Economics in an Engineering School

At Harvard, which saw itself as America's preeminent university, home to many academic stars in arts and sciences, Paul was at the center of the coun­try's academic life. Its economics department was able to boast of being home to some of the world's leading economists; as a junior fellow, Samuelson mixed with eminent mathematicians, scientists, philosophers, historians, and social scientists.

Since its foundation in 1861, MIT had concentrated on training under­graduates in the practical skills required in engineering. This began to change after the First World War, when two industrialists—Gerard Swope, of General Electric; and Frank Jewett, of Bell Telephone Laboratories—decided that industry needed engineers who had strong backgrounds in science and who could contribute to the creation of science-based technologies.¹ Training in practical engineering skills was no longer sufficient. Under their influence, the Department ofElectrical Engineering developed active research in physics. They then turned to the institute as a whole, giving Karl Compton, a widely respected experimental physicist who was recruited as president of MIT in 1930, the task of “introducing a much more powerful element of fundamental science” into the engineering curricula.² During the 1930s, the curriculum was rede­signed so that all students spent their first two years studying mathematics, physics, chemistry, English, and history, not specializing until their upper­class years.³ Major laboratories were established, science departments were developed, and with the assistance of Vannevar Bush, who became vice presi­dent and dean of Engineering, Compton transformed MIT's other engineering departments.

According to historian Christophe Lecuyer, “From a polytechnic insti­tution training practical engineers for positions of immediate usefulness in industry, it had become a full-fledged research university with leading research and graduate programs in physics, chemistry, electrical engineering, and chemical engineering.” The institute had developed strong links with industry, and was also offering courses specifically for officers in the U.S. military: Navy officers could take courses in naval engineering, aeronautical engineering, meteorology, or torpedo engineering; Army officers could take specially designed courses in civil engineering or army ordinance, and there was a special course for chemical warfare officers.⁴

When Samuelson arrived, the Department of Economics and Social Science at MIT was very small, its composition reflecting MIT's his­tory of offering the practical skills needed by engineers.⁵ The head of the department, Ralph Freeman, was a former Rhodes Scholar and had served in the Canadian artillery during the First World War. When a separate Department of Economics and Statistics was established in 1930, Freeman, then at the University of Ontario, had been appointed as an associate pro­fessor, and in 1933—34, he became head of the department. The following year the department acquired the name it had in 1940, so as to reflect a broadening of its activities and the appointment of a sociologist to its staff.⁶ Freeman had, according to Samuelson, absolute power in the new department, though out of courtesy he deferred to professorial votes on new appointments. Between them, the economists on the faculty had published very little: Armstrong and Tucker specialized in banking and finance, approached historically with a focus on institutions, while Thresher appears to have published nothing on economics.^a Ralph Freeman published most

a.

The 1940 edition of the MIT catalogue boasted that the institute “was the first technological institution to recognize and provide for the impor­tant place of economics in the training of the engineer.”⁸ Economics was a required part of the curriculum in all programs. Some courses were taught by specialists located in the engineering departments (for example, aeronautical engineering had a specialist in “air law and economics” and biology had an instructor in “marine economics,” and there were courses in subjects such as “power system economics”), but the Department of Economics and Social Science provided most of the required economics teaching. Its main activ­ity was an elementary course taken by virtually all students at the institute, which accounted for a high proportion of the department's teaching load and for which members of the department had collaborated on a textbook, The Economic Process.

First issued in 1934, this textbook was revised the following year, in which course offerings were increased to include American Government, Social and Economic Factors in City Planning, Methods of Social Investigation, Planning and Housing Legislation, and Economics of Transportation. The significant feature of these courses is that they were all introduced at the request of other departments. The department was not shaping its own activities.

Ralph Freeman shared his surname with another member of the depart­ment, Harold Freeman (1909—1997), with whom Samuelson shared an office suite with telephones—a luxury that even Schumpeter and Haberler did not have at Harvard—and a secretary.¹⁰ Samuelson described Harold Freeman as “the most unforgettable person I ever met,” describing him as a cross between Peer Gynt and Baron Munchausen, whose versions of events rarely coincided with Samuelson's own.¹¹ Gregarious and full of gossip, he had studied at MIT in the late 1920s, in the days when it taught practical engineering skills, including handling ladles full of molten steel, a feat Samuelson found hard to believe given that Freeman was tall but weighed less than his IQ.^b Graduating in 1931, he worked in a rubber plant, “pounding cheap heels into cheap shoes at 19 cents an hour” before becoming an instructor at MIT. He was a statistician, but from 1936 to 1938 he attended Harvard so that he could teach his share of economics properly. During this period he joined Samuelson at Schumpeter’s and Wilson's lectures. At Harvard he wrote a thesis on The Projective Differential Geometry of Plane and Space Curves. He also undertook quality-control consulting work with industrial concerns, and published on statistical methods of quality control, before returning to MIT in 1939 as an associate professor to support the department’s work in industrial sta­tistics, in which there was extensive collaboration with the Mathematics Department.¹²

Samuelson’s account of Harold Freeman, who became one of his closest friends, says as much about him as about its subject:

[H]e told stories like Baron Munchausen. I never heard him describe an event as it happened.

Every single day from September 10, 1927, to November 3, 1943, Harold ordered a chicken pie at the Walton Cafeteria out­side MIT’s main gate. By Laplace’s Law of Succession, November 4, 1943 had an all but certain outcome. But never since has he eaten chicken.

Once I asked him: “If the Devil promised you a theorem in return for your immortal soul, would you accept the bargain?” Without hesi­tation he replied, “No. But I would for an inequality.”¹³

They shared a sense of humor, which is evident from their subsequent limited correspondence.¹⁴

b. Note that it is normal for an American to be weighed in pounds, whereas the UK uses kilos or stones.