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Wesley Clair Mitchell (August 5, 1874 – October 29, 1948) was an American
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 ...
known for his empirical work on
business cycle Business cycles are intervals of Economic expansion, expansion followed by recession in economic activity. These changes have implications for the welfare of the broad population as well as for private institutions. Typically business cycles are ...
s and for guiding the
National Bureau of Economic Research The National Bureau of Economic Research (NBER) is an American private nonprofit research organization "committed to undertaking and disseminating unbiased economic research among public policymakers, business professionals, and the academic c ...
in its first decades. Mitchell was referred to as
Thorstein Veblen Thorstein Bunde Veblen (July 30, 1857 – August 3, 1929) was a Norwegian-American economist and sociologist who, during his lifetime, emerged as a well-known critic of capitalism. In his best-known book, ''The Theory of the Leisure Class'' ...
's "star student."
Paul Samuelson Paul Anthony Samuelson (May 15, 1915 – December 13, 2009) was an American economist who was the first American to win the Nobel Memorial Prize in Economic Sciences. When awarding the prize in 1970, the Swedish Royal Academies stated that he "h ...
named Mitchell (along with
Harry Gunnison Brown Harry Gunnison Brown (May 7, 1880– March 11, 1975) was a Georgist economist teaching at Yale in the early 20th century. Paul Samuelson named Brown in a list of "American saints in economics" that included only 6 other economists born after 1860 ...
,
Allyn Abbott Young Allyn Abbott Young (September 19, 1876 – March 7, 1929) was an American economist. He was born into a middle-class family in Kenton, Ohio. He died aged 52 in London, his life cut short by pneumonia during an influenza epidemic. He was then at ...
,
Henry Ludwell Moore Henry Ludwell Moore (November 21, 1869 – April 28, 1958) was an American economist known for his pioneering work in econometrics. Paul Samuelson named Moore (along with Harry Gunnison Brown, Allyn Abbott Young, Wesley Clair Mitchell, Frank Kni ...
,
Frank Knight Frank Hyneman Knight (November 7, 1885 – April 15, 1972) was an American economist who spent most of his career at the University of Chicago, where he became one of the founders of the Chicago School. Nobel laureates Milton Friedman, George S ...
,
Jacob Viner Jacob Viner (3 May 1892 – 12 September 1970) was a Canadian economist and is considered with Frank Knight and Henry Simons to be one of the "inspiring" mentors of the early Chicago school of economics in the 1930s: he was one of the leading fig ...
, and
Henry Schultz Henry Schultz (September 4, 1893 – November 26, 1938) was an American economist, statistician, and one of the founders of econometrics. Paul Samuelson named Schultz (along with Harry Gunnison Brown, Allyn Abbott Young, Henry Ludwell Moore, Fr ...
) as one of the several "American saints in economics" born after 1860.


Biography

Mitchell was born in
Rushville, Illinois Rushville is a city in Schuyler County, Illinois, United States. The population was 3,192 at the 2010 census and 2,902 in 2018. It is the county seat of Schuyler County. It was first settled by Euro-Americans in 1823. History Geography Accord ...
, the second child and oldest son of a Civil War army doctor turned farmer. In a family with seven children and a disabled father with an appetite for business ventures "verging on rashness" a lot of responsibility fell on the oldest son. Despite these challenges, Wesley Clair went to study at the
University of Chicago The University of Chicago (UChicago, Chicago, U of C, or UChi) is a private research university in Chicago, Illinois. Its main campus is located in Chicago's Hyde Park neighborhood. The University of Chicago is consistently ranked among the b ...
and was awarded a PhD in 1899. Mitchell's career as a researcher and teacher took the following course: instructor in economics at Chicago (1899–1903), assistant professor (1903–08) and professor (1909–12) of economics at the
University of California, Berkeley The University of California, Berkeley (UC Berkeley, Berkeley, Cal, or California) is a public land-grant research university in Berkeley, California. Established in 1868 as the University of California, it is the state's first land-grant u ...
, visiting lecturer at
Harvard University Harvard University is a private Ivy League research university in Cambridge, Massachusetts. Founded in 1636 as Harvard College and named for its first benefactor, the Puritan clergyman John Harvard, it is the oldest institution of higher le ...
(1908–09), lecturer (1913) and full professor (1914–44) at
Columbia University Columbia University (also known as Columbia, and officially as Columbia University in the City of New York) is a private research university in New York City. Established in 1754 as King's College on the grounds of Trinity Church in Manhatt ...
. In 1916 he was elected as a
Fellow A fellow is a concept whose exact meaning depends on context. In learned or professional societies, it refers to a privileged member who is specially elected in recognition of their work and achievements. Within the context of higher education ...
of the
American Statistical Association The American Statistical Association (ASA) is the main professional organization for statisticians and related professionals in the United States. It was founded in Boston, Massachusetts on November 27, 1839, and is the second oldest continuousl ...
. He was one of the founders of the
New School for Social Research The New School for Social Research (NSSR) is a graduate-level educational institution that is one of the divisions of The New School in New York City, United States. The university was founded in 1919 as a home for progressive era thinkers. NSSR ...
, where he taught for a time between 1919 and 1922, and of the
National Bureau of Economic Research The National Bureau of Economic Research (NBER) is an American private nonprofit research organization "committed to undertaking and disseminating unbiased economic research among public policymakers, business professionals, and the academic c ...
(1920), where he was director of research until 1945. There were interruptions for government service during the
First World War World War I (28 July 1914 11 November 1918), often abbreviated as WWI, was one of the deadliest global conflicts in history. Belligerents included much of Europe, the Russian Empire, the United States, and the Ottoman Empire, with fightin ...
and Mitchell served on many government committees; he was chairman of the President's Committee on Social Trends (1929–33). In 1923–4 he was president of the
American Economic Association The American Economic Association (AEA) is a learned society in the field of economics. It publishes several peer-reviewed journals acknowledged in business and academia. There are some 23,000 members. History and Constitution The AEA was esta ...
. Mitchell and
John Whitridge Williams John Whitridge Williams (January 26, 1866 – October 21, 1931) was a pioneering obstetrician at Johns Hopkins Hospital. Williams was also an acclaimed author, as he was able to contribute 137 publications regarding his findings. Early life John ...
represented the United States at the
World Population Conference The first ever World Population Conference was held at the Salle Centrale, Geneva, Switzerland, from 29 August to 3 September 1927. Organized by the forerunner of the United Nations, the League of Nations, and Margaret Sanger; the conference was an ...
held in Geneva, Switzerland in 1927. From 1941 he was on the original standing committee of the
Foundation for the Study of Cycles The Foundation for the Study of Cycles (FSC) is an international nonprofit organization that fosters, promotes, and conducts scientific research in respect to rhythmic and periodic fluctuations in any branch of science. It was incorporated on Janu ...
. The National Bureau was the institution through which Mitchell had greatest influence. There his important associates included
Arthur Burns Arthur Frank Burns (April 27, 1904 – June 26, 1987) was an American economist and diplomat who served as the 10th chairman of the Federal Reserve from 1970 to 1978. He previously chaired the Council of Economic Advisers under President Dwight ...
and
Simon Kuznets Simon Smith Kuznets (; rus, Семён Абра́мович Кузне́ц, p=sʲɪˈmʲɵn ɐˈbraməvʲɪtɕ kʊzʲˈnʲɛts; April 30, 1901 – July 8, 1985) was an American economist and statistician who received the 1971 Nobel Memorial Pr ...
. In his autobiography Kuznets acknowledges his "great intellectual debt to Mitchell." Mitchell has also made valuable contributions to the
history of economic thought History (derived ) is the systematic study and the documentation of the human activity. The time period of event before the History of writing#Inventions of writing, invention of writing systems is considered prehistory. "History" is an umbr ...
. Mitchell was married to Lucy Sprague Mitchell, a pioneering educator and the founder of
Bank Street College of Education Bank Street College of Education is a private school and graduate school in New York City. It consists of a graduate-only teacher training college and an independent nursery-through-8th-grade school. In 2020 the graduate school had about 65 full ...
. He assisted his wife with the founding of the school.


Work


University of Chicago

Mitchell’s teachers included economists
Thorstein Veblen Thorstein Bunde Veblen (July 30, 1857 – August 3, 1929) was a Norwegian-American economist and sociologist who, during his lifetime, emerged as a well-known critic of capitalism. In his best-known book, ''The Theory of the Leisure Class'' ...
and J. L. Laughlin and philosopher
John Dewey John Dewey (; October 20, 1859 – June 1, 1952) was an American philosopher, psychologist, and educational reformer whose ideas have been influential in education and social reform. He was one of the most prominent American scholars in the f ...
. Although Veblen and Dewey did more to shape Mitchell’s outlook, Laughlin supervised his dissertation. Laughlin's main interest was in
currency A currency, "in circulation", from la, currens, -entis, literally meaning "running" or "traversing" is a standardization of money in any form, in use or circulation as a medium of exchange, for example banknotes and coins. A more general def ...
questions; he was a strong opponent of the
quantity theory of money In monetary economics, the quantity theory of money (often abbreviated QTM) is one of the directions of Western economic thought that emerged in the 16th-17th centuries. The QTM states that the general price level of goods and services is directly ...
. The currency question facing the US in the 1890s was the choice between alternative monetary standards: inconvertible paper,
gold Gold is a chemical element with the symbol Au (from la, aurum) and atomic number 79. This makes it one of the higher atomic number elements that occur naturally. It is a bright, slightly orange-yellow, dense, soft, malleable, and ductile met ...
monometallism Metallism is the economic principle that the value of money derives from the purchasing power of the commodity upon which it is based. The currency in a metallist monetary system may be made from the commodity itself (commodity money) or it may us ...
and gold/silver
bimetallism Bimetallism, also known as the bimetallic standard, is a monetary standard in which the value of the monetary unit is defined as equivalent to certain quantities of two metals, typically gold and silver, creating a fixed rate of exchange betwee ...
. Mitchell’s thesis, published as ''A History of the Greenbacks,'' considered the consequences of the inconvertible paper regime established by the Union in the
Civil War A civil war or intrastate war is a war between organized groups within the same state (or country). The aim of one side may be to take control of the country or a region, to achieve independence for a region, or to change government policies ...
. However this, and the follow-up study ''Gold Prices and Wages Under the Greenback Standard,'' transcended conventional monetary history of the kind Laughlin did and provided a comprehensive quantitative account of the behavior of the US economy in the recent past.


''Business Cycles,'' 1913

Mitchell's next project, which would occupy him for the rest of his life, was the study and measurement of the
business cycle Business cycles are intervals of Economic expansion, expansion followed by recession in economic activity. These changes have implications for the welfare of the broad population as well as for private institutions. Typically business cycles are ...
, which was then emerging as the big problem in economics. His
magnum opus A masterpiece, ''magnum opus'' (), or ''chef-d’œuvre'' (; ; ) in modern use is a creation that has been given much critical praise, especially one that is considered the greatest work of a person's career or a work of outstanding creativity, ...
, ''Business Cycles'' appeared in 1913. The Preface begins
This book offers an analytic description of the complicated processes by which seasons of business prosperity, crisis, depression, and revival come about in the modern world. The materials used consist chiefly of market reports and statistics concerning the business cycles which have run their course since 1890 in the United States, England, Germany and France.
In chapter I Mitchell reviews 13 theories of the business cycle and admits that "All are plausible." He then puts them aside, arguing,
To observe, analyse, and systematise the phenomena of prosperity, crisis, and depression is the chief task. And there is better prospect of rendering service if we attack this task directly, than if we take the round about way of considering the phenomena with reference to the theory.
Mitchell's research strategy was thus quite different from that adopted by H. L. Moore or
Irving Fisher Irving Fisher (February 27, 1867 – April 29, 1947) was an American economist, statistician, inventor, eugenicist and progressive social campaigner. He was one of the earliest American neoclassical economists, though his later work on debt def ...
who started from a hypothesis and went looking for evidence to support it. Moore and Mitchell offer another contrast in that, while Moore embraced the new
statistical methods Statistics (from German: ''Statistik'', "description of a state, a country") is the discipline that concerns the collection, organization, analysis, interpretation, and presentation of data. In applying statistics to a scientific, industria ...
of
correlation In statistics, correlation or dependence is any statistical relationship, whether causal or not, between two random variables or bivariate data. Although in the broadest sense, "correlation" may indicate any type of association, in statistics ...
and regression, Mitchell found little use for them.


''Measuring Business Cycles''

Thirty years later Mitchell was still working on business cycles and he published another large work, ''Measuring Business Cycles'' with A.F. Burns. This book presented the characteristic " National Bureau" methods of analyzing business cycles. While Mitchell was still following the 1913 agenda, other economists had taken to studying the economy using models and even to constructing macroeconometric models. Against this background of
Keynesian economics Keynesian economics ( ; sometimes Keynesianism, named after British economist John Maynard Keynes) are the various macroeconomic theories and models of how aggregate demand (total spending in the economy) strongly influences economic output an ...
and the new
econometric Econometrics is the application of statistical methods to economic data in order to give empirical content to economic relationships. M. Hashem Pesaran (1987). "Econometrics," '' The New Palgrave: A Dictionary of Economics'', v. 2, p. 8 p. 8 ...
methods Mitchell and his project looked dated.
Milton Friedman Milton Friedman (; July 31, 1912 – November 16, 2006) was an American economist and statistician who received the 1976 Nobel Memorial Prize in Economic Sciences for his research on consumption analysis, monetary history and theory and the ...
believed that, "Mitchell is generally considered primarily an empirical scientist rather than a theorist". However, Mitchell's main creative efforts went into his empirical work on business cycles. Mitchell stated an endogenous theory, based on the internal dynamics of capitalism. Whereas neoclassical theories are deduced from unproven psychological axioms, he builds his theory from inductive generalities gained from empirical research. Also, he was considered a critic of conventional economic theory. As influenced greatly by Veblen, Mitchell is usually categorized with him as an American institutionalist.


Bibliography

* ''A History of the Greenbacks,'' University of Chicago Press, 1903. * ''Gold Prices and Wages Under the Greenback Standard,'' University of California Press, 1908. * ''Business Cycles,'' University of California Press, 1913. * * The Making and Using of Index Numbers, ''Bulletin of the US Bureau of Labor Statistics,'' 1915. * ''Business Cycles: The Problem and its Setting, '' New York: National Bureau of Economic Research, 1927. * ''The Backward Art of Spending Money: and other essays, '' New York: McGraw-Hill, 1937. * ''Measuring Business Cycles'' (with A.F. Burns), New York: National Bureau of Economic Research, 1946. * ''What Happens During Business Cycles, '' New York: National Bureau of Economic Research, 1951. * ''Types of Economic Theory from Mercantilism to Institutionalism, '' ed. Joseph Dorfman, 2 vols. New York: Augustus M. Kelley, 1967. (Reconstructed from Mitchell's lecture notes). There is a bibliography in the volume edited by Burns (below). Lucy Sprague Mitchell, Wesley Mitchell's wife, wrote the book ''Two lives; the story of Wesley Clair Mitchell and myself'' (New York, Simon and Schuster, 1953).


References


Further reading

* * Fiorito, Luca, and Massimiliano Vatiero. "Wesley Clair Mitchell and the 'Illiberal Reformers' A Documentary Note." ''History of Political Economy'' 53.1 (2021): 35-56
online
* Ginzberg, Eli. "Wesley Clair Mitchell" ''History of Political Economy'' (1997) 29#3 pp 371-390. Reproduces autobiographical essay written in 1931 but never published. * * Morgan compares Mitchell's approach to business cycles with both earlier and later approaches. * Rutherford, Malcolm. "Institutional Economies at Columbia University." ''History of Political Economy'' 36.1 (2004): 31-7
online
*


External links




S. Fabricant: The Founding of the NBERFinding aid to the Wesley Clair Mitchell papers at Columbia University
{{DEFAULTSORT:Mitchell, Wesley Clair University of Chicago alumni 1874 births 1948 deaths University of Chicago faculty University of California, Berkeley faculty Harvard University staff Columbia University faculty Institutional economists Economists from New York (state) Historians of economic thought Fellows of the American Statistical Association Presidents of the American Statistical Association Fellows of the Econometric Society Presidents of the Econometric Society The New School faculty Business cycle American statisticians Presidents of the American Economic Association People from Rushville, Illinois Social Science Research Council National Bureau of Economic Research Mathematicians from New York (state) Mathematicians from Illinois Economists from Illinois Journal of Political Economy editors