Wesley Clair Mitchell
Wesley Clair Mitchell was an American
United States
The United States of America is a federal constitutional republic comprising fifty states and a federal district...

An economist is a professional in the social science discipline of economics. The individual may also study, develop, and apply theories and concepts from economics and write about economic policy...

 known for his empirical work on business cycle
Business cycle
The term business cycle refers to economy-wide fluctuations in production or economic activity over several months or years...

s and for guiding the National Bureau of Economic Research
National Bureau of Economic Research
The National Bureau of Economic Research is an American private nonprofit research organization "committed to undertaking and disseminating unbiased economic research among public policymakers, business professionals, and the academic community." The NBER is well known for providing start and end...

 in its first decades.

Mitchell was born in Rushville, Illinois
Rushville, Illinois
Rushville is a city in Schuyler County, Illinois, United States. The population was 3,212 at the 2000 census. It is the county seat of Schuyler County.-Demographics:...

, the second child and oldest son of a Civil War army doctor turned farmer. In a family with seven children and a disabled father with an appetite for business ventures "verging on rashness" a lot of responsibility fell on the oldest son. Despite these challenges, Wesley Clair went to study at the University of Chicago
University of Chicago
The University of Chicago is a private research university in Chicago, Illinois, USA. It was founded by the American Baptist Education Society with a donation from oil magnate and philanthropist John D. Rockefeller and incorporated in 1890...

 and was awarded a PhD in 1899.

Mitchell’s teachers included economists Thorstein Veblen
Thorstein Veblen
Thorstein Bunde Veblen, born Torsten Bunde Veblen was an American economist and sociologist, and a leader of the so-called institutional economics movement...

 and J. L. Laughlin
James Laurence Laughlin
James Laurence Laughlin was an American economist who helped to found the Federal Reserve System.Born in Deerfield, Ohio, Laughlin received his PhD from Harvard University. His thesis regarded "Anglo-Saxon Legal Procedure". A conservative, he generally subscribed to the economic theories of John...

 and philosopher John Dewey
John Dewey
John Dewey was an American philosopher, psychologist and educational reformer whose ideas have been influential in education and social reform. Dewey was an important early developer of the philosophy of pragmatism and one of the founders of functional psychology...

. Although Veblen and Dewey did more to shape Mitchell’s outlook, Laughlin supervised his dissertation. Laughlin's main interest was in currency
In economics, currency refers to a generally accepted medium of exchange. These are usually the coins and banknotes of a particular government, which comprise the physical aspects of a nation's money supply...

 questions; he was a strong opponent of the quantity theory of money
Quantity theory of money
In monetary economics, the quantity theory of money is the theory that money supply has a direct, proportional relationship with the price level....

. The currency question facing the US in the 1890s was the choice between alternative monetary standards: inconvertible paper, gold
Gold is a chemical element with the symbol Au and an atomic number of 79. Gold is a dense, soft, shiny, malleable and ductile metal. Pure gold has a bright yellow color and luster traditionally considered attractive, which it maintains without oxidizing in air or water. Chemically, gold is a...

Gold standard
The gold standard is a monetary system in which the standard economic unit of account is a fixed mass of gold. There are distinct kinds of gold standard...

 and gold/silver bimetallism
In economics, bimetallism is a monetary standard in which the value of the monetary unit is defined as equivalent both to a certain quantity of gold and to a certain quantity of silver; such a system establishes a fixed rate of exchange between the two metals...


Mitchell’s thesis, published as A History of Greenbacks, considered the consequences of the inconvertible paper regime established by the Union in the Civil War
American Civil War
The American Civil War was a civil war fought in the United States of America. In response to the election of Abraham Lincoln as President of the United States, 11 southern slave states declared their secession from the United States and formed the Confederate States of America ; the other 25...

. However this, and the follow-up study Gold Prices and Wages Under the Greenback Standard, transcended conventional monetary history of the kind Laughlin did and provided a comprehensive quantitative account of the behavior of the US economy in the recent past.

Mitchell's next project, which would occupy him for the rest of his life, was the business cycle
Business cycle
The term business cycle refers to economy-wide fluctuations in production or economic activity over several months or years...

, then emerging as the big problem in economics. His magnum opus
Masterpiece in modern usage refers to a creation that has been given much critical praise, especially one that is considered the greatest work of a person's career or to a work of outstanding creativity, skill or workmanship....

, Business Cycles, appeared in 1913. The Preface begins

This book offers an analytic description of the complicated processes by which seasons of business prosperity, crisis, depression, and revival come about in the modern world. The materials used consist chiefly of market reports and statistics concerning the business cycles which have run their course since 1890 in the United States, England, Germany and France.

In chapter I Mitchell reviews 13 theories of the business cycle and admits that "All are plausible." He then puts them aside, arguing,

To observe, analyse, and systematise the phenomena of prosperity, crisis, and depression is the chief task. And there is better prospect of rendering service if we attack this task directly, than if we take the round about way of considering the phenomena with reference to the theory.

Mitchell's research strategy was thus quite different from that adopted by H. L. Moore
Henry Ludwell Moore
Henry Ludwell Moore was an American economist known for his pioneering work in econometrics.Moore was born in Charles County, Maryland, the first of 15 children. He received a B.A. from Randolph-Macon College in 1892 and a Ph.D. from Johns Hopkins University in 1896. His thesis was on von Thünen's...

 or Irving Fisher
Irving Fisher
Irving Fisher was an American economist, inventor, and health campaigner, and one of the earliest American neoclassical economists, though his later work on debt deflation often regarded as belonging instead to the Post-Keynesian school.Fisher made important contributions to utility theory and...

 who started from a hypothesis and went looking for evidence to support it. Moore and Mitchell offer another contrast in that, while Moore embraced the new statistical methods of correlation
In statistics, dependence refers to any statistical relationship between two random variables or two sets of data. Correlation refers to any of a broad class of statistical relationships involving dependence....

 and regression
Regression analysis
In statistics, regression analysis includes many techniques for modeling and analyzing several variables, when the focus is on the relationship between a dependent variable and one or more independent variables...

, Mitchell found little use for them.

Thirty years later Mitchell was still working on business cycles and he published another large work, Measuring Business Cycles with A.F. Burns. This book presented the characteristic "National Bureau
National Bureau of Economic Research
The National Bureau of Economic Research is an American private nonprofit research organization "committed to undertaking and disseminating unbiased economic research among public policymakers, business professionals, and the academic community." The NBER is well known for providing start and end...

" methods of analyzing business cycles. While Mitchell was still following the 1913 agenda, other economists had taken to studying the economy using models and even to constructing macroeconometric models. Against this background of Keynesian economics
Keynesian economics
Keynesian economics is a school of macroeconomic thought based on the ideas of 20th-century English economist John Maynard Keynes.Keynesian economics argues that private sector decisions sometimes lead to inefficient macroeconomic outcomes and, therefore, advocates active policy responses by the...

 and the new econometric
Econometrics has been defined as "the application of mathematics and statistical methods to economic data" and described as the branch of economics "that aims to give empirical content to economic relations." More precisely, it is "the quantitative analysis of actual economic phenomena based on...

 methods Mitchell and his project looked dated.

Milton Friedman
Milton Friedman
Milton Friedman was an American economist, statistician, academic, and author who taught at the University of Chicago for more than three decades...

 believed that, "Mitchell is generally considered primarily an empirical scientist rather than a theorist". However, Mitchell's main creative efforts went into his empirical work on business cycles. Mitchell stated an endogenous theory, based on the internal dynamics of capitalism. Whereas neoclassical theories are deduced from unproven psychological axioms, he builds his theory from inductive generalities gained from empirical research. Also, he was considered a critic of conventional economic theory. As influenced greatly by Veblen, Mitchell is usually categorized with him as an American institutionalist
Institutional economics
Institutional economics focuses on understanding the role of the evolutionary process and the role of institutions in shaping economic behaviour. Its original focus lay in Thorstein Veblen's instinct-oriented dichotomy between technology on the one side and the "ceremonial" sphere of society on the...


Mitchell's career as a researcher and teacher took the following course: instructor in economics at Chicago (1899–1903), assistant professor (1903–08) and professor (1909–12) of economics at the University of California, Berkeley
University of California, Berkeley
The University of California, Berkeley , is a teaching and research university established in 1868 and located in Berkeley, California, USA...

, visiting lecturer at Harvard University
Harvard University
Harvard University is a private Ivy League university located in Cambridge, Massachusetts, United States, established in 1636 by the Massachusetts legislature. Harvard is the oldest institution of higher learning in the United States and the first corporation chartered in the country...

 (1908–09), lecturer (1913) and full professor (1914–44) at Columbia University
Columbia University
Columbia University in the City of New York is a private, Ivy League university in Manhattan, New York City. Columbia is the oldest institution of higher learning in the state of New York, the fifth oldest in the United States, and one of the country's nine Colonial Colleges founded before the...

. He was one of the founders of the New School for Social Research, where he taught for a time between 1919 and 1922, and of the National Bureau of Economic Research
National Bureau of Economic Research
The National Bureau of Economic Research is an American private nonprofit research organization "committed to undertaking and disseminating unbiased economic research among public policymakers, business professionals, and the academic community." The NBER is well known for providing start and end...

 (1920), where he was director of research until 1945. There were interruptions for government service during the First World War and Mitchell served on many government committees; he was chairman of the President's Committee on Social Trends (1929–33). In 1923-4 he was president of the American Economic Association
American Economic Association
The American Economic Association, or AEA, is a learned society in the field of economics, headquartered in Nashville, Tennessee. It publishes one of the most prestigious academic journals in economics: the American Economic Review...

. From 1941 he was on the original standing committee of the Foundation for the Study of Cycles
Edward R. Dewey
Edward Russel Dewey was an economist who studied cycles in economics and other fields.-Dewey's cycles work:Dewey first became interested in cycles while Chief Economic Analyst of the Department of Commerce in 1930 or 1931 because President Hoover wanted to know the cause of the Great Depression...


The National Bureau was the institution through which Mitchell had greatest influence. There his important associates included Arthur Burns and Simon Kuznets
Simon Kuznets
Simon Smith Kuznets was a Russian American economist at the Wharton School of the University of Pennsylvania who won the 1971 Nobel Memorial Prize in Economic Sciences "for his empirically founded interpretation of economic growth which has led to new and deepened insight into the economic and...

. In his autobiography Kuznets acknowledges his "great intellectual debt to Mitchell."

Mitchell has also made valuable contributions to the history of economic thought
History of economic thought
The history of economic thought deals with different thinkers and theories in the subject that became political economy and economics from the ancient world to the present day...



  • Arthur F.Burns (ed.) Wesley Clair Mitchell: the Economic Scientist New York: National Bureau of Economic Research, 1952.
  • Simon Kuznets (1949) Wesley Clair Mitchell, 1874-1948: An Appreciation, Journal of the American Statistical Association, 44, 126-131.
  • Joseph A. Schumpeter (1950) Wesley Clair Mitchell (1874–1948), Quarterly Journal of Economics, 64,139-155.
  • M. S. Morgan A History of Econometric Ideas, Cambridge 1990. Morgan compares Mitchell's approach to business cycles with both earlier and later approaches.

External links

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