The “Triangle Man” is now 100 years old.
University of Chicago economist Arnold Harberger turns 100 today. Unless I’m wrong, he’s still going strong, even in class.
The Wikipedia article about some of Harberger’s accomplishments is actually pretty good so I won’t try to repeat it.
Instead, I will tell 3 stories about my collaboration with Al.
Number one: I first met Al at a cocktail party at my colleague Ron Hansen’s home in the late 1970s when I was a young assistant professor of economics at the University of Rochester’s Graduate School of Management (now the Simon School.) To me he was already a god because of his ability to use fundamental price theory to achieve important conclusions. But he did not act like a god. He was a normal and very accepting person.
Number two: When I was at the Cato Institute in 1979, Al helped me with data for an article my friend Roy Childs was writing. Here are the details.
Number three: Although the Chatham House rule applies to the proceedings of the Mont Pelerin Society meetings, I can put the spirit of the law into telling this story without naming names. At one of the events at the MPS meetings at the Hoover Institution in January 2020, there was a breakfast, if I remember correctly, where Al spoke; he talked about what happened in Chile. In the 1970s and later, Harberger was very important, even more important than Milton Friedman, in helping to move Chile’s economy toward a free market. I discuss his role briefly in my review of Sebastian Edwards’ excellent book 2023, The Chile Project: The Story of the Chicago Boys and the Fall of Economic Freedom. (I would guess that his support of the Chicago Boys, although he did not support Pinochet, is one of the reasons why he was never awarded the Nobel Prize in economics.) He had a long and gentle relationship with various “Chicago Boys” from for at least two generations and it was evident in the way they asked him and, if we can say it clearly, they showed their love for him.
If you’re wondering why I call him the “Triangle Man,” check out this link. A good comprehensive and comprehensive treatment of Harberger’s classic 1954 article on American Economic Review, “Authorization and Resource Allocation.” Economists have been saying for decades that monopoly causes deadweight but he was the first to try to quantify the size of the deadweight. Harberger found that, for US production, it was unlikely to be more than 0.1 percent of GNP. (Gross National Product was a common measure of economic size at the time.) There are, of course, various criticisms of his argument and measurement. The point is that he did it and no one had done it before him. The deadweight loss from monopoly is usually measured in triangles. Hence the nickname, which was used on various skits worn by University of Chicago students and one he wore proudly.
Note: The photo above is of Al Harberger and me after his morning talk.
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