Tag: Tobin

The Yale Economics Department:
Memories and Musings of Past Leaders

M. Ann Judd, Business Manager/Research Associate
Economic Growth Center

As beauty is in the eye of the beholder, so one’s view of history is often influenced by one’s own role in that history as well as by the roles of one’s fellow actors. The history of the Yale Economics Department is more than a collection of dates and facts and is probably best told by those who lived it, were changed by it, and, in turn, shaped it. Among the important players in this history were James Tobin, Richard Ruggles, William Parker, Merton J. Peck, Richard Levin, and William Brainard. Their reminiscences give a flavor for the department over the past 50 years. Each man brought special talents and qualities to the department; each has taken away a unique set of memories of the people and events that defined the department for him. Within each unique set of memories, however, some common threads emerge: Lloyd Reynolds’ important contributions to building the department from being second-rate to one of the strongest in the country; the arrival of the Cowles Foundation and its impact on the department; the creation of the Economic Growth Center; the turmoil of the sixties; the downsizing in the seventies and eighties; and the many factors that give Yale’s Economics Department its distinctive character.

Introduction

The history of the department has been set forth by Lloyd Reynolds in “Economics at Yale, 1940-1990.” According to Reynolds, both the study of economics and the department itself have undergone major changes since the teaching of economics at Yale began with the appointment of Irving Fisher in 1891. Many of the changes in the department began around the time that Reynolds himself joined the department in 1945. The department of the 1920s and 1930s lacked a clear identity due in part to the fact that some of the “economics” faculty were members of the Department of Political and Social Science (which included several sub-disciplines – economics, government, anthropology and sociology), and some were members of a small Department of Applied Economics at the Sheffield Scientific School. These applied economists generally did not have formal training in economics and were more business and practically oriented. In 1937, a major restructuring of the university merged the faculties of Sheffield and Yale College into a single Faculty of Arts and Sciences under a single dean. This process resulted in the creation of a separate Department of Economics, which brought together economists from the Department of Political and Social Science and applied economists from Sheffield.

Although there was a group of younger economists in the department in the mid-1940s, which included, in addition to Reynolds, John Miller, Max Millikan, Harold Williamson, and Ralph Jones, the decision-making in the department was dominated by what Reynolds refers to as the “ice cap.” This group consisted of older, conservative professors, eulogized by William F. Buckley, Jr. in his God And Man At Yale, who were prone to regard younger economists as being dangerously liberal. However, they had control over appointments and promotions, which meant that the atmosphere for junior faculty at Yale was relatively discouraging. In the forties, the power of the “ice cap” began to melt, and Kent Healy, who was chair in the mid- to late-1940s, began the process of strengthening the department. In the early postwar period, he brought in a very strong group of younger faculty members, many of whom were later to make major contributions to the department: Neil Chamberlain; Challis Hall; Charles E. Lindblom; Warren Nutter; Richard Ruggles; and James Tobin.

Reynolds describes the period between 1950 and 1965 as one of great expansion. During this period, the number in professorial ranks tripled, the annual expenditures for teaching and research increased from $118,000 in 1951-52 to over $1 million in 1965-66, and the department achieved a ranking of either first or second in the country. Also during this period the Cowles Foundation moved to Yale, very strong faculty members were recruited, the Economic Growth Center was founded, and there was an abundance of foundation money.

In 1951, the department had five full professors; by 1954 there were eleven. This was made possible by three outside appointments (Henry Wallich, Robert Triffin, and William Fellner) and three internal promotions (Richard Ruggles, James Tobin, and Ralph Jones). Between 1952 and 1957, fifteen assistant professors were appointed, an average of three per year. All fifteen of these junior faculty members were from outside Yale because at that time the department’s Ph.D. program was not very strong.. By the end of the fifties, the department had a large and strong group of junior faculty, only two of whom ended up staying at Yale over the long run. The main reason faculty were lost was that they were lured away by competing institutions.

The year 1965 marked the peak of departmental strength: economics was one of the largest undergraduate majors; the graduate school admitted approximately 30 prospective economists of high quality each year; the M.A. program for government economists from developing countries was flourishing; Cowles and the Economic Growth Center were important and firmly established parts of the department; and invitations to join the faculty were rarely turned down. Only two issues clouded an otherwise positive picture: 1) the unbalance in the department that was the result of the faculty’s being heavily weighted toward theory and mathematical economics but being weak in some applied fields; and 2) the perceived and sometime actual inequality between department members who were affiliated with either Cowles or the Economic Growth Center and those who were not.

The period between 1965 and 1990 is described by Reynolds in three words: consolidation; decline; and recovery. By 1980, the department was ranked toward the bottom of the “top ten.” The quality of the graduate student body declined in part because top undergraduate students were choosing graduate programs in law, medicine, or business over Ph.D. programs. The department also lost many of the best applicants to Harvard and MIT. The university itself also went through a period of consolidation during this time, which had an effect on all departments. Government and grant money became more difficult to obtain, which in turn led the department to cut back on faculty. Finally, the department lost and had trouble recruiting faculty replacements during this time for three major reasons: 1) New Haven was not viewed as being a desirable location; 2) the area had limited opportunities for two-career families; and 3) internal disagreements often prevented appointments from being made. Actions taken in the late 1980s ameliorated the situation somewhat, and a few strong junior and senior appointments have brought the overall quality of the department back to its mid-1960’s level.

Memories and Musings

I had the opportunity and honor to spend time with several of the men who have contributed so much to the department. The thoughts they shared with me give insight into their contributions to the department and put their own particular spin on some of the major events in the department’s history. I have edited some of their comments (some were more loquacious than others), but have tried to preserve the personality and character of these men as reflected in their own words.

 

Richard Ruggles

In 1939 I graduated from Harvard with my classmates, William Parker and James Tobin, and like them undertook graduate study in economics. The previous cohort of Harvard graduate students in economics was very distinguished and included Paul Samuelson, Ken Galbraith, Abe Bergson, Lloyd Reynolds, John Miller, Lloyd Metzler, Robert Triffin, Henry Wallich, and many others, including my sister Catherine Ruggles. With the outbreak of World War II, Bill Parker went into the Army and Jim Tobin went into the Navy. I managed to finish my graduate work and I went into OSS. I served in London in 1943, in Europe in 1944, and went to Japan for the Bombing Survey at the end of the war.

In 1946, I returned to Harvard as an Instructor and married Nancy Dunlap, who enrolled as a graduate student in economics at Radcliffe. At the 1946 meetings of the American Economic Association, I met John Miller, who had moved to Yale, and he invited me to give a talk at Yale. I did so and was appointed Assistant Professor. At that time Ed Lindblom, Neil Chamberlain and Challis Hall were also appointed as Assistant Professors. Although, at Harvard, Yale was viewed as a boys’ finishing school, there was a group of younger faculty members who were highly regarded. In addition to John Miller, Lloyd Reynolds had come from Harvard, and there were Max Millikan, Richard Bissell (who was always on leave) and Wight Bakke. The so-called “ice cap” consisted of pre-Keynesian economists who, for the most part, specialized in specific areas such as transportation, corporate finance, accounting, and money and banking. Generally speaking, the “ice-cap” were reasonable men, but they were oriented toward training Yale undergraduates to go out into the business world.

The newly appointed Assistant Professors were quite congenial and held Saturday night dances in the Strathcona lounge. There was, however, no role for professional women in the Economics Department so Nancy and I became consultants for the government, the United Nations, and foundations. In 1948, we went to Europe for the Economic Cooperation Administration. In the 1950s, we worked for ECA in Washington, the Ford Foundation, and the United Nations in New York. When the Korean war broke out, we were asked to create an intelligence unit for the CIA for collecting and analyzing Soviet factory markings. We hired some Yale students and employees from ECA. At Yale we developed a “Rapid Selector” project in conjunction with the Yale Electrical Engineering Department to help analyze the factory markings data collected from Korea. The “Yale Rapid Selector” was quickly made obsolete by the development of computers.

During the 1950s, Lloyd Reynolds was building up the Economics Department at Yale. He recruited Robert Triffin, Henry Wallich, and William Fellner. The Yale Economics Department was becoming known for the quality of its faculty. At that time, the Cowles Commission at the University of Chicago was unhappy with their arrangements there and approached Lloyd about coming to Yale. The arrangements for bringing Cowles to Yale were made in 1955, with Tjalling Koopmans and Jacob Marschak being appointed as Professors in the Economics Department. As part of the agreement, the Econometric Society also moved to Yale, and I agreed to serve as Secretary, with Nancy as Treasurer.

By 1959, however, friction developed between some members of the Cowles Foundation and the Chairman, Lloyd Reynolds. As a consequence I was asked to serve as chair. As Chairman I managed to recruit Joe Peck, William Parker, and Hugh Patrick, who had been an undergraduate at Yale and had participated in the CIA Korean project. However, I did not like being Chairman, and I resigned in 1962.

The Yale Economic Growth Center was established in 1961. Lloyd Reynolds and I had served as consultants to the Ford Foundation, and they had expressed an interest in establishing a center for the study of economic development at Yale. In addition, Nancy and I were actively consulting for the Agency for International Development in Washington D.C., and they also wished to foster such research. As a consequence, Lloyd Reynolds established the Yale Economic Growth Center. It had as its mission the development of “country studies” of economic development. Graduate students in economics writing their doctoral dissertations were sent to developing countries to do “country studies.” To facilitate and manage the operations, Miriam Chamberlain was appointed Executive Secretary to manage the day-to-day operations of the Growth Center. Miriam had been working at the Ford Foundation in New York and had moved back to New Haven when her husband Neil was made a Professor of Labor Economics. Mary Reynolds, wife of Lloyd Reynolds, was placed in charge of building up a library of books, documents, and data relating to developing countries. Nancy Ruggles was hired with AID funds to design the framework of data for the country studies. In addition, Nancy agreed to become the Secretary of the International Association for Research in Income and Wealth, which was transferred to the Economic Growth Center from the University of Cambridge, England. All three women had Ph.D.s from Radcliffe and were highly qualified for their functions.

To some members of the Economics Department, however, the hiring of faculty wives seemed inappropriate, and in 1966 the Chairman, therefore, asked for their resignations. Simon Kuznets suggested that Nancy and I could carry out our research program at the National Bureau of Economic Research in New York. For the next decade I carried out my research activities at the NBER in New York and Washington D.C. I taught the undergraduate course of the “Economics of the Public Sector,” the Senior Honors Seminar, the graduate course in “National Accounting,” and carried out the administrative tasks of Director of Undergraduate Studies or Director of Graduate Studies in Economics.

In 1978, I transferred my research activities from the NBER to the Institution for Social and Policy Studies at Yale. Nancy had been employed as the Assistant Director of the United Nations Statistical Office, but she also became associated with ISPS in 1980. We jointly carried out our research at ISPS until the accidental death of Nancy in 1987.

 

James Tobin

I came to the Yale Economics Department in 1950. It was my first job after having gotten my degree at Harvard and then having spent three years on a postdoctoral fellowship, partly at Harvard and partly at Cambridge in England. When I came here in 1950 the department was very small. I think there were maybe 4 or 5 professors (maybe a few more); that was all. The faculty weren’t all really economists. Some of them had been in the Applied Economics Department at the Sheffield Scientific School: Ralph Jones was an accountant; Wight Bakke was in labor economics though he was more of a sociologist than an economist; and Kent Healy was a railroad economist. Healy was a very interesting man, but he was not squarely in the center of the field of economics. There were others in industrial engineering, business, and banking. Two other members of the department had gone into academic administration. Edgar Furniss was Provost and Norman Buck was Dean of Freshman. Furniss and Buck were part of the famous trio, Fairchild, Furniss and Buck, who had written what was the big textbook in the 1920s and early 30s. At the time I came to Yale, Furniss and Buck were not very active in the department because they were busy with administrative responsibilities.

However, there were some new people here, people I had known at Harvard. Lloyd Reynolds and John Perry Miller, who were maybe five or six years older than I was, had been instructors, i.e., advanced graduate students, when I was an undergraduate at Harvard. Richard Ruggles, who had been a classmate of mine at Harvard College and in graduate school, was also here and was very influential in my deciding to come to Yale. Another graduate school acquaintance of mine, Challis Hall, had also come to Yale. There were others, not from Harvard, new to me. Ed Lindblom was another of the younger and new people here back then; then as now a most interesting colleague.

At the time I came there were very few graduate students (7 or 8 at the most), so the department could not be described as having been a big thing at Yale. I came to Yale because Ruggles, Reynolds, and Miller convinced me that there would be a renaissance of the department; it would grow and improve. That was indeed what happened. I think when I was chairman in the 1970s that we had a department of almost 60 people, 30 of whom were full professors, and that was about 25 years after I had come. So over those years a lot did happen and much of that was due to the initiatives of John Miller and Lloyd Reynolds who scrambled around among Yale alumni to get help in financing graduate fellowships and started building the department. During the early 50s, they were active in recruiting. William Fellner, Henry Wallich, and Robert Triffin were three excellent professorial appointments who helped to put the department on the map.

In 1954, I was asked by the Cowles Commission for Research in Economics (then located at the University of Chicago) to come to Chicago and be its director. I had tremendous respect for the commission and for the people there, including two great economic theorists and econometricians. One was Jacob Marschak. Marschak came originally from Russia through Germany. He had left Germany in the 30s in fear of Hitler, joined the New School in New York on his way to Chicago and Cowles. I had first met Marschak at the American Economics Association meetings in 1948 where I had been asked to discuss a paper of his. I was barely out of graduate school at the time, actually a postdoc, and it took me all Christmas vacation to prepare for the session. But my discussion impressed Marschak, and that’s how I got to know him. The other Cowles leader was Tjalling Koopmans, who was then its Director. I was being asked to succeed Koopmans who had had as much as he wanted of that job. I went out to Chicago to discuss the offer, but I was not very anxious to move there, and my wife was certainly not anxious to do that. I phoned Koopmans a week or so after my visit, and I told him what I thought he would find to be bad news, that I was going to decline their invitation. Koopmans didn’t seem to think that it was bad news. He said at once that he was going to be on sabbatical leave for the 1954-55 academic year, and he wondered if it would be possible for him to spend the year at Yale. I was not yet a full professor and I certainly couldn’t speak for Yale, but I told him I couldn’t imagine that Yale wouldn’t be absolutely delighted. Surely the department would be enthusiastic if he were to come. Koopmans did come under the Irving Fisher Visiting Professorship. It turned out that Koopmans had anticipated that this would happen. The whole idea had been that the commission would try to get a new director. However, they didn’t expect that they would be able to get anybody that they wanted and that if this were the case they would then consider moving. So Koopmans’ idea in coming here for his sabbatical was to start the ball rolling for the move to Yale. Yale was the logical place to come because the Cowles Commission was founded and financed by a Yale alumnus of the class of 1913, Alfred (Bob) Cowles.

During the 1954-55 academic year Koopmans negotiated the deal that brought Cowles here. I then became the director of the Cowles Foundation for Research in Economics when it relocated here beginning in 1955. Both Koopmans and Marschak also made the move to Yale, as did a group of very bright younger people, many of whom have become very distinguished economists over the intervening years: Roy Radner for one and Gerard Debrue who later won a Nobel Prize (which, of course, Tjalling Koopmans did also). Our department was augmented not just by the two major professors who came but also by the younger assistant professors. The Cowles move kept the momentum going toward enlarging the department, improving its reputation, and attracting more graduate students. It also helped to get the funds to finance all these things, in part because the Cowles Foundation brought its own money. We soon became a major department in the country, one of the top four or five, whereas Yale in 1950 had not ranked at all among major departments of economics.

I was the director of Cowles for some years, interrupted by my going to work with the Council of Economic Advisors in Washington for two years, in 1961 and 1962. I came back and was director again for a while and then moved on. I was chairman for a year (1968-69) when Joe Peck went to the CEA, but my real term as chairman was 1974-78. This period was the peak of the department in size; it was probably the biggest in terms of number of faculty that it’s ever been. It was also a time of transition because some of the older professors were retiring. At the end of my term as chairman, I wrote a final report to the provost. In the report, I discussed a number of problems that I saw in the department. However, I must say that when I was chairman I got the most complete cooperation that anyone could ask for from the provost, who at that time was Hannah Gray. Gray was very sympathetic to the department and appreciative of the distinction that the economics department and its faculty were bringing to the university.

As I’ve said, in those days the department was doing well and was highly regarded. There were a few things that I worried about, but I should say that I didn’t worry very much. I did not find it hard to be chairman. I actually liked the job. I didn’t find it to be a great burden, and I didn’t find that it took all of my time. I had an excellent staff at 28 Hillhouse and fine cooperation from my colleagues.

However, we were having some problems in recruiting and holding some of the best quality economists in the country, for various reasons. Among people who had never lived here or knew very little about the city, New Haven didn’t have a great reputation then, or now I guess, as a place to live. (Actually when I first mentioned, in 1950, to my wife that we had an excellent offer from Yale, she was not very keen on the idea. But she learned to love New Haven, so it all worked out). But one of the problems of New Haven (even 20 years ago) was finding jobs for the spouses of people we wanted to attract to the faculty. There are not a lot of other attractive educational institutions around here, and the area is not a big place for a lot of the professional jobs that spouses of professors are looking for. The spouses often thought that they should have a connection with Yale, but it wasn’t easy to arrange joint appointments for two people at once. In fact, that’s one of the reasons we lost Joe Stiglitz. Stiglitz was a very eminent young economist in those days, a real rising star, and we felt good that we had attracted him here at the same time that we got Bill Nordhaus. Unfortunately, we couldn’t accommodate his new wife who was also an economist; in fact one of our graduates at Stanford could.

Our difficulties in getting outside people to come here applied also to assistant professors. Earlier in the 70s they had come gladly. They knew they wouldn’t get tenure, but they thought the experience would be interesting and valuable to them. However, our uniqueness in providing that opportunity was going away, and we didn’t have much chance to make internal promotions because we were already a very large department. It turned out, and has turned out over the years, that the people we had an advantage in trying to recruit were people who had been students here, who knew the place, who knew the department, and who knew New Haven. Many of our faculty are Yale Ph.D.s, and they came back here more readily than people who had Harvard degrees or Chicago degrees or whatever. For people of the same quality, we had a greater chance of getting them if they had some experience or previous knowledge of Yale.

The graduate program had already begun attracting students in the 1950s and was a very popular place for graduate study for people who came out of colleges such as Oberlin, Swarthmore, Williams, and such places all around the country. However, we were not able to do as well as Harvard or MIT in getting the graduate students we wanted. First, to them Boston was a more attractive place to live than New Haven. Second, there was a feeling among graduate students who had gotten National Science Foundation fellowships that one should go to MIT because a lot of other people who had gotten NSF fellowships would be there as well. So a superior student body was attracting a superior student body.

I would also say that, in both faculty and graduate student recruiting, Yale has had a tendency to think of itself as more obviously attractive to everybody than it is. We’ve often been a bit arrogant in deciding whether we wanted somebody or not and in finding reasons not to recruit them. In addition, we didn’t have higher salaries or higher fellowships to use to attract people, partly because of the attitude of “well, after all it’s Yale.” There were also times when we would have done well to take risks in getting younger people for full professorships or associate professorships ahead of their normal appointment rank. The department tended to be very choosey about these things and some of our faculty felt that we’d better wait and see how good someone was. However, by the time we had waited to see how good they were, they had accepted positions somewhere else, and we had no chance to get them. That happened quite often, and I think still does. However, in looking at the program I received for the departmental reunion this April, I see a list of very eminent scholars. They are all our own Ph.D. products, and they are great people. We should be proud of having produced a group like that over all these years.

In those days, back in the 60s and well into the 70s when I was still chairman, many excellent college students in good colleges and universities who majored in economics were interested in getting a Ph.D. in economics and going into college teaching. I think at Yale in those days ten percent of the senior class who were majors in economics went to graduate school in economics somewhere; now almost nobody does. The same is true for the other institutions that were the feeder schools for graduate students in economics. Students now go to business school or law schools or they go to Goldman-Sachs in New York to take a remunerative job. At any rate, they don’t find an academic career in conventional economics as attractive as did their forebears who had graduated from the same list of good colleges and universities in the past. That’s why we have had to rely on foreign students much more these days, which has changed the atmosphere of the department. The department always had good foreign students, but having so few American and Canadian students has changed the interests of the graduate students. There is less interest in policy, world affairs, American affairs, current events and more exclusive interest in formal theory and technique. Also it used to be that our graduate economics club itself organized symposia, debates on political economy – things that were in the press everyday. That doesn’t happen now.

Another concern of mine was the slowness of dissertations. The question is whether we rely too much on students being self-starters on their dissertations. My observation is that students often spend a lot of wasted motion and wasted time trying to find, on their own, a dissertation subject. In the physical sciences graduate students usually attach themselves to a lab in which there is one principal investigator, one faculty member, and the professor has a whole large research agenda in mind that is then parceled out to students as subjects for dissertations. We’ve always regarded the choice and the design of the subject as part of the test of the candidate; something that the students should do on their own. However, maybe we have overdone it. This is a perennial problem, and there is a perennial debate as to how it should be organized.

One problem that we had in my day as chairman and since is the fragmentation of the department. Partly the profession itself has become more specialized, so that few people are general economists. They’ve become specialized and tend to see more of people who have interests that are closely related to their own than they see of their colleagues in general. It was partly for that reason that I was advocating, back in the time when I wrote my chairman’s report, a physical connection between 28 and 30 Hillhouse. We finally got that, thanks to Bill Brainard sticking with it and getting it done. I think it’s great, a wonderful common room for the department and the graduate students.

The coming of Cowles in 1955, as I see it, without a doubt must be regarded as a big plus for this department. It certainly brought very eminent people here, and it did great things for us to have Marschak and Koopmans and the younger people they attracted. However one problem that it brought was the result of the fact that the Cowles Commission had originally started in the 1930s when mathematical and quantitative methods in economics were rather new and rare. Actually, Irving Fisher, beginning in the 1890s here at Yale, was one of the rare pioneers in bringing mathematics into economics. He was very unusual in that respect. There weren’t very many people like that. In fact, he was almost the only one in the U.S. in those days. The Cowles Commission was founded by Alfred Cowles precisely to see if quantitative methods, statistics, and mathematical formulations in economics couldn’t be promoted and couldn’t solve some of the problems that had been difficult in the 30s in the actual operation of the markets and the economy in general. The commission was the major focus in the world of people who had the interest, ability and training to do this, and it was a pioneering thing to do. It was also the same Mr. Cowles and his generosity that produced, in conjunction with the Commission, the Econometrics Society, the journal Econometrica, and really the whole subject of econometrics.

However, by the 1950s and 60s these techniques had begun to spread over the whole profession and, essentially, rather than being unusual skills, they became the normal skills that people had to learn if they wanted to be graduate students and become professional economists. So it was no longer the case that people who had the abilities and interests that had marked the Cowles Commission in its earlier stages were so unusual, and, therefore, almost everybody who might be recruited to Yale felt that he or she was capable and qualified to be in the Cowles Foundation. Essentially the Cowles Commission doctrine had won, it had swept the profession, and everybody was doing it. So the question became what was the difference between the people who came to Yale who were in Cowles and the people who were not. There were those who didn’t see any reason that they shouldn’t be in Cowles, and job candidates were often told by their professors at Harvard or Princeton or wherever that they should accept a position at Yale only if they could be in Cowles. It really became a status thing. When Cowles came to Yale in 1955 and I was the director, I invited some people who were already at Yale to be in the foundation; Arthur Okun, Charles Berry, Michael Lovell, and so on. So the foundation was composed partly of people who had come from Chicago and partly of people who were already at Yale. And we did in the future add to the Cowles roster people who were recruited because they were wanted by the department as a whole and not just by Cowles for its own program. However, there was a psychology of fragmentation which resulted from some of the difficulties some people saw in having this high-powered organization here.

Now in the old days of economic research in general there was a willingness on the part of foundations to give block grants to research institutions such as Cowles, the Economic Growth Center, and the National Bureau for Economic Research. The NSF, Ford Foundation, and Rockefeller Foundation were willing to give a bunch of money to the organization for whatever broad program had been described to them by the leadership of the organization. The foundations stopped doing that sometime in the late 60s and started insisting, the NSF particularly, that every grant be for a specific research project. When I was first director of Cowles I got block grants, but afterwards the policies of the foundations were such that you couldn’t do that anymore; you had to look for funding on a project-by-project basis. This lessened the administrative distinction between the Cowles and the rest of the department. Everybody at Cowles had to put together individual grants as did everybody else in the rest of the department.

This Cowles-not Cowles problem, which was severe in the 70s and early 80s, finally got solved. Now there isn’t any attempt to have any foundation-wide program here in this building as there was back in Chicago and in the first days at Yale. Cowles is now more of a service organization for anybody who wants to be in it.

The Economic Growth Center also became a center with its own program, its own leadership, and its own members. I thought as chairman that once these institutions existed that we had to treat them with fairness, they have legitimate reasons for being here and sometimes they need to have appointments that are departmental appointments. Cowles really was not doing a lot of specialized things in those days or now, but the Growth Center was and is still now concentrated on some particular problems, so they need to have the personnel to study them.

I felt that there were some problems related to the then new School of Management, and these may be continuing problems. One problem was, is, that SOM hires economists. The school should, of course, and there was a good prospect that SOM and the department could have useful joint appointments. We did have some, e.g., Paul McAvoy and Stephen Ross, but I have the feeling that in general joint appointments were not as successful as they could have been. Sidney Winter, who was primarily a department appointment, was also very suitable for an appointment at SOM and doing some teaching there. He wasn’t happy with his relationship with the school so we lost him a few years ago. I thought then and think now that there are some missed joint opportunities. The department would get a person who could add to the general intellectual climate of economics with only one-half a slot instead of a full slot. There are a number of areas that would make sense to be joint such as financial economics, industrial organization, regulation of business, any number of things like that that can be useful for collaboration in research and in teaching. But it doesn’t seem that we’ve been able to devise the ad hoc or systematic relationships to do that. It could also help to bring applied people into the department, which we need in several traditional areas of economics. We should have coverage in all the main areas. The school also has higher salaries for economists. The same economics Ph.D. would get more money being at the school than here. There’s just something about being a school of business instead of a department of economics. But I think we’ve gotten used to the fact that there’s a school up there, and they have bigger offices and plusher carpets and so on.

I’m also disappointed that the school has abandoned its original dedication to being not just a school of business but being a school of management including public management (employment in the public sector, government jobs as well as private business jobs, and so on). And now they have abandoned that ambition even in the title of the degree they offer. They used to offer MPPM, Master of Public and Private Management, now they offer just an ordinary MBA. So they have pretty much abandoned the notion that they were going to be different from other business schools in the sense of worrying about management in general and management in the public sector as well as the private sector. I think that’s regrettable, and I also think it makes more difficult the kind of association with this department that there could be.

One thing that the department needs, in my opinion, that the university needs, is some kind of center of policy research, some group of people or organization that could concern itself with public policy, public economic policy in particular, but it wouldn’t need to be confined to that. Most of our rival institutions do have such an institution. There’s the Woodrow Wilson School at Princeton, Kennedy School at Harvard, Center for Economic Policy at Stanford, and so on. But we don’t have anything like that, and, as I said earlier, we are missing that. We do have a great collection of theorists here; we have the most powerful collection of econometric methodologists and a lot of what our students do is the technical stuff, formal theory, etc. They do not have enough, at least to my taste, interest in what’s going on in the world. We’re unlike our rival institutions (Berkeley, Stanford, Harvard, Princeton) in this respect, and I think we should try to do something about that. We have joint majors between economics and political science, economics and ethics, and so on that are very popular with undergraduates. We don’t have anything parallel to that at the graduate level. It would be natural to do that. There are people here who are individually quite involved in this – YCIAS is the closest thing we have to that, and it’s very important. It has made a very big difference to have that. But there should be a center that is broader than that to include things besides development and international economics.

One thing I’ve observed over the years of being an academic and a faculty member of one institution for a long, long time is, to put it in the extreme, that there are two kinds of faculty members. There are those who are by nature, by instinct, by inclination, and by sense of responsibility, what you might call institutionalists who have adopted Yale as an institution that they identify themselves with and regard as a very important part of their lives and their obligations. They do the best they can for this institution – for Yale and for the economics department within Yale. And then there are professors who are very much more individually motivated and who are ready to leave at the drop of a better offer somewhere else. They have no particular identification with this place except as it is the best thing from their individual point of view, and they don’t feel the same sense of dedication and responsibility to the institutions within Yale as a whole. This department was built up by people who were of the former type like John Perry Miller and Lloyd Reynolds, and it’s been kept going by people like that: Bill Nordhaus, for example; and Gus Ranis, Bill Brainard, Joe Peck, and Bill Parker. These are people who really see themselves as wanting to be identified with the institution and to do what makes the institution better. That’s what keeps things going. And it’s not just faculty but assistants and secretaries and administrators who have kept the institution thriving and take pride in it. Yale and the department have been fortunate in having so many dedicated institutionalists.

One final thing – the whole academic enterprise didn’t do very well on minorities and women in academic jobs. We tried to do better, and I considered that to have been an important part of my job when I was chairman. On women, the university did very badly. There was this fear of nepotism, that one must avoid having both husband and wife appointed. The situation with Nancy Ruggles was a shame, because she was someone who had all of the necessary qualifications to be a professor, should have been, and would be under present circumstances. It was an unfortunate idea of people in that generation that there was something corrupt about having two members of the same family together. We’ve done better on minorities than we have on women. But both are still unfinished business – it was priority business twenty years ago and it’s priority business now.

William Parker

I came to Yale at the same time Joe Peck did, 1962. We had both been in Washington. I had been teaching at North Carolina but was on leave in Washington. Joe was there working for William McNamara, Secretary of Defense. I was at Brookings doing research. We both got jobs at Yale and both asked for another year off before coming, which John Miller accepted readily. It was annoying to realize that Yale would rather save the year’s salary than have our services. The department had just moved out of Strathcona Hall in the tower. Both Lloyd Reynolds and John Miller had had their offices there. The department moved to Hillhouse Ave. Joe and I, however, were given offices that were being vacated in Strathcona, so the whole rest of the department was on Hillhouse except for Joe and me. We had lunch together every day. One day Joe looked at me and said, “I thought it was going to be a big deal teaching at Yale. This is like teaching at Denison or some little college. I just see you and have lunch and that’s it.” We did finally get offices on Hillhouse too. When Joe became chair, he gave me that big office that Bill Nordhaus has in 28 Hillhouse; I was glad to be Joe’s friend.

I became DGS around 1970, and was DGS off and on for about 10 years. This was the time of Vietnam and there was a notable alteration in the attitude of the graduate students then – they were raising hell. I enjoyed that. It brought out a radical streak in me that I didn’t realize I had. There were radicals of all different flavors – Maoists, a few old time socialists, German-type Marxist/socialists, environmental people. (Two or three good dissertations on the environment were produced. I especially remember Jim Tober’s on wildlife in the 19^th century and Hamilton Helmer’s on economic development in Vermont. But I shouldn’t mention any specific names because there were so many that were so wonderful and on all sorts of different subjects!) Then there were really just plain radicals who didn’t know what they were for, but whatever it was we (i.e., the department) were giving them, they didn’t want it. One of the most vigorous of the radicals was Ross Thompson (now chair at University of Vermont). I remember the first night of the term when Gus Ranis had a reception at his house for the new graduate students. Tobin was there (and everyone had enormous respect for him even before he won his Nobel Prize). I looked over and saw Thompson giving Tobin hell (no one ever does that), saying things like, “Old Keynesian stuff is for the birds.” Tobin assumed a shocked look, as your mother might do, but didn’t say anything. Tobin’s wife came up to me and said, “Do you hear what that young man is saying to Jim? He ought to be ashamed of himself!”

Heidi Cochran, who has become a leading feminist economist, also came to me, almost in tears, and demanded that the department fire Willy Fellner, a conservative European, who insisted on teaching the required micro course. I pointed out to her that this would be hard to do in as much as he was the President of the American Economic Association. But she said that didn’t make any difference. He was about to retire, but she looked at our keeping him as an example of male bonding. I couldn’t dispute that.

Then a dozen of the students wanted a specific course in Marx and Marxism, and they weren’t getting it. They came to me with their request and I said, “Why not? It’s a good field.” The problem was the students didn’t trust anyone to teach the course. The students had a good course worked out, and I agreed to come in and sign forms so the students could get credit. I went to their lectures as DGS, but I finally began to raise doubts and questions in class about things they were saying. (They attacked Malthus, who was a great idol of mine.) One day one of the students came to my office and told me that the students didn’t want me in there anymore; they just wanted to have someone who was sympathetic to them. I said, “You’ll have trouble getting a grade without an instructor, but it’s a waste of time for me to come if you don’t want to listen.” They kept on with the course and when the end of the term came, I gave everyone a B and they were all satisfied.

Finally, one of their number, David Levine, assumed leadership. David was a tough-minded Marxist and thought deeply, after the fashion of a German philosopher. Ray Powell, as chairman, hired three men: Joe Stiglitz, Bill Nordhaus from MIT, and Al Klevorick from (I believe) Princeton. Levine, despite a (magisterial) book called A Reformulation of Economic Theory, was appointed for several years, but never promoted. That was the department’s notion of filling the need in “radical economics.”

I almost got Rick Levin into economic history, but industrial organization was also strong with Peck and Nelson. Rick got interested in technology and ended up going in that direction. Organizations, indeed, have become his métier.

It was almost always a problem to keep economic history in the curriculum. The policy people didn’t think that history was worth anything, and the econometricians thought it wasn’t scientific. The people who supported it were Gus Ranis and the Growth Center faculty (bless their hearts), Fei, Schultz, Evenson, and Srinivasan. Also, surprisingly, the mathematicians as such, i.e., the mathematical theorists, Koopmans, Scarf and Bewley believed in its importance. Their stuff wasn’t useful either, and they had more sympathy for a purely academic pursuit. The “old Europeans,” Koopmans, Triffin, Fellner, and Wallich, and also Montias were friendly and supportive. I was able to keep the program a required field partly by being willing to be DGS. I kept accepting the job every couple of years when it came up because no one else wanted it, and if they put history out, I’d go with it. I was the only senior appointment, but I had a series of excellent assistant professors who never got promoted. Originally the idea was that there would be a joint economic history program in the history and economics departments. This was John Miller’s idea when he was dean. He was very favorable to economic history and wanted a person in economics and a person in history. When I came to Yale, they made an offer to David Landes, who went to Harvard finally. I preferred to be in economics because that’s what my degree was in, and I didn’t see the point of being in two departments. It was hard enough to keep up with the politics of one department. I was on the dissertation committee of a couple of very good history graduate students.

I could tell lots more stories about the students and faculty. I really felt very fond of the students, especially the fifty or so who wrote their theses under me. The better they were, the less they needed me; and they were all (nearly) so good!

Merton J. Peck

I was first appointed chair in the summer of 1968, but served for just a few months before going to Washington to work for President Johnson. Tobin was chair while I was in Washington. I returned from Washington in 1969, and served as chair for a total of about ten years (from 1969 to 1973 and again from 1978 to 1983).

In 1969-70, early in my chairmanship, the department was able to persuade John Meyer, who was a professor at Harvard, to join us. That was considered a great coup because few Harvard professors resigned to come to Yale. Meyer had been a friend of mine from graduate school, and we actually wrote our first book together. He filled a void here in the newly emerging field of urban economics. He was originally an econometrician. He was also president of the National Bureau of Economic Research, which was then located in New York. Meyer established a branch office of NBER in New Haven. Meyer, however, eventually returned to Harvard. The second big appointment that was made in the first year of my chairmanship was Richard Nelson, who was then at Rand, and, coincidentally, I’d also written a book with him.

Another thing that was distinctive about the department in the first years of my chairmanship was the high ranking in various surveys of the Yale Economics Department. Yale was tied with MIT, ahead of Harvard. This reflected, in part, the fact that the Harvard faculty were growing older and retiring. It also reflected the fact that during that period both Koopmans and Tobin were awarded Nobel Prizes. In addition, Ray Powell, my predecessor, had hired eight or nine very able assistant professors. In this group were people who later became important in the department and the profession – Bill Nordhaus and Al Klevorick (both still at Yale), Marty Weitzman (who left first for MIT and then for Harvard), and Joe Stiglitz (who left us for every place including Stanford, Oxford, Princeton, Chair of Council of Economic Advisors in the Clinton Administration, and now Chief Economist of the World Bank). So it was both the two impressive older people, Koopmans and Tobin, plus these younger people who made the department a lively and exciting place for both graduate and undergraduate students. That was all early in my chairmanship. After that we began to slip a little, partly because we got older and partly, of course, because Koopmans retired. Tobin retired later, but after that we didn’t have quite as visible a senior faculty.

The other problem here was that the department in the mid-seventies began to decline steadily in numbers. The high point was 1973/74 with about 63 faculty; by 1988/89 we were down to 40. The size reduction was the result of slow growth in the endowment and in giving in the seventies. The department had also been very much dependent on NSF, which financed almost one-half the salaries. We also had big Ford grants to both the Economic Growth Center and to Cowles. I remember showing the Provost that, given the overhead we could charge, the university actually made money by hiring more assistant professors. But that era collapsed because the Ford Foundation switched its attention to other areas: urban problems; public schools; arts, and the NSF sharply cut back its spending on economics. The contraction was not as traumatic as it was in some other parts of Yale because we decided not to change the terms of employment for any of the existing faculty, tenured or non-tenured. Instead, we stopped hiring. However, that meant we lost the kind of particular thrust you get from bringing in two or three young people every year. There were a couple of years when the department didn’t hire anyone. People left and weren’t replaced – that’s how the number was lowered.

Another issue that began to surface was the relationship among Cowles, the Growth Center, the department and the Institution for Social and Policy Studies, which had been established in the early seventies with an endowment from the Beinecke family. There were different issues for each of these organizations. ISPS was very dependent on short-term soft money, which became progressively more difficult to obtain. In the case of Cowles and the Growth Center, as the outside money disappeared, faculty there became, in terms of their employment, less distinguishable from the rest of the assistant professors who, in those days, were called departmental appointments. The distinction between Cowles and EGC began to blur in terms of employment conditions and financing, and the distinction between the kind of people Cowles would hire and the rest of the faculty began to disappear. When I first came here, people in Cowles were people who knew mathematics. However, by the early 1980s, every younger economist knew the mathematics that distinguished the Cowles group in an earlier era. So it became unclear who was to be in Cowles and who wasn’t. Cowles, because of Tobin, Koopmans, and others, had great prestige. Everyone wanted to be in Cowles, and Cowles members worried about what it would mean to be a Cowles member if Cowles lost its elite status. This issue was finally resolved during Rick Levin’s chairmanship by essentially saying that anyone in the department could be a member of Cowles if they applied. There had been various perks that were associated with being at Cowles, and these tended to disappear (in part because outside financing disappeared). Cowles had had a Wednesday lunch, which fairly rapidly became a departmental lunch, but financed by Cowles! I think that the change was probably the right thing to do, but it made Cowles members restive because they felt rightly that they were losing their distinctiveness.

During my chairmanship, we lost our star econometrician, Nerlove, to Chicago, and we had trouble replacing him. This hurt us because many younger faculty wanted to go to a place where they could get help with econometrics. The problem was solved in the Brainard era with the arrival of Peter Phillips.

Throughout the period we remained very strong in attracting graduate students, and we were rather consistently either the third or fourth biggest major in Yale College. There was always a substantial number of undergraduates who were very good. Yale encourages its undergraduates to get graduate training elsewhere. Also, by the time most undergraduates have spent four years in New Haven, they would much rather move to Boston, Palo Alto, or Berkeley. The number of undergraduate economics majors, however, who go on to graduate study in economics has been consistently low. About one-fourth of economics majors go to law school, one-fourth to business school, one-fourth to some other kind of graduate school (of whom 5% get a Ph.D. in economics), and one-fourth essentially have a career without any additional professional training. One thing that has changed is that many more students work for a couple of years before going on to law school or business school. That’s partly because they’re in debt and partly because they’re counseled not to go to law school or business school until they have some professional experience.

Among our Ph.D. students, we’ve had quite a diversity in what they pursue. There has always been something like 30-40% who have taken non-academic positions. Favorite employers are the federal government, the Federal Reserve System, and international organizations. The remainder pursue an academic career. However, people do bounce around a bit – they may work at the New York Federal Reserve Bank for a couple of years and then take a teaching position at NYU.

One thing that has happened, beginning more in Brainard’s chairmanship, is a shift in where our graduate students come from. Originally, John Miller, DGS in the post-war period, had the theory that the best way to attract good graduate students was to focus on small, liberal arts colleges such as Oberlin, Swarthmore, Williams, Wesleyan, and Amherst, and then go there and don’t take the best student (he or she will go to Harvard or MIT anyway), but take the second or third best. It’s likely that the second or third best will turn out to be as good as the first best. Miller was a very successful recruiter in that period – Gus Ranis was recruited from Brandeis and Dick Nelson and Bill Brainard from Oberlin. What happened then was that the slowdown in academic hiring caused students at these schools (particularly the best students) to shift their interest to going to law school or business school. At the same time, we got an increasing number of applications from abroad so that the typical entering class today is only 10-20% from the U.S. Many of the foreign students prefer to stay in the U.S. when they finish because the U.S. treats young people much better than they are treated in Europe in terms of allowing them to work and giving them research opportunities. Many students, therefore, like to stay until they have gotten some international recognition and can then go home in glory. Japan is unusual in that, by statute, you cannot be a full professor until you are 38; so you might as well stay here and get better pay. Many other countries are similar in that younger people are not promoted very rapidly.

Another problem we have in attracting graduate students is that Yale (and this is sometimes said as a compliment and sometimes said pejoratively) has a reputation as a high tech department. We use extensive mathematics; we emphasize econometrics and theory. Because in many places American undergraduate education in economics is much more like writing a senior essay on the debate about tariffs, some American students are more inclined to want to go to a department where applied fields are better represented.

Through much of my chairmanship we almost never had a person who stayed nine years before he or she was then considered for tenure. The reason was that people were hired away in their seventh or eighth year. They would get an offer and then we’d either have to say you’re lucky or we’ll have to match that offer. It was much easier to deal with individuals because we didn’t face the uncomfortableness of trying to decide whether someone should be promoted. It was an infinitely better way to have things happen. In some cases, for example Marty Weitzman, we couldn’t hold him. Then there was the period, toward the end of my chairmanship, when the market slowed down, and we actually had people here in the ninth year who had to be considered for tenure (and in many cases not given tenure). During this period Paul Schultz came, and Bill Nordhaus, Ray Fair, and Al Klevorick were promoted. But several people left too — Joe Stiglitz, John Meyer. This was normal turnover and wouldn’t have been a problem except for the fact that we weren’t hiring. That affected mostly the assistant professor ranks. We did not replace two full professors for budgetary reasons, but we generally tried to keep full professor vacancies even though by keeping them it cost us two assistant professorships.

In the latter part of my chairmanship, the creation of SOM had an impact on the department. SOM hired economists, and in the initial group of appointments were quite a few distinguished people who came in at the full professor level. These people wouldn’t come unless they were also given an appointment in the Economics Department. Different arrangements were made in different cases: for some we paid a little bit of the salary; for others we let SOM pay the entire salary, but the faculty member taught here. Several quite noted people left during what I call “the time of troubles” at SOM This had an impact on the department because we lost five full professors. These faculty members had varied in the degree to which they were active in the department. They generally did not do any undergraduate teaching. Shiller started out at SOM and then came to the department. MacAvoy came down to the department and then went off to Rochester to be Dean. He then came back to Yale to be Dean of SOM. Sharon Oster, who was an excellent teacher, became a professor at SOM. Susan Rose-Ackerman, who had started a career in economics, ended up in political science. Ed Lindblom also started a career in economics and ended up in political science.

Kingman Brewster, who had started SOM, wanted it to be integrated into the Faculty of Arts and Sciences. His model was that most of the faculty would hold joint appointments. This gradually tended to break down a bit because the department got a little nervous – we didn’t want to be outvoted in our own home. Also, SOM people generally wanted to do graduate teaching, and that’s what our own faculty liked to do best. The relationship between the department and SOM was never reestablished after “the time of troubles.”

I had come to Yale in 1963, which is when Bill Parker and Herb Scarf came. The Parker appointment was significant because he was able to develop a tradition of strong graduate students outside of Cowles or the Growth Center. He turned out a succession of economic historians who went to Stanford, Northwestern, Berkeley and so on. John Miller was always trying to give support to the idea that there must be a “third force” that would offset Cowles and EGC. That was probably one of the ideas behind the creation of ISPS.

The Yale Economics Department is probably more integrated socially than some of our rivals. I can point particularly to Columbia and Harvard, where many of the faculty live in the suburbs, work at home, and come in the three days a week that they teach. That gives a different air to the place than when people are constantly having coffee with one another. New Haven is a small town, and everyone has a short commute by New York standards. This social integration has declined somewhat over the years in part because there is hardly any faculty spouse who does not work.

The department has had a tradition of trying to pay attention to undergraduates. I’m not sure now that we’re much different from our rivals, but when I came here that was always a strong point. Economics is not an easy major because all students have to take theory and econometrics, which are very demanding courses. The number of economics majors over the last five years has doubled – from 100 to 200 – and we’ve gone from third or fourth to being the largest major. That irritates people in history and English, which were always the traditional big majors. There has been at Yale, in the last five years, a shift away from the humanities and to the social sciences and sciences. And within the social sciences, there has been a shift away from anthropology, sociology, and psychology to political science and economics.

All of our undergraduates are required to take two seminars. It used to be that these seminars were given by ladder faculty. However, we moved, under Rick Levin, from teaching four courses a year (two each semester) to teaching three courses, which was the standard introduced by Princeton. When we made that change, there weren’t enough ladder faculty for the seminars. Currently one-half of the seminars are given by outside faculty – two Trinity professors, someone from Epidemiology and Public Health, and a lecturer from radiology who started studying economics and says he loves it (he comes and teaches the seminar for free). The outsiders do a good job because they have one-year appointments, and if their teaching evaluations aren’t good, they’re not renewed. Even so, students say, rightfully, that Yale students are entitled to be taught by Yale professors. That is a tension that comes about, and we see the solution as expanding the Economics Department. This is an on-going controversy since while the number of undergraduate majors has doubled, the size of the department has not changed.

The number of graduate students in the department has actually declined. When the Clinton Administration was new, it reduced federal hiring, with the result that a lot of economists were dumped into the academic market. This made it hard for our students to get jobs. So, with a slack demand, we cut back from 30 new doctoral students per year to 25, and then to 22. Ironically, our graduate students are now in great demand because there is a shortage of economists.

When I first started at Yale, the department was in the process of moving from Strathcona to the buildings on Hillhouse. In the period of my first chairmanship, the move was completed and we took over 28 Hillhouse (which had been occupied by Far Eastern Languages). Before that time, the department had just had Cowles, EGC, and 37 Hillhouse. Taking over 28 was crucial to being able to have the entire department on Hillhouse. The buildings underwent some renovation at that time, but it was under Bill Brainard’s chairmanship that we began to get things in shape. Bill was very good in dealing with the physical facilities; he was probably the best chair for that. Under him, the basement at 37 was turned into a computer room and the Tobin Lounge was built. Bill had pushed hard for the lounge even though several people, myself included, argued that we didn’t need such a luxury and that we should use the money for fellowships in Tobin’s honor instead. But Bill was right; the lounge has proved to be an important addition to the physical space of the department.

When I was chair, particularly in my first term, it was a remarkably easy job. This was due, in part, to the fact that Fellner, Reynolds, and Tobin had a very balanced view about appointments and the department. I would go and see them, and then when there was a department meeting, once they spoke, everybody tended to fall into line – not out of terror but because they understood that when Jim spoke, he wasn’t speaking for Cowles but for the department as a whole. The same was true for Fellner and Reynolds. I also know that if all three of them said that something was a dumb idea, then it really was a dumb idea. As those three became less active and then retired, the department became more individualistic, which made things a little harder. There wasn’t really anyone who could step in to take over their roles. Both Brainard and Levin were regarded as being wise, but they didn’t have quite the academic stature or long service that was true of the others.

I did enjoy being chair, but I had what now seems to have been the easy years. It was a less demanding job then in part because the DGS took care of graduate students and the DUS took care of the undergraduates; the chair dealt mostly with the administration and faculty. I could teach two courses, consult and write. Beginning in Levin’s period, and particularly in Brainard’s period, the chair’s duties expanded, and it became a full-time job.

 

Richard Levin

I served as chair during the late 80s and early 90s, a time of resurgence as described by Lloyd Reynolds in his departmental history. Looking backward, some of the appointments made in the middle and later 1980s turned out to be extremely important for the long-term future of the department – the promotion of John Geanakopolos, bringing in Ariel Pakes, and moving up Don Andrews and David Pierce. A lot of the future leadership of the department was brought in in that era, both before my time and during my time as chair.

Of course, there were some disappointments as well. James Heckman, mentioned by Reynolds as one of the bright lights in this resurgence, ended up returning to the University of Chicago. I think Heckman left because he had the University of Chicago mode of operation in his soul and never completely adjusted to Yale. He is a superb economist. It’s not surprising that he went back to Chicago, but it was disappointing because he would have helped to build the empirical, applied side of the department. But that’s happening anyway under Ariel’s leadership. Ariel, along with Steve Berry and the current crop of junior people who do applied work, have brought empirical economics to as strong a position as it has had at Yale for a long time. The department still has a strong core of theory, and in theoretical econometrics it is clearly the best in the world. Recent senior appointments and the quality of the junior faculty both augur very well for the future. The department is better now than it was a decade ago.

The signal achievement of my first year as chair was a consequence of efforts initiated by Don Brown, who was chair before me, and Al Klevorick, director of Cowles. The achievement was solving the long-standing awkwardness of having within the department a research institution with independent appointment powers. The department had been hampered in some respects by the Cowles Foundation’s having independent power to make appointments to the research center. There were often junior faculty whom the department would seek to recruit, vote an offer to, and then recruitment would founder if the person could not get a Cowles appointment. There were positives and negatives to the situation. It gave Cowles, at least in the early years, a sharper identity as an institution with a distinctive research program; it did once have a mission to incorporate mathematics into the study of economics in a rigorous way. The mission succeeded so thoroughly that by the 1970s there were no more worlds to conquer. Indeed by the 1970s, Cowles ceased to have a coherent research program and was simply a collection of outstanding economists pursuing their own research agendas. A Cowles appointment from the early 1970s onward was more a certification of quality or excellence than it was a statement of whether the person fit into the research program of the foundation. This created a dual class of citizenship, and while it made it possible to recruit excellent people to Cowles, it also made it more difficult to recruit excellent people to the department as a whole. The issue was brought to a head by Don Brown’s courageous leadership; he took the issue head on in his own characteristic forthright way and got many people hopping mad. I have never hesitated to give Don credit because he put the issue out there and set it up so that I could solve it with a somewhat less confrontational approach. Immediately upon becoming chair, Al Klevorick and I worked out an essentially smooth and easy transition to a new regime that allowed any member of the department to elect to join Cowles in return for some commitment to participate in the activities of the foundation. It has been a net positive change in that it strengthened the ability of the department to recruit excellent junior faculty across the board. There have been several internal promotions to tenure over the past few years both inside and outside of Cowles. It does make it more difficult, this is on the downside, for Cowles to develop a distinctive identity as a group of researchers pursuing a common agenda. However, having said that for Cowles as a whole, it hasn’t prevented, for example, the emergence of a very strong econometrics research group that does have a pretty clear research program. Phillips, Andrews, and Linton are pursuing a common agenda with enormous success. There is less coherence in the theoretical work being pursued by the economic theorists at Cowles, but the current leadership is trying very hard to use Cowles more as a national center for conferences on important and current topics in research. I am hopeful that the next few years will restore Cowles’ prominence and visibility in the profession.

The fact that the department is housed in four separate buildings has caused some problems, though not of a serious nature. Historically, communication has waxed and waned across the different areas in the department. The faculty do come together regularly for meetings. There is a high level of civility and mutual respect – not like many departments that are riven with deep antagonisms. People like one another and that has been the case since I joined the department in 1970. Patterns of interactions, however, tend to be focused more within the buildings than between them. So it has always been something of a limitation that the department is in separate facilities. This got better, especially the interaction between 28 and 30, when the Cowles situation was changed. Even before the Tobin Lounge was built, things had improved. Don Brown and Bill Brainard led the way by making it clear that people from Cowles could and should locate in 28.

During my tenure as chair and, before that, as DGS, I saw eight graduate student cohorts. It was not an especially strong time for Yale in attracting graduate students compared to the 60s and early 70s when we were regarded as being one of the top two or three graduate programs in the country. We did get excellent graduate students in several of the fields where we had traditional strength. For example, we attracted outstanding prospective econometricians, but in other fields we had slipped in appeal to graduate students relative to four or five other schools. It’s hard to say what caused this. The department was perceived as not having as much strength in the younger tenured ranks as some of the competitors, and that was a problem. That’s been much altered in the last decade. In the last few years, Yale students have done quite well on the job market, which is either an indication that the students are getting better training or that the department is getting better inputs. I suspect both are true to some extent. The department’s reputation will continue to improve in the coming years because of the combination of strong junior faculty and a much more visible representation of younger tenured faculty.

The job market for graduate students in the late 80s and early 90s was not the best it had ever been, but it was also not the worst. Yale students have always gotten pretty good jobs. What was a little light during those years was the number of people going to the absolute top departments in the country, somewhat fewer than it had been in the 70s. However, we didn’t have the problem that a lot of the humanities departments had, i.e., failure to place students. Throughout the whole period the department has had some wonderful graduate students, many of whom have gone on to great, successful careers. There is really no period from which one could not draw an outstanding all-star team. I have personally gotten great pleasure out of seeing so many of my own students move on to outstanding careers, and I served on something like 62 dissertation committees in my 19 years on the faculty.

One thing often not noticed when one thinks about the department and its position relative to other departments is the extraordinary quality of our undergraduate alumni. I have had at least as many, if not more, senior essay students who have ended up as outstanding economists in positions in major departments as I have had graduate students. Typically these students do their undergraduate work at Yale and then go on to MIT or Harvard, occasionally to other places. The department has had a fairly rigorous approach to undergraduate education in economics. I hope that’s still true, but I have noticed numbers increasing, which is worrisome. It was true in the 70s and 80s that enrollments in some competing institutions for undergraduate economics majors were much larger than at Yale, but that was at the expense of rigor in the programs. Economics was often an “easy” major even at some of the more illustrious competing institutions. At Yale, the department has always insisted on using mathematics liberally in undergraduate courses. We have assumed that students had mastery of calculus and could handle multivariate calculus in their courses and linear algebra in econometrics courses. That makes a big difference because it puts meat into the undergraduate program. Don Brown and I were both absolutely rigorous in our insistence that faculty teach undergraduates. There were one or two historically grand fathered exceptions to that rule, but essentially faculty were not allowed to escape their obligation to teach undergraduates. In truth it’s a pleasure to teach Yale College students so most faculty accept the responsibility quite willingly. Occasionally it is an issue in faculty recruiting since other departments are often more permissive in giving less onerous teaching loads to faculty and sometimes specifically offer exemption from undergraduate teaching as though that were a burden and not one of the pleasures of the job. Yale approached that very differently (at least under Brown and myself) and said that one of the best things about being at Yale was the opportunity to teach Yale College students. The burden is shared fairly, and everyone participates. The department occasionally loses people because of the teaching load, but very rarely.

Another development that has had an impact on faculty recruiting is the issue of academic superstars and the wage competition that has resulted. Yale has been slow to adapt to the change in regime. This makes some colleagues impatient but Yale, like Harvard, has always had a somewhat more egalitarian pay structure among senior faculty – not strictly egalitarian, but less skewed than a lot of other places. At the higher end, we do now have something of a competitive problem in economics that does need to be addressed. Yale won’t go to extraordinary levels of compensation, i.e., 75% higher than an average full professor. The university’s standards for tenure are so high that everyone here is a star and would be almost anywhere else. The fact that most faculty could command very high salaries at other institutions can’t guide us excessively. We just have to be sure we don’t get in a position in which institutions of comparable quality are outbidding us. We are holding our own in most other disciplines. Economics is more skewed than even engineering or computer science, and that’s surprising.

Finally, I’d like to add that any department history ought to give appropriate recognition to the remarkable longevity and devotion of some staff. In my years, Mary Doody, Eleanor van Buren, and Cornelia Awdziewicz retired after long tenure and tremendous service to the department. Eleanor assisted the DGS from before the time I was admitted as a graduate student to the beginning of my chairmanship. She was a great friend of so many students – more than an administrative helper but a personal counselor and source of real humanity for so many people. Cornelia was the undergraduate registrar for many, many years. Mary kept the place running extremely efficiently for at least 15 years. All three were terrific people. Having to replace both Eleanor and Mary was an important event in my tenure as chair. We did it in a somewhat unconventional way with a mother-daughter team, Lorraine and Pam O’Donnell.

William Brainard

I came to Yale as a student in 1957 (the same year as T.N. Srinivasan). I finished my degree in the fall of 1962 and was appointed assistant professor for the 1962-63 academic year. I had finished my degree just in time to get a retroactive appointment to July 1 and just about the same day my middle son was born. I’ve been on the faculty since then; my perception of what goes on in the department has gradually changed, partly I suppose simply from the passage of time, and partly as a result of passing through the ranks.

In my early days, there was a much stronger identification of faculty with the research centers. Most junior faculty were affiliated either with Cowles or the Growth Center. Cowles had formal control over some senior slots and at that time took a strong interest in junior appointments if they had to do with micro or macro theory, mathematical economics or econometrics. The Growth Center brought in a large number of junior faculty in connection with the country studies program. Although there was a departmental seminar where faculty presented their research or discussed current economic issues (Ruggles and Wallich, for example, had a friendly debate on the costs of inflation), much of the intellectual life of the department was concentrated in the research centers. My closest colleagues were other junior faculty members at Cowles; Cowles coffee did lead to quite a bit of informal contact with senior faculty.

In the late 60s, things were quite wild in the university at large. The Vietnam War and its political and social consequences dominated discussion within the university, with heated faculty meetings (too large for Connecticut Hall), boycotts of classes, teach-ins. The national skepticism about authority and the establishment was amplified on the campuses. We had a “town meeting” on the appropriateness of ROTC in the university (with an incredible tied vote of the more than 2,000 participants. Robert Dahl, chairman of the meeting, and Martin Shubik, one of the many tellers, assert to this day that it really was a tie and not simply a graceful way of ending a contentious meeting with roughly evenly divided participants). Faculty and students were focused not only on Vietnam, but also on civil rights, poverty and the environment.

In the department the same mood led to changes in the department’s appointments process. Before then, for junior faculty, and I suspect many senior faculty, the process was mysterious. I don’t know exactly how my appointment was made, but I’m sure there were no junior faculty members involved. I had been told that Yale never hired its own and that I should accept one of the other offers I had. I had deadlines for these offers and was ready to accept one of them when I got the offer from Yale at the last minute. The rumor was that Arthur Okun had called Richard Ruggles the Saturday before I had to decide and asked what this rule was anyway. On Monday I got an offer. My recollection is that Bill Nordhaus and Ted Truman, who were then junior faculty, led the drive for reform. Finding that the corporate bylaws allowed faculty to vote on appointments to their own rank or lower, they got agreement from the senior faculty to open meetings on junior appointments to all members of the faculty. While complicating the process, this was undoubtably a healthy change. It led to the much more formal and orderly process that we have today, and maybe even to better appointments! It also meant that junior faculty became much more aware of what was going on in the department than they had been when I first arrived. In the early days following the reform, there were some rather heated and raucous meetings, not only because there were more people making decisions, but also because issues of ideology and a bit of counterculture were sometimes involved. Many students, and some faculty, questioned the usefulness of economic theory and econometrics, the emphasis on efficiency rather than equity, on competition, rather than on power. During that period, we devoted a class in micro theory to a discussion of the relevance of theory. We did lose some students because of disillusionment with the value of an economics education and because of a personal questioning of the appropriateness of being in graduate school with so many pressing social needs outside.

The Bobby Seale trial was held in New Haven and the city was the site for a national rally protesting the trial. There was enormous turmoil. Brewster handled the situation gracefully, establishing a positive, welcoming stance and avoiding confrontation. He got the National Guard to agree to stay outside of town unless there was severe disorder. There was a lot of anxiety about violence, and, in fact, there had been some – the front of Ingalls Rink was blown out. It’s hard to believe in retrospect, but the younger faculty at Cowles thought we should have someone “standing guard” in 30 Hillhouse the night prior to the big march. We chose shifts, and Dave Cass and I had the graveyard shift. We sat in the seminar room, now the library, chatting, doing puzzles, etc. What we would have done if anyone had ever tried to do anything beats me.

The department has a tradition of civility, which stood it in good stead during this period. There was a great deal of collegiality and mutual respect even though there were very wide divergences of views about the issues. Ray Powell, whose office I now occupy, will always be a model; he was person of high principle who practiced what he believed. He had strong personal views, but great respect for the views and rights of others. He was one of the faculty who taught classes on schedule during a boycott, but also gave a complete second series for students who had boycotted. William Fellner was the epitome of the civility and graciousness of the faculty. For individuals like Fellner and Wallich, who had lived through the European experience, or had fled Europe, it was reminiscent of the breakdown of order and the license of extremes, and was enormously distressing. For younger faculty like myself, things were easier. We didn’t feel threatened and didn’t feel that our world was coming apart. It is remarkable how well Yale and the Economics Department came through that period; at other places there was great tension and bitterness.

There was tension with respect to some appointments and promotions involving “radicals.” Tobin and Powell were always determined to be fair, and there were painful reviews of individuals who most thought did not merit promotion, but where there was a question of whether the person was not highly regarded simply because of his beliefs. It made for quite interesting faculty meetings. There was also more discussion of the curriculum. Most faculty had a pretty clear idea of what was important to teach in graduate courses, but they had to do more defending and explaining why to students than either before or since. I don’t think there were any permanent changes, but there were some new courses responding to the felt needs of students. Bill Parker has described his involvement in one such course. There was also great interest in the environment, the role of government, education, poverty, etc. Dick Cooper, Peter Mieskowski and I taught a course on public goods and externalities, which attracted over thirty graduate students. Such a course would be lucky to get 4 or 5 students today. We had an informal seminar on Yale’s role in New Haven and on poverty and the environment. And there were a number of interdisciplinary courses involving faculty and students from a wide variety of departments. Much of this was good, but one did not need to be much of a cynic to predict that these were transitory interests, and that the excitement would not last very long.

The role of the department in the curriculum has changed over time, but probably not primarily in response to the politics of the 60s. Even before then there was more departmental involvement in the design of the basic courses than there is today. For example, at a departmental meeting where various undergraduate matters were discussed, the faculty teaching introductory courses (now Econ. 110, 111, 115, 116) would present and discuss their proposed course outline, reading list and text. It was always interesting to see whether the faculty member in charge of sections recommended Samuelson or Reynolds. Although most of the comments and suggestions from other faculty were minor, there was no question that the department regarded the basic courses as its responsibility, not individual faculty’s property.

There was some tension over this issue during the 60s. A junior faculty member teaching the intro course decided to make it essentially an anti-classical economics course. Art Okun’s oldest son was here as an undergraduate, and Okun was appalled at what he heard about the course. So Tobin talked to the instructor. I believe he said the instructor had a responsibility to teach the core economics material – if only so the students would have a clear understanding of what was being beat up. If he wanted to teach a course on radical economics, he could, but it would be advertised as such. Today we may discuss whether there’s too much or too little mathematics in the basic courses, but there isn’t the same fundamental questioning of the value of the discipline. In the late 50s and early 60s, there was an informal dress code – a lot of undergraduates and faculty (and even some graduate students) wore coats and ties. I was pretty much at the low end – as a student I wore gym shoes and sweat shirts to class. When I joined the faculty I didn’t change much and I guess I was fairly notorious for my informal attire. We had a Christmas skit in which I was to dress in a tux and everyone else was to wear t-shirts, blue jeans and sneakers. I borrowed Richard Ruggles’ tux, which didn’t fit too well but had a beautiful ruffled shirt (the pants were a bit too short). In the late 60s, the dress code dramatically changed; I suddenly found myself in median attire. Gary Smith set the new standard, teaching barefoot, with holes in his dungarees and t-shirt. When I became Provost, I had to have a tux so I asked Ruggles if I could buy the one I had used in the skit. He gave it to me (no ruffled shirt though). I took the pants to Rosie the Tailor to be altered and Rosie told me he had a better pair that had belonged to John Perry Miller. So the tux I have now is indeed quite special – Ruggles’ jacket and Miller’s pants.

One of the challenges of the department is finding talented people, and holding on to them. It has gotten harder. Yale is at a disadvantage in attracting dual-career households (but Amtrak is about to solve that!). As the profession has grown, there are more universities that have first-class departments. Demand for economists in private firms and government organizations (e.g., the IMF, World Bank, Fed) has grown. Business schools have become major competitors for talent. Economics departments have both benefitted and been hurt by the discipline’s success. Salaries and job placement of graduate students have done well during a period when other academic fields have not prospered. I don’t have the numbers, but I would bet that job turnover in the profession has gone up. I think these forces have subtly changed the degree to which faculty feel bonded to the department, and in general there is less institutional bonding and loyalty than there was twenty-five years ago. The fraction of faculty who go to Yale College meetings, or are heavily involved in university affairs, is smaller than in earlier days. At the same time, I am struck by how many of our faculty, junior and senior, are wonderfully concerned about undergraduates and teaching.

There has been a big change in the graduate student population, with globalization of the program. When I was getting my degree, most students were American. Yale got very strong applicants from U.S. colleges and universities. The experience of the depression, the macro economic problems of that period and the quantitative nature of economics attracted people into the profession. Small liberal arts colleges were a major source of such students. There was a blossoming of economics as a discipline with the development of modern tools of analysis and the availability of data and computers. It was exciting to be in a discipline that was in such a state of ferment, with challenges that seemed surmountable. There was optimism about the extent to which modern tools would enhance our ability to understand the economy. The strength of the applicant pool from U.S. colleges and universities gradually faded – I’m not entirely sure why. Yale undergraduates still went on to Harvard, MIT, and Stanford, but rather than going on to do graduate work in economics, they went to law school, medical school, business school, etc. At the same time, there was growth in the pool of qualified applicants from around the world eager to come to the U.S. The U.S. undoubtably has the best graduate education going, and we dominate economics education worldwide. The growth in talented applicants from abroad has had a variety of effects on the program. Foreign applicants have different interests from the typical American undergraduate. They are less likely to be interested in social security or U.S. monetary policy and more likely to be interested in theory and econometrics. They are less likely to go into applied areas which are interesting, in part, because they concern U.S. economic issues. Among the applied fields, they are more likely to be interested in international economics or development. This has obvious implications for both the demand and supply of different kinds of courses in the department.

The profession in general has become much more specialized, and there are fewer generalists. This is a major change since the 1960s. You used to be able to attend essentially every seminar. It couldn’t possibly be done today; indeed some even take place at the same time. Although there were fewer seminars then than now, everyone tended to go. Tobin, Koopmans, Okun, Fellner, and Wallich all came to the Cowles seminar on a regular basis. Seminars on theory, econometrics, or mathematical economics were expected to be more or less understandable to the whole population. Today, seminars are more specialized and tailored more to the folks in the field. While that has its advantages, the profession is more fragmented and there is less cross-fertilization of the sub-disciplines.

The department still has the notion of a “liberal” economics education but there’s some tension about it. Students take micro, macro, econometrics, and economic history and have to write an applied econometrics paper, but there’s a lot of chafing. Students who are interested in doing theory want to know why they have to do the applied topics, and students interested in applied topics want to know why they need all that theory.

The intellectual heroes of my day were people who were driven by concerns about applied problems even if they were very good on the technical stuff. Tobin, Samuelson, Arrow all had the technical tools but never lost their interest in policy. In retrospect, it seems remarkable that Arrow and Solow both served as staff on the CEA. Koopmans, a theorist and econometrician, was always motivated by a desire to understand real world phenomena. They were not interested in abstraction or the internal logic of theory for their own sake, but as a way of advancing our understanding of economic problems. They were broad in their outlook. That generation has either died or retired, and the next generation is more specialized. I worry that specialization in the profession breeds specialization and will create greater and greater distance between abstract theorists and the economist who’s worried, for example, about poverty.

The uniqueness of the department at Yale comes in part from the presence of Cowles and the Growth Center. Our great strength in econometrics and econometric theory reflects the Cowles tradition. We are strong in development even though that’s an area that has suffered in the profession at large. We are a pretty eclectic department, with a tradition that goes back at least to my earliest days when it was evident that individuals in the department, far apart in politics, respected and listened to each other. Fellner was conservative, but Art Okun always said it was worth arguing with him; Art always took him seriously. It’s a diverse faculty, and there is pleasure in that diversity. And we still have a reputation for seminars where papers are critically examined and where a lot of constructive criticism is handed out.

Appendix I
YALE DEPARTMENT OF ECONOMICS
Past Chairmen
Past Directors of Undergraduate and Graduate Studies
1951-52 through 2012-13

Note: In addition, the following article was distributed at the reunion:

“Conversations with James Tobin and Robert Shiller on the ‘Yale Tradition’ in Macroeconomics.” Conducted by David Colander (Middlebury College), Macroeconomic Dynamics 3, 1999, 116-143.

Source:  From Yale University, Department of Economics Reunion (April 16-18, 1999). Internet Archive, Wayback Machine (August 16, 2000).  Updated table for Appendix I from copy of the Yale economics department website at Internet Archive,Wayback Machine (May 8, 2013).

Image Source: Handsome Dan the Yale bulldog. Yale Alumni Magazine Website (March/April 2017).