Economics professor James Tobin, a Nobel laureate and an adviser to President John F. Kennedy, died from a stroke March 11 in New Haven. He was 84.
Called “the leading macroeconomist of our generation” by Massachusetts Institute of Technology professor Paul Samuelson in The New York Times, Tobin gained national recognition for his Keynesian theories and for his unique ability to apply economic theory to real world situations.
“He was extremely knowledgeable about public policy and he brought economic theory to bear on it,” economics professor Robert Shiller said. “Tobin was the rare person who brought policy and theory together.”
With work on a variety of topics, from portfolio diversification to government intervention, Tobin was an “enormously productive scholar,” said William Brainard, a former student of Tobin’s and the director of undergraduate studies for Economics.
Tobin’s status as one of the world’s leading economists was solidified in 1981 when he was awarded the Nobel Memorial Prize in Economic Sciences for his work on financial markets.
“Jim Tobin was an extraordinary economist,” Yale President Richard Levin said. “He probably had the clearest mastery of economic theory of anyone I’ve encountered in my career as an economist.”
Lasting contributions to Yale
Even while he was serving on national boards, advising politicians and producing groundbreaking research outside New Haven, Tobin made several important contributions to the University during his 50 years at Yale.
A mere five years after arriving at Yale in 1950, Tobin brought the Cowles Foundation, an economic research center, from the University of Chicago to Yale, and acted as its director until 1961. Alfred Cowles ’13, the center’s founder, decided to move the institution to Yale after Tobin rejected an offer from the University of Chicago to head the center there.
Since then, the Cowles Foundation has attracted and produced numerous Nobel laureates and has been the defining characteristic of Yale Economics, said economics professor John Geanakoplos, who is currently the center’s director.
“He was the leader,” Geanakoplos said. “He gave the Yale Economics Department an identity. Because of him, Yale stood for a belief in free markets, but tempered by fine-tuning from the government.”
University of California at Berkeley economics professor Janet Yellen GRD ’71, who was a former student and teaching assistant for Tobin, said he created an intellectual foundation for the Cowles Foundation that encouraged graduate students to produce their best work.
“It was a center of intellectual activity and excellence for grad students at the time,” Yellen said. “There was a strong intellectual community that centered around the Cowles Foundation and centered around Jim.”
Yellen is a member of the Yale Corporation and also served as the chairwoman of former President Bill Clinton’s Council of Economic Advisers from 1997 to 1999.
In the early 1980s, Tobin also played an influential role in devising an endowment spending rule that dictates that the University only spend a fixed percentage of the endowment every year. That rule continues to govern Yale’s spending policies today.
Brainard, who was the University’s provost at the time, said the endowment spending rule is just another example of how Tobin used his intellect to improve Yale.
Tobin also led an ad-hoc committee on faculty appointments in the early 1980s. With an empirical, data-based report, the committee changed the appointments process by improving its objectivity and fairness, Brainard said.
A lifetime commitment
Unlike many of his peers who decided to move around within academia, Tobin chose Yale in 1950 and remained in New Haven until his death, serving as a professor emeritus after his retirement in 1988.
Yellen said Tobin was a naturally loyal person who invested much effort in all his endeavors.
“When people ask ‘why is it that you come to love a place?’ it’s hard to say,” Yellen said. “But my feeling is that he had created a community there that he probably felt very proud and very much a part of.”
Yellen added that Tobin was an extraordinarily devoted teacher and that his loyalty to his students might have kept Tobin at Yale.
“He encouraged his students to do work that was about something,” Yellen said. “Work that would not only meet a high intellectual standard, but would improve the well-being of mankind.”
Brainard said Tobin’s spirit of generosity was evident in the courses on theory that Tobin taught.
“It was abstract, but Jim never let you lose sight that the ultimate reason for studying theory was to make the world a better place,” Brainard said.
Tobin also came to love New Haven, sending his children to the city’s public schools and serving on the city’s zoning boards.
While Tobin continued his teaching and research activities through the mid-1990s, he had become a less frequent participant in the Economics Department’s activities in the past five years because of heart and hip problems.
Tobin is survived by his wife of 55 years, the former Elizabeth Fay Ringo; four children, Margaret, Michael, Hugh and Roger; and three grandchildren.