Abstract
In Chaps. 5 and 6 (Vol. I), dedicated to the examination of the relationship between the programming approach and the elaboration of a political preference function, we have seen how the programming approach cannot remove itself from the given elaboration; and how this elaboration n turn reaches an unavoidably clear distinction (and relative separation in the modelling) between the construction of descriptive and decisional models.
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Notes
- 1.
Frisch presented this advanced viewpoint for the first and only time in his lecture at the Nobel Prize awards (1970a, b), republished in F. Long ed. 1976, pp. 20–21. This rare publication is particularly unique because Frisch had the habit of recycling ample portions of his writings whenever he found it convenient to do so, and without changing a single word. In this case, I think he felt the need to engage in a dialogue with his natural listeners, the econometricians, threading new synthetic arguments related to the entire force of econometrics in itself, even if he had found such force—on many occasions—both illogical and not useful. Consequently, in the outline offered on this occasion (in Table 7.1), he locates the types of models that otherwise were defined as purely descriptive and not useful for programming.
- 2.
In the lecture given on the occasion of the Nobel Prize award in 1969, Frisch traces a panorama of all the econometric modelling. However, such an overview still belongs in a certain sense to a ‘model of pre-programming approach’, as he called it. The fact that in this lecture he wanted to premise such a table, as a demonstration of the ‘transition towards economic planning on a national level’ and in order to show the instrumentation for activating the cooperation between policy-makers and econometricians for the formulation of the political preference function (which is considered to be his most original and important contribution to economic science), signifies that he still did not feel fully satisfied with his way of illustrating the difference between descriptive models and decisional models. This was a crucial point for giving substance to the programming approach, of which he urgently recalled and sketched the most salient aspects (as seen in Chaps. 4, 5 and 6).
- 3.
In his writings, Frisch used many words to describe the category of experts who advised politicians. He refers to them at times as econometricians, or analysts or experts, clearly neglecting questions of nomenclature.
- 4.
He could not attend owing to health reasons.
- 5.
Frisch committed different groups of students from the DE-UO, from the end of the 1940s until he retired in 1965.
- 6.
This Memorandum, an implementation system for optimal national economic planning, without detailed quantity fixation from a central authority Part I. Prolegomena: Selection (dated January 3, 1963, but signed as ‘second preliminary printing’, September 1963), was presented, in part, at a Third International Conference of Operative Research that was held in Oslo in 1963 (and consequently published as part of the proceedings of that Conference, Actes de la 3e conference internazionale de recherche operationelle, Oslo, 1963, (Paris, London: Dunod and English Universities Press)). The Memorandum was then republished posthumously in 1976 by F. Long and later by O. Bjerkholt in 1995, in their respective collections of Frischian writings. It is important and intriguing to remember how this Memorandum was presented as Part I (Selection) of a work, to be completed by a Part II dedicated to the Implementation, which already have their traces apparent in the former. In the same cover of the Memorandum, there was the declaration: ‘One hopes that Part II: (Implementation) can be soon brought to completion (the numbering of the sections of Part II will be continued from those found in Part I)’. However, this Part II was never completed, neither in the life of Frisch, nor after his death by his successors at the DE-UO. If the traces are not lost, why is this so? This is a question to ask Frisch’s successors at the DE-UO, who conserve all of the papers, manuscripts and documents that remain of his work.
- 7.
Indeed, the work (already cited in Chap. 6) on the ‘cooperation between politicians and economists for the formalization of the political preference’ (this last writing produced by Frisch and presented at the Seminary of the Federation of Swedish Industries), contains a part of the technical–mathematical treatment of variables, conditions and bounds, of a process of cooperation between politicians and technicians, that could be considered as the continuation of that implementation system of optimal planning on a national scale, which could be seen in the ‘Second part’ of the Memorandum of 1963. In 1963, however, the process of selection from that of implementation was clearly separated, distinguishing them between two moments and two distinct processes that should never have interfered with the other, since doing otherwise would create great confusion. In the writing of 1970 the technicians were pressed to enact the form of cooperation between politicians and technicians (interviews, various data resulting from interviews, iterations and approximated runs, marks of various compromises, etc.), and other instruments of implementation were no longer examined (referred to as essentially ‘financial’) but used until the point at which the results of the obtained configuration choice relating to the selection process could be followed up with facts. One should be content from the description of the Model Re-Fi (already formulated within the ‘Table’ of 1960, Reprint n. 13 of the DE-UO), published in 1962 (Preface of the Oslo Channel Model, ed. Long, p. 106, in notes); and completed in 1966, (A generalized form of the Refi interflow table, Memorandum del DE-UO), republished in a writing in honour of M. Kalecki, ed. T. Kowalik, Pergamon 1966.
- 8.
Testimony to this, let me note, is the frosty welcome and the numerous objections to the paper Frisch presented at the Colloque in Rome, promoted in 1963 by the Papal Academy of Sciences, and at the First World Congress (in Rome, 1965) of the first Congress of the Econometric Society, of which we have already spoken a great deal in Chaps. 3 and 4.
- 9.
Frisch, in this note, also refers to a place where this ‘principle of microization’ is better discussed, specifically within ‘Chap. 3, Vol. II’; but the relevant paragraph of this chapter is, as above, nowhere to be found.
- 10.
Here Frisch sees the need to refer (in the L’Aquila CIME lectures) to the experience of compartmentalisation in the history of Soviet planning:
In the Soviet Union they started with the ministerial system of planning. This was a highly centralized system. There was one ministry for each category of goods. And each such ministry was responsible for union so far as this category of goods was concerned. Then after some time they found out that this system entailed great difficulties of various sorts. For instance, one ministry may not receive in due time the goods it needed from other ministries, and this may induce it to set up its own factories for spare parts and other things needed for its own production. Of course, this was very much contrary to the principle that the national plan should be global. Finally the ministerial system broke down and in 1957 they passed from this system to a more regionally oriented system with planning within geographical regions. But this was only shifting from one set of difficulties to another. For instance: How should the interests of the regions be reconciled? (Frisch, Ibidem, pp. 15–16)
- 11.
Here the problem arises of how to access the ‘ghost Part II’. (As already noted in the above note 4) this one of Frisch’s papers, which has been reproduced in the Frank Long collection, appears to have already been published in the Actes de la troisieme Conference internazionale de recherche operationnelle, Oslo 1963. But it has also been published as a Memorandum of the DE-UO (3 September 1963), only as Part I Prolegomena: Selection, announcing in the Memorandum cover, a Part II: Implementation, with the declaration: ‘We hope the Part II: Implementation could be performed slowly. (The page numbering of the Part II will continue that of the Part I).’ This Part II, however, seems to have been mislaid or lost. It would be most opportune to recover it, because it seems to me to concern a research area that is not found in other writings by Frisch and the knowledge contained within it would be precious. It would be beneficial if the owner of the Frisch papers, the editors of the writings of Frisch and Frisch’s leading bibliographer, Kare N. Edvardsen, could resolve this mystery.
- 12.
Compare with, for instance, UN-ECE, Multi-level planning and decision-making (papers presented at the Sixth Meeting of Senior Economic Advisers to ECE Governments (1970).
- 13.
Here Frisch references his own document ‘Macroeconomic decisions models’, written on request for a United Nations Conference (Geneva 1963), though poorly identified (Series No.1755, sub-item H.1).
- 14.
Here Frisch refers again, for a further examination, to the cited paper: ‘Macroeconomic decisions models’.
- 15.
Here Frisch feels the need, on the other hand, to clarify in advance that the question does not concern ‘which person or persons constitute this ‘responsible authority’. It may be a single man (or woman), a small group of people, an elected parliament or even the population as a whole, expressing its wishes through a plebiscite.’
- 16.
It should be noted that Frisch , in his development of the Oslo Model, did not ever refer to the works of Leontief and the matrices of a Leontiefian type, even though he used them to a great extent. It is probable that he considered such matrices (even at the time at which the econometric community was just beginning to speak of them, in the 1930s) as a legacy of this ever so obvious kind of econometrics, insofar as it could be put under the name of his (more or less) premature use and diffusion. Another motivation could derive from very light divergences on the size of disaggregation to achieve between statistical and econometric models, which existed between Frisch and Leontief in the beginning of the 1930s, on the methods of estimating demand and supply curves. All the writings regarding this controversy, called ‘the trap debate’, which was first denominated by Frisch in one of his writings (‘Pitfalls in the statistical construction of demand and supply curves’, 1933), were republished in a collective work, during this period, including many reprints of the origins of econometrics, by Hendry and Morgan eds, (1955).
- 17.
Frisch returns here to another writing already cited: Macroeconomic Decision Models.
- 18.
Frisch notes that the reasons for thinking in this way are described in another one of his works, ‘The Principle of Recursive Planning.’ A volume in honour of Berthil Ohlin, Stockholm 1959.
- 19.
- 20.
Here Frisch references his paper on ‘A complete Scheme for computing all direct and cross demand elasticities in a model with many sectors’, in Econometrica, April 1959. He also quotes a work of Leif Johansen, A multi-sectoral study of economic growth, Amsterdam 1960.
- 21.
Here Frisch refers to another of his studies that illustrates the Oslo Median Model. And, he adds, ‘This paper gives a fairly good account of one aspect of my earlier attempt at mathematical programming at the macro-economic level, but it has in recent years been substituted by something much better. In particular, by the Cairo Channel Model and the Oslo Channel Model.’
- 22.
The mathematical symbolisation of such an admissible region (and the system of equations from which such is basically expressed) is articulated by Frisch in the writing that we have examined here (An implementation system for optimal national economic planning, 1963, ibidem) in the last section (4.22), pp. 151–157.
- 23.
Here Frisch was drawing attention to the fact that ‘a considerable part of the research activity of the DE-UO had in recent years been directed towards this more difficult problem. I hope to be able to report on this in the not too distant future.’ Cf. also Sect. 4.4.
- 24.
The reference to Myrdal here is only because he has been mentioned in the two initial chapters of this book, in light of his position on economic philosophy, which I consider related to the argument of this book. Obviously the epistemological theme is debated among the philosophers, particularly science’s philosophers, so it could be misleading here.
- 25.
Johansen’s work is developed in two volumes (North-Holland, Amsterdam, 1977 e 1978) of 400 pages each and with a very rich bibliography. The first volume, published in 1977, is dedicated to the general aspects of macroeconomic planning in its different historical and political aspects. The second volume, published in 1978, is dedicated to the problems of centralisation, decentralisation, and planning under uncertainty. The last time that I visited Leif Johansen in Oslo, in 1978, he told me that he was working on completing his work with a third volume (in a kind of trilogy), dedicated to the structure of the demand of consumers, the determination and use of preference functions for planning activities and a representative review of planning models. This work was interrupted by his premature death. It would be interesting to know if some traces of this work have remained amongst family, friends or university archives.
- 26.
However, Johansen adds:
if it is found convenient and useful for clarification one may of course introduce W(a, x) instead of simply W(x), and correspondingly avoid repeating the instruments in question in the description of x. Whether we use the form W(x) or W(a, x) the function W will in practice only depend on some of the elements in x or a, x. We could then introduce special symbols for those parts of x, or a, x which actually count in the preference function. For the moment this is however not necessary. (Johansen, ibidem, p. 59 n.)
Bibliographical References to Chapter 7 (Vol. I)
Frisch, R. (1962). ‘Preface to the Oslo Channel Model: A Survey of Types of Economic Forecasting and Programming’. In: R. C. Geary, ed., Europe’s Future in Figures. Amsterdam, North-Holland. [republished. in: F. Long ed., Economic Planning Studies, Reidel, Dordrecht (see), 1976, (pp. 87–127)].
Frisch, R. (1963). ‘An Implementation System for Optimal National Economic Planning without Detailed Quantity Fixation from a Central Authority, Part 1, Prolegomena’, Memorandum, DE-UO, Sept 1963. Second preliminary printing. [Republished. in: Economic Planning Studies, F. Long ed (see) (1976) pp. 129–174].
Frisch, R. (1965). ‘General Outlook on a method of advanced and democratic macroeconomic planning’, (paper presented at CIME Study Week, L’Aquila, 29 Agosto–7 Settembre 1965). In: de Finetti ed., Mathematical Optimization in Economics, Roma: Cremonese Edizioni 1966.
Frisch, R. (1969). ‘From Utopian Theory to Practical Applications: The Case of Econometrics’, in: Nobel Memorial Lecture, in: (Nobel Lectures, Economic Sciences, 1969–1980, Assar Lindbeck ed.) Singapore, World Scientific, 1992 [Republished also in: Frisch R., F. Long, ed. 1976, pp. 1–39].
Frisch, R. (1970a). ‘Econometrics in the World of Today’, in: Eltis, Scott and Wolfe, eds, Induction: Growth and Trade. In honour of Sir Roy Harrod Oxford, Clarendon Press (1970).
Frisch, R. (1970b). ‘Cooperation between Politicians and Econometricians of the Formalization of Political Preferences. A Background Paper (Preliminary version) (mimeo). Oct 1970. (Republished in: Frisch. R., Economic Planning Studies, F. Long, ed., (1976). (pp. 41–86).
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Archibugi, F. (2019). The Impact of the Programming Approach on Socio-Economic Modelling. In: The Programming Approach and the Demise of Economics. Palgrave Macmillan, Cham. https://doi.org/10.1007/978-3-319-78057-3_7
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