Entrepreneurship, knowledge and employment

Macroeconometric modeling at the SSRC’s Committee on Economic Stability, 1959-1963

Acosta Juan, Université de Lille
Pinzón-Fuchs Erich, Universidad de los Andes

In this paper we discuss the activities of the Committee on Economic Stability of the Social Science Research Council (SSRC) during the early 1960s. The Committee was established in 1959 with the overall aim to help researchers increase the knowledge about causes of instability and provide useful tools for policy analysis. We focus on the Committee's activities during the 1960s, exemplified by its key role in the development of two milestones in the history of macro-econometric model building to inform policy decisions—the Brookings model (1961-1964) and the Federal Reserve-MIT-Pennsylvania model (1966-1970)—and by their work on the comparative analysis of the experience of several developed countries with quantitative policy analysis. Using archival material from the SSRC's records, we show how the Committee brought together economists with various institutional affiliations to work on the provision of better quantitative tools for macroeconomic policy analysis. In particular, we document the close relationship that the Committee helped build between academics, foundations, and government agencies. The latter were not only an important source of new and existing data series, but also of expertise in specific fields. In fact, several government officials played a major role in the construction of individual sectors of the macro-econometric models. Equally important, the various inter-institutional, and international conferences organized during the 1960s helped foster the interest of the Treasury, the Council of Economic Advisers, the Federal Reserve, and the Department of Commerce's Office of Business Economics in the new macro-econometric tools.


Keywords: macroeconometrics, models, policy making

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