Wesley Clair Mitchell

Wesley Clair Mitchell

American economist (1874–1948)

Wesley Clair Mitchell (August 5, 1874 – October 29, 1948) was an American economist known for his empirical work on business cycles and for guiding the National Bureau of Economic Research in its first decades.2

From Wikipedia’s article on Wesley Clair Mitchell (this version), CC BY-SA 4.0.

Born Aug 5, 1874, died Oct 29, 1948.1

About

Mitchell was referred to as Thorstein Veblen's "star student."

Paul Samuelson named Mitchell (along with Harry Gunnison Brown, Allyn Abbott Young, Henry Ludwell Moore, Frank Knight, Jacob Viner, and Henry Schultz) as one of the several "American saints in economics" born after 1860.

From Wikipedia’s article on Wesley Clair Mitchell, shared under CC BY-SA 4.0.2

Companies

Early life and education

  • Date not recordedUniversity of Chicago3

University of Chicago

Mitchell's teachers included economists Thorstein Veblen and J. L. Laughlin and philosopher John Dewey. Although Veblen and Dewey did more to shape Mitchell's outlook, Laughlin supervised his dissertation. Laughlin's main interest was in currency questions; he was a strong opponent of the quantity theory of money. The currency question facing the US in the 1890s was the choice between alternative monetary standards: inconvertible paper, gold monometallism and gold/silver bimetallism.

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. 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.

From Wikipedia’s article on Wesley Clair Mitchell (this version), CC BY-SA 4.0.

Career

Occupation: statistician, university teacher, economist.7

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, which was then emerging as the big problem in economics. His magnum opus, 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 by 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 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 of correlation and regression, Mitchell found little use for them.

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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. The 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 that background of Keynesian economics and the new econometric methods, Mitchell and his project looked dated.

Milton Friedman believed, "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.

From Wikipedia’s article on Wesley Clair Mitchell (this version), CC BY-SA 4.0.

Personal life

  • BornAug 5, 1874, Rushville8
  • DiedOct 29, 1948, New York City9
  • CitizenshipUnited States10
  • SpouseLucy Sprague Mitchell11

Awards

  • 1947Francis A. Walker Medal12 14
  • 1945doctor honoris causa from the University of Paris12
  • 1934Messenger Lectures12
  • 1933Fellow of the Econometric Society12 13
  • Date not recordedFellow of the American Statistical Association12

Sources

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