Which economic education?

A small sample of exam subjects given by “great economists” between 1928 and 1960. To be compared with the subjects we worked on as students or we’re currently grading as teachers.

Exam given by Jacob Marschak to his students in 1928, presumably at the Kiel Institut für Weltwirtschaft. I don’t know whether the students were undegraduate or graduate, if the distinction ever made sense at that time


The participant of the exercise should put himself into the position of a delegate of the parliament, a member of a Union, or a higher ministerial official. He must get a picture of the existing relations in the industry under investigation….. The main ressource for answering individual questions is the statistics Yearbook….The participant’s work will not limited to the computation of figures, they will add to the figures obtained a short commentary…. The statistics give numerical proofs that are not readily comparable with each other, and most figures furthermore derive from different various methods sometimes contradictory….”

8 series of questions regarding

1. General determination of natural resources; 2. Quantities and value of Coal production and refinement; 3. Transport; 4. Price and evaluation of trade; 5. Labor issues; 6. Raw coal in competition with other kinds of energy; 7. Capital ratio and business organisation, importance of the public sector 8. policy statements: impact of trade policies, fiscal policies, transport policies, social policies

Examples of questions:

How have the profits of the German mining industry developed since the war?

How would you conquer new territories so as to strenghten the situation of Coal in its competition with oil / water energy / wood before and after the war?

What would be the effect of a 5pft per hour increase of the miners’ wages on the retail price of coal?

What would be the effect of the introduction of a 1mk per ton of Coal custom duty for the fiscal authorities / the contractors wihin the industry / the workers / the steel industry

(Box 155, Jacob Marschak papers, Young Research Library, UCLA. My painful translation from German)


Final exam given by Paul Samuelson to his Ec26 (Business Cycles) students on May 20, 1943.

Answer two or three questions not all from the same section:

  1. « the older economists regarded the trade cycle as a fluctuation around an undefined base. Modern economists have for the first time a theory of effective demand to determine that base. » Develop the last sentence, and weigh the accuracy of the whole quotation

  2. Must savings equal investment? Dsicuss this problem, giving as little weight as possible to terminological and definitional answers. Go to the hearth of the matter, and show how hoarding enters the picture if at all

  3. What is the optimum amount of money in a system; the optimum marginal efficiency of capital; the optimum marginal propensity to consume? Explain.

  4. How can those who have lost faith in monetary control have so much confidence in the efficacy of fiscal policy?

  1. What is the effect on prices and wages of greatly increased effective demand? Illustrate with the policy problems raised during the war.

  2. Weight the chances of booms and depression in the half decade after the war

  3. resolve: secular stagnation is likely if not inevitable. Prepare a brief for th affirmative and the negative.

  4. Discuss the problems raised by the public debt

(Box 33, Samuelson papers, Research Library, Duke University)


Term paper assigned by Jacob Marschak to his Econ 303 (Economics of Uncertainty) students in 1952, presumably at Chicago.

Write Essays on any two of the following five question …

(1)-(3) The following behavior rule has been proposed: maximize expected utility. Discuss either

  1. the logical foundation of the rule; or

  2. the empirical evidence on whether the rule is actually applied by people; or

  3. some applications of the rule in the economics of the firm

    4. Discuss the following proposition: if probabilities (including “probabilities of single events”) are interpreted as subjective “degrees of belief” the rule of maximizing expected utility implies the rule that the probability of a repeated event be estimated by its relative frequency

    5. Discuss the concept of strategy and decision function, and its application in economics. What rules have been recommended for decision under incomplete information?

(Box 88, Jacob Marschak papers, Young Research Library, UCLA)


Final Exam given my Milton Friedman to his Econ 302 (Price theory)  students in 1960 at Chicago (Thanks to Dan Hammond for sending me a copy of this)

  1. Consider an individual firm which (1) has a production function that is homogeneous of degree unity in the factors of production it uses; (2) can acquire all these factors on competitive markets; and (3) sells its products on a competitive market.

    a) state precisely what (1), (2) and (3) mean

    b) do the conditions describe a “long run” or a “short run” situation? Do they need to be modified to differentiate between the two? If so, how?

    c) What do these conditions imply about the firm’s equilibrium output?

    2. Analyze each of the following quotations:

    a) In a recent editorial on the recent steel wage settlement, the Wall Street Journal commented ‘no matter how you slice it, the new contracts add upwards of a billion dollars to the wage cost of this basic industry… and gives an upward bias to all new wages negotiations in other industries.’

    b) ‘For years, the chemical industry has been able to operate profitably in the face of declining prices, largely as a result of its steadily increasing sales.’

    c) ‘Even though the soil bank plan and the other measures to restrict acreage cultivated have not succeeded in raising the market price of most crops above parity levels, they have raised the wages of farm labor by requiring heavier reliance on labor.’

    3. “Net accumulation of capital by a society has sometimes been regarded as a trasitory stage in the movement from one stationary state equilibrium position to another, each characterized by zero accumulation of capital; sometimes as itself an equilibrium position that conceivably could continue indefinitely even without any changes in ‘given’ conditions.”

    State and discuss the conditions for which each of these views is valid or possible. Which view seems to you to be stressed by the writers on capital theory whose work you have read (in particular, Keynes and Knight)?

    4. The rent of land is determined in part by the demand for products produced with the aid of land; the demand for these products depends in part on the income of the population at large; the income of the population depends in part on what the landowners receive for the use of their land. So it is quite clear that the rent of land depends on the rent of land.

    To what extent does this statement involve circular reasoning? Simultaneous determination? Prove your answers by writing down the relevant system of equations.

Quoted from Hammond, Dan. 1999. The Legacy of Milton Friedman as a Teacher. Cheltenham: Edward Elgar Publishing.

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