Entrepreneurship, knowledge and employment

The Genesis of John von Neumann’s 1937 Growth Model Paper

Juan Carvajalino, Duke University

This project is an exploration of the genesis of John von Neumann’s A Model of General Economic Equilibrium. In that paper, von Neumann suggested that he had first presented his model in 1932 at a mathematical seminar of Princeton University. His paper then appeared in 1937 in German in the Ergebnisse eines Mathematischen Kolloquiums, journal published by Karl Menger. Since then, commentators of von Neumann’s growth model have often restated von Neumann’s account of the history of the paper. This leaves us with the impression that von Neumann, a great mathematician, one day around 1932 during his leisure time wrote a paper in mathematical economics out of the blue. Von Neumann’s growth model subsequently played a significant influence in the development of General Equilibrium Theory, and more generally, in the mathematical turn of economics of the 1940s. In our paper, heavily based on archival material, the process that led von Neumann to write his growth model paper will be tentatively reconstructed. On that basis, it will be argued that von Neumann’s 1937 paper resulted from a significant personal engagement with economics. It will also be argued that as von Neumann travelled around the world, this engagement was mediated by his encounters between 1928 and 1935 with young economists, such as Jacob Marschak in Berlin, Nicolas Kaldor in Budapest and Frank Graham in Princeton, as well as with other mathematicians interested in mathematical economics, in particular Abraham Wald in Vienna. By establishing these connections, the paper will also bring new light on certain theoretical and methodological issues related to von Neumann’s 1937 paper.

Area:

Keywords: John von Neumann, mathematical economic, growth model, dynamics,

Paper file