Karl Shell (born May 10, 1938) is an American theoretical

economist An economist is a professional and practitioner in the social sciences, social science discipline of economics. The individual may also study, develop, and apply theories and concepts from economics and write about economic policy. Within this ...

, specializing in

macroeconomics Macroeconomics (from the Greek prefix ''makro-'' meaning "large" + ''economics'') is a branch of economics dealing with performance, structure, behavior, and decision-making of an economy as a whole. For example, using interest rates, taxes, and ...

and

monetary economics Monetary economics is the branch of economics that studies the different competing theories of money: it provides a framework for analyzing money and considers its functions (such as medium of exchange, store of value and unit of account), and ...

. Shell received an A.B. in

mathematics Mathematics is an area of knowledge that includes the topics of numbers, formulas and related structures, shapes and the spaces in which they are contained, and quantities and their changes. These topics are represented in modern mathematics ...

from

Princeton University Princeton University is a private research university in Princeton, New Jersey. Founded in 1746 in Elizabeth as the College of New Jersey, Princeton is the fourth-oldest institution of higher education in the United States and one of the ...

in 1960. He earned his Ph.D. in

economics Economics () is the social science that studies the production, distribution, and consumption of goods and services. Economics focuses on the behaviour and interactions of economic agents and how economies work. Microeconomics anal ...

in 1965 at

Stanford University Stanford University, officially Leland Stanford Junior University, is a private research university in Stanford, California. The campus occupies , among the largest in the United States, and enrolls over 17,000 students. Stanford is conside ...

, where he studied under

Nobel Prize in Economics The Nobel Memorial Prize in Economic Sciences, officially the Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel ( sv, Sveriges riksbanks pris i ekonomisk vetenskap till Alfred Nobels minne), is an economics award administered ...

winner

Kenneth Arrow Kenneth Joseph Arrow (23 August 1921 – 21 February 2017) was an American economist, mathematician, writer, and political theorist. He was the joint winner of the Nobel Memorial Prize in Economic Sciences with John Hicks in 1972. In economi ...

and

Hirofumi Uzawa was a Japanese economist. Biography Uzawa was born on July 21, 1928 in Yonago, Tottori to a farming family. He attended the Tokyo First Middle School (currently the Hibiya High School ) and the First Higher School, Japan (now the University ...

. Shell is currently Robert Julius Thorne Professor of

Economics Economics () is the social science that studies the production, distribution, and consumption of goods and services. Economics focuses on the behaviour and interactions of economic agents and how economies work. Microeconomics anal ...

Cornell University Cornell University is a private statutory land-grant research university based in Ithaca, New York. It is a member of the Ivy League. Founded in 1865 by Ezra Cornell and Andrew Dickson White, Cornell was founded with the intention to tea ...

(succeeding notable economist and airline deregulator

Alfred E. Kahn Alfred Edward Kahn (October 17, 1917 – December 27, 2010) was an American economist and political advisor who specialized in regulation and deregulation. He was an important influence in the deregulation of the airline and energy industrie ...

in the Thorne chair). He previously served on the economics faculty at

MIT The Massachusetts Institute of Technology (MIT) is a private land-grant research university in Cambridge, Massachusetts. Established in 1861, MIT has played a key role in the development of modern technology and science, and is one of the m ...

and the

University of Pennsylvania The University of Pennsylvania (also known as Penn or UPenn) is a Private university, private research university in Philadelphia. It is the fourth-oldest institution of higher education in the United States and is ranked among the highest- ...

. Shell has been editor of the ''

Journal of Economic Theory The ''Journal of Economic Theory'' is a bimonthly peer-reviewed academic journal covering the field of economic theory. Karl Shell has served as editor-in-chief of the journal since it was established in 1968. Since 2000, he has shared the edi ...

'', generally regarded as the leading

journal A journal, from the Old French ''journal'' (meaning "daily"), may refer to: *Bullet journal, a method of personal organization *Diary, a record of what happened over the course of a day or other period *Daybook, also known as a general journal, a ...

in theoretical economics, since its inception in 1968.

Contributions to economics

While Shell has published academic articles on numerous topics in economics, he is primarily known for his contributions in three areas. Between 1966 and 1973, Shell published three papers on inventive activity, increasing returns to scale,

industrial organization In economics, industrial organization is a field that builds on the theory of the firm by examining the structure of (and, therefore, the boundaries between) firms and markets. Industrial organization adds real-world complications to the perf ...

, and

economic growth Economic growth can be defined as the increase or improvement in the inflation-adjusted market value of the goods and services produced by an economy in a financial year. Statisticians conventionally measure such growth as the percent rate o ...

. This contribution was important in its day, and later influenced the development of "new growth theory." Among others,

Paul Romer Paul Michael Romer (born November 6, 1955) is an American economist and policy entrepreneur who is a University Professor in Economics at New York University. Romer is best known as the former Chief Economist of the World Bank and for co-recei ...

cited and heavily built upon Shell's work in his seminal papers on endogenous growth theory. Shell also made important contributions to the

overlapping generations In population genetics overlapping generations refers to mating systems where more than one breeding generation is present at any one time. In systems where this is not the case there are non-overlapping generations (or discrete generations) in wh ...

literature (and was perhaps the first to refer to the overlapping generations model by its modern name). The overlapping generations model is now a workhorse in modern macroeconomics and

. Karl Shell is also co-inventor (with

David Cass David Cass (January 19, 1937 – April 15, 2008) was a professor of economics at the University of Pennsylvania, mostly known for his contributions to general equilibrium theory. His most famous work was on the Ramsey–Cass–Koopmans model of ...

) of the concept of

sunspot equilibrium In economics, the term sunspots (or sometimes "a sunspot") refers to an ''extrinsic'' random variable, that is, a random variable that does not affect economic fundamentals (such as endowments, preferences, or technology). ''Sunspots'' can also r ...

(and sunspots).

Sunspot equilibrium In economics, the term sunspots (or sometimes "a sunspot") refers to an ''extrinsic'' random variable, that is, a random variable that does not affect economic fundamentals (such as endowments, preferences, or technology). ''Sunspots'' can also r ...

provides a model for excess market volatility, including

bank runs A bank run or run on the bank occurs when many clients withdraw their money from a bank, because they believe the bank may cease to function in the near future. In other words, it is when, in a fractional-reserve banking system (where banks no ...

References

Publications

*Karl Shell, "Toward a Theory of Inventive Activity and Capital Accumulation", ''American Economic Review'', Vol. 56(2), May 1966, 62–68. *Karl Shell, "A Model of Inventive Activity and Capital Accumulation" in ''Essays on the Theory of Optimal Economic Growth'' (K. Shell, ed.), Cambridge, Massachusetts: MIT Press, 1967, Chapter IV, 67–85. *Karl Shell (Editor), ''Essays on the Theory of Optimal Economic Growth'', Cambridge, Massachusetts: MIT Press, 1967, (hardcover), 9780262690133(paperback). *Karl Shell, "Notes on the Economics of Infinity", ''Journal of Political Economy'', Vol. 79(5), September/October 1971, 1002–1011. *Karl Shell and Giorgio P. Szegö (Editor), ''Mathematical Methods in Investment and Finance'', Amsterdam: North-Holland, 1972. (North- Holland), 044410395 (American Elsevier). *Karl Shell and Franklin M. Fisher, ''The Economic Theory of Price Indices: Two Essays on the Effect of Taste, Quality, and Technological Change'' , New York: Academic Press, 1972. . *Karl Shell, "Inventive Activity, Industrial Organization and Economic Growth" in ''Models of Economic Growth'' (J.A. Mirrlees and N. Stern, eds.), London: Macmillan, and New York: Halsted (John Wiley & Sons), 1973, 77–100. *Karl Shell and David Cass (Editor), ''The Hamiltonian Approach to Dynamic Economics'', New York: Academic Press, 1976. . *David Cass and Karl Shell, "Do Sunspots Matter?", ''Journal of Political Economy'', Vol. 91(2), April 1983, 193–227. *Karl Shell, William A. Barnett and John Geweke (Editor), ''Economic Complexity: Chaos, Sunspots, Bubbles, and Nonlinearity'', New York: Cambridge University Press, 1989. . *Karl Shell and Franklin M. Fisher, ''Economic Analysis of Production Price Index'', New York: Cambridge University Press (Hardcover, , and soft cover, ), 1998. *Karl Shell, "Sunspot Equilibrium", ''The New Palgrave: A Dictionary of Economics, 2nd Edition'' (L. Blume and S. Durlauf, eds.), New York: Palgrave Macmillan, 2008.

External links

*Karl Shell Web Page: http://www.karlshell.com. * *''Journal of Economic Theory'' Web Page: http://jet.arts.cornell.edu/Main.html. * * *Karl Shell CV: http://karlshell.com/wp-content/uploads/2021/07/CV-June-25-2021-4.pdf American economists 1938 births Living people Fellows of the Econometric Society {{US-economist-stub