Economists who passed away in 2016

These (below) are the ones I remember, but there are certainly more. Here, with links to obituaries: Karl Case, Aldo Ferrer, Lloyd Shapley, Thomas Schelling, Charles L. Schultz, Lester Thurrow, Robert Tollison. The only one I met was Ferrer, in a few conferences in Argentina and Brazil. Two "Nobel" (Central Bank of Sweden) Prize winners among the departed. Interesting that Shapley said about his prize that: "I consider myself a mathematician and the award is for economics. I never, never in my life took a course in economics." So I'm not sure he should be on this list (or there should be a prize like that one). Of the non-economists discussed in this blog, the most prominent loss in 2016 was the historian William McNeill. He is one of the authors from other social sciences that I suggest, like say Jared Diamond or David Graeber, that use the surplus approach analytical framework, more akin to old classical political economy than modern marginalist (neoclassical) economics. And Keynes is still dead, 70 years ago this year, but there is always hope for an intellectual revival.

PS: Sad addendum, Tony Atkinson passed away.

Obituaries: Nathan Rosenberg (1927-2015)

E-mail was sent to the Society for the History of Economics (SHOE) informing that Nathan Rosenberg has passed away. Have not seen an obituary, but will link later. He was the author How the West Grew Rich, that suggested that freedom was central for creating the supply-side conditions for economic growth in Western Europe. Several heterodox neo-Schumpeterians used his work, in particular Inside the Black Box. Personally I prefer demand-driven stories, including for technology. At any rate, another blow for economic history, that has less space in economics departments, and that needs clear, erudite thinkers like him.

Eduardo Galeano (1940-2015)

Open Veins

Galeano, famous for The Open Veins of Latin America, among several other books, has passed away. He was a leading voice of the Latin American left, as The Guardian elegantly put it, which is a more accurate description than the 'anti-capitalist' epithet used by Reuters.

I inherited the copy of the book pictured above from my mom, who loved Galeano's books, in the 1980s, I guess, when I decided to study economics. I can't say that I was influenced by his book, even though Galeano thanks one of my teachers, Carlos Lessa.* He wasn't an economist, and I normally wouldn't post about it. But I decided to post something since, not long ago, a friend told me he had disavowed the book.

If one reads the accounts of his rejection of the book, it seems that it was the language, the vocabulary of the left in the early 1970s, which Galeano seemed to suggest that was heavy and dated, what led to his criticism of his work. Also, as he got older, and found mistakes in the book (sadly he doesn't specify which ones), his older self tended to be less satisfied with the result. Note, however, that in this discussion about what message he would like Obama to get from the book, after Chávez gave the US president a copy, he summarizes the basic point, which he seems to still uphold. In his words, he wanted Obama to get: "a certain idea about the fact that no richness is innocent. Richness in the world is a result of other people's poverty. We should begin to shorten the abyss between haves and have-nots."

A cursory look at the book might give you the not altogether incorrect sense that Open Veins provides a simplified version of Dependency Theory. Galeano was a popularizer of the kind of political economy that can be broadly defined as Structuralist. One not all together different from the one used for consumption in American universities, which simplifies and blames underdevelopment on developed countries, and that sees limited space for development in the periphery.** And, in that sense, it is a good thing that Galeano could say: "Reality has changed a lot, and I have changed a lot." But it is unclear that he threw the baby out with the bath water.

* If I had to say a book that influenced my choice to study economics, that I read in high school, it was Osvaldo Sunkel's El marco histórico del proceso de desarrollo y de subdesarrollo, which has a message that is not altogether different from Open Veins, namely that underdevelopment is part of the same process that caused development. Think of the Industrial Revolution in England, that goes hand in hand with deindustrialization in India. Industry and empire, as another historian would put it, are tied together.

** For alternative and more sophisticated versions see here.

Frederic S. Lee

Sad news for the heterodox community, Fred Lee has passed away. He was a tireless builder of institutions, an activist for Post Keynesian, and institutionalist economics, creating space for heterodox economists and he will be sorely missed. Below one of his last presentations.

Check also his website here. His short bio from the website below.

I attended a small state college in Maryland where I majored in history and took a bit of philosophy. After graduating in 1972, I took some more philosophy courses. But then I got interested in economics and began reading books and articles by Smith, Ricardo, Marx, J. B. Clark, Schumpeter, Joan Robinson, Keynes, Kalecki, Sraffa (or at least I tried to) and others. After working in Saudi Arabia for a couple of years, I returned to the States and attended Colombia University (1976-77) where I picked my undergraduate economic courses. While there I read about everything I could find on costs, pricing, the determination of the mark up, and the business enterprise; and the economists I read included Philip Andrews, Adrian Wood, Harcourt, Hall and Hitch and many others. Because I was a Post Keynesian economist (although I did not know it), it was suggested to me that I go talk to an economists called Alfred Eichner. I did so and became part of the Post Keynesian movement. After Colombia, I went to the University of Edinburgh for a year; and then returned to Rutgers University where I got my Ph.D. My teachers included Jan Kregel, Paul Davidson, Nina Shapiro, and Eichner. In my first year, I took an independent study with Kregel and he told me that I should read the Keynes-Harrod letters regarding the General Theory which had just been published. I did so and wrote a paper which became the basis of my first article, "The Oxford Challenge to Marshallian Supply and Demand: The History of the Oxford Economists’ Research Group." I left Rutgers to take up a one-year teaching position at the University of California-Riverside; and after 3 years there I obtained a tenured position at Roosevelt University in Chicago. In 1990 I went to England where I taught at De Montfort University in Leicester for the next decade. In August 2000 I moved to Kansas City to take up my current at UMKC.

My research interests are Post Keynesian microeconomics, Post Keynesian industrial organization, and the history of economics in the 20th century, with special emphasis on the history of heterodox economics. I am currently writing a monograph on Post Keynesian microeconomic theory. In addition, I am engaged in three other projects, the history of heterodox economics in the United Kingdom since 1945, market governance in the U.S. gunpowder industry, 1865 to 1900, and Congressional response to the problem of corporate size, monopoly and competition, 1945 to 1980. This last project is quite exciting because it enables me to explore the administered price controversy, examine in detail various institutional economists such as Walton Hamilton and John Blair, and examine the way neoclassical economists used their institutional power to suppress heterodox economics. These four projects are generating a great many but more specific projects that are just perfect for Ph.D. dissertations.

PS: Barkley Rosser has written a nice post on Fred here. Other posts by Stephany Kelton, Lars Syll, David Ruccio and others have been linked here.

Augusto Graziani's contributions to economics

(1933-2014)

Augusto Graziani one of the leaders of the Italian Circuitist School has passed away. Below the abstract of the recent paper on Graziani's contributions to economics by Riccardo Bellofiore published in the Review of Keynesian Economics (ROKE).

"The article gives an appraisal of Augusto Graziani's thought as a heterodox structural Keynesian. Graziani has always challenged the basic assumptions of orthodox theory by rejecting the initial definition of the economic and social world as being populated by identical individuals, where consumers are sovereign, technology is exogenous and money is neutral. Since the 1970s, Graziani's efforts have aimed at rebuilding on solid foundations the line of inquiry that sees capitalism as a ‘monetary economy of production’. Authors such as Schumpeter and Keynes, and before them Wicksell and Marx, were all key influences on Graziani's work. This theoretical attitude shaped Graziani's studies on the Italian economy within the European and the global landscapes. We are confronted here with an idea of state intervention where demand policies are not separated from supply-side policies, and are indeed embodied in a structural design to redefine the composition of production with great attention to the quality of labour. He reminds us that economic theory has to put at the heart of its discourse not the ‘imperfections’ of the market, but rather the ‘normality’ of power and conflict, not only between labour and capital, but also between fractions of capital, and between capitalisms."

Full paper is available here.

Lawrence Klein author of The Keynesian Revolution has passed away

Lawrence R. Klein (1920-2013)

Lawrence Klein, of Klein-Goldberger US econometric model fame, and author of The Keynesian Revolution (here the Google Books link), and winner of the Sveriges Riksbank Prize in Memory of Alfred Nobel in 1980, has passed away. Klein was a Neoclassical Synthesis Keynesian (often referred to as Old Keynesian now, to distinguish him from the New Keynesians) that made his contribution by developing the empirical applications of the Keynesian model for the US economy.

The seminal work was done in the late 1940s and early 1950s in the context of the Cowles Commission. His book An Econometric Model of the United States, 1929–1952 was further developed in 1955 with his co-author (Arthur Goldberger), published as An Econometric Model of the United States 1929–1952, introduced the celebrated Klein-Goldberger model. The Cowles Commission Model still lives in Ray Fair's macro-econometric model, that maintains essentially the same methodology, resisting to the Lucas critique and the Dynamic Stochastic General Equilibrium (DSGE) models of the Real Business Cycle School (RBC) and their New Keynesian alternatives.

It must be noted that in Klein's original model, expectations did not play a role, since it was complicated to incorporate those, interest rates did not have an impact on investment (basically adopting an accelerator) and that wealth effects (which allow for the Pigou effect, and the return to full employment) on consumption were also absent. So in a sense his model did differ, because of the need to adapt to economic data, from the theoretical versions of the Neoclassical Synthesis, and was closer to heterodox interpretations of Keynes.

Frank Hahn: 1925 - 2013

Frank Hahn, an old Keynesian that had written a book with Solow, passed away this week. He also signed a famous letter (co-signed by 364 economists) against the austerity policies of Margaret Thatcher in 1981 (other Cambridge signatories were Cripps, Deane, Eatwell, Godley, Kahn, Kaldor, Meade, Moogridge, and Austin and Joan Robinson).

He is best known for his contributions to General Equilibrium (in particular his famous book with Kenneth Arrow), and by heterodox economists for his misguided reply to Sraffians in his "The Neo-Ricardians." After retiring from Cambridge he taught at the University of Siena in Italy.

PS: I know, it's kind of funny that Mr. Booth thinks that those that criticized austerity were wrong, particularly after the recent British experience.

Albert Hirschman (1915-2012)

Albert Hirschman, one of the last pioneers of development, has passed away. News via Monkey Cage and Dani Rodrik.

Eugene Genovese and modes of production

Eugene Genovese has passed away. He was a historian of American slavery, and his views were not particularly popular or discussed in economics courses, as far as I know. Mainstream, quantitative historians suggested that his view that slavery in the South was not profitable was incorrect (in particular Engerman and Fogel, the latter a Bank of Sweden prize, also known as the Nobel, winner). The other reason, I imagine, that made his work particularly difficult for mainstream authors was his use of Marxist categories, including one that I still find essential for historical analysis, namely: the notion of mode of production.

Genevose (I read only his The Political Economy of Slavery and not the classic Roll, Jordan, Roll, often praised as his best work) argued that slavery was an economic drag to the Master class, and that the system remained a pre-capitalist formation, with the profit motive having a secondary role in the process of social reproduction. The idea was that, even if the South was connected by trade (cotton mostly) with the capitalist production in England (and New England too), the commercial relations where not central for the relations of production in the plantation system [I find his argument very unconvincing, by the way].

In other words, very much like Dobb, in the Transition debate with Sweezy, Genovese argued that the trade link was not central and could not define the South as part of the capitalist mode of production. In this sense, Southern slavery was for him a distinctive mode of production, one that was seen increasingly from a positive angle by Genovese, as he became more conservative and remained, interestingly, critical of the capitalist mode of production (which in a sense makes him more in tune with old conservatives that also repudiated the mercantilization of social relations).

Note that Genovese, like Engerman and Fogel in this case, thought that the peculiar institution was quite more benign that it is usually thought. In this sense, he reminds me of the quintessential Brazilian analysis of slavery in The Masters and the Slaves, by Gilberto Freyre, who also, even if for different theoretical reasons, saw Brazilian (not Southern, even if he saw similarities) slavery as benign and helped create the myth of Brazil as a racial democracy.

PS: On the slavery debates Nate Cline suggests this paper by Wallerstein (subscription required).

Phyllis Deane (1918-2012)

Phyllis Deane retired emeritus professor at the University of Cambridge and an authority on economic history, particularly the British Industrial Revolution, and the history of economic ideas, has passed away. Data collection on the British National Accounts led to her volume, with Max Cole, British Economic Growth, 1688-1959, which remains a classic on the Industrial Revolution, and later to her broader volume on the topic depicted above. She also wrote a very readable volume on the history of economic ideas, The Evolution of Economic Ideas.

Alice H. Amsden and Asian Development

Professor Amsden, author of Asia's Next Giant: South Korea and Late Industrialization (1989), has passed away. Her contributions to the understanding of the Asian late development experience were essential to debunk the neoliberal views, already dominant by the late 1980s, according to which the export-led experience in Asia was market driven, in contrast with the State-led Import Substitution Industrialization (ISI) in Latin America. She argued that South Korea actually distorted prices (with tariffs, quotas and credit subsidies), that is, got prices wrong, and growth did not result from efficient allocation of resources by market forces. Further, the state intervened directly in production, as a banker and did active industrial policy picking up winners and promoting the consolidation of big national groups, the chaebols.

Following Gerschenkron, who had argued about the advantages of backwardness, she suggested that some of the characteristics of South Korean growth resulted from its late development. For her the two main characteristics that explained South Korean success were the greater discipline exerted by the state on the national conglomerates, forcing them to export, and the Schumpeterian drive for innovation that that processed sparked.

She published several other important works, including The Rise of the Rest. Her views on economic development will certainly remain influential for a long while.

Garegnani and the revival of the surplus approach

(1930-2011)

Last weekend Pierangelo Garegnani passed away in Rome. He was the main disciple of Piero Sraffa, and one of the most important heterodox critics of the mainstream marginalist (neoclassical) approach. A full account of his contributions to economics is well beyond what I can offer in this space, but here are a few highlights.

As early as 1961, while spending an academic year at MIT, he suggested during a presentation by Paul Samuelson that his results depended on the assumption that all sectors use the same capital-labor ratio. The final results of his critique were presented in Garegnani's paper "Heterogeneous Capital, the Production Function and the Theory of Distribution." His paper shows conclusively that the marginalist theory of value and distribution based on an aggregate production function is untenable. This of course builds on Sraffa's work in the Production of Commodities (PC). By 1966, in the famous Quarterly Journal of Economics (QJE) Symposium, Samuelson had admitted that the neoclassical parable was not defensible.

In his 1976 paper "On a Change in the Notion of Equilibrium in Recent Work on Value and Distribution" Garegnani argued that to avoid the problems associated with the aggregative marginalist model, the mainstream had switched to Arrow-Debreu (AD) General Equilibrium models, which did not use aggregative capital, but also did not assume a tendency to a uniform rate of profit, which implies that it can only be seen as a short run equilibrium. Further, Garegnani later argued that, beyond the problem of being stuck with a short run theory, the AD model was still open to the capital critique, since a notion of aggregate capital was still needed for the equilibration of savings and investment (see his 2003 paper "Savings, Investment and Capital in a System of General Intertemporal Equilibrium").

Garegnani was also the central author arguing that the recovery of the classical theory of value and distribution (and hence Marx) was not incompatible with the Principle of Effective Demand (PED), as developed by Keynes and Kalecki. His two papers in the Cambridge Journal of Economics show that a rejection of the marginalist notion that labor and capital markets tend to full employment depends on the rejection of the mainstream theory of value and distribution, and that Keynes' PED is fully consistent with the old and forgotten classical or surplus approach. He also actively contributed to the extension of the PED to the long run until the end of his life (e.g. his paper with Trezzini).

There are several other contributions, in particular his work on the interpretation of Ricardo and his debates with orthodox Marxists, which again follow in the steps of his teacher. His work is essential for those interested in the understanding of the functioning of capitalist economies, and the incapacity of the mainstream to provide a useful tool to analyze reality.