Among modern economists, the person who completely revolutionized economic thinking and practice during the Great Depression of 1930s had been John Maynard Keynes whose unconventional ideas contained in his book, The General Theory of Employment, Interest and Money, brought new hopes of salvaging war-ravaged European economies. Keynes has been one of the greats, if not the greatest, of all the modern economists who have had a lasting influence in the world economy.

Keynes was the prime mover and guiding light for the Bretton Woods Conference which led to the creation of the twin world institutions of the International Monetary Fund (IMF) and the International Bank for Reconstruction and Development (The World Bank). Keynes opened new frontiers of macroeconomics, especially Public Finance, and his ideas were translated into economic strategy and policy formulation for many governments. His economic theories and ideas are known a Keynesian economics or Keynesianism. His macroeconomic theories also came into action during the world economic crisis in 2007-2008. Keynes had a chequered career as a mathematician, philosopher, civil servant, administrator, negotiator, diplomat, economics teacher and an economic strategist.

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The invaluable experience he gained from the British Treasury and the banks greatly helped him to formulate successful economic policies and strategies for the British government. Ironically, this genius had been an accidental economist as his heart lay in mathematics (he graduated in mathematics) and philosophy and it is Alfred Marshall who forced him to take up political economy as his principal subject at Cambridge. Modern economists (other than Keynes) who have made seminal contributions to the discipline of economics include Paul A Samuelson, Milton Friedman, George Stigler, Friedrick Hayek, Garry Baker, John Hicks, Kenneth Arrow, Joan Robinson, J K Galbraith, Gunnar Myrdal, Nicholas Kaldor, Joseph Schumpeter and Amartya Sen to name a few. Most of them had been Nobel Prize winners.

Paul Anthony Samuelson (1915-2009), an American of Jewish descent from Poland teaching at Massachusetts Institute of Technology (MIT-1940- 2009) is considered to be the founder of neo-Keynesian economics and a seminal figure in the development of neoclassical economics. The book Foundations of Economic Analysis (1946) derived from his doctoral dissertation had been his magnum opus. Samuelson has had considerable influence on the American economy having served in the Councils of Economic Advisers to President John F. Kennedy and Lyndon B Johnson and also as a consultant to the United States Treasury. In their citation, the Royal Swedish Academy stated Samuelson “has done more than any other contemporary economist to raise the level of scientific analysis in economic theory.”

He received worldwide acclaim not only for his economic models, especially in the fields of consumption, public finance and welfare, but also for his recordbrea king book, Economics: An Introductory Analysis (1948) which is considered the best text book ever written on economics. The book, in multiple editions and reprints (19th by 2010) was translated in 41 languages and by 2018 it had sold more than four million copies making it the most popular economics textbook of all time. While he considered mathematics as “the natural language” for the economists and laid the foundation for mathematical economics, in his Economics, Samuelson used mathematical tools to the minimum and only when their use was essential.

Milton Friedman (1912- 2006) was another American economist who was himself an institution ~ the father of the Chicago School of economics, which produced a large number of winners of the Nobel Memorial Prize in economic sciences. In his Capitalism and Freedom (1962), Friedman extolled the philosophy of free market economy with least interference by the government; this led to the popular slogan, ‘the government has no business to be in business.’ Initially, Friedman wanted to be an actuary or mathematician but the state of the economy during the Depression led him to become an economist.

This five-foot-tall scholar (Elfin Libertarian) had to leave his job as assistant professor of economics at the University of Wisconsin-Madison owing to antiSemitic slurs (he had Jewish roots from Ukraine) and had to struggle hard before he could get a faculty position in the University of Chicago where he taught economics for 30 years and nurturing the Chicago School of economics. Friedman made a huge impact on the monetary policy of the Federal Reserve as well as on the economic policies of the US government and many other governments of the world. He had been an advisor to the Republican US President Ronald Reagan and the Conservative British Prime Minister Margaret Thatcher. His books and essays considerably influenced a generation of economists. According to a survey (2011) commissioned by EJW (Economic Journal Watch), Friedman was found to be the second-most popular economist of the 20th century after John Maynard Keynes.

The Economist described him “as the most influential economist of the second half of the twentieth century.” This writer, as a student, had the opportunity of interacting with Friedman during his visit to the Department of Economics of Calcutta University in 1963 when he expressed, among other things, his concern about the employment situation in the United States ~ a concern which still persists there. No history of economics or economists would be complete without the mention of an extrardinary personality and a political economist named Joseph Alois Schumpeter (1883-1950), who had a chequered career in Europe and the United States.

Born in Trest (present-day Czech Republic), Schumpeter was an Austrian political economist belonging to the Historical School ((he received his doctoral degree from the University of Vienna’s faculty of law), and having worked as a professor of economics at the University of Czernowitz (Ukraine ~ 1904), University of Graz (Austria ~ 1911-13), Columbia University, (USA-1913-14), Harvard (USA ~ 1927-28, 1930), University of Bonn (Germany ~1925-32) and also briefly working as the Finance Minister of Austria (1919), he migrated to the United States in 1932 to become a professor of economics at Harvard where he remained for the rest of his life. As an ‘evolutionary economist’, Schumpeter was totally opposed to Marxism and socialism and believed in evolutionary capitalism and ‘liberal capitalism’ brought about by innovation, entrepreneurship and “constructive destruction.”

Three of his books ~ The Theory of Economic Development (1934), Business Cycles (two volumes ~ 1939) and Capitalism, Socialism and Democracy (1942), especially the last one, created waves in the economic world and made him one of the most influential economists of the 20th century. Christopher Freeman summed him up by noting “the central point of his whole life’s work: capitalism can only be understood as an evolutionary process of continuous innovation and ‘creative destruction’.” Schumpeter’s ‘dynamic, change-oriented and innovation based economics’ distinguished him from other contemporary economists.

His History of Economic Analysis published posthumously in 1954 has been a monumental work of scholarship (1322 pages, cost: Rs 16,000- 36,000 at Amazon) in which he traced and analysed economic thoughts from the days of Greek civilization to the modern times. According to Schumpeter, the greatest 18th century economist had been the French economist Jacques Turgot rather than Adam Smith and Leon Walras of France had been “the greatest of all economists”. It will be seen that till the Sec ond World War, the discipline of economics was taught as political economy and the economists were basically political economists. Political science and economics have been twin sisters and were being taught together in universities all over the world including India.

Development of the economics discipline radically changed in the post-WWII scenario when attempts were made to make economics more mathematical with the introduction of mathematical and statistical tools to explain economic phenomena and theories synchronizing with human psychology, sociology and demography. Thus started an era of creating economic models using mathematical equations and statistical tools. A hybrid subject called Econometrics was also born.

(The writer is a former Dy. Comptroller & Auditor General of India and a former Ombudsman of Reserve Bank of India. He is also a writer of several books and can be reached at brahmas@gmail.com)