Along with Frisch and others Tinbergen developed the field of econometrics, the use of statistical tools to test economic hypotheses. Tinbergen was one of the first economists to create multiequation models of economies. He produced a twenty-seven-equation econometric model of the Dutch economy, and his 1939 book, Business Cycles in the United States, 1919–1932, includes a forty-eight-equation model of the American economy that explains investment activity and models American business cycles.
Another of Tinbergen’s major contributions was to show that a government with several economic targets—for both theunemployment rate and the inflation rate, for example—must have at least as many policy instruments, such as taxes andmonetary policy.
Nouriel Roubini is a Professor of Economics and International Business at New York University Stern School of Business. He is
Arthur Laffer (b. 1940), one of the chief architects of Ronald Reagan’s economic policies, is best known for the “Laffer