Economics as a 'Tooled' Discipline: Lawrence R. Klein and the Making of Macroeconometric Modeling, 1939-1959

Abstract

In this dissertation, I place macroeconometric modeling at the center of the history of twentieth century macroeconomics, i.e. as a history of macroeconometrics, and ask two central questions: (1) What exactly were the objectives and the forces driving the development of macroeconometric modeling, and what kind of tools and institutions did macroeconomists build to observe, understand, and control the US postwar economy? (2) What were the effects that the construction and use of these tools had on the production of macroeconomic knowledge? Taking Lawrence R. Klein as a vehicle, I travel across the economics discipline of the 1940s and 1950s, and study the intersection between the history of macroeconomics and the history of econometrics, providing a new understanding of twentieth century economics as a “tooled” discipline in which theory (economic and statistical), application, expertise, and policy become embedded within one scientific tool: a macroeconometric model. Consequently, I present the history of macroeconomics not as the product of monolithic ideological and purely theoretical issues, but rather of divergent epistemological views and modeling strategies that go back to the debates between US-Walrasian and US-Marshallian approaches to empirical macroeconomics in which macroeconometric modeling forms the heart of macroeconomics. My thesis is that Klein was the most important figure in the creation of a new way to produce scientific knowledge that consisted in the construction and use of complex tools (macroeconometric models) within specific institutional configurations (econometric laboratories) for explicit policy and scientific objectives in which well-defined roles of experts (scientific teams) were embodied within a new scientific practice (macroeconometric modeling).