Say's Law and Operationalism - Tobin Addendum

["Gunnar Tomasson" <tomasson@xxxxxxxx>]

Alan:

Further to the following:

> In his speech at the link which you provided, Assar Lindbeck "divide[d
> Samuelson's] contributions into four main areas" - call them A, B, C, and
> D - the "first [of which] is dynamic theory and stability analysis."
After
> summarizing Samuelson's work in the field, Lindbeck concluded:
>
> "This is, in fact, an application of Samuelson's famous "correspondence
> principle", whereby a bridge was built between static and dynamic
analysis,
> which earlier had usually been regarded as two completely different
methods
> of analysis."

Tobin's work in monetary theory before the 1970s represents, as it were, an
empirical test of Samuelson's "bridge...between static and dynamic
analysis" - was it real or imaginary?

By 1969, when he published a survey article on his work and that of other
mainstream monetary theorists in the inaugural issue of 'Money, Credit, and
Banking' [???], Tobin acknowledged up front that, as it were, the answer to
this question remained to be decided.

In other words, mainstream monetary theorists had yet to integrate the
economy's Income and Capital - Dynamic and Static - Accounts within a
unified conceptual framework.

In the 1980s, when I advised Tobin to the effect that epistemological
considerations suggested that the quest for such framework was quixotic, he
replied that he now "like[d] a stock-flow-stock" approach to monetary theory
and referred me to his Stockholm Nobel Lecture for demonstration thereof.

IF Samuelson's "bridge...between static and dynamic analysis" is for real,
THEN any would-be Nobel Prize-winning economist out there need only pick up
the thread where Tobin left off.

Gunnar