In a comment on my recent post, fellow blogger Scott Sumner made a good point:
Ricardian equivalence should probably be called “Barrow equivalence”, as the economics profession usually names the concept after its modern (re)discoverer.
This reminds me of another funny story.
Background: The rediscovery of Ricardian equivalence was Barrow’s article Journal of Political Economy In 1974. (He didn’t mention Ricardo in his article.) I put my head down that year, and started working on my Ph.D. Dissertation and so I missed it completely. I knew about Barrow because we read some of Barrow and Grossman’s work in my macro class at UCLA. He and Grossman wrote the pieces when, I think, Barrow could reasonably be called a Keynesian.
In June 1975, I was invited to my first Liberty Fund Colloquium. Svetozar Pejovich organized it at Ohio University in Athens, Ohio and I attended. There were several economists who I considered economic stars. Because of the story I’m about to tell, I won’t name the specific economic star. A Liberty Fund rule is the Chatham House rule, which says you’re not allowed to report what someone says without that person’s consent. Call this person “X”.
In discussing the deficit, X, kind of out of the blue, criticized Bob Barrow for that article saying he was reinventing the wheel. (Bob Barrow was not one of the participants.) He then explained to the group quite well what the article said and seemed critical of two things: (1) Barrow’s reinvention of the wheel and (2) the actual point Barrow, and Ricardo, made. .
I didn’t get this guy’s point, so I did what I do in situations like this: asked a question.
“X,” I said, “I’m trying to figure out your criticism: is it that Barrow reinvented the wheel or that the wheel is not round?” I can’t remember getting a clear answer but I think it was basically the wheel not being all round.
Fast forward to September 1975, when I arrived at the University of Rochester as an assistant professor at the Graduate School of Management (now the Simon School.) Robert Sproul, president of the university, had a really nice reception and dinner for everyone. New hires across campus. I found myself sitting at the same table as Bob Barro. He came to the economics department, if I remember correctly, as an associate professor with tenure. So I told him the story without asking the question. Then, I said, I asked X “Is the wheel round?” Baro laughed out loud. We became close later and I always enjoyed her smile.
Anyway, here’s some fun reminiscence about Barro’s 1974 article.
And here is my biography of Ricardo in David R. Henderson, ed. Concise Encyclopedia of Economics.