- Person
- Simon Kuznets
- Lived
- 1901–1985
- Field
- Economics
- From
- Russian-born American
The story
By the end of World War II, Simon Kuznets was the best-known authority on measuring a national economy. In 1931, at the request of his mentor Wesley Clair Mitchell, he had taken charge of the National Bureau of Economic Research's work on US national income, and in 1934 he produced the first official estimate of American national income. During the war his figures had helped the War Production Board plan military output. Many other countries, some newly independent and others rebuilding from the war, now needed the same tools to understand and steer their economies.
After the war Kuznets served as an adviser to the governments of China, Japan, India, Korea, Taiwan and Israel as they established their national systems of economic information. The job was practical and painstaking: deciding what to count, how to gather reliable figures, and how to assemble them into accounts of national income, output and investment that officials could use to make decisions.
He also built the international networks that kept this work going. In 1936 he had led the creation of the Conference on Research in Income and Wealth, which brought together government statisticians and academic economists in the United States. In 1947 he helped establish its international counterpart, the International Association for Research in Income and Wealth. Later, from 1961 to 1970, he chaired the Social Science Research Council's Committee on the Economy of China, and in Israel he led the Falk Project for Economic Research from 1953 to 1963.
Kuznets brought an unusually international outlook to this work. Born in 1901 in Pinsk and educated in Rovno and Kharkov before emigrating to the United States in 1922, he knew the economic writing of Russia and Ukraine well. In the 1920s he reviewed and translated papers by economists such as Kondratiev and Slutsky, who were then little known in the West.
The systems he helped design spread national accounting from a research bureau in New York to governments across Asia and the Middle East. His improved methods for calculating national income became the basis of the modern system of national accounts, the shared framework that lets countries track growth, compare themselves with others and judge whether their policies are working.
Why it matters
Kuznets helped developing and rebuilding nations create the statistical foundations they needed to plan for growth, and his methods underpin the national accounts countries use today.
About Simon Kuznets
Pinsk-born economist who built the first official estimates of US national income, laying the foundations of GDP, and won the 1971 Nobel Prize for his empirical study of economic growth.
More about Simon Kuznets
- Simon Kuznets proposed the famous Kuznets curveIn 1955 Simon Kuznets proposed that as countries develop, income inequality first rises and then falls, an idea known as the Kuznets curve.
- Simon Kuznets discovered the 15–25 year economic swingsStudying US data back to 1865, Simon Kuznets identified economic cycles lasting 15 to 25 years, now known as Kuznets cycles or long swings.
- Simon Kuznets produced the first US national income figuresIn 1934 Simon Kuznets delivered the first official estimate of US national income, laying the groundwork for the measure we now call GDP.
- Simon Kuznets launched the study of how nations growSimon Kuznets compiled 60 years of data for 14 countries to explain modern economic growth, helping to found the field of development economics.
- Simon Kuznets showed savings rates stay stable over timeIn 1942 Simon Kuznets used long-run data to show that the US savings rate stayed roughly constant from the 1870s to the 1940s, overturning a prediction drawn from Keynes.
- Simon Kuznets warned that GDP does not measure welfareSimon Kuznets helped standardise the measurement of national output, but cautioned that a nation's welfare can scarcely be inferred from a measure of national income.
Sources
- Simon Kuznets Wikipedia
- Simon Kuznets, Biographical NobelPrize.org
Another act of tikkun olam. This is part of tikkun olam, the Jewish idea of repairing the world, and every one of us can add to it.