"A forthcoming book by Harry Markowitz, Techniques of Portfolio Selection, will treat the general problem of finding dominant sets and computing the corresponding opportunity locus, for sets of securities all of which involve risk. Markowitzs main interest is prescription of rules of rational behaviour for investors; the main concern of this paper is the implications for economic theory, mainly , that can be derived from assuming that investors do in fact follow such rules."
James Tobin was an American economist who served on the Council of Economic Advisers and consulted with the Board of Governors of the Federal Reserve System, and taught at Yale University. He contributed to the development of key ideas in the Keynesian economics of his generation and advocated government intervention in particular to stabilize output and avoid recessions. His academic work include
"The historic terrain of macro-economic theory is the explanation of the levels and fluctuations of overall economic activity. Macro-economists have been especially interested in the effects of alternative fiscal, financial, and monetary policies."
"In economic surveys of households, many variables have the following characteristics: The variable has a lower, or upper, limit and takes on the limiting value for a substantial number of respondents. For the remaining respondents, the variable takes on a wide range of values above, or below, the limit."
"I shall argue that Keynesian macroeconomics neither asserts nor requires nominal wage and/or price rigidity. It does assert and require that markets not be instantaneously and continuously cleared by prices."
"Tobin was a person who really impressed me, because he had a passion for social justice and for public policy (...) for Tobin it was always something that was about making the lives of people better."
"According to [the general equilibrium approach to monetary theory], the principal way in which financial policies and events affect aggregate demand is by changing the valuations of physical assets relative to their replacement costs."
"Keynes did not challenge the efficacy of price adjustment mechanisms in clearing particular markets in the Marshallian partial equilibrium theory on which he had been reared. He did challenge the mindless application of those mechanisms to economy-wide markets. Founding what came to be known as macroeconomics, he was modeling a whole economy as a closed system. He knew he could not use the Marshallian assumption that the clearing of one market could be safely described on the assumption that the rest of the economy was unaffected."