03 May 2013

Samuelson Memorial

April 20, 2010

Paul Krugman:

A bit late, my remarks for the service held the weekend before last.

To be honest, it has been a long time since I made a close personal study of Paul Samuelson. Actually, the one and only time that happened was when I had to play him in the grad student skit party. You see, he had this slightly high-stepping way of walking …

That said, I did have the great privilege of sharing an office suite with Paul for many years. (I always liked the fact that, in MIT tradition, the names on the outside of the suite were in alphabetical order: Krugman, Samuelson, Solow.) I’ll say a bit more about that in a minute. But first, a few words about Paul Samuelson the economist.

Just after Paul died, I wrote that he defied the famous distinction between two kinds of thinkers – foxes who know many things and hedgehogs who know one big thing. Paul Samuelson knew many big things. By my count, he created – literally created — at least eight whole fields of economics; any one of those acts of creation would have earned him a place among history’s greatest economic thinkers. Right now I’m teaching a course on trade policy, and hardly a single class has gone by without my drawing on some part of the Samuelson oevre.

Yet path-breaking research was only part of what Paul Samuelson brought to economics. People often mention his famous textbook; what I’m not sure everyone realizes is how revolutionary that textbook really was. For one thing, it brought Keynesian economics to America’s classrooms – overcoming, by the sheer clarity and quality of its writing, what were at the time formidable intellectual and ideological hurdles.

Beyond that, Samuelson 1948 brought to America’s classrooms a sensibility, a style of thought, that was a sharp break with what went before. Instead of bludgeoning students with the voice of Authority with a capital A, or covering a lack of clear ideas with a thick, obscuring blanket of detail, Paul offered concise little models – what amounted to economic parables – illustrated and supported by acute real-world observations. The Samuelson textbook didn’t succeed because of its author’s prestige (he was still young and not that famous when it came out); it succeeded because it was a work of marvelous craft.

May I also say that on the economic issues we face now, Samuelson 1948 reads incredibly well – it seems in many ways more realistic about speculative bubbles, about the limitations of monetary policy in a depressed economy, than almost any modern textbook.

Wait, there’s more.

By choice, Paul Samuelson never played much direct role in the formation of economic policy, probably applying the same techniques he used to avoid becoming department head. But he did something much more important – he created the framework that all sensible policymakers work from to this day, an achievement only slightly tainted by the fact that not all policymakers are sensible. In the world according to Samuelson – what is often called the “neoclassical synthesis” or the “Keynesian synthesis,” but which was actually the Samuelsonian synthesis — markets are wonderful things that can sometimes go spectacularly awry. It’s good to let supply and demand do their thing – markets should be assumed innocent unless proven guilty — but it’s crucial to have the government prepared to do what it takes to prevent depressions. And Paul kept to that wisdom even as a na├»ve faith in markets – not just in their virtues, but in their mystical infallibility — began to dominate our popular discourse.

So how did he do all that? By being incredibly smart, of course. But that wasn’t the whole story.

Let me go back to the years I shared that office suite with the great man. What struck me from the beginning, and strikes me even more in retrospect, was this: the greatest economist of the century didn’t take himself too seriously.

I guess I don’t have to tell you how unusual that is in famous – or even not-so-famous – academics. I’ve known professors with no more than a handful of derivative papers to their name who expect to be treated like the Pope. (Not such a good thing these days, actually). Paul Samuelson didn’t. He was informal and, always, intellectually playful – eager to try out new ideas and try out other people’s point of view.

And that same spirit, I believe, informed his work – and made it possible. We talk about people playing with ideas; Paul Samuelson really did, and it shows throughout his writings. There’s an irrepressible quality to his best work, a sense of someone having a huge amount of fun and wanting to share it with the rest of us. One of his most influential papers, the one that introduced the overlapping-generations model, is brimming with humor, from its mock-pompous title – “An exact consumption-loan model of interest, with or without the contrivance of money” – to the footnote that begins, “Surely, no sentence beginning with the word ‘surely’ can validly contain a question mark at its end?”

The moral, I believe, is that only someone who doesn’t take himself too seriously is really fit to produce ideas that make the world a much better place. Paul Samuelson didn’t, and he did. We mourn his passing – but let us also celebrate the life of a truly great, truly good man.