Lawrence Klein facts for kids
Quick facts for kids
Lawrence Klein
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| Born | September 14, 1920 Omaha, Nebraska, U.S.
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| Died | October 20, 2013 (aged 93) Gladwyne, Pennsylvania, U.S.
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| Nationality | American |
| Institution | University of Pennsylvania University of Oxford University of Michigan NBER Cowles Commission |
| Field | Macroeconomics Econometrics |
| School or tradition |
Neo-Keynesian economics |
| Alma mater | Massachusetts Institute of Technology (PhD) University of California, Berkeley (BA) Los Angeles City College (AA) |
| Doctoral advisor |
Paul Samuelson |
| Doctoral students |
Arthur Goldberger Bennett Harrison Ignazio Visco E. Roy Weintraub |
| Influences | Jan Tinbergen |
| Contributions | Macroeconometric forecasting models |
| Awards | John Bates Clark Medal (1959) Nobel Memorial Prize in Economic Sciences (1980) |
| Information at IDEAS / RePEc | |
Lawrence Robert Klein (born September 14, 1920 – died October 20, 2013) was an American economist. He won the Nobel Memorial Prize in Economic Sciences in 1980. He earned this award for creating computer models that could predict how economies would change. These models are used in a field called econometrics, which combines economics with statistics. Thanks to his work, these types of models are now very common among economists. A professor from Harvard University once said that Klein was the first to build statistical models based on the ideas of John Maynard Keynes. These tools are still used by important financial groups like the Federal Reserve Bank.
Contents
Life and Career
Lawrence Klein was born in Omaha, Nebraska. He went to Los Angeles City College, where he learned calculus (a type of advanced math). He then studied at the University of California, Berkeley, earning a bachelor's degree in economics in 1942. He continued his studies at the Massachusetts Institute of Technology (MIT), where he earned his PhD in economics in 1944. A PhD is the highest university degree you can get.
Building Early Economic Models
After MIT, Klein joined the Cowles Commission for Research in Economics, a research group. There, he built a model of the U.S. economy. This model helped him predict how the economy would change and how government policies might affect it. After World War II, many people thought there would be a depression. But Klein used his model to correctly predict that the economy would actually get better. This was because people who returned from the war would want to buy more things. He also correctly predicted a small economic slowdown after the Korean War.
During the 1940s, Lawrence Klein faced some challenges because of his past associations. This was a difficult time in American history, and it affected many people's careers.
At the University of Michigan, Klein created even better macroeconomic models. One famous one was the Klein–Goldberger model, which he made with Arthur Goldberger. This model was based on ideas from Jan Tinbergen of the Netherlands, who later won the first Nobel economics prize. Klein used a different economic theory and statistical methods than Tinbergen.
Moving to England
In 1954, because of the challenges he faced in the U.S., Lawrence Klein moved to the University of Oxford in England. There, he developed an economic model for the United Kingdom called the Oxford model with Sir James Ball. He also helped create surveys about savings in Britain.
Returning to the U.S.
In 1958, Klein came back to the U.S. and joined the University of Pennsylvania. In 1959, he received the John Bates Clark Medal, which is one of the top awards in economics. By 1968, he became a special professor of economics and finance at the university.
Important Projects
In the early 1960s, Klein led a big project called the "Brookings-SSRC Project." The goal was to build a detailed econometric model to predict how the U.S. economy would perform in the short term.
Later in the 1960s, Klein built the Wharton Econometric Forecasting Model. This model was smaller than the Brookings model but became very well-known for its accurate predictions. It could forecast things like national product, exports, and investments. It also helped study how changes in taxes or oil prices would affect the economy.
In 1969, Klein started a company called Wharton Econometric Forecasting Associates (now IHS Global Insight). This company helped launch the economic forecasting industry in the U.S. His clients included big companies like General Electric Company and IBM. He also started and led the LINK project, which was a group of model builders from many countries. The goal of LINK was to create the world's first global economic model. This model linked the economies of different countries so that changes in one country would show how they affected others. The LINK project is still active today.
Later Career
During the 1976 U.S. presidential election, Klein helped Jimmy Carter with his economic plans. He was asked to join Carter's government but decided not to. Klein also served as president of important groups like the Econometric Society and the American Economic Association.
Many experts agree that few researchers in economics have had as many followers or as much impact as Lawrence Klein. In his later years, he worked on "current quarter models." These models use the latest economic information to predict how fast the economy is growing right now and in the next few months. These newer models were more automatic and mechanical than his earlier ones.
Even after he officially retired, Klein continued to build high-frequency economic models. These models could predict economic changes monthly and quarterly for countries like the U.S., China, Russia, India, Brazil, Mexico, Korea, and Hong Kong.
Klein was a founding member of Economists for Peace and Security. He was also a member of several important academic groups, including the National Academy of Sciences.
He passed away at his home on October 20, 2013, at the age of 93.
See also
In Spanish: Lawrence Klein para niños
- List of economists
