Ragnar Frisch: Economics

“I believe that economic theory has arrived at a point in its development where the appeal to quantitative empirical data has become more necessary than ever. At the same time its analyses have reached a degree of complexity that require the application of a more refined scientific method than that employed by the classical economists.”

Ragnar Frisch

Ragnar Frisch (1926); Quoted in: " Ragnar Frisch 1895-1995 https://www.ssb.no/a/histstat/doc/doc_199403.pdf." O. Bjerkholt, 1994.
1920

Time

“… in economic political discussions there is a nearly infinite number of specific questions that may be asked. Besides the ones mentioned in section 3 consider for instance these: "Should we build a road between points A and B in the country?", "Should we promote investments that will give employment to many people, or should we on the contrary promote such investment which will save labour?"… "Should we put more emphasis on things that have up to now not been included in the statistical concept of the gross national product? For instance, should we try to avoid air-pollution and all the kinds of intoxications that may be caused by refuse and waste (a problem that must be studied in its totality as a problem of circulation of matter in society, much in the same way as we study interindustry relations in an input-output table)?“, “Should we assess economic value to an undisturbed nature?””

Ragnar Frisch

etc.
Source: 1970s and later, From Utopian Theory to Practical Applications, 1970, p. 29

People , Way , Question , Nature

“We may predict that the science of which we try to be the humble and devoted servants will in the future life of the nations be an important factor in eliminating maladjustments between fundamental economic sectors and assure a smooth and progressive utilization of resources… One wants men with a knowledge of the characteristic features of the economic and social structure of their country and with a fundamental theoretical knowledge along modern lines.”

Ragnar Frisch

Frisch, (1946, p. 1), as quoted in: " Ragnar Frisch 1895-1995 https://www.ssb.no/a/histstat/doc/doc_199403.pdf." O. Bjerkholt, 1994.
1940-60s

Life , Men , Knowledge , Science

“In this essay on econometrics in its conception and its use in economic planning for the betterment of man’s fate, I will try to cover a very broad field.
When talking about the methodology in the particular fields mentioned - about which I am supposed to have a little more than second hand knowledge - I have always found it utterly inadequate to focus attention only on these special fields without seeing them in a much broader perspective.
Therefore it was inevitable that I should have to include in the field of vision of this paper also some branches of science where I can only speak as a layman, hopefully as a somewhat informed layman. For whatever blunders I may have made in these fields I must ask for the reader’s forgiveness”

Ragnar Frisch

Source: 1970s and later, From Utopian Theory to Practical Applications, 1970, p. 9 : Lead paragraph

Fate , Forgiveness , Knowledge , Science

“Two important features in the modern development of economics are the application of mathematics to abstract economic reasoning… and the attempt at placing economics on a numerical and experimental basis by an intensive study of economic statistics.
Both these developments have a common characteristic: they emphasize the quantitative character of economics. This quantitative movement in our estimation is one of the most promising developments in modern economics. We also consider it important that the two aspects of the quantitative method referred to should be furthered, developed, and studied jointly as two integrating parts of economics.
We therefore venture to propose the establishment of an international periodical devoted to the advancement of the quantitative study of economic phenomena, and especially to the development of a closer relation between pure economics and economic statistics.
We believe that the scope of the new journal would be happily suggested if it is called "Oekonometrika."”

Ragnar Frisch

Accordingly, the quantitative study of economic phenomena here considered may be termed econometrics.
Frisch (1927) as quoted in Divisia 1953, pp.24-25; Cited in: Bjerkholt, Olav. " Ragnar Frisch and the foundation of the Econometric Society and Econometrica http://www.ssb.no/a/histstat/doc/doc_199509.pdf." ECONOMETRIC SOCIETY MONOGRAPHS 31 (1998): 26-57.
Lead paragraph of a memorandum on the importance of establishing the journal "Oekonometrika"
1920

Mathematics , Study , Parting

“The majority of the economic oscillations which we encounter seem to be explained most plausibly as free oscillations.”

Ragnar Frisch Propagation problems and impulse problems in dynamic economics

Source: 1930s, Propagation problems and impulse problems in dynamic economics, 1933, p. 1

“An important object of the Journal should be the publication of papers dealing with attempts at statistical verification of the laws of economic theory, and further the publication of papers dealing with the purely abstract problems of quantitative economics, such as problems in the quantitative definition of the fundamental concepts of economics and problems in the theory of economic equilibrium.
The term equilibrium theory is here interpreted as including both the classical equilibrium theory proceeding on the lines of Walras, Pareto, and Marshall, and the more general equilibrium theory which is now beginning to grow out of the classical equilibrium theory, partly through the influence of the modern study of economic statistics. Taken in this broad sense the equilibrium problems include virtually all those fundamental problems of production, circulation, distribution and consumption, which can be made the object of a quantitative study. More precisely: The equilibrium theory in the sense here used is a body of doctrines that treats all these problems from a certain point of view, which is contrasted on one side with the verbal treatment of economic problems and on the other side with the purely empirical-statistical approach to economic problems”

Ragnar Frisch

Frisch (1927). as quoted in: Bjerkholt, Olav, and Duo Qin. A Dynamic Approach to Economic Theory: The Yale Lectures of Ragnar Frisch. Routledge, 2010: About "Oekonometrika"
1920

Law , Problem , Sense , Study

“Certain exterior impulses hit the economic mechanism and thereby initiate more or less regular oscillations.”

Ragnar Frisch Propagation problems and impulse problems in dynamic economics

Source: 1930s, Propagation problems and impulse problems in dynamic economics, 1933, p. 173

“When we approach the study of business cycle with the intention of carrying through an analysis that is truly dynamic and determinate in the above sense, we are naturally led to distinguish between two types of analyses: the micro-dynamic and the macro-dynamic types. The micro-dynamic analysis is an analysis by which we try to explain in some detail the behaviour of a certain section of the huge economic mechanism, taking for granted that certain general parameters are given. Obviously it may well be that we obtain more or less cyclical fluctuations in such sub-systems, even though the general parameters are given. The essence of this type of analysis is to show the details of the evolution of a given specific market, the behaviour of a given type of consumers, and so on.”

Ragnar Frisch Propagation problems and impulse problems in dynamic economics

Source: 1930s, Propagation problems and impulse problems in dynamic economics, 1933, p. 2

Business , Nature , Sense , Study

“In the last decade's intensive study of all sorts of social and economic time series, it has become clear, it seems to me, that the usual time series technique is not quite adequate for the purpose which the social investigator is pursuing… We want to find out on more or less empirical grounds what is actually present in the series at hand, that is to say, what sort of components the series contains.”

Ragnar Frisch

Ragnar Frisch, " A method of decomposing an empirical series into its cyclical and progressive components http://www.sv.uio.no/econ/om/tall-og-fakta/nobelprisvinnere/ragnar-frisch/published-scientific-work/rf-published-scientific-works/rf1931e.pdf." Journal of the American Statistical Association 26.173A (1931): 73-78.
1930s

Study , Time

“Intermediate between mathematics, statistics, and economics, we find a new discipline which, for lack of a better name, may be called econometrics. Econometrics has as its aim to subject abstract laws of theoretical political economy or "pure" economics to experimental and numerical verification, and thus to turn pure economics, as far as possible, into a science in the strict sense of the word.”

Ragnar Frisch

Ragnar Frisch (1926) "On a Problem in Pure Economics: Translated by JS Chipman." Preferences, Utility, and Demand: A Minnesota Symposium. 1926."
Original in French:
Intermediaire entre les mathematiques, la statistique et l'economie politique, nous trouvons une discipline nouvelle que ion peut, faute de mieux, designer sous le nom de reconometrie. L'econometrie se pose le but de soumettre les lois abstraites de l'economie politique theorique ou l'economie 'pure' A une verification experimentale et numeriques, et ainsi de constituer, autant que cela est possible, l'economie pure en une science dans le sens restreint de ce mot.
1920

Law , Mathematics , Sense , Science