History

The Beginnings

Professor Charles Francis DunbarIn his 1982 article in the Quarterly Journal of Economics, Harvard economics professor Edward Mason (faculty from 1923-69) provides a rich history of the early years of Harvard Economics.  At Harvard - and more generally across the United States - economics was studied as political economy in the 1800s, under the general field of philosophy.  Historian and moral philosopher Professor Francis Bowen taught political economy at Harvard until 1871, when Professor Charles Franklin Dunbar received Harvard’s first endowed professorship in political economy.  More firsts would soon follow.  Stuart Wood was Harvard’s first political economy graduate student, receiving his PhD in 1875 from the Department of Political Science. Wood’s thesis is often cited as the first PhD in the subject of economics in the United States. Dunbar established the Quarterly Journal of Economics in 1886, which was the first scholarly journal of economics in the English-speaking world. And in 1894, Harvard conferred its first PhD in Political Economy. Throughout it all, Dunbar was instrumental in developing the study of economics at Harvard - and in 1897, Economics became a separate department within the division of History, Government, and Economics.

Architect Drawing of the Littauer Center for Public Policy

From the early 1900s to the First World War, Harvard had arguably the strongest economics program in the country.  Though consisting of only about 10 faculty members and instructors, the Department had strengths in applied work, theory, and history.  The key faculty members during this period include Thomas Carver, Frank Taussig, Edwin Gay, Charles Bullock, and William Ripley. 

The First World War took a toll on the Department when several faculty left for positions in Washington and other institutions.  These vacancies, however, led to strong, new hires, including Allyn Young, John H. Williams, and Seymour Harris, in whose honor the Department still has undergraduate awards. Additionally, Harold Hitchings Burbank, Edward Chamberlin, Overton Taylor, and Mason himself joined in the 1920s and were part of the Department’s “changing of the guard” in the 1930s, according to Mason (p. 419).

Of the several new faculty who joined the Department in the 1930s, one was Alvin Hansen, whose name along with Mason’s currently graces the Department’s largest gathering space, the Hansen-Mason Room.  The 1930s also brought new faculty from Europe, including Wassily Leontief, Gottfried Haberler, and the legendary Joseph Schumpeter.  Mason credits them and their colleagues as having “again brought the Department of Economics to a position of eminence” (p. 430).

Laying the Littauer cornerstone, May 1938. Lucius Littauer, seated leftmost.These were also the years of the Great Depression, which fueled a growing interest in public policy.  In this spirit, Harvard alumnus Lucius N. Littauer gave two million dollars to Harvard in 1935 (and an additional quarter million in 1937) to establish the Littauer Center building and to create the Graduate School of Public Administration - renamed the John F. Kennedy School of Government in 1966.  Opening its doors in 1939, the Littauer Center for Public Administration became the proud home of the Economics Department, Government Department, and Graduate School of Public Administration.  In 1978, the Kennedy School moved to its new campus in Harvard Square. And in 2005, the Government Department relocated to Cambridge Street, leaving the Economics Department as the sole occupant of Littauer.

Looking Back

Professor Emeritus Henry Rosovsky’s knowledge of the Department stretches back to 1949, when he joined the PhD program after serving in the army during World War II. “The war had a big impact on the field,” he says, recalling the role of economists in the war, such as Edward Mason, who served in military intelligence, Kenneth Arrow, who served as a weather officer, and James Dusenberry, who served as a statistician. The war also influenced the composition of Rosovsky’s graduate student peers,who were generally older, American veterans - in contrast to the younger, more international cohorts of today. Rosovsky joined the Department faculty in 1965; he went on to become Dean of the Faculty of Arts and Sciences and twice served as Acting  President of Harvard.

Among the Department’s current faculty, Professor Stephen Marglin is the longest-serving member, joining the faculty in 1965. But he first set foot in Littauer in 1955 as a Harvard undergraduate and enjoyed the Department’s frequent, rich debates on the economy. As Marglin neared his graduation in 1959, he could see the growing emphasis on mathematical rigor in the Department—a goal of the late Schumpeter, who died in 1950.

The 1960s hiring of Marglin, Martin Feldstein (1967), Dale Jorgenson (1969), and others kicked off Harvard’s big push to become a top economics program.  While Harvard’s program was strong, the field was dominated by MIT, Chicago, Berkeley, Yale, and Minnesota.  “We were very strong in economic history at that time, but not econometrics or theory,” says Jorgenson.  He, along with Professor Zvi Griliches and others, developed econometrics at Harvard, which was a new area of inquiry at the time.  When Professor Gary Chamberlain joined the faculty in 1975, he was part of the core of building up the econometrics program.

Alongside econometrics, the Department developed enormous strength in economic theory, which impacted the field more broadly. Kenneth Arrow’s appointment in 1968 was so pivotal that “many of the next generation of economists were attracted to Harvard solely by the prospect of working with him,” says Professor Jerry Green, who joined the Department in 1970.  Green cites 1968-79 as the period when Arrow’s presence at Harvard - and the many young economists who came to work with him - inspired much of modern economic theory.

Chamberlain and Green along with two other current faculty members who joined in the 1970s -  Benjamin Friedman (1972) and Richard Freeman (1973) - all fondly recall those electric years.  “There were so many new, young, incredible economists coming to Harvard that were excited to work on new things,” says Green. Jorgenson agrees, labeling the 1960s and 1970s as a booming period for Harvard Economics. Indeed, three of the first five Nobel Prizes in Economics went to Harvard professors: Simon Kuznets (1971) was the first Nobel recipient in the Department, immediately followed by Kenneth Arrow (1972), and Wassily Leontief (1973), a testament to the transformational research happening at Harvard.  Four Nobel Laureates currently roam Littauer’s wings: Amartya Sen (1998), Eric Maskin (2007), Oliver Hart (2016), and Michael Kremer (2019).

With all the growth in the 1970s, the Department needed additional space and acquired the building at 1737 Cambridge Street for some faculty and staff. Several current faculty members reflect on those days in what is affectionately referred to as “1737.”  When the Harvard Kennedy School moved to Harvard Square in 1978, the Economics faculty in 1737 moved into Littauer.  While some faculty missed 1737 and its exciting, collaborative atmosphere, having the Department united in Littauer kicked off a new era. “It was an exciting moment,” recalls Friedman.  “The whole idea that all of us were going to be sitting together in Littauer was a very special thing.”

In 1977, Professor Martin Feldstein became president of the National Bureau of Economic Research (NBER), then headquartered in New York City.  Many view his decision to move the NBER to Cambridge as a game changer for economics in Boston broadly and at Harvard specifically.  “Having the NBER in Cambridge - and the way it developed into a major research organization - made Cambridge a very attractive place for economics faculty. That helped both Harvard and MIT,” says Feldstein.  Professor Richard Freeman agrees, citing the NBER’s move to Cambridge as bringing about a change in economics research - particularly empirical research.

After building up strength in theory and econometrics in the 1960s and 1970s, Jorgenson describes the Department’s next endeavor as strengthening its applied work in international economics, labor economics, policy, and finance.  This pursuit dominated the 1980s and 1990s and was part of the Department’s allure for Professor Alberto Alesina. After completing his PhD at Harvard in 1986, Alesina became Assistant  Professor of Economics in 1988. He recognized the Department’s upward trend in the 1980s, marked by a series of strong hires such as Professors Lawrence Summers, Lawrence Katz, Robert Barro, Eric Maskin and N. Gregory Mankiw.  “I was lucky to join the Economics Department at the beginning of a phenomenal positive trend of hiring incredible young faculty.”

Professor John Campbell shares this sentiment.  Campbell heeded the call of Littauer in 1994, joining the Department during a period when Harvard decided to challenge MIT for the best economics PhD program. Senior faculty - such as Martin Weitzman and Oliver Hart - were poached from MIT and other top institutions. Campbell himself left Princeton to join Harvard, feeling that “Harvard was going places.”  He joined Andrei Shleifer in helping the Department develop the field of finance and fondly recalls the excitement of expanding the finance faculty and being part of this new endeavor.

Department staff members recall the 1980s and 1990s as a period of major technological change. Jane Trahan—now retired after 33 years as a faculty assistant - remembers her days formatting equations for research papers in Littauer’s basement computer room.  Faculty recall the IBM mainframe on Cambridge Street, where they ran their punch cards for econometric analyses.  Leontief worked with human computers and graduate students for  his pioneering work in input-output analysis.  But by the late 1980s, personal computers were introduced to all faculty assistants and soon found their way into professors’ offices as well.  This ushered in a changing relationship between faculty and their assistants, allowing faculty to do some administrative and technical work on their own.  Computing advances aside, the days were still dominated by paper, with Littauer’s corridors full of filing cabinets.

Along with the technological advances and faculty boom during this period, a major turning point came in 1990, when Professor Claudia Goldin became the Department’s first woman to be granted tenure.  She would kick off a slow, but growing, march of women into the Department’s tenured ranks.  With a specialty in history, Goldin was excited to join the giants of economic history at Harvard.  She was also interested in exploring other avenues - such as labor, education, and gender issues - and was drawn to the variety of research possibilities at Harvard.

The Department continued its momentum into the turn of the millennium.  Moving from Chicago to Harvard in 2005 was not too difficult a decision for Professor Gita Gopinath, who is now the Chief Economist at the International Monetary Fund.  “I came here because it was - without a doubt - the best international economics program in the world,” she says.  It was not, however, the most diverse department: Gopinath’s tenure in 2010 made her only the fourth woman ever among the Department’s senior faculty.  The continued change in this area is one of the most exciting developments for Gopinath, as she cites the recent promotion of three women to the rank of Professor of Economics.  “I want students to see that they’re taking classes with a diverse set of faculty and that you don’t have to look a particular way to become an economist.”

The 2000s have also brought a stronger undergraduate program to the Department.  In 2005, the economics undergraduate advising offices moved from Garden Street to the first floor of Littauer.  Many faculty credit Jeffrey Miron, the Department’s Director of Undergraduate Studies, who in 2010 began revamping undergraduate advising in economics and strengthening the undergraduate economics program more broadly. Professor Melissa Dell, an economics concentrator from 2001-05, was a happy undergraduate but says the consistent quality of mentorship and support now available to economics students is one of the biggest and best changes she has seen in the Department.

 

Looking Forward

In the 2017-18 academic year, Isaiah Andrews, Melissa Dell, Amanda Pallais, and Stefanie Stantcheva were the most recent faculty to be named Professor of Economics.  Professor Raj Chetty also returned to the senior faculty.  In the long line of distinguished Harvard economists who came before them and shaped the Department of today, this next generation of faculty members and their colleagues will carry forward the Harvard Economics Department.

2018 Faculty Recruits

These five professors embody the future of cuttingedge economics research. “The massive progress in data sets, digitization, and computing power is the new frontier in economics,” says Dell. “We’re pushing the boundaries with data, and it’s opened up a huge space for new and exciting questions.”  Researchers are now studying places and topics that were previously understudied due to data constraints.  Dell’s own research on the impacts of weather on economic growth and the long-run effects of historical policies and institutions are shining examples of this.

Chetty’s pathbreaking work - with Professor Nathaniel Hendren - using “big data” is another example, as he and his colleagues analyze a wealth of information to understand a range of topics from tax policy and unemployment insurance to education and affordable housing.  Pallais’ research involves large-scale randomized field experiments to understand the labor market performance and educational investment decisions of disadvantaged and socially excluded groups.  Stantcheva studies how best to use the tax and transfer system to raise revenue, reduce inequality, and foster the productivity of firms and individuals.  With access to incredible data and computing power and new questions to explore, Andrews’ research focuses on  developing new econometric methods that are robust to common challenges in empirical research.

Across the Department, faculty - and students - today address a variety of questions at the frontier of economics research and are active in public policy.  From the work at the intersections of economics and psychology to economics and computer science; from developing country research and field experiments to the economics of urban areas; from environmental policy to monetary policy; from theory to applied work to economic history, the Department is teeming with research and coursework that demonstrates the versatility of the economics approach.

Looking ahead, some members of the Department are concerned by the recent success of peer institutions in recruiting faculty and students.  Some lament the lack of other social science viewpoints being taught in economics.  Many worry that the physical space of beloved Littauer is less conducive to the collaboration and faculty-student interactions that are essential to current research.  Gone are the days of solo-authored papers by senior faculty members.  “Modern economics - especially empirical research - is collaborative and the best ideas come from interaction between faculty and students,” says Freeman.

The general feeling about the future seems firmly optimistic, as the Department continues to attract first-rate talent and remains an outstanding place to work in economics.  While the interior of Littauer is filled with talent, so too is the exterior.  Members of the Department enjoy access to some of the world’s best minds in complementary fields such as political science, computer science, and psychology; proximity to the people and resources in Harvard’s other schools, such as the Business School, Law School, Graduate School of Education, and T. H. Chan School of Public Health, as well as nearness to the NBER; and the prevalence of centers and institutes fostering regional studies and specializations.  This breadth and “big tent” version of economics allow Harvard to be a uniquely special space for economists.

The students are a crucial part of this too.  Faculty across the board appreciate the density of remarkable undergraduate and graduate students at Harvard.  “I learn so much from the students,” says Freeman.  As the torch passes to this next, increasingly diverse, generation of economists, so too will the direction of the field expand and change.  This, combined with technological and data advances, is “incredibly exciting and will open up a whole new world of economics research,” says Dell.