the history of thought: we too use this to introduce and motivate the theories and we intend that it permeate the courses rather than be discussed in the middle of 331, as our memo now indicates.
  3. The optimum quantity of money comes right out of discussions of intertemporal optimization by individuals (as in your article) and it does seem that the “Dynamic” course is a good place to discuss it.
  4. The early quantity theorist’ views will obviously be discussed in great detail in the demand for money side of 330, and also in 331; this was one of the sub-topics we intended to be included under the 331 heading “doctrinal history.”

We would very much appreciate your commenting on this since we ourselves discussed several alternative organizations for the courses, and are far from certain that our proposal is optimal. Indeed, in the light of the fact that, as you say, everyone teaches what he wants, we felt some diffidence in making our proposal. But we do think it important to have some generally-greed-upon division of material for the three courses, if only to be fair to the students faced with the Core exam.

Source: Hoover Institution Archives. Milton Friedman Papers. Box 194, Folder 5.

Image Source: Milton Friedman (undated). University of Chicago Photographic Archive, apf1-06230, Special Collections Research Center, University of Chicago Library.