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Lawrence Robert Klein

BIOGRAPHY 18.1 Lawrence Robert Klein (1920 - )

The first Nobel Memorial Prize in Economic Science was awarded to a Dutch economist, Jan Tinbergen, for this pioneering work in econometrics that began in the 1930's. Nearly half a century later, when Lawrence R. Klein received the Nobel Prize in Economic Science of 1980, econometrics had come a long way. The University of Pennsylvania professor was cited as the leading research worker in the field and honored for developing computer models that can forecast directions taken by national economies as well as the effects of public policies. "Thanks to Mr. Klein's contributions the building of econometric models has attained ... universal use."

Colleagues who knew Prof. Klein as president of the Econometric Society and of the American Economic Association or as a member of the President's Council of Economic Advisers (1977-1980) cited his theoretical brilliance when dealing with complex simultaneous equations systems. They were equally impressed by an enormous amount of hard detail work that gave rise to such publications as The Keynesian Revolution (1947), Economic Fluctuations in the United States, 1921-41 (1950), An Econometric Model of the United States, 1929-52 (with A. S. Goldberger, 1955), The Wharton Econometric Forecasting Model (with M .K. Evans, 1967), Econometric Model Performance (1976), and many more. No wonder that Klein, a graduate of the University of California at Berkeley and of MIT, received well over 30 honorary degrees from universities around the world. Indeed, his latest work has focused on the world economy, notably the econometric study of world trade and payments. He founded Wharton Econometric Forecasting Associates, Inc. (now known as The WEFA Group) and served as principal investigator in a research project called LINK that seeks to coordinate econometric models of different countries. This permits forecasts of how political measures taken in one country might affect the economic performance of another. Thus, an oil price increase in Saudi Arabia might affect labor productivity in Germany and export prices there, which, in turn, might affect unemployment in the Netherlands and that country's exports to the United States.

Source: Adapted from John Vinocur, "Pennsylvania Professor Wins Nobel for Economics," The New York Times, October 16, 1980, pp. A1 and D6, and material supplied by Professor Klein.

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