“Those Of You Who Are Old Enough Will Really Get This”

July 22, 2017
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“Those Of You Who Are Old Enough Will Really Get This”

I am adding yet more  to my most recent two posts where I am complaining about this essentially side remark that Larry Summers made in his commemoration of his late uncle, Kenneth Arrow, in which he reports that at the party celebrating Arrow’s Nobel Prize in 1972, Summers’s other uncle, the late Paul Samuelson was supposedly “discussing how stupid  Joan Robinson was.”  As it is,  I should have added to my quote from his talk in the last post what immediately followed that snide and inappropriate remark.  It is the title of this post: “Those of you who are old enough will really get this.”  This was then followed by “And they were discussing the turnpike theorem and the maximum principle and the Hamiltonian and whatever.”  After that, Summers then moved on to how they continued to  discuss these matters until all the guests were gone and their wives were waiting there impatiently for them to wrap it up, with Larry himself, then a sophomore at MIT, also waiting so somebody could take him back to his dorm.

I think this additional remark  is also worthy of note for  being inappropriate.  It essentially reinforces the idea that it was perfectly reasonable  for Samuelson to have discussed “how stupid  Joan Robinson was.” After all, sufficiently senior insiders would “really get this,” the strong implication being that of course Samuelson was right about Robinson, and these wise insiders would agree.

Except, of  course, any truly knowledgeable insiders there, and there may well have been some as some of those involved in the Cambridge capital controversy, particular Eytan Sheshinski, who was specifically mentioned in another part of Summers’s talk  and who has long been based in Israel, would know  that Summers was being very misleading, that whatever Robinson’s level of intelligence,she and her allies in Cambridge, UK had won the debate, the controversy, with Samuelson having admitted that they had and subsequently changing his line about the appropriateness of using the concept of aggregate capital, even if  the rest of those at MIT, especially Robert Solow,  simply ignored this and continued on their merry way using the concept, even though Solow himself showed it be very weak in explaining anything about economic growth.  In any case, few grad schools even teach about this controversy anymore  while continuing to  shove aggregate neoclassical production functions down the throats of unwitting grad students, hence Summers himself recognizing that one needs to be “old enough” to know to what he was referring to when he in effect inaccurately made it look like Samuelson had legitimate grounds for his snarky remark.

In discussing these two earlier posts in comments over on Economists View, RGC linked to the Wikipedia entry on all this. A curious tidbit near the end of that Wikipedia entry on the Cambridege capital controversy is that it quotes one of  the participants, Edwin Burmeister, in 2000 stating that he and Leland Yeager in a 1978 Reply had admitted that assuming smooth substitutability of factors did not  eliminate the possibility of capital-reversing. However, the 1978 cite does not appear in the References.  As it was, it was in Econoimic Inquiry and was a reply to my “Continuity and Capital Reversal: Comment,” which had appeared in the Jan.1978 issue of Econoimic Inquiry, which was on a 1976 paper by Yeager (which had won a prize) in Economic Inquiry on capital theory.  Yeager had made the false claim that such smooth substitutability would eliminate those annoying capital theoretic paradoxes in a properly formulated Austrian model.  I showed that he was wrong, and he and Burmesiter admitted it in their Reply to me (they were both at UVa at the time while that was my first year at JMU).

Yeager’s 1976 paper in Economic Inquiry was “Toward Understanding some Paradoxes in Capital Theory.”

J. Barkley Rosser, Jr., “Continuity and capital-reversal: comment,” Economic Inquiry, 1978, 16(1), 143-146.

He and Burmeister’s Reply (Yeager first coauthor) was “Continuity and Capital  Reversal: Reply,” Economic Inquiry, 16, 147-149.

Barkley Rosser

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