Alvin Hansen: Difference between revisions
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'''Alvin Harvey Hansen''' (1887-1975) was professor of [[Economics]] at Harvard University, and is best known for introducing [[Keynesian economics]] in the United States in the 1930s. More effectively than anyone else, he explicated, extended, domesticated, and popularized the controversial ideas embodied in Keynes' ''The General Theory,'' and promoted it to his many graduate students at Harvard | '''Alvin Harvey Hansen''' (1887-1975) was professor of [[Economics]] at Harvard University, and is best known for introducing [[Keynesian economics]] in the United States in the 1930s. More effectively than anyone else, he explicated, extended, domesticated, and popularized the controversial ideas embodied in Keynes' ''The General Theory,'' and promoted it to his many graduate students at Harvard. In 1967, Paul McCracken, chairman of the President's Council of Economic Advisers, saluted Hansen: "It is certainly a statement of fact that you have influenced the nation's thinking about economic policy more profoundly than any other economist in this century."<ref> cited in Miller (2002) p. 604, which is the major source for this article.</ref> | ||
==Career== | |||
Hansen was born to Danish immigrant parents on the South Dakota frontier. After an English degree at Yankton College, he took his PhD in economics at the University of Wisconsin, where he worked with institutionalists John R. Commons and Richard T. Ely. He then taught at the University of Minnesota, specializing in business cycles. He consulted frequently in Washington, and helped Edwin E. Witte, to help draft the Social Security Act of 1935. | Hansen was born to Danish immigrant parents on the South Dakota frontier. After an English degree at Yankton College, he took his PhD in economics at the University of Wisconsin, where he worked with institutionalists John R. Commons and Richard T. Ely. He then taught at the University of Minnesota, specializing in business cycles. He consulted frequently in Washington, and helped Edwin E. Witte, to help draft the Social Security Act of 1935. | ||
His review of the Keynes book was skeptical when it first appeared, but by December 1938, in his presidential address to the American Economic | ==Keynesian== | ||
His review of the Keynes book was skeptical when it first appeared, but by December 1938, in his presidential address to the American Economic Association, he embraced [[John Maynard Keynes]]'s theories of the need for government intervention in periods of economic recession soon after arriving at Harvard in 1937. | |||
Hansen's major theoretical contribution was an elaboration of the analytical approach created by British economist J. R. Hicks. Hansen elaborated the "IS-LM" framework, which became standard fare in economics textbooks to describe the interrelationships among interest rates, savings, investment, demand for money, and income. | |||
[[Paul Samuelson]] was Hansen's most famous student. Samuelson credited Hansen's ''Full Recovery or Stagflation?'' (1938) as the main inspiration for his famous accelerator-multiplier business cycle model of 1948. Leeson (1997) shows that while Hansen and Sumner Slichter continued to be regarded as leading exponents of Keynesian economics, their gradual abandonment of a commitment to price stability contributed to the development of a Keynesianism which conflicted with positions of Keynes himself. | |||
==Stagnation== | |||
In the late 1930s Hansen argued that "secular stagnation" had set in, so that the American economy would never grow rapidly again, because all the growth ingredients had played out, including technological innovation and population growth. The only solution, he argued, was constant deficit spending by the federal government. Critics, such as George Terborgh, attacked Hansen as a pessimist and defeatist for advancing his secular stagnation thesis. Hansen replied that secular stagnation was just another name for Keynes's underemployment equilibrium. However, the sustained economic growth beginning in 1940 undercut Hansen's predictions and his stagnation model was forgotten. | |||
Hansen excelled at both scholarly works and popular expositions that helped people understand economic cycles and deficit spending. He trained and influenced hundreds of students, many of whom later held important government posts, and he served on numerous governmental committees dealing with economic issues. The American Economic Association awarded him its Walker Medal in 1967. | |||
==Bibliography== | ==Bibliography== | ||
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*"Alvin Hansen on Economic Progress and Declining Population Growth" in ''Population and Development Review'', Vol. 30, 2004 | *"Alvin Hansen on Economic Progress and Declining Population Growth" in ''Population and Development Review'', Vol. 30, 2004 | ||
* Leeson, Robert. "The Eclipse of the Goal of Zero Inflation." ''History of Political Economy'' 1997 29(3): 445-496. Issn: 0018-2702 Fulltext: in Ebsco. deals with Hansen and Sumner Slichter | * Leeson, Robert. "The Eclipse of the Goal of Zero Inflation." ''History of Political Economy'' 1997 29(3): 445-496. Issn: 0018-2702 Fulltext: in Ebsco. deals with Hansen and Sumner Slichter | ||
* Miller, John E. "From South Dakota Farm to Harvard Seminar: Alvin H. Hansen, America's Prophet of Keynesianism" ''Historian'' (2002) 64(3-4): 603-622. Issn: 0018-2370 | * Miller, John E. "From South Dakota Farm to Harvard Seminar: Alvin H. Hansen, America's Prophet of Keynesianism" ''Historian'' (2002) 64(3-4): 603-622. Issn: 0018-2370, online at EBSCO | ||
*Rosenof, Theodore. ''Economics in the Long Run: New Deal Theorists and Their Legacies, 1933-1993'' (1997) | *Rosenof, Theodore. ''Economics in the Long Run: New Deal Theorists and Their Legacies, 1933-1993'' (1997) | ||
Revision as of 20:06, 4 June 2007
Alvin Harvey Hansen (1887-1975) was professor of Economics at Harvard University, and is best known for introducing Keynesian economics in the United States in the 1930s. More effectively than anyone else, he explicated, extended, domesticated, and popularized the controversial ideas embodied in Keynes' The General Theory, and promoted it to his many graduate students at Harvard. In 1967, Paul McCracken, chairman of the President's Council of Economic Advisers, saluted Hansen: "It is certainly a statement of fact that you have influenced the nation's thinking about economic policy more profoundly than any other economist in this century."[1]
Career
Hansen was born to Danish immigrant parents on the South Dakota frontier. After an English degree at Yankton College, he took his PhD in economics at the University of Wisconsin, where he worked with institutionalists John R. Commons and Richard T. Ely. He then taught at the University of Minnesota, specializing in business cycles. He consulted frequently in Washington, and helped Edwin E. Witte, to help draft the Social Security Act of 1935.
Keynesian
His review of the Keynes book was skeptical when it first appeared, but by December 1938, in his presidential address to the American Economic Association, he embraced John Maynard Keynes's theories of the need for government intervention in periods of economic recession soon after arriving at Harvard in 1937.
Hansen's major theoretical contribution was an elaboration of the analytical approach created by British economist J. R. Hicks. Hansen elaborated the "IS-LM" framework, which became standard fare in economics textbooks to describe the interrelationships among interest rates, savings, investment, demand for money, and income.
Paul Samuelson was Hansen's most famous student. Samuelson credited Hansen's Full Recovery or Stagflation? (1938) as the main inspiration for his famous accelerator-multiplier business cycle model of 1948. Leeson (1997) shows that while Hansen and Sumner Slichter continued to be regarded as leading exponents of Keynesian economics, their gradual abandonment of a commitment to price stability contributed to the development of a Keynesianism which conflicted with positions of Keynes himself.
Stagnation
In the late 1930s Hansen argued that "secular stagnation" had set in, so that the American economy would never grow rapidly again, because all the growth ingredients had played out, including technological innovation and population growth. The only solution, he argued, was constant deficit spending by the federal government. Critics, such as George Terborgh, attacked Hansen as a pessimist and defeatist for advancing his secular stagnation thesis. Hansen replied that secular stagnation was just another name for Keynes's underemployment equilibrium. However, the sustained economic growth beginning in 1940 undercut Hansen's predictions and his stagnation model was forgotten.
Hansen excelled at both scholarly works and popular expositions that helped people understand economic cycles and deficit spending. He trained and influenced hundreds of students, many of whom later held important government posts, and he served on numerous governmental committees dealing with economic issues. The American Economic Association awarded him its Walker Medal in 1967.
Bibliography
Primary sources
- Alvin Hansen, "Economic Progress and Declining Population Growth," American Economic Review (29) March (1939). online at JSTOR.
- Alvin Hansen, Fiscal Policy and Business Cycles (1941)
Secondary sources
- Quarterly Journal of Economics vol 90 # 1 (1976) pp 1-37, online at JSTOR and/or in most college libraries.
- "Alvin Hansen on Economic Progress and Declining Population Growth" in Population and Development Review, Vol. 30, 2004
- Leeson, Robert. "The Eclipse of the Goal of Zero Inflation." History of Political Economy 1997 29(3): 445-496. Issn: 0018-2702 Fulltext: in Ebsco. deals with Hansen and Sumner Slichter
- Miller, John E. "From South Dakota Farm to Harvard Seminar: Alvin H. Hansen, America's Prophet of Keynesianism" Historian (2002) 64(3-4): 603-622. Issn: 0018-2370, online at EBSCO
- Rosenof, Theodore. Economics in the Long Run: New Deal Theorists and Their Legacies, 1933-1993 (1997)
- ↑ cited in Miller (2002) p. 604, which is the major source for this article.