Paul Samuelson Economist Economic Theory

Sleeping Beauty and The Double Kiss, Paul Samuelson Economist

Economics was a sleeping princess waiting for the invigorating kiss of Maynard Keynes...but....economics was also waiting for the invigorating kiss of mathematical methods (Samuelson, 1972)

The attack by Keynes in the 1930s upon the orthodox neo­classical theory of employment brought about a revolution in economic thinking and policy. If, for many economists, the message of state intervention and the control of aggregate demand was a difficult one to accept, it had, at least, the merit of being presented in a literary, although highly complex form and, as such, could readily be discussed and disputed within academic journals and the serious press. The mathematical revolution in economics during the thirties and forties offered no such conso­lation and brought despair to those who, having struggled to absorb Keynesian principles, were confronted with the trans­formation of new and old theories into mathematical form. Samuelson's role in this revolution was crucial, for although mathematical arguments had been employed by economists, such as Cournot, Walras, Pareto, Edgeworth and Fisher, in the nineteenth and early twentieth centuries, the use of mathematics in economics had been essentially piecemeal and ad hoc. Drawing upon an education that included formal training in advanced mathematics and the physical sciences, Samuelson set out to reveal the common mathematical structure which underpinned disparate areas of economics such as consumer behaviour, international trade and Keynesian theory. The debate between Keynes and the neoclassical orthodoxy concerning the de­ficiencies of macroeconomic theory tended to obscure the fact that economic theory as a whole was accompanied by analytical methods that were fuzzy and unsystematic. In attempting to rectify this, Samuelson has taken the stance of economist qua scientist; the scientific awakening experienced by economics, as a result, has been far-reaching and profound.