A 'giant of record'.
Just as cats can look at kings, I can try to evaluate Paul Samuelson's achievements over a 90-year lifetime.
My own connection to Samuelson begins with my selection of graduate schools some fifty years ago, including ignoring the sound advice offered by Alvin Hansen, quite probably Paul's true mentor at Harvard. In a labor economics seminar at the University of Wisconsin during the 1910s, Hansen had submitted a term paper written in longhand to John R. Commons, who was assisted by my father Selig Perlman, who became a longtime professor of labor economics at Wisconsin. It was Perlman who worked his way through Hansen's handwriting and went to Commons, saying this is not only the best paper submitted, but one which you 'must read.' Thereafter Hansen's reputation was made, and in time he was recommended for three positions--Brown, the University of Minnesota and finally at Harvard where he relocated in 1937 and remained active on the faculty until 1962 and then as an emeritus until his death in 1975.
Just before the 1946 winter break my father advised me to tour several universities to see where I should apply to take a doctorate. I recall conversations at Harvard with Sumner Slichter (in earlier days my father's fellow graduate student) and then with Alvin Hansen. Slichter, to whom I eventually dedicated a book, assumed that anyone in his right mind would try to get into Harvard's program. Thus it came as a distinct surprise to me when Hansen, after recalling how pivotal Selig had been in his own career, told me that if I were intent on coming to Cambridge, the place to go was MIT. Why? Because Samuelson was not only there, but also because he was building a 'greater' faculty than Harvard's. Here I must admit I erred; I did not take Hansen's advice, nor Slichter's, nor a good many other scholars'.
What matters here is why Hansen thought so much of MIT. Years later (in the 1980s) when I was long the senior professor of economics at the University of Pittsburgh, our Provost came to me and asked what it would take to improve Pitt's economics department. I told him that I thought on a scale of 10, Pitt had, at best, a grade five department, and with a fair sum of money I believed it could possibly be raised to a good grade three department. "No better than that?" was his reaction. My reply was that in my opinion there were only three first-rate departments of economics at that time in the United States: MIT, Chicago, and Stanford. They were first-rate because they had recruited brilliant graduate students (generally on some form of fellowship), brilliant faculty members, and most to the point, the two really worked together. Many schools had the first two, but it was the lack of close faculty interaction and true interest in their students that marked them as simply second-rate. What Samuelson was bringing to MIT, Hansen opined, was not only his own brilliance but a wonderful openness with excellent colleagues and students. (Indeed, it was my own worries about my skills not being what Samuelson would think brilliant that forced my choice against going to Cambridge.) But I have never forgotten that 30 minute conversation with Hansen.
I reminded him of it when my wife, Naomi, and I met the Hansens again in 1958 while touring Japan. Their cicerone was Shigeto Tsuru, not only a long-time close friend of Samuelson's, but the one who translated repeatedly the various editions of Samuelson's Principles into Japanese. Shigeto introduced himself to my wife and me by noting that he had once been my father's student at Wisconsin, and that Samuelson and he were both Hansen proteges. (1) From that beginning a long and for me certainly a very precious friendship developed, furthered by the semester that Shigeto and his wife, Masako (the great-grandchild of the Goro Kiddo), later spent at Hopkins where I was then teaching. A clear byproduct of my knowing Shigeto was a tremendous derived appreciation of Samuelson. It is from Tsuru that I gained some further insight into that wonderful Samuelson-openness which Hansen had so appreciated.
So much by way of introduction. Even so, it marks the first part of Samuelson's tremendous heritage--he built a first-rate economics department not only by being seemingly effortlessly brilliant, but by being willing to work with brilliant colleagues like Tsuru and many unusual students of whom George Akerlof, Michael Spence, and Joseph Stiglitz are exemplar. (2)
The remainder of this essay has two substantive parts. The first describes the importance attached to the 1947 Foundations--what it did in a positive sort of way, what it clearly omitted, and, given a reference to Richard Goodwin, just why. The second takes up Samuelson's work from my favorite standpoint--identifying his (at times conflicted) authority systems and from where they seemingly derived. And the finale is really a coda repeating the original themes, that perhaps Samuelson's greatest (because it is dynamic) contribution was his influence on the development of one of the very few top departments of economics in this country, and indeed in the world, and his being for more than half a century the final word on economic statics.
2. The Samuelson Intellectual Legacies
Here we can begin with another important point about Hansen, which relates directly to Samuelson's preeminence among American economists. Hansen's work in labor economics at Wisconsin focused on what Marshall called the secular trend, or economic dynamics, the study of which was built on institutional history (Marshall, 1923). As such it defied the use of logic (i.e. mathematics) because full specification of all the variables was virtually impossible or at least terribly difficult. When Hansen went to Minnesota, a department that focused on static economics, he devoted himself to teaching its analytical apparatus. But with the constant adeptness of his mind, particularly when it was focused on economic welfare, he was one of the first Americans to see the new possibilities for relevant static analysis to be found in Keynes' General Theory. Hansen's interest (Hansen, 1941) in adding the Keynesian general equilibrium analytical apparatus to the usual (often Marshallian) static analysis found its later fruition in Samuelson's dissertation.
In my view the 1947 publication of that dissertation as The Foundations of Economic Analysis effectively changed the training language of professional economics from prose to equations. (3) True, even at the time there were professional economists who saw in what Samuelson had done the seeds of some professional disaster, for his exercise had ennobled static analysis built around a Newtonian concept of equilibrium, and the math really was not suited for handling the multiple historic-, cultural-, nationalistic-, theological-, or group-collective-bargaining complexities underlying historic economic dynamics, much less the complexities of institutional influences. (4)
But then there was his 1948 Economics (Samuelson, 1948), which contained a far more-than-merely-competent display of knowledge about the roots and evolution of several American economic institutions, including their dynamic (reform) programs. It was also one of the few undergraduate American general economics textbooks containing some efforts at explaining Marxism. Though the book was focused on the teaching of undergraduates, as one who was taking his doctoral examinations in economic theory at the time (1949), I calculated that Samuelson's so-called 'elementary' Economics was really the best general review on economic theory to be had (even though my examiner was George Stigler, whose own textbook I thought uninspiringly mechanical). Since 1948 Samuelson's Economics has gone through numerous revisions, each revision perhaps weakening his original display of dynamic (reform) programs in an effort to ready undergraduates to slip into the static abstractions that graduate training increasingly demanded.
3. Harvard, Schumpeter, and the Filiation of Ideas
One way of appraising Samuelson is to guess why Harvard forewent hiring him. Samuelson attributes Harvard's anti-Semitism to Burbank, which seems to have been a strong source (see Perlman, 2001). But there were in the Department significant scholars who should have thrown their weight against Burbank and the others of his ilk. Harvard's tragedy was that they did not choose to do so. These included Austrians, one of whom admitted to me that they often referred to Samuelson as der Judenbanker or of being guilty of the 'Jewish offense' namely being an 'early bloomer.' (5) So instead of Samuelson, they put up as their candidate Paul Sweezy, who albeit a Stalinist came from a prominent banking family--indeed his grandfather was one of J.P. Morgan's partners. The Harvard faculty may have pride in their being tolerant of ideas; it was their socio-ethnic intolerance that stumped them. Something of a 'self-identified' Schumpeter emotional-if-not-actual-stepson, Wolfgang Stolper wrote a biography of Schumpeter that takes as a principal theme that Schumpeter was not really an anti-Semite (Stolper, 1994). Perhaps not by German or Viennese standards, but that Schumpeter and Habeler did not force the issue of Harvard's retaining Samuelson suggests a reticence that cost Harvard its traditional claim to academic leadership in the field of economics, something of which Alvin Hansen was all too aware. On the other hand my father's judgment about envy might well have been an even more basic reason (see note 3 supra).
I infer from Samuelson's many references to Schumpeter that Samuelson's one-time interest in Marxian theory never bothered Schumpeter (who was at his best a 'do-it-yourself Marxian'). (6) For years Samuelson eschewed any open criticism of Schumpeter, but in 1980 when speaking at the International Economic Association's Congress in Mexico City, Samuelson chose adjectives revealing criticism not of Schumpeter's ideas but of his character. (7) Interestingly enough, just when Schumpeter actually penned the closing paragraphs of his History of Economic Analysis (Schumpeter, 1954, pp. 1182-84) is not known to me, but what those closing words imply is that his Holy Grail, a dynamic theory of general equilibrium, would probably flow in time from Samuelson's pen. (8) Schumpeter's was an historic figure, for reasons including his knowledge of bibliography, his distaste for the nearly total impact of Benthamite Utilitarianism on modern western economic thought, and the many tragedies in his life (though several were not self-inflicted, I would hold that an uncommon number were just that). But as with Isaac Newton, his brilliance could not overcome certain character defects.
On the day that I joined the Pitt faculty, Asher Isaacs, who taught the required doctoral course in the History of Thought, dropped dead. I was asked to replace him, and thereafter I taught what was eventually Pitt's undergraduate Honors College and non-required departmental PhD two-semester course. I began to devour books I thought offered creative treatments of the subject. (9) At first I depended most heavily upon a pirated Taiwanese version of Schumpeter's 1954 History, which I had purchased in 1962 but not really examined. For a long time thereafter I was much taken with his schema of the filiation of ideas. (10) So much so that when I established the Journal of Economic Literature I was eager and grateful for the record number of four articles Samuelson wrote. The first on Marx's Transformation Problem (Samuelson, 1971) provoked a flurry of offers to rebut. Eventually besides publishing some of them (among others, William Baumol (1974a, 1974b), Abba Lerner (1972), Michio Morishima (1974), and Joan Robinson (1973) I also asked Martin Bronfenbrenner (1973a, 1973b) to comment on Robinson's attack. Of course I had my own ideas about the Transformation Problem gleaned from my father's course, "Capitalism & Socialism," wherein he spent about half a dozen lectures on Marx's writings. I recall asking Will Baumol about his interpretation, and upon realizing that it differed from all but my father's, I asked him whether it was possible that he, too, had read Capital in German; "Of course," he said. The going translation of Capital, published by Charles Kerr & Co., made little or no sense. Samuelson's second article was less provocative, entitled "COMPLEMENTARITY: An Essay on the 40th Anniversary of the Hicks-Allen Revolution in Demand Theory" (Samuelson, 1974). The third was a discussion of the literature on the St. Petersburg Paradox (Samuelson, 1977). The fourth in 1978 "The Canonical Classical Model of Political Economy" vexed Sam Hollander (Hollander, 1980) and brought an immediate reaction from Samuelson (Samuelson, 1980).
When questioned several times about my 'featuring' Samuelson so often, I recall replying that his articles generally exceeded my standards for analytical originality as well as for offering every reader some parts that he could readily appreciate. They remain the exemplar Schumpeterian efforts, always explained formally--as only ideas can be explained formally, historically oriented to previous writers' intellectual legacies, and then laid out in understandable prose.
In 1991 I was asked to give my views, based on my study of the early American professional economics journals, on what accounted for a journal's success (Perlman, 1991). Among the major factors was the editor's finding a scholar who delivered interesting articles regularly (and on time!). Indeed, as I look over the 12 plus annual volumes of the Journal of Economic Literature that I edited, it was Samuelson's four articles and discussions of at least two of them that characterized the string or linkage that gave reading the journal a continuity during my tenure. Samuelson's contributions were in just about half of those volumes. He was to my editorship of the Journal of Economic Literature what Bates Clark had been to the early volumes of Charles F. Dunbar's Quarterly Journal of Economics and what Irving Fisher had been to the early volumes of Edgeworth's Economic Journal. I can think of no other living economist who could write so many technical, but entirely different, articles in so short a time period. Effortless superiority!
As the years went by, my course took on a pattern of its own. I was convinced that ideas had short lives unless they became institutionalized, and the very process of institutionalization was almost invariably associated with a cultural authority system. In 1984 Karl Pribram's The History of Economic Reasoning was published posthumously (Pribram, 1984). Its principal thesis is that modern economics reflects a continuous methodological conflict between Platonic thought and some improved form of Aristotelian empiricism. Pribram was von Wieser's man, and although Schumpeter had become for a time Boehm Bawerk's protege, Schumpeter's major professor had really been von Wieser. So in a way Schumpeter's filiation of ideas originally was mostly a fascination with the Platonic elements he could find in economics, mathematics and all. (11) Pribram's successors to Plato were really Roger Bacon and Descartes; his successor to Aristotle was Francis Bacon and the group founding the British Royal Society. Newton seemed for generations the perfect fusion of the two. Historically considered, the Newtonian system of equilibrium of forces seemed so perfect that virtually every discipline sought to find its Occam's Razor equivalent.
And so it seemed to me in the late 1940s when I first examined Samuelson's Foundations that his leadership in switching to the centrality of mathematics in graduate economics departments and away from concentration of problems (e.g. labor problems; the business cycle; economic growth and nationalism) would become the institutional significance of his dissertation. What I could not find there was any strong interest in dynamic syntheses of historical material--something that had been the focus of my training both at Wisconsin and at Columbia (I took Maurice Clark's rather than Stigler's or Vickrey's seminars on theory).
In the discussion of a paper given at the Second Schumpeter Society Congress (1988) in Siena, Richard Goodwin told a story of his going regularly to Schumpeter offering to show him some new mathematics that could yield Schumpeter's Holy Grail (i.e. a model of dynamic equilibrium). Schumpeter, whose actual knowledge of mathematics was far below the competence of his mathematical intuition, invariably poured cold water on Goodwin's latest. (12) However, by 1988 Goodwin had become convinced that the future of dynamic economic modeling was going to be associated with chaos theory, and that Schumpeter, if alive, would have agreed with him.
Goodwin's efforts aside, what dominated and still rules the training of economists is Samuelson's contributions. (13) The premier authority in the Samuelson system is the tradition of Plato and Descartes. Yet, there has always been in his mind something of a conflict, between the emphasis on mathematical logical perfection and a contrary mixed-up empirical politics, namely the mid-western 'progressive reformism' of his boyhood. It is more than a mixture of the populist tradition of the late nineteenth century, more than a strain of La Follette Progressivism, more than the shadow of American Marxism of the 1930s (see Perlman 1993 for a somewhat more detailed discussion of this point). For me it is no coincidence that just before his 90th birthday Samuelson, the very apotheosis of American professional economic wisdom, should write an essay questioning the social effects of international outsourcing (Samuelson, 2004). To return to the world of cliches, Samuelson left the American Midwest, but that Midwest never left Samuelson.
Let me close with one more reference to Schumpeter. From the standpoint of the history of economic thought during the middle part of the twentieth century there was an interesting difference of opinion: "Who affected the 'economic science' the more, Walras or Ricardo?" Schumpeter, when writing what became his posthumous 1954 History of Economic Analysis proposed Leon Walras. In Lionel Robbins (of London School of Economics and The Financial Times fame) review of that book) he thought that Ricardo clearly outclassed Walras (Robbins, 1955). Neither seems to have recognized that both answers, even then, were outdated.
For had they only looked into what was actually going on at the moment, they would have realized even then that the 'winner' could only be Paul Anthony Samuelson. What he had accomplished even prior to 1950 involved not only changing the lingua franca of the profession from prose to some forms of mathematics, but also the turning of the profession from the study of institutional dynamics to concentration on stability conditions in the often-unrealized complex area of economic statics. And the fame of both Ricardo and Walras rested on their contributions to economic statics.
For me scientific inquiry is not teleological. But for the post-World War II generations of economists, no one in the past (even Stuart Mill or Marshall) ever approached the universal influence of Samuelson. I have written elsewhere that no economist has ever so affected the course of world history as Kuznets, (14) (it turns out to have been a contribution both in economic statics and economic dynamics) but Kuznets's impact on the current profession simply pales by comparison with Samuelson's (Kapuria and Perlman, 1995). Both are, to my mind, clearly the economists' 'giants of record.'
Baumol, William J. (1974a) "The transformation of values: what Marx really meant (An interpretation)," Journal of Economic Literature, vol. 12, pp. 51-62.
--. (1974b), "Comment," ibid., pp. 74-75.
Brentano, Lujo (1870). On the history and development of gilds & the origins of trade unions. Jena: Diederichs
Brigante, John E. (1950). "The feasibility dispute: Determination of war production objectives for 1942 and 1943." (Washington, D.C.: Committee on Public Administration Cases).
Bronfenbrenner, Martin (1973a). "Samuelson, Marx, and their latest critics." Journal of Economic Literature, vol. 11, pp. 58-63.
--.(1973b). "Comment on Robinson's 'Samuelson and Marx'." Ibid., pp. 1367.
Dorfman, Robert, Paul A. Samuelson, & Robert A. Solow (1958). Linear Programming and Economic Analysis. New York: McGraw-Hill.
Frisch, Ragnar (1951). "Some personal reminiscences on a great man." in Harris, Seymour (1951).
Hansen, Alvin (1941). Fiscal policy and business cycles. New York: W.W. Norton.
Hanusch, Horst (2007) The Elgar Companion to Neo-Schumpeterian Economics. Aldershot (UK): Edward Elgar.
Hollander, Samuel (1980). "On Professor Samuelson's canonical classical model of political economy." Journal of Economic Literature, vol. 18, pp. 559-74.
Kapuria-Forman, Vibha and Mark Perlman (1995). "An economic historian's economist: remembering Simon Kuznets." Economic Journal, vol. 105, pp. 1524-47.
Khachaturov, Tigran S. (1983). "Comments on Professor Samuelson's 'The world economy at century's end." In Tsuru, Shigeto (ed.) (1983), pp. 89-94.
Lerner, Abba P. (1972). "A note on understanding the marxian notion of exploitation." Journal of Economic Literature, vol. 10, pp. 50-1.
Machlup, Fritz (1952). "Issues in methodology," American Economic Review: Papers and Proceedings, vol. 42. pp. 34, 69-78.
Marietta, Morgan and Mark Perlman (2000) "The Uses of Authority in Economics: Shared Intellectual Frameworks as the Foundation of Persuasion" The American Journal of Economics & Sociology 59,2:151-89.
Marshall, Alfred (1923, 4th edition). Industry and trade: a study of industrial technique and business organization, and of their influences on the conditions of various classes and nations. London: Macmillan.
Mitchell, Wesley Clair (1967, 1969). Types of economic theory: from mercantilism to institutionalism. New York: Augustus Kelley.
Morganstern, Oskar (1972). "Thirteen critical points in contemporary economic theory: An interpretation," Journal of Economic Literature, vol. 10, pp. 1163-89.
Morishima, Michio (1974). "The fundamental marxian theorem: A reply to Samuelson." Journal of Economic Literature, vol. 12, pp. 71-74.
Perlman, Mark (1991). "On the editing of American economic journals: Some comments on the earlier journals and the lessons suggested." Economic Notes, vol. 20, pp. 159-72.
--. (1993). "Series editor's note," in Tsuru, Shigeto (1993), pp. 267-70.
--. (2001). Editing economics: Essays in honour of Mark Perlman. Edited by Hank Lim, Ungsuh Kenneth Park, and Geoffrey Harcourt. London and New York: Routledge.
--.(unpublished). "Schumpeter's views on methodology: Their source and their evolution." See Hanusch, Horst (2007).
Perlman, Mark and Morgan Marietta (2005) "The Politics of Social Accounting: Public Goals and the Evolution of the National Accounts in Germany, Britain, and the United States" Review of Political Economy, vol. 17, pp. 211-30.
Perlman, Mark and Charles R. McCann (1998). Pillars of economic understanding: Ideas & traditions. Ann Arbor: University of Michigan Press.
Pribram, Karl (1984). A History of Economic Reasoning. Baltimore and London: Johns Hopkins University Press.
Puttersmith, K. (ed.) (2002). Paul Samuelson & the foundations of modern economics. New Brunswick, N J: Transactions Publisher.
Robbins, The Lord [Lionel] (1955). "Schumpeter's History of Economic Analysis." Quarterly Journal of Economics, vol. 44, pp. 1-22.
Robinson, Joan (1973). "Samuelson and Marx." Journal of Economic Literature, vol. 11, pp. 1367.
Samuelson, Paul (1947) Foundations of economic analysis. Harvard Economic Studies, vol. 80. Cambridge, Harvard University Press.
--. (, 2004). Economics: An introductory analysis. New York: McGraw-Hill.
--. (1971). "Understanding the marxian notion of exploitation: Called transformation problem between marxian value and competitive prices." Journal of Economic Literature, vol. 9, pp. 399-431.
--. (1972). "The economics of Marx: An ecumenical Reply." Journal of Economic Literature, vol. 10, pp. 51-7.
--. (1973a). "Reply [to Bronfenbrenner] on marxian matters." Journal of Economic Literature, vol. 11, pp. 64-8.
--. (1973b). "Comment [on Robinson's 'Samuelson and Marx']." Journal of Economic Literature, vol. 11, pp. 1367.
--. (1974a). "Insight and detour in the theory of exploitation: A reply to Baumol." Journal of Economic Literature, vol. 12, pp. 62-70.
---. (1974b). "Rejoinder: Merlin unclothed, A final word." Journal of Economic Literature, vol. 12, pp. 75-77.
--. (1974c). "COMPLEMENTARITY: An essay on the 40th anniversary of the Hicks-Allen revolution in demand theory." Ibid. vol. 12, pp. 1255-89.
--. (1977). "St. Petersburg paradoxes: Defanged, dissected, and historically described." Journal of Economic Literature, vol. 15, pp. 24-55.
--. (1980). "Noise and signal in debates among Classical Economists." Journal of Economic Literature, vol. 18, pp. 575-78.
--. (1983). "The world at century's end." In Tsuru, Shigeto (1983), pp. 58-77.
--. (2001). "Where Ricardo and Mill confirm and rebut arguments by mainstream economists supporting globalization." Journal of Economic Perspectives, vol. 18, pp. 135-46.
Samuelson, Paul. A; Solow, Robert M.; & Dorfman, Robert (1958). Linear programming and economic analysis. (see Dorman, Robert).
Schumpeter, Joseph (1952) Memorial Volume. See Hanson, Seymour (1951).
--. ( 1994). History of economic analysis. With a new introduction by Mark Perlman. New York: Oxford University Press.
Stolper, Wolfgang (1994). Joseph Alois Stolper: The public life of a private man. Princeton: University of Princeton Press.
Tinbergen, Jan (1951). "Schumpeter and quantitative research in economics." See Harris, Seymour (1951).
Tsuru, Shigeto (Editor for the International Economic Association) (1983). Human resources, employment and development. Volume 1. Proceedings of the International Economic Association held in Mexico City, 1980, New York: St. Martin's Press.
--. (1993). Japan's capitalism: Creative defeat and beyond. New York: Cambridge University Press.
(1.) Tsuru is one of the most remarkable men of the pre-war Harvard generation. He is a real pundit of the type one almost never comes across. When I once mentioned this point to Samuelson, he indicated that Shigeto's mind was too brilliant for even him to argue with. If ever there was a true reason for a first-class mutual admiration society it seems to me that Paul and Shigeto easily qualify. For those wanting to know more about this amazing scholar see my Nachwort to his 1993 Japan's Capitalism: Creative Defeat and Beyond (Tsuru, 1993).
(2.) A brief anecdote may shed light on why this is so unusual. I once remarked to my father about David Hume's observation that the basic sense was the sense of smell. He responded that he didn't know about 18th century Edinburgh ("I was never there" he said in his rich Russian-Yiddish accent), "but in 20th century Madison surely the basic sense is the sense of envy."
(3.) The almost equally brilliant Linear Programming and Economic Analysis (Samuelson, Solow, & Dorfman, 1958) not only confirms this point, but also serves to confirm the earlier observation about Samuelson's selfless indifference to sharing the spotlight with brilliant colleagues.
(4.) Fritz Machlup was sufficiently concerned about the looming Samuelson influence that he organized a session on Methodology at the 1951 American Economic Association meetings (see American Economic Review Supplement, May 1952). It was at that session that Samuelson improved on Willard Gibbs statement that, "Mathematics is a language"; Samuelson's version was "Mathematics is language."
(5.) Schumpeter often articulated a 'mild but continual' criticism of early bloomers, that being in his (apparently not self-regarding) eyes principally a distasteful Jewish characteristic. Insofar as I am aware Samuelson has always eschewed personal religious or Jewish cultural identification.
(6.) Marxism was a popular topic around Chicago and Harvard and most other American universities prior to the early beginnings of the Cold War when Soviet distrust of the American government was becoming reaffirmed, for some unexpectedly.
(7.) They do not appear in the formal, printed version of Samuelson's talk (see Samuelson, 1983), but I clearly recall the leading Soviet 'delegate' remarking immediately upon taking the floor that after hearing Samuelson they (the Soviet economists) had additional reasons for despising Schumpeter (cf. Khatchurov (1983) particularly at p. 89).
(8.) Schumpeter's point is that Keynes had a feel only for static analysis which both Hansen-Samuelson and Arthur Smithies had formalized. His hopes were that Samuelson could reshape his static model to one that had dynamic propensities.
(9.) As one trained in American institutionalism I had found that Wesley Clair Mitchell's lectures on Formative Types of Economic Thought were much to my taste but greatly lacking in the critical analysis of the evolution of ideas and not much more inspired in his examination of the institutions that gave flesh to the boney-theoretical structure (Mitchell, 1967, 1969). Fortunately that lack was made up by my full year course with John Maurice Clark. Clark was the only one at Columbia's economics department in my time who could begin to rival my father in synthesizing institutional, ideological, and intellectual elements to become a useful whole. Jacob Viner, whose course I audited while teaching at Princeton, dismissed Quesnay's Tableau Economique in ten minutes showing that its linear schema was flawed. John Maurice Clark spent two lecture hours showing that if redrawn the Tableau was the basis of all macroeconomics, albeit that term was in 1948-49 not yet in general use.
(10.) Over the years I changed my view and substituted for Schumpeter's filiation of ideas my own thoughts about the authority system underlying those ideas (Perlman and McCann 1998, Marietta and Perlman 2000). Authority systems are themselves the critical 'institutions,' and my conclusion became that an idea without an institutional underpinning tended to be like a wind-blown leaf.
(11.) Richard Swedberg (whose biography of Schumpeter both Samuelson and I have written is the current last word on that subject) wonders why Schumpeter had no use for Wisconsin institutionalism (Swedberg, 1991). The answer I opine is that Commons and Co. were 'episodic empiricists' (Kuznets's phrase), and there is no easy way to show the filiation of social institutions, albeit semi-geniuses like Lujo Brentano have tried it and done pretty well (Brentano, 1870).
(12.) Both Ragnar Frisch and Jan Tinbergen explicitly remarked in the Schumpeter Memorial Volume published by Harvard (Schumpeter 1952) that they were amazed at how little mathematics Schumpeter seems actually to have known. That topic is discussed fully in my paper, 'Schumpeter's Methodology,' in a forthcoming book edited by Horst Hanusch and to be published by Edward Elgar (Hanusch, Horst [ed.] 2007).
(13.) In 1972 I published what I thought would be the equivalent of 'starting a gold rush,' namely Oskar Morgenstern's quizzical "Thirteen Critical Points in Contemporary Economic Theory: An Interpretation," which among other things attacked several sources of Samuelson's influence on economic theorists. It surprised me that even the co-author of the Theory of Games went almost totally unnoticed, so firm has Samuelson's influence been on the profession.
(14.) My views come not only from many discussions with Kuznets but are also reinforced by John Brigante's revised dissertation (Brigante, 1950). Kuznets in 1940 served on Robert Nathan's 'Planning Committee' of the War Production Board. After he criticized the U.S. Army command for its outdated materiel acquisition policies, no less than General George C. Marshall came down to the WPB and told Kuznets and Nathan to their faces that 'the Army didn't need university intellectuals telling them how to do its business.' The two men immediately resigned. But that was not the end of the story. Nicholas Eberstadt, a New York investment banker, went to the venerable George L. Stimson (quondam Secretary of War under Taft, Secretary of State under Hoover, and then Secretary of War under FDR), and persuaded Stimson of the validity of Kuznets' view. Secretary Stimson ordered Marshall and the Army to comply with Kuznets' plans for war production. Whereas only 4 percent of the American GNP was war-materiel oriented in 1941, by 1944 (the last full year of the conflict) it reached 48 percent. The size of that shift is credited to Kuznets (see Perlman and Marietta 2005). To the best of my knowledge the only other 'person' credited with organizing a nation's supply so that it survived was 'Joseph, the son of Jacob.'
Mark Perlman, University of Pittsburgh. I am indebted to Morgan Marietta for editorial and other suggestions.
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