MIDWESTERN PROFESSORS NET NOBEL
FOGEL, NORTH ARE HAILED AS PIONEERING ECONOMIC HISTORIANS

Author: By David Warsh, Globe Staff

Date: Wednesday, October 13, 1993
Page: 33
Section: BUSINESS

Fogel, a professor at the University of Chicago, often is described as the father of modern econometric history. He's especially noted for using careful empirical work to overturn conventional wisdom.

North, a professor at Washington University in St. Louis, was honored as a pioneer in the "new" institutional history. In the Nobel announcement, specific mention was made of a 1968 paper on ocean shipping, in which North showed that organizational changes played a greater role in increasing productivity than did technical change.

The Cambridge native has also written a series of books, including "The Rise of the Western World" in 1971 and "Structure and Change in Economic History," which set out with clarity the role institutional change, especially property rights, could be expected to play in a rigorous theory of economic development.

Fogel is identified with two issues in particular. There was a 1964 book arguing that the spread of the railroad was not as important to the opening of the American West as had been argued by Joseph Schumpeter and Walt Rostow. Using "counterfactual" arguments (supposing that things had happened differently than they did, and examining what the consequences would have been) and a great deal of benefit-cost analysis, Fogel argued that canals would have done the job about as well; the "iron horse" probably contributed no more than 3 percent to the growth of gross domestic product, he calculated.

In a second, far more controversial book, "Time on the Cross," written with Stanley Engerman and published in 1974, Fogel argued that the institution of slavery had been more profitable than previously thought. His conclusion gave rise to a decade of controversy, and he was attacked as somehow endorsing slavery. Fogel later published a four-volume study called "Without Consent or Contract," in which he argued forcefully that slavery ended not because it was economically inefficient, but because it was morally repugnant.

It was the fourth year in a row the Nobel Prize in economics went to works that extended economic analysis to an applied field: The economic sociology of education and the family, law and industrial organization, finance, and now history have been recognized as important subfields of the discipline.

It was the fourth consecutive year that a University of Chicago economist shared in the prize, which has been given annually by the Swedish Central Bank since 1969. In the familiar argot of the Windy City, University of Chicago president Hugo Sonnenshein said, "This four-peat is a truly grand endorsement of our university."

"I think it was Bob Fogel who coined the term cliometrics" for the application of econometric theory to history, said Harvard University professor John Meyer. "It's a small club with big energy." It was Meyer, with a seminal paper on the economics of slavery written with Alf Conrad in 1967, who started the excitement over using the econometric methods that emerged from World War II to study history.

Commented Richard Easterlin, a professor at the University of Southern California: "The new economic history has been around for more than 30 years. It's good to finally have some recognition."

Fogel's son, Steven, proprietor of Steve's Beale Street Diner in Quincy said: "He's very excited about it. There is something about the recognition by his peers that's really thrilling." (Fogel's other son, Michael, a consultant, lives in Chicago's Hyde Park.)

"It's a good day for economics, and here's why," said Donald McCloskey, a professor at the University of Iowa. "This is a prize for empirical work. We've given enough prizes for the blackboard; more like half or three quarters of the prizes given have been for existence theorems."

Said Mancur Olson, a professor at the University of Maryland: "Their work was quite different. Robert Fogel brought quantitative methods to economic history; Doug North was distinguished more by his broad range in the time and space. His work has been more synthetic."

North was born in Cambridge in 1920. As an undergraduate at the University of California at Berkeley in the early 1940s, he considered himself a Marxist. Wartime service in the merchant marine and nine months as a dust bowl photographic chronicler of California farm life for the government persuaded him to become an economist. He formulated his views during 15 years as a professor at the University of Washington in Seattle, before moving to Washington University in St. Louis in 1982.

Fogel was born in New York City in 1926. He earned his doctorate under Simon Kuznets at Johns Hopkins University in 1963, and taught at the University of Chicago until 1975, when he moved to Harvard. He returned to the University of Chicago in 1981, where he remains director of the Center for Population economics. His wife retired in 1988 as associate dean for students of the Graduate School of Business.

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