Arnold Harberger facts for kids

Arnold Carl Harberger (born July 27, 1924) is an American economist. An economist studies how people and countries make choices about money, resources, and goods. Harberger is known for teaching economics in a way that helps solve real-world problems.

One of his famous ideas is called the "Harberger triangle." It's a way to show how much an economy loses when things aren't perfectly fair or efficient, like when one company has too much control over a market.

His Life and Studies

Arnold Harberger studied economics at Johns Hopkins University. He then earned his master's and Ph.D. degrees in economics from the University of Chicago.

He taught at Johns Hopkins before returning to the University of Chicago, where he taught for many years. Later, he became a professor at the University of California, Los Angeles (UCLA). He is now a professor emeritus, which means he is a retired professor who is still highly respected.

In 1958, he married Anita Valjalo from Chile. They were together until she passed away in 2013.

Harberger speaks Spanish very well. He is known for staying in touch with his former students. Many of them became important government leaders in Latin America, especially in Chile. About 15 of his students became heads of central banks, and around 50 became government ministers! He is proud that they worked to create good economic policies in many countries.

Some people have criticized him because his former students worked for some governments in Latin America that were not democratic. For example, in Chile, his students, known as the Chicago Boys, helped fix a big economic crisis. They introduced "free-market" ideas that helped the economy. These ideas were so helpful that even after the government changed, the new democratic governments continued to use them.

Harberger turned 100 years old on July 27, 2024!

What He Studied

Harberger's main work focused on how taxes affect people and the economy, how to measure the well-being of a country (welfare economics), and how to decide if a project is worth doing (benefit-cost analysis).

The Cost of Monopolies

One of Harberger's first big studies looked at how much "monopolies" hurt the economy. A monopoly is when one company has total control over a product or service, so there's no competition.

He found that the harm from monopolies in the U.S. manufacturing industry was actually quite small. He believed that most of the U.S. economy was competitive, meaning many companies were competing fairly.

How Taxes Affect Everyone

Harberger also did important work on how taxes affect different parts of the economy. This is called "tax incidence"—it's about figuring out who really pays a tax, even if someone else writes the check.

He created a model to show how a tax on companies' profits (like the corporate income tax) could affect workers and business owners. His big discovery was that even if a tax is placed on a company, the burden of that tax might actually fall on other people, like workers or all business owners, because money and jobs move around the economy.

For example, if a tax makes it less profitable for companies to invest in one area, they might move their money to another area. This can change wages and prices for everyone. His work showed that who pays a tax can be very different from who seems to be paying it at first glance.

He also looked at how these tax effects change in a country that trades a lot with other countries. He found that if a country can easily get money from other countries, then the burden of a company tax might fall more on workers than on the people who own the companies.

Honors and Awards

• Fellow, Econometric Society
• Fellow, American Academy of Arts and Sciences
• Special Ambassador, U.S. Department of State (1984)
• National Academy of Sciences of the United States
• President, Western Economic Association (1989–1990)
• Foreign Honorary Member, Chilean Academy of Social Sciences
• President, American Economic Association (1997)
• Distinguished Fellow, American Economic Association
• Simon Kuznets Memorial Lecturer, Yale University (2000)
• Daniel Holland Medal, National Tax Association (2002)
• President, Society for Benefit-Cost Analysis (2008–2009)
• Bradley Foundation Prize (2009)
• Life for Freedom Award, Roads to Freedom Foundation (Mexico)

See also

In Spanish: Arnold Harberger para niños

• Chicago Boys
• Harberger Tax