PURPOSE
The Cowles Commission for Research in Economics was founded in 1932 as a not-for-profit
corporation to conduct investigations into problems of current economic interest, with
particular reference to the application of statistics and mathematics in the solution of
these problems. Any activity which promises ultimately to further the unification of
theoretical and factual studies in economics is within the sphere of interest of the
Commission.
A function of the Commission is to issue from time to time various monographs of an
economic-statistical or econometric nature without, however, assuming responsibility for
theories or opinions expressed therein. Monograph No. 1
entitled Dynamic Economics: Theoretical and Statistical Studies of Demand, Production,
and Prices, by Charles F. Roos, now Director of Research for the Cowles Commission,
was published in 1934. Two monographs are now in course of preparation by the staff, one a
study of the action of stock prices, and the other an analysis of some experiments in
economic planning. In addition the staff members are encouraged to publish in journals
shorter studies of a factual or theoretical character.
The Commission maintains a statistical research laboratory in Colorado Springs,
Colorado, and includes the following in its personnel: Alfred Cowles 3rd, Director;
Charles F. Roos, Director of Research; Harold T. Davis, Mathematician; William F.C.
Nelson, Economist; Forrest Danson, Statistician; Herbert E. Jones, Assistant Statistician.
It also employs several full-time secretaries and computers, about a dozen part-time
college student computers, and a number of graduate student assistants. Besides the
ordinary computing machinery, the laboratory is equipped with Hollerith card-punching,
sorting, and tabulating machines.
The Commission is affiliated with the international Econometric Society, which
nominates an Advisory Council. Members of this Council in 1935 were Professor Ragnar
Frisch, University of Norway, Oslo, Norway, Research Consultant for the Commission;
Professor Irving Fisher, Yale University; Professor Arthur L. Bowley, London University;
Professor Wesley C. Mitchell, Columbia University; and Mr. Carl Snyder, Federal Reserve
Bank of New York. Mr. Cowles is Treasurer and Mr. Roos Secretary of the Econometric
Society.
The office of Econometrica, the journal of the Society, is located at the Cowles
Commission. In 1935 the Commission continued its subvention to this journal, and the
following members of the Commission continued to assist in its publication: Mr. Nelson as
Assistant Editor, Mr. Davis as one of three Associate Editors, Mr. Roos as a member of the
Advisory Editorial Board, and Mr. Cowles as Business Manager.
MONOGRAPHS IN PREPARATION
During the year substantial progress has been made on the two monographs in course of
preparation by members of the staff of the Commission, and it is expected that both will
be published in 1936. The monograph on the action of stock prices will present new monthly
indexes of common stock prices covering all or part of the years 1872 to 1918, or in some
cases 1872 to 1926, where they will be joined to the Standard Statistics series. These
fresh indexes embrace all industrial and public utility stocks quoted on the New York
Stock Exchange for two successive months and weight the prices of the stocks by shares
outstanding. All proper corrections for stock rights, split-ups, and other capital
changes, have been effected. In addition to the major classifications and one
all-inclusive series, indexes have been prepared covering all sub-groups, such as steel,
copper, automobile stocks, etc., for the periods for which data are available. In all, 53
pairs of such indexes have been computed, the first including, the second excluding, the
effects of cash dividends. Also, properly weighted indexes of common stock yields covering
all these classifications have been prepared, and an index of earnings on common stocks
will also be presented. It is proposed to include all this fresh statistical material in
the above-mentioned monograph and reserve analyses, a substantial amount of which has also
been accomplished, for a second volume to be published later.
The monograph dealing with some experiments in economic planning is already in
manuscript form and is now in process of editing and revision. It will contain chapters
devoted to the evolution of the NRA idea, the creation of the NRA, the development of NRA
general policy, personnel and administration, technology and hours of work, the compulsory
shorter work week, wage distributions and wage changes, collective bargaining, cost and
cost formulas of codes, some specific price experiments, open prices and terms of sale,
fair trade practices and the consumer, and some problems of the small business man. The
analysis will be concluded by an evaluation of the NRA and related experiments.
PUBLICATIONS AND PAPERS IN 1935
In 1935 the following papers by staff members were published or presented at scientific
meetings:
- "Economic Theory of the Shorter Work Week," by Charles F. Roos, Econometrica,
Vol. III, No. 1, January 1935.
- "A Statistical Study of Climate in Relation to Pulmonary Tuberculosis," by
Alfred Cowles 3rd and Edward N. Chapman, Journal of the American Statistical
Association, Vol. XXX, No. 191, Pt. 1, Sept. 1935.
- "Annual Survey of Statistical Information: Capital Formation and the Flow of
National Income in the United States," by Charles F. Roos, Econometrica, Vol.
III, No. 4, October 1935.
- "Practical Problems in the Method of Multiple Correlation Analysis," by Alfred
Cowles 3rd, presented at the Colorado Springs meeting of the Econometric Society, June
22-24, 1935.
- "Painting and Prices," by W.F.C. Nelson, ibid.
- "Some Periodic Aspects of the Stock Market," by Harold T. Davis, ibid.
- "Cost Experiments of the NRA," by Charles F. Roos, ibid.
In addition the following papers were prepared in 1935 by staff members for
presentation at the St. Louis joint meetings of the Econometric Society with the American
Association for the Advancement of Science, January 2 and 3, 1936:
- "Effects of Building Activity and Other Factors on Security Prices," by Alfred
Cowles 3rd.
- "Effects of Credit, Building Costs, and Rent, on Building Activity," by
Charles F. Roos.
- "Statistical Validity of the 40 Month Stock Market Period," by Harold T.
Davis.
THE 1935 SEMINAR
In the summer of 1935 the Commission inaugurated an advanced seminar in mathematical
statistics and economics, the following lectures being given under its auspices:
- "Generalized Multiple Correlation for Pairs of Sets of Economic Variates," by
Harold Hotelling, Columbia University.
- "Multiple Correlation Analysis of Intercorrelated Variates," by Alfred Cowles
3rd, Cowles Commission.
- "Lag Analysis with Special Reference to the Building Industry," by Charles F.
Roos, Cowles Commission.
- "The Statistical Validity of Harmonic Analysis," by Harold T. Davis, Cowles
Commission and Indiana University.
- "The Mathematical Theory of Index Numbers," by Thomas H. Rawles, then of Yale
University, now of Colorado College.
- "The Location and Development of Economic Areas," by August Loesch, University
of Bonn, Germany.
- "Business Cycles and Population Waves," by August Loesch, University of Bonn,
Germany.
- "The Economics of Overhead Costs with Applications to Pumping," by Herbert E.
Jones, hydraulic engineer and statistician, now of the Cowles Commission.
THE 1936 SEMINAR
The Cowles Commission proposes to organize a second seminar to be held in the summer of
1936. During this seminar, which will extend from July 1 to August 1, certain facilities
of its laboratory in the way of computational and supervisory assistance will be made
available to qualified research workers who attend and who are investigating problems
within the sphere of interest of the Commission.
Through arrangements completed this year with Colorado College, qualified research
workers in the fields of statistics and economics who wish to attend or participate in the
summer seminar may secure rooms in McGregor Hall of the College free of charge for the
duration of the seminar. A limited number of rooms in this Hall will be available at
nominal cost for wives or husbands of participating research workers, and those with
families may rent furnished houses belonging to the College, its affiliates, or faculty
members, at rates ranging from $60.00 per month upwards. Board will be furnished, when
desired, at Bemis Hall of the College for $7.00 per week per person.
Applications for computational help or rooms should be addressed to the Cowles
Commission. |