Here is a short summary I put together last weekend of 20th century economists and their main ideas. I hope it’s helpful!
John Maynard Keynes (1883-1946): Keynes argued that free markets, by themselves, can sometimes lead to unemployment and depressions. Government must step in to manage the economy, and a healthy economy is one that has full employment. Keynes also had a big impact on the theory of money: he argued that it was the quantity of money in circulation, rather than the interest rate, that determined how much people spent.
Milton Friedman (1912-2006): Friedman argued that the main reason the Great Depression had been so severe was because of the excessive money supply growth in the years leading up to the Depression. He argued that the money supply should be linked to the growth of the economy, rather than being managed by the monetary authorities. His idea was that if the supply of money increased at a steady rate, the economy would grow at the same rate, and prices would remain stable. Friedman was a strong proponent of free markets and limited government intervention in the economy.
Paul Samuelson (1915-2009): Samuelson’s main contribution was in integrating mathematics and economics. He made economics a lot more rigorous, and he also put economics on more solid mathematical ground. He also made economics more “scientific” in that it was harder to argue that economics was not a science if one accepted his mathematical approach. His book Foundations of Economic Analysis was the first economics textbook that was also a bestseller.
Kenneth Arrow (b. 1921): Arrow is known for his contributions to the theory of general equilibrium. He was the first economist to prove that a competitive economy was not necessarily efficient. He showed that if preferences were sufficiently general, and markets were “complete,” then there would be no way to ensure that all markets were always in equilibrium.
Wassily Leontief (1906-1999): Leontief was another mathematician who made a major impact on the way economics was done. He developed input-output tables that allowed economists to make quantitative analyses of the economy. He also made major contributions to the theory of general equilibrium.
Robert Solow (b. 1924): Solow was an economist who did work on growth theory, and he is especially well known for his work on technical progress. He showed that much of the growth in the economy is due to “technical progress,” and that the rate of technical progress is itself determined by other economic factors.
Franco Modigliani (1918-2003): Modigliani developed the life cycle hypothesis of savings, which argued that people save more as they get older. He also made major contributions to the theory of interest, and he developed the “Modigliani-Miller Theorem,” which showed that the value of a firm did not depend on how it was financed.
Merton Miller (1923-2000): Miller is known for his work on the theory of financial markets. He also did work on the theory of capital.
Robert Lucas (b. 1937): Lucas is the most recent American winner of the Nobel Prize in economics (1995), and he is my favorite economist. He is an advocate of the rational expectations hypothesis, which argues that if people have rational expectations, then they will not systematically make mistakes when they act. He is also known for his work on the theory of economic growth, which focuses on the causes of growth and how they may change over time.
Robert Barro (b. 1943): Barro is known for his work on the relationship between economic growth and democracy. He has argued that democracy leads to economic growth because it is associated with lower levels of government spending and higher levels of investment by the private sector. He has also done work on monetary policy, and he has argued that central banks should set interest rates based on the growth rate of the economy, and not based on the rate of inflation.