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Tuesday, April 4, 2017

Paul Samuelson and mathematical economics


Photo source: Wikimedia Commons, Bender235

Photo license: CC BY 1.0


Paul Samuelson is an influential economist best known for his 1948 textbook, Economics. Economist Avinash Dixit said,


"Many principles of economics were hidden in obscure verbiage of previous generations; [Samuelson] reformulated and extended them with crystal clarity in the language of mathematics." (Paul Samuelson's Legacy, 2012)


The rest of this post is some quotes from Samuelson.


Pro-math quotes


"To a person of analytical ability, perceptive enough to realize that mathematical equipment was a powerful sword in economics, the world of economics was his or her oyster in 1935. The terrain was strewn with beautiful theorems and begging to be picked up and arranged in unified order." (Brainy Quote)


"Mathematics is just the catalyst that enables you to handle multivariate things." (YouTube: Infinite History Project MIT)


"You know the expression in real estate, 'location, location, location'. In prediction it's, 'timing, timing, timing'. Going into present day economics it's, 'math, math, math'. (YouTube: Infinite History Project MIT)


"When Saint Peter admits me into heaven, he's going to ask 'Why did you help make economics so mathematical?' My answer will be, 'Well I couldn't help it.' (YouTube: Infinite History Project MIT)


"Indeed, until the appearance of the mathematical models there of there is reason to believe that Keynes himself did not truly understand his analysis." (Knowledge and Wealth of Nations by David Warsh)


Math neutral quotes


"I can claim that in talking about modern economics I am talking about me. My finger has been in every pie. I once claimed to be the last generalist in economics, writing about and teaching such diverse subjects as international trade and econometrics, economic theory and business cycles, demography and labor economics, finance and monopolistic competition, history of doctrines and locational economics." (Lives of laureates, 1985)


"I think that it's more important for an economist to be wise and sophisticated in scientific method than it is for a physicist because with controlled laboratory experiments possible, they practically guide you; you couldn't go astray. Whereas in economics, by dogma and misunderstanding, you can go very sadly astray." (Brainy Quote)


Math critique quotes


"Macroeconomics - even with all of our computers and with all of our information -- is not an exact science and is incapable of being an exact science. It can be better or it can be worse, but there isn't guaranteed predictability in these matters." (Interview with Paul Samuelson, 2007)


"This is probably a change from what I would have said when I was younger: Have a very healthy respect for the study of economic history, because that's the raw material out of which any of your conjectures or testings will come." (Interview with Paul Samuelson, 2007)


"My notion of a fruitful economic science would be that it can help us explain and understand the course of actual economic history. A scholar who seriously addresses commentary on contemporary monthly and yearly events is, in this view, practicing the study of history - history in its most contemporary time phasing." (An interview with Paul A. Samuelson, 2003)


"My philosophy of scientific method is that it is the empirical reality of history is all important. What we say in the classroom is second." (UBS: Is Economics a Real Science?)