Economists began using models between the First and Second World Wars. The first econometric model of the United States was produced by Jan Tinbergen at the League of Nations. Modeling was a methodological solution to the political problems of the interwar period. International norms of cooperation and governance had to be reconciled with new demands for national autonomy in economic affairs, with a new understanding of the nation-state's capacity to make and remake the economy. Models possessed a composite, ambiguous character that appealed to both nationalist and internationalist sympathies. Models combined fact and theory, the particular and the general, the local and the global. The practice of modeling contrasted with and largely displaced an older, universalizing discourse of scientific law, predominant in the nineteenth century. Modeling reflected the nation-state's ascendance as a legitimate arbiter of economic policy, situated uneasily within a regime of international norms and institutions.
During the First World War, the term “essential business” was used initially in military procurement, and then in disease control when pandemic influenza struck. Essential businesses were exempt from restrictions imposed in the interest of national defense or public health, so debates about essential business concerned the necessity of various goods and services to the consumer. Ultimately, the concept of essential business depended on a shared understanding of the American consumer’s rights and duties as a citizen. On the one hand, consumers furthered the state’s interests by complying with, interpreting, implementing, and enforcing public-health restrictions. On the other, what contemporaries called “the American standard of living” entitled citizens to maintain relatively large expenditures. This relationship between citizenship and consumption explains the economy’s surprising stability in 1918. The flu did not cause a depression because social norms authorized most consumer expenditures as legitimate and appropriate, even during the wartime epidemic. “Essential” work is theorized using the Marxist concept of socially necessary labor, which relates productivity and purchasing power to norms of consumption.
scite is a Brooklyn-based organization that helps researchers better discover and understand research articles through Smart Citations–citations that display the context of the citation and describe whether the article provides supporting or contrasting evidence. scite is used by students and researchers from around the world and is funded in part by the National Science Foundation and the National Institute on Drug Abuse of the National Institutes of Health.