Development and Underdevelopment in the History of Economic Thought

Institutional Order and Mathematical Structure in Jan Tinbergen’s Econometrics (part of Panel by Carret on Tinbergen and Frisch)

Dekker Erwin Dekker, Mercatus Center at George Mason University

Tinbergen’s econometric work in the 1930s was shaped by two competing tendencies. On the one hand he was influenced strongly by the burgeoning movement in econometrics which sought to uncover stable mechanisms in the particular markets and the economy as a whole. On the other hand his work was crucially shaped by a more institutional (and historical) program, which sought to identify the relevant institutional order of the economy. This paper will outline the relevant particular influences on his work of the 1930s, and demonstrate how they create tensions in his econometric work. What is particularly striking is that he remained highly sensitive to institutional criticisms of his work. These tensions were never fully resolved, but find something of a synthesis in the decision-models of the early 1950s.

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Keywords: Tinbergen; econometrics, institutions, mathematization