Arnold Kling  

Thoughts on the Late Paul Samuelson

Borenstein's Biased Reporting... Recommended Reading on Health ...

1. He was influential. He influenced students through his textbook, and he influenced the entire economics profession through his dissertation, published as "Foundations of Economic Analysis." Readers of this blog will tend to disapprove of his influence, in that it promoted Keynes and the use of mathematical modeling. Perhaps Milton Friedman was more influential on policy. But Samuelson was more influential on the internal dynamics of the economics profession. On that score, I would say that he was without peer in this century

2. Compared with later generations of economists, he was more nuanced in his thinking and not as capable a mathematician. When I was an undergraduate, Bernie Saffran liked to repeat the joke that Samuelson had never proven a true theorem, meaning that his proofs typically had to be corrected.

3. He taught me Austrian capital theory. I had him for a half-semester course on capital theory, and what I remember best was his description of the Austrian model of roundabout production. That was the only Austrian economics I encountered until quite recently.

4. He was prolific. Avinash Dixit is quoted as saying,

As to the techniques I learned from him and used: comparative statics of constrained optimization, the correspondence principle and the envelope theorem, factor price equalization in international trade, valuation of real options, the list could go on.

The list could certainly include Samuelson's proof that stock prices follow a random walk, as Tyler Cowen notes.

For a recent interview that demonstrates the nuanced Samuelson, see The Atlantic. For example, in part two of the interview, he advocates teaching economic history.

UPDATE: David Warsh expresses my first point.

John Maynard Keynes may have had more influence on policy makers, Milton Friedman on citizens, Kenneth Arrow on economic theory, but Samuelson had more influence on the way economics is done today, and the purposes to which it is put, than any other economist of the twentieth century.

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COMMENTS (5 to date)
Greg Ransom writes:

Admirably, Samuelson had the capacity for acknowledging when the science of economics turned out very differently than he had conceived as a hot shot mathematical economist.

Samuelson acknowledged the empirical failure of his Operationalist / Machian conception of economic science (taken mostly from Schumpeter) which had presumed a confirmation process whereby the functionalist quantitative relationships of math econ. would be verified by econometrics. Samuelson seems to have held on to his Operationalist / Machian conception of "good science" -- and to have abandoned his faith in the presumed verification role of econometrics.

Samuelson also changed his mind about socialism and the economics of socialism -- Samuelson in his later years concluded that Hayek was right and Samuelson's teacher Schumpeter was wrong about the possibility of a math econ grounded socialism.

GMD writes:

I don't know if it's just me but Kling comes off as pretty petty here. Samuelson is as first rate as they come; saying he never got a proof right is ridiculous. Cowen is as libertarian as can be and he didn't make a post like this. Ranking "influence" with an insidious tone as his best trait is silly.

Rodrigo writes:

GMD, I agree with you. The late Nicholas Georgescu-Roegen wrote in this ( article that Samuelson was the most clear analytical mind of the mathematical small compliment. I disagree with some positions he had in respect to government and all that, but saying his mathematics was fault is a little too much....

Greg Ransom writes:

"He taught me Austrian capital theory."

I'm guessing this had or nothing to do with what you find in Hayek's _The Pure Theory of Capital_ or in Hayek's discussion of capital theory in Hayek's essays on the problems of socialist economics.

bill greene writes:

". . he was more nuanced in his thinking and not as capable a mathematician."

I can't understand why GMD and Rodrigo take umbrage from the above posted comment. I would prefer nuanced thinking over mathematic modelling any day of the week. Besides, the post is actually quite a favorable tribute to someone who helped gain almost a century of influence for Keynsian theory.

Would it be fair to say that Keynes and Samuelson laid the foundation for President Obama's trillion dollars of stimulus pump priming?

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