Academic, Economist (1918-2002)
James Tobin was a Nobel Prize winning American economist. Tobin was a strong advocate of Keynesian economics and contributed many papers to monetary economics as well as the study of investment and financial markets.
As well as proposing Keynesian models with micro-foundations, Tobin is widely known for his ‘Tobin tax’; a tax on foreign exchange transactions. Tobin suggested this as a means to decrease dangerous speculation in international currency markets. He also developed the Tobit model for censored endogenous variables in econometrics. Tobin also advanced his ‘q’ theory of investment in 1969 and helped create the Baumol-Tobin model of the transactions demand for money.
Tobin also served on John F. Kennedy’s Council of Economic Advisors between 1961-62 and offered consultancy services to the US government between 1962-1968. Alongside Robert Solow, Kenneth Arrow and Arthur Okun, Tobin helped the Kennedy administration deploy their Keynesian economic policy.
“The miserable failures of capitalist economies in the Great Depression were root causes of worldwide social and political disasters.”
“I studied economics and made it my career for two reasons. The subject was and is intellectually fascinating and challenging, particularly to someone with taste and talent for theoretical reasoning and quantitative analysis.”
– James Tobin