Samuelson was a liberal, and like many of his generation a follower of British economist John Maynard Keynes, who proposed that a nation needs an activist government that could foster low unemployment by steering tax and monetary policies, even if it meant deficit spending at times
Economist Paul Samuelson, who won a Nobel prize for his effort to bring mathematical analysis into economics, helped shape tax policy in the Kennedy administration and wrote a textbook read by millions of college students, died on Sunday. He was 94.
Samuelson, who taught for decades at the Massachusetts Institute of Technology, died at his home in Belmont, Massachusetts, the school said in a statement announcing his death.
President Barack Obama’s chief economic adviser, Lawrence Summers, is his nephew.
First American to win the Nobel Prize in Economics
In 1970, Samuelson became just the second person, and first American, to win the Nobel Memorial Prize in Economic Sciences, created in 1968 by the Central Bank of Sweden. The other Nobels have been awarded since 1901.
The award citation said Samuelson “has done more than any other contemporary economist to raise the level of scientific analysis in economic theory.”
A 1970 New York Times profile said his mind “possesses the agility of a Nijinsky and the endurance of a cross-country runner.” When he won the Nobel, he said it was “nice to be recognised for hard work.”
Samuelson was a liberal, and like many of his generation a follower of British economist John Maynard Keynes, who proposed that a nation needs an activist government that could foster low unemployment by steering tax and monetary policies, even if it meant deficit spending at times.
“In the old-fashioned laissez-faire economy, prosperity was indeed a fragile blossom,” he wrote in a 1970 article for The New York Times. “But for a modern ‘mixed economy’ in the post-Keynesian era, fiscal and monetary policies can definitely prevent chronic slumps, can offset automation or under-consumption, can insure that resources find paying work opportunities.”
Adviser to Kennedy
He was among a circle of advisers, who also included John Kenneth Galbraith and Walter Heller, who led President John F. Kennedy to recommend the historic income tax cut that Congress eventually passed in early 1964, three months after the president was assassinated.
“A temporary reduction in tax rates on individual incomes can be a powerful weapon against recession,” Samuelson had written in a report to Kennedy in early 1961.
The cut was widely credited with helping foster the 1960s economic boom. When Heller died in 1987, Samuelson said, “In Kennedy’s Camelot, he was chairman of the greatest team ever assembled. He was a great policy economist and a witty, phrase-making economist.”
Read by college students since the 1940s
It was Samuelson’s work as an educator, both in the classroom and as a textbook author, that may have been his most influential role.
College students have been reading Economics since the late 1940s. It had its roots in a short text that Samuelson put together to use in his MIT classes.
It is now in its 19th edition; the more recent editions were co-written by William D. Nordhaus of Yale.
The book has sold more than 4 million copies in more than 40 languages.
“I knew it was a good book, but what I didn’t realise would be its lasting power,” Samuelson said in a 1998 Associated Press interview. He said his aim was to make economics “understandable and enjoyable. ... I think economics — and this is what I’ve tried to impart — has a tremendous amount of human interest in it.”
“It’s my baby”
The late Robert Heilbroner, himself a notable author on economics The Worldly Philosophers, wrote in The Nation magazine in 1997 that Samuelson’s text “became almost immediately ‘the’ college textbook. ... His text changed our vision of economics from the dismal science to a study of social possibilities.”
Publisher McGraw-Hill paid an unusual tribute in 1997 by reissuing the original 1948 edition, reproducing not just the original text but the illustrations and layout. That same year, in a column by Mark Skousen entitled “Welcome back, Professor,” Forbes magazine praised Samuelson for gradually turning away in his textbook from pure Keynesianism toward more traditional economic theory.
Asked about the effort he put into double-checking and updating each edition, Samuelson told The New York Times he did so “because it’s my baby.”
For the more casual reader, Samuelson wrote a column for Newsweek magazine from 1966 to 1981. Conservative economist Milton Friedman, a fellow Nobel-winner, also wrote for Newsweek during that period.
Born in Gary, Indiana, in 1915, Samuelson graduated from the University of Chicago in 1935 and received master’s and doctoral degrees from Harvard. He joined the MIT faculty in 1940.
He gained wide notice in the field in 1947 for his book Foundations of Economic Analysis and the same year was awarded the American Economic Association’s John Bates Clark Medal for distinguished contributions from an economist under the age of 40.
He married Marion Crawford, a fellow economist, in 1938, and he credited her with helping in his early research. They had six children: Jane, Margaret, William, John, Paul and Robert. (The Robert Samuelson who writes a business column for Newsweek is no relation to the Nobel winner.)
Marion Crawford Samuelson died of cancer in 1978 at age 62. In 1981, Samuelson married Risha Eckaus.
Transformed everything he touched
“Paul Samuelson transformed everything he touched: the theoretical foundations of his field, the way economics was taught around the world, the ethos and stature of his department, the investment practices of MIT, and the lives of his colleagues and students,” said Susan Hockfield, MIT’s president, in a statement.
Sameulson is survived by his wife, six children and 15 grandchildren.
Funeral arrangements will be private, but MIT said it plans to hold a public memorial service.