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People at SCEPA
SCEPA Advisory Board
 Robert
Solow
Professor Emeritus of Economics
Harvard University
Robert Solow
won the Nobel Prize in 1987 for his analysis of economic growth.
His first major paper on growth was "A Contribution to the Theory
of Growth." In it he presented a mathematical model of growth that
was a version of the Harrod-Domar growth model. The main difference
between his model and the Harrod-Domar model was that Solow assumed
that wages could adjust to keep labor fully employed. Out the window
went the Harrod-Domar conclusion that the economy was on a knife
edge.
Solow followed
shortly after with another pioneering article, "Technical Change
and the Aggregate Production Function." Before that article, economists
had believed that the main causes of economic growth were increases
in capital and labor. But Solow showed that half of economic growth
cannot be accounted for by increases in capital and labor. This
unaccounted-for portion of economic growth-now called the "Solow
residual"-he attributed to technological innovation. His article
originated "sources-of-growth accounting," which economists use
to estimate the separate effects on economic growth of labor, capital,
and technological change.
Solow also was
the first to develop a growth model with different vintages of capital.
The idea was that because capital is produced based on known technology,
and because technology is improving, new capital is more valuable
than old capital.
A Keynesian,
Solow has been a witty critic of economists ranging from interventionists
like Marxist economists and John Kenneth Galbraith to noninterventionist
economists such as Milton Friedman. Solow once wrote that Galbraith's
disdain for ordinary consumer goods "reminds one of the Duchess
who, upon acquiring a full appreciation of sex, asked the Duke if
it were not perhaps too good for the common people." Of Milton Friedman,
Solow wrote, "Everything reminds Milton of the money supply. Well,
everything reminds me of sex, but I keep it out of the paper."
Solow earned
his Ph.D. from Harvard, where he studied under Wassily Leontief,
and has been an economics professor at MIT since 1950. From 1961
to 1963, he was a senior economist with President Kennedy's Council
of Economic Advisers. In 1961, he won the American Economic Association's
John Bates Clark Award, given to the best economist under age forty.
In 1979, he was president of that association.
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