Modern Theory of Economic Growth
The works of Robert Solow cover a gamut of economic topics, including macroeconomic analysis, unemployment, inflation, the economics of non-renewable resources, and most notably, economic growth and development. Solow, a dedicated pragmatist, asserts that economics is a science with a small ‘s’, not a capital one, because the science of economics must respect facts and conform to reality.
A native of Brooklyn born on August 23, 1924, Solow is dismayed at the current crop of cutting-edge theorists, whom he views as too often attempting to explain all economic realities with excessively abstract and simplistic, though highly mathematical, models. No economic theory can explain everything, and attempts to do so, he intimates, end up explaining nothing. His disdain may be fueled in part because economists who experienced such realities as the Great Depression are dying out. Solow views capitalist economies as relatively stable, but not always so. His work is firmly grounded in events both contemporary and historical, and it has garnered tremendous respect for its practical applications.
Following in the footsteps of John Maynard Keynes, Solow advocates occasional government intervention to help stabilize a market economy. Consequently, his work on economic growth has helped shape government policies around the globe. The Solow growth model, currently the dominant framework for analysis of economic growth and development, suggests that an equilibrium growth path is achieved when capital and population increase at roughly similar rates. Variable capital-labor ratios can help an economy maintain equilibrium or restore it. Other specialists in the field now term economic growth not attributable to increases in capital or labor as the “Solow residual.”
Solow attended public schools as a child and comments favorably on the quality of his early education. He enrolled at Harvard on a scholarship in 1940, studying bits of biology, sociology, and anthropology, and a tiny dose of economics. No field really captured his full attention, so he left Harvard and joined the army when the United States became embroiled in World War II.
Upon his return four years later and newly married, Solow had to choose a major quickly. His wife, an economic historian, suggested that he would probably find economics interesting. And so, economics it was. (Students choose their majors for funny reasons, don’t they!) Solow might have never become serious about economics, but Harvard required all upperclassmen to have a tutor - a professor who gave weekly assignments which they met to discuss. Solow was assigned to Wassily Leontief [Nobel Prize, 1973], whom he credits with turning him into an economist. Solow earned his BA in 1947, and his Ph.D. in 1951.
After a fellowship year at Columbia University, Solow was offered an assistant professorship to teach statistics and econometrics at the Massachusetts Institute of Technology. Paul Samuelson was in an adjacent office, and Solow was soon drawn back into the field of ‘straight’ economics because of a close professional collaboration born of daily conversations about economics, politics, and personal matters. Their friendship has lasted for more than half a century.
Robert Solow has a reputation for affability and first-class teaching. He attributes much of his character to membership in three groups of hardworking and loyal friends: in the army, as a member of the President Kennedy’s Council of Economic Advisers [1961-64], and as a faculty member in the Economics Department at MIT. He says he never longed to be anywhere other than exactly where he is.