Abba P. Lerner
Abraham "Abba" Ptachya Lerner (also Abba Psachia Lerner;[1][2] 28 October 1903 – 27 October 1982) was a Russian-born British economist.
Abba P. Lerner | |
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| Born | 28 October 1903 |
| Died | 27 October 1982 (aged 78) |
| Nationality | Moldovan-British-American |
| Field | Economics |
| School or tradition | Post-Keynesian economics |
| Alma mater | London School of Economics |
| Influences | Friedrich Hayek, John Maynard Keynes, Paul Samuelson, Oskar R. Lange |
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Born in Bessarabia, Russian Empire,[3] Lerner grew up in a Jewish family, which emigrated to Great Britain when Lerner was three years old. Lerner grew up in London's East End and from age 16 worked as a machinist, a teacher in Hebrew schools, and as an entrepreneur. In 1929, Lerner entered the London School of Economics, where he studied under Friedrich Hayek. A six-month stay at Cambridge in 1934–1935 brought him into contact with John Maynard Keynes. In 1937, Lerner emigrated to the United States.[4][5] While in the US, he befriended intellectual opponents Milton Friedman and Barry Goldwater.[6]
Lerner never stayed at one institution long, serving on the faculties of nearly a dozen universities and accepting over 20 visiting appointments.[7] Lerner was 62 when he was given a professorship at the University of California, Berkeley in 1965 and left after reaching mandatory retirement age six years later.[7] During his time there, Lerner criticized the unrest caused by the student protests as a threat to academic freedom.[7]
Although Lerner never received the Sveriges Riksbank's Nobel Memorial Prize in Economic Sciences, he has been recognized as one of the greatest economists of his era.[8] Fundamental economic "concepts, theorems and rules" were derived and/or furthered by Lerner's work throughout his academic career.
Activities
- Lerner developed a model of market socialism which featured decentralised market pricing proportional to marginal social cost[9][10][11] and in so doing contributed to the Lange–Lerner–Taylor theorem.[12]
- Lerner contributed to the idea of a social dividend by incorporating it into Oskar R. Lange's original model of socialism, where the social dividend would be distributed to each citizen as a lump-sum payment.[13]
- The use of fiscal policy and monetary policy as the twin tools of Keynesian economics is credited to Lerner by historians such as David Colander.[14]
- The Lerner symmetry theorem states that an import tariff can have the same effects as an export tax.[15][16]
- The Lerner Index measures potential monopoly power as mark-up of price over marginal cost divided by price or equivalently the negative inverse of demand elasticity.[17]
- Lerner improved a formula of Alfred Marshall, which is known since as the Marshall–Lerner condition.[18]
- Lerner improved the calculations made by Wilhelm Launhardt on the effect of terms of trade.
- Lerner developed the concept of distributive efficiency, which argued that economic equality will produce the greatest probable total utility with a given amount of wealth.[19]
- Based on effective demand principle and chartalism, Lerner developed functional finance, a theory of purposeful financing (and funding) to meet explicit goals, including full employment, no taxation designed solely to fund expenditure or finance investment and low inflation.[20]
- Lerner (1951) developed the concept of the NAIRU (before Friedman and Phelps). He termed it "low full employment" and contrasted it with "high full employment", the maximum employment achievable by implementing functional finance.[21]
- The Lerner–Samuelson theorem goes back to Lerner.[22][23]
Personal life
Lerner married Alice Sendak in 1930. In 1932, they had twin children Marion and Lionel. At some point, their marriage ended and Lerner ended up remarrying to Daliah Goldfarb at the age of 57.
References
- The London Gazette (8 November 1935)
- New York Passenger Lists
- "Abraham Psachia Lerner, Assistant Lecturer in Economics", The London Gazette, 8 November 1935.
- Odekon, Mehmet (2011). Booms and Busts: An Encyclopedia of Economic History from the First Stock Market Crash of 1792 to the Current Global Economic Crisis. Armonk, NY: Sharpe. ISBN 9780765682246.
- Colander, David (December 1984), "Was Keynes a Keynesian or a Lernerian?", Journal of Economic Literature, 22: 1571–79, argues for the influence of Lerner's interpretation Keynes in "textbook" Keynesianism.
- Arrow, Kenneth J. (25 August 2016). On Ethics and Economics: Conversations with Kenneth J. Arrow. Routledge. ISBN 978-1-317-19779-9.
- Gérard Debreu; B. Hansen; Charles J. Hitch (1988). 1988, University of California: In Memoriam. University of California Academic Senate. pp. 82–84. Retrieved 8 April 2017.
- Scitovsky, Tibor (1984). "Lerner's Contribution to Economics". Journal of Economic Literature. 22 (4): 1547–1571. JSTOR 2725381.
- Abba P. Lerner, 1938. "Theory and Practice in Socialist Economics". Review of Economic Studies, 6(1), pp. 71–75.
• _____, 1934. "Economic Theory and Socialist Economy," Review of Economic Studies, 2(1), pp. 51–61.
• _____, 1936. "A Note on Socialist Economics", Review of Economic Studies, 4(1), pp. 72–76.
• _____, 1937. "Statics and Dynamics in Socialist Economics," Economic Journal, 47(186), pp. 253–270.
• _____, 1944, The Economics of Control, Macmillan. (J.E. Meade article book-review extract.) - Tadeusz Kowalik (2008), "Lange, Oskar Ryszard (1904–1965)," The New Palgrave Dictionary of Economics, 2nd Edition. Abstract.
- Tibor Scitovsky, ([1987] 2008). "Lerner, Abba Ptachya (1905–1982)," The New Palgrave Dictionary of Economics, 2nd Edition. Preview link.
- Raaj Kumar Sah and Joseph E. Stiglitz, 1985. "Human Fallibility and Economic Organization", American Economic Review, 75(2), pp. 292–297.
- "What eventually became known as textbook Keynesian policies were in many ways Lerner's interpretations of Keynes's policies, especially those expounded in The Economics of Control (1944) and later in The Economics of Employment (1951)...Textbook expositions of Keynesian policy naturally gravitated to the black and white 'Lernerian' policy of Functional Finance rather than the grayer Keynesian policies. Thus, the vision that monetary and fiscal policy should be used as a balance wheel, which forms a key element in the textbook policy revolution, deserves to be called Lernerian rather than Keynesian." (Colander 1984, p. 1573)
- Abba P. Lerner, 1936. "The Symmetry Between Import and Export Taxes", Economica, N.S., 3(11), pp. 306–313.
- Jagdish N. Bhagwati, Arvind Panagariya, and T. N. Srinivasan, 1998 Lectures on International Trade, 2nd Edition, MIT Press. Description and ch. 12, sect. 12–6, Lerner Symmetry Theorem, scrollable preview, pp. 215–19.
- Abba P. Lerner, 1934. "The Concept of Monopoly and the Measurement of Monopoly Power," Review of Economic Studies, 1(3), pp. 157–175.
- • Abba P. Lerner, 1944, The Economics of Control, Macmillan.
• _____, 1952. "Factor Prices and International Trade," Economica, N.S., 19(73), pp. 1–15. - • Abba P. Lerner, 1944, The Economics of Control, Macmillan, ch. 3.
• _____, 1978. "Utilitarian Marginalism (Nozick, Rawls, Justice, and Welfare)," Eastern Economic Journal, 4(1), pp. 51–65. - Abba P. Lerner, 1943. "Functional Finance and the Federal Debt," Social Research, 10(1), pp. 38–51.
- Abba P. Lerner, 1951, Economics of Employment, ch. 14. McGraw-Hill. Review extract.
- Abba P. Lerner, 1952. "Factor Prices and International Trade," Economica, N.S., 19(73), pp. 1–15.
- Murray C. Kemp, 2008. International Trade Theory: A Critical Review, Routledge, pp. xiv–xvii. Description.
External links
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Wikiquote has quotations related to: Abba Lerner |
- "Abba Lerner".
- "Abba Lerner".
- "Abba Ptachya Lerner (1905–1982)". The Concise Encyclopedia of Economics. Library of Economics and Liberty (2nd ed.). Liberty Fund. 2008.
- Mathew Forstater (July 1999). "Functional Finance and Full Employment: Lessons from Lerner for Today?". Working Paper. No. 272. The Jerome Levy Economics Institute.
- David Landes (1994). Biographical Memoirs Volume 64. Washington, DC: National Academies Press. pp. 209–230. ISBN 978-0-309-04978-8. Retrieved 8 April 2017.
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