A Century of Economics and Engineering at Stanford

Abstract

This article documents the disciplinary exchanges between economists and engineers at Stanford throughout the twentieth century. We outline the role of key scholars such as Kenneth Arrow and Robert Wilson, as well as engineers turned administrators like Frederick Terman. We show that engineers drew upon economic theories of decision and allocation to improve practical industrial management decisions. Reciprocally, economists found in engineering the tools that they needed to rethink production and growth theory (including linear programming, optimal control theory, an epistemology of “application” that emphasized awareness to institutional details, trials and errors and experiments). By the 2000s, they had turned into economic engineers designing markets and other allocation mechanisms. These cross-disciplinary exchanges were mediated by Stanford’s own institutional culture, notably its use of joint appointments, the development of multidisciplinary “programs” for students, the ability to attract a variety of visitors every year, the entrepreneurial and contract- oriented vision of its administrators, and the close ties with the industrial milieu that came to be called the Silicon Valley.

Komparativna analiza korištenja modela digitalnog blizanca u inženjerstvu i ekonomiji

“…Paradigma ekonomije "kao" inženjerstvo podrazumijeva usvajanje inženjerskog pristupa od strane ekonomije, razvijajući tržišne modele, poput teorije igara. (Cherrier & Saidi, 2020), (Klein, 2020). Ovdje ekonomska znanja poprimaju izrazito praktičnu orijentaciju, pa su tako inženjeri ušli u područje ekonomskog dizajna povezanih industrija (Jenle, Pallesen, 2017).…”

Institutionalizing a Pluralistic Alliance between Economics and Engineering

“…The paradigm refers to how economics has adopted engineering epistemology for the design of markets, through common elements of language, methodology and organization of research. It is embodied in a generation of economists who, self-defining as "economic engineers", develop market models using tools such as optimal control and game theory (Cherrier & Saidi, 2020;Klein, 2020). In his essay The economist as engineer, Alvin Roth clarifies: « economists have lately been called upon not only to analyze markets, but to design them […] Designers cannot work only with the simple conceptual models used for theoretical insights into the general working of markets.…”

“Rise and Fall” of the Walrasian Program in Economics: A Social and Intellectual Dynamics of the General Equilibrium Theory

“…Suffice it to mention panels at the conferences of the Econometric Society; important meetings such as the European Workshop on General Equilibrium Theory (EWGET) held each year in prestigious European venues since 1991; the annual CARESS-Cowles Conference on General Equilibrium and Its Applications launched in 2005; and a specialized GE meeting organized yearly as a part of prestigious NSF/NBER/CEME Conference on Mathematical Economics in the United States; not to forget similar workshops in other parts of the world (like GETA in Asia or Gein Rio in Latin America).20 On the careers and theoretical interests of some of those individuals, in particular Cass and Shell, seeCherrier and Saïdi (2018).…”

“…Stanford was also home for some other key GE theorists such as Mordecai Kurz, Herbert Scarf, and Hirofumi Uzawa, whose many students were doing GET as well. See Cherrier and Saïdi (2020) on the Stanford culture of collaboration between economics and mathematics.…”