James Tobin (March 5, 1918 – March 11, 2002) was an American economist who served on the Council of Economic Advisers and consulted with the Board of Governors of the Federal Reserve System, and taught at Harvard and Yale Universities.
This was designed to reduce speculation in the international currency markets, which he saw as dangerous and unproductive. ==Life and career== ===Early life=== Tobin was born on March 5, 1918, in Champaign, Illinois.
Tobin followed primary school at the University Laboratory High School of Urbana, Illinois, a laboratory school in the university's campus. In 1935, on his father's advice, Tobin took the entrance exams for Harvard University.
During his studies he first read Keynes' The General Theory of Employment, Interest and Money, published in 1936.
Tobin graduated summa cum laude in 1939 with a thesis centered on a critical analysis of Keynes' mechanism for introducing equilibrium involuntary unemployment.
His first published article, in 1941, was based on this senior thesis. Tobin immediately started graduate studies, also at Harvard, earning his AM degree in 1940.
His first published article, in 1941, was based on this senior thesis. Tobin immediately started graduate studies, also at Harvard, earning his AM degree in 1940.
In 1941, he interrupted graduate studies to work for the Office of Price Administration and Civilian Supply and the War Production Board in Washington, D.C.
student of Paul Samuelson, on September 14, 1946.
in 1947 with a thesis on the consumption function written under the supervision of Joseph Schumpeter.
In 1947 Tobin was elected a Junior Fellow of Harvard's Society of Fellows, which allowed him the freedom and funding to spend the next three years studying and doing research. ===Academic activity and consultancy=== In 1950 Tobin moved to Yale University, where he remained for the rest of his career.
They had four children: Margaret Ringo (born in 1948), Louis Michael (born in 1951), Hugh Ringo (born in 1953) and Roger Gill (born in 1956).
In 1947 Tobin was elected a Junior Fellow of Harvard's Society of Fellows, which allowed him the freedom and funding to spend the next three years studying and doing research. ===Academic activity and consultancy=== In 1950 Tobin moved to Yale University, where he remained for the rest of his career.
They had four children: Margaret Ringo (born in 1948), Louis Michael (born in 1951), Hugh Ringo (born in 1953) and Roger Gill (born in 1956).
They had four children: Margaret Ringo (born in 1948), Louis Michael (born in 1951), Hugh Ringo (born in 1953) and Roger Gill (born in 1956).
He joined the Cowles Foundation, which moved to Yale in 1955, also serving as its president between 1955–1961 and 1964–1965.
Tobin also served for several terms as a member of the Board of Governors of Federal Reserve System Academic Consultants and as a consultant of the US Treasury Department. Tobin was awarded the John Bates Clark Medal in 1955 and, in 1981, the Nobel Memorial Prize in Economics.
They had four children: Margaret Ringo (born in 1948), Louis Michael (born in 1951), Hugh Ringo (born in 1953) and Roger Gill (born in 1956).
His "q" theory of investment (Tobin 1969), the Baumol–Tobin model of the transactions demand for money (Tobin 1956), and his model of liquidity preference as behavior toward risk (the asset demand for money) (Tobin 1958b) are all staples of economics textbooks. In his 1958 article Tobin also led the way in showing how to deal with utility maximization under uncertainty with an infinite number of possible states.
In 1957 Tobin was appointed Sterling Professor of Economics at Yale. Besides teaching and research, Tobin was also strongly involved in the public life, writing on current economic issues and serving as an economic expert and policy consultant.
Lord Turner's suggestion that a "Tobin tax" – named after James Tobin – should be considered for financial transactions made headlines around the world. Tobin's Tobit model of regression with censored endogenous variables (Tobin 1958a) is a standard econometric technique.
His "q" theory of investment (Tobin 1969), the Baumol–Tobin model of the transactions demand for money (Tobin 1956), and his model of liquidity preference as behavior toward risk (the asset demand for money) (Tobin 1958b) are all staples of economics textbooks. In his 1958 article Tobin also led the way in showing how to deal with utility maximization under uncertainty with an infinite number of possible states.
During 1961–62, he served as a member of John F.
Kennedy's Council of Economic Advisors, under the chairman Walter Heller, then acted as a consultant between 1962–68.
He joined the Cowles Foundation, which moved to Yale in 1955, also serving as its president between 1955–1961 and 1964–1965.
His "q" theory of investment (Tobin 1969), the Baumol–Tobin model of the transactions demand for money (Tobin 1956), and his model of liquidity preference as behavior toward risk (the asset demand for money) (Tobin 1958b) are all staples of economics textbooks. In his 1958 article Tobin also led the way in showing how to deal with utility maximization under uncertainty with an infinite number of possible states.
He also proposed an econometric model for censored dependent variables, the well-known Tobit model. Along with fellow neo-Keynesian economist James Meade in 1977, Tobin proposed nominal GDP targeting as a monetary policy rule in 1980.
He also proposed an econometric model for censored dependent variables, the well-known Tobit model. Along with fellow neo-Keynesian economist James Meade in 1977, Tobin proposed nominal GDP targeting as a monetary policy rule in 1980.
Tobin received the Nobel Memorial Prize in Economic Sciences in 1981 for "creative and extensive work on the analysis of financial markets and their relations to expenditure decisions, employment, production and prices." Outside academia, Tobin was widely known for his suggestion of a tax on foreign exchange transactions, now known as the "Tobin tax".
Tobin also served for several terms as a member of the Board of Governors of Federal Reserve System Academic Consultants and as a consultant of the US Treasury Department. Tobin was awarded the John Bates Clark Medal in 1955 and, in 1981, the Nobel Memorial Prize in Economics.
Reprinted in Tobin, 1987, Essays in Economics, v.
In 1988 he formally retired from Yale, but continued to deliver some lectures as Professor Emeritus and continued to write.
Theory and Policy (in 1989 paperback as Policies for Prosperity: Essays in a Keynesian Mode).
James Tobin (March 5, 1918 – March 11, 2002) was an American economist who served on the Council of Economic Advisers and consulted with the Board of Governors of the Federal Reserve System, and taught at Harvard and Yale Universities.
He died on March 11, 2002, in New Haven, Connecticut. Tobin was a trustee of Economists for Peace and Security. ===Personal life=== James Tobin married Elizabeth Fay Ringo, a former M.I.T.
In late June, 2009, the family announced via a private email that Tobin's wife had died at the age of 90. ===Legacy=== In August 2009 in a roundtable interview in Prospect magazine, Adair Turner supported the idea of new global taxes on financial transactions, warning that the "swollen" financial sector paying excessive salaries had grown too big for society.
TOC. ==See also== Basic income Guaranteed minimum income Q Ratio (Tobin's Q ratio) Tobit model (Tobin's model for censored endogenous variables) Tobin tax ==References== ==External links== James Tobin at the Cowles Foundation site Short biography at nobel-winners.com IDEAS/RePEc John Mihaljevic's Equities and Tobin's Q Report The Q Ratio Sends a Modestly Bearish Long-Term Signal (July 2009) Tobin's Q Moderately Bullish on U.S.
Equities (as of March 2009) The Manual of Ideas Launches Tobin's Q Research Service Based on James Tobin's Q Indicator Robert Huebscher on "The Market Valuation Q-uestion" James Tobin Papers.
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