Sunday, December 20, 2009


Excerpts from Chapter 1 of Paul Samuelson's Economics (1958 edition)

"Take a good look at the man on your right and the man on your left, because next year one of you won't be here."

"... the political health of a democracy is tied up in a crucial way with the successful maintenance of stable high employment and living opportunities."

"... we are subject to periodic depressions of obscure causation."

"In short, modern nations must worry lest total money spending and national income be too little, thus creating mass unemployment. But they must also worry lest total national income and money spending be too much, thus creating general price inflation."

"Because of the complexity of human and social behavior, we cannot hope to attain the precision of a few of the physical sciences.... Fortunately, however, our answers need not be accurate to several decimal places; on the contrary, if only the right general direction of cause and effect can be determined, we shall have made a tremendous step forward."

"... dispassionate analysis of the economic facts ..."

"... we must all try to cultivate an objective and detached ability to see things as they are, regardless of our likes or dislikes."

"... there is only one valid reality in a given economic situation, however hard it may be to recognize and isolate it. There is not one theory of economics for Republicans and one for Democrats, not one for workers and one for employers."

"... many of us have been speaking prose all our lives without knowing it ..."

"[Economics is] a field where such an everyday concept as 'capital' may have ten or more different meanings...."

"All analysis involves abstraction. It is always necessary to idealize, to omit detail, to set up simple hypotheses and patterns by which the mass of facts are to be related, to set up the right questions before we go out looking at the world as it is."

"And the test of a theory's goodness is its usefulness in illuminating observational reality. Its logical elegance and finespun beauty are irrelevant."

"Individual virtues can be restored to being social virtues, provided we are able to restore a healthy environment of adequate aggregate demand for the product of business."

"... if modern economics does its task well so that unemployment and inflation are substantially banished from democratic societies, then its importance will wither away..."

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