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Paul Samuelson & the rise of MIT Economics

April 10, 2010

A memorial service this morning at Kresge auditorium on the MIT campus celebrated the remarkable life of towering liberal intellectual and long-time economics professor Paul Samuelson who passed away last year at the ripe old age of 94. Samuelson is widely credited for introducing mathematical rigor into the economics profession and using scientific analysis to promote Keynesian ideals as one of the foremost economists of the 20th century. He had a storied career that spanned a staggering seven decades: becoming an MIT assistant professor at age 25, earning tenure at 32, winning the first ever John Clarke Bates medal given to an outstanding economist under 40 also at age 32, winning the first ever Nobel Prize in Economics in 1970, receiving the National Medal of Science in 1996. An extraordinary man who singlehandedly elevated the stature of the MIT Economics department upon his arrival in 1940 after entering the University of Chicago at age 16 as an undergraduate, two years in graduate school at Harvard and three more as a Junior Fellow. When Harvard would only offer him the menial position of instructor (his advocacy of a prominent role for governmental involvement in the economy was then-considered controversial, also he was Jewish), the nascent economics department at MIT cunningly lured him away with an offer of a tenure-track position. At that time, the economics department at MIT amounted to little more than a small staff offering two required undergraduate classes based on classical economics to its largely engineering-focused student body. Samuelson’s arrival at MIT heralded the beginning of sweeping changes: he initiated a graduate program, used his stature to attract top-flight faculty and transformed this once sleepy side of east campus into a mecca of scholarship. Today’s memorial service featured eulogies from a number of his notable colleagues and former students: Susan Hockfield (President of MIT), Ricardo Caballero (head of MIT Economics), William Samuelson (eldest son), Larry Summers (nephew, and former President of Harvard), Stanley Fischer (Governor of the Bank of Israel), Paul Krugman (former student, colleague and now professor at Princeton), James Poterba (colleague and current member of MIT faculty), Helmut Weymar (former student and acclaimed commodities trader) and finally his long-time colleague, friend and fellow Nobelist Robert Solow as the master of ceremonies. Caballero began by reminiscing a faculty lunch during a snowy winter day in 2002 where few attended, unexpectedly among them the elder Samuelson who proceeded to mesmerize his younger, star-struck peers with his clairvoyant summary of an obscure technical detail. The younger Samuelson, William, recounted his father’s overriding passion for research as he would habitually evade his household chores and six children to escape to his office sanctuary in E52 to write academic papers or popular articles for Newsweek. Paul Krugman, who once shared an office suite with Samuelson and Solow while a young assistant professor at MIT, remarked that Samuelson should have received eight separate Nobel prizes for initiating eight major fields of research. The always charismatic Larry Summers offered a couple of amusing anecdotes of his late uncle. Once, at a dinner party in 1972 at the Samuelson house in Belmont to celebrate the announcement of the Nobel Prize to Kenneth Arrow, Summers remembered that his two uncles, Paul (his father’s brother) and Ken (his mother’s brother), spent the entire evening debating turnpike theory in a separate room until all the guests had eventually left. This memory left a lasting impression on the young Summers, then a sophomore at MIT, on Uncle Paul’s profound commitment to his work. Summers also recalled a car ride many years later with his uncle to the Belmont tennis club when news on the radio announced that the Dow Jones Industrial Average had closed higher for the day to which Summers quipped “That’s a good thing!” and his perplexed uncle wryly responded “Now does that mean people will be buying or selling their stocks?” Poterba described several instances of Samuelson’s young career where his early mathematically-inclined papers were continually rejected from the top academic journals where skeptical referees derided its unconventional methods. Some of these papers are now among Samuelson’s most highly cited works. Solow retold the unforgettable story of Samuelson’s oral qualifying exam in front of his doctorate committee at Harvard, when at the very end one of the professors, Joseph Schumpeter, asked: “Our dear Paul, did we pass?” Samuelson was a man so singularly fixated on economics research that he continually turned down offers to act as an administrator or take up a job in the government as policy planner (most notably at the request of JFK in the early 1960s). He once famously said: “I don’t care who writes a nation’s laws, as long as I can write its economics textbook.” And that he did, Foundations of Economic Analysis and the curtly named Economics; the former was a technical tour-de-force that introduced for the first time methods from theoretical physics into economics and the latter has become a standard textbook in the field having sold more than four million copies. Though I share vastly different views on the role of government in the free market, I am no doubt mindful of the seminal contributions of this titan to his profession. It was awe-inspiring for me to witness so many accomplished individuals sing the praises of a former colleague whose legacy is now fully enshrined in the profession. Samuelson’s life is a lucid demonstration of the power of unconventional ideas emanating from a lone individual in the face of fierce opposition to transform a whole field.

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From → economics, MIT

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