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Secretary Hoover and the Emergence of Macroeconomic Management

Published online by Cambridge University Press:  11 June 2012

Evan B. Metcalf
Evan B. Metcalf
Affiliation:
Assistant Professor of Economics, Johnson State College
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Abstract

This study describes the 1920s movement (spearheaded by Herbert Hoover) to reduce unemployment by reducing fluctuations in business production and investment. Although the efforts had very limited success, they anticipated later attempts to manage prosperity for the economy as a whole.

Type
Research Article
Information
Business History Review , Volume 49 , Issue 1 , Spring 1975 , pp. 60 - 80
Copyright
Copyright © The President and Fellows of Harvard College 1975

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References

1 Donald Winch also places the emergence of similar “demands for a conscious system of state economic management” in the U.K. in the 1920s. Winch, , Economics and Policy (New York, 1969), esp. 17, 70–71Google Scholar.

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22 “Notes for a History of the President's Unemployment Conference,” n.d., Unemployment Conference — Plans and Purposes file, COP, HHP; see also Harding to Hoover, August 24, 1921, UF — President, COP, HHP; Lebergott, Manpower in Economic Growth, 512.

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25 PCU, Report, 17, 18, 63–65; “Activities of Mayors' Unemployment Committees,” Monthly Labor Review, XIII (December, 1921)Google Scholar; Grin, “Unemployment Conference,” 92–97. On war analogy, see e.g., Chenery, William, “Mr. Hoover's Hand,” Survey, XLVII (October 22, 1921), 107Google Scholar; “Cycle of Unemployment” (editorial), NYT, April 3, 1922. p. 14.

26 PCU, Report, 65, 134; Chenery, William, “Unemployment at Washington,” Surrey, XLVII (October 8, 1921), 42Google Scholar; cf. Dickinson, Roy, “Lower Prices and Better Selling as the Key to Normal Times,” Printers' Ink, CXVII (October 6, 1921), 3–4Google Scholar; “Report of Advisory Committee to Unemployment Conference,” 11, Unemployment Statistics (2) file, COP, HHP; Advisory Committee, “Emergency Measures Adopted by Employers to Mitigate Unemployment Due to the Present Situation,” 10–12, UF — Reports of Committees to Unemployment Conference (1), COP, HHP; NYT, October 12, 1921, 1; October 14, 1921, 1.

27 PCU, Report, 159–161; Hoover, Herbert, The Memoirs of Herbert Hoover, Vol. 2: The Cabinet and the Presidency, 1920–1933 (New York, 1952), 44Google Scholar; PCU, Seasonal Operation in the Construction Industries (New York, 1924)Google Scholar; U.S. Coal Commission, Report (Sen. Doc. 195, 68th Cong., 2nd Sess., 1925), ix; E. E. Hunt to William M. Leiserson, November 25, 1921, W. M. Leiserson Papers, State Historical Society of Wisconsin, Madison; Hunt to E. F. Gay, January 25, 1922, UF — Miscellaneous — Gay, COP, HHP.

28 Hoover to Edgar Rickard, November 14, 1921, Unemployment Conference — PCU (2) file, COP, HHP; cf. Julius H. Barnes to Edgar Rickard, October 12, 1921, ibid. For a general discussion of Hoover's use of research committees, see Karl, Barry D., “Presidential Planning and Social Science Research: Mr. Hoover's Experts,” Perspectives in American History, III (1969), 347–409Google Scholar.

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30 See “Minutes of Meeting for Business Cycle Committee and Staff,” March 3, 1922, UF — NBER, COP, HHP; Hunt to Mitchell, August 10, 1922, UF — Mitchell (NBER) (2), COP, HHP; Minutes of Meeting of Economists with Members of Committee on Business Cycles, October 2, 1922, UF — Chicago Meeting, COP, HHP; and Meeting of Economists, December 28, 1922, ibid., for a partial record of the committee's deliberations.

31 BC&U, xxiv–xxvi; cf. Mitchell, Wesley C., “The Crisis of 1920 and the Problem of Controlling Business Cycles,” American Economic Review, Supplement, XII (March, 1922), 21–23Google Scholar; U.S. Department of Commerce, Annual Report, 1922, 32; Otto T. Mallery, “The Long-Range Planning of Public Works,” in BC&U, Ch. XIV; Howenstine, E. Jay Jr., “Public Works Policy in the Twenties,” Social Research, XIII (December, 1946), 479–500Google Scholar; Stein, Herbert, The Fiscal Revolution in America (Chicago, 1969)Google Scholar, Ch. 2.

32 BC&U, xxvii; Mitchell in Minutes of Meeting of Economists with Members of Committee on Business Cycles, October 2, 1922, UF — Chicago Meeting, COP, HHP.

33 Hoover to Edgar Rickard, November 18, 1921, Unemployment Conference — President's Conference on Unemployment (2), COP, HHP; see Hunt to Owen D. Young, February 13, 1922, UF — NBER, COP, HHP; Hoover to Young, May 14, 1923, Hoover Personal — O. D. Young file, Hoover Personal Papers, HHP; Hunt to Hoover, April 6, 1922, Hunt 1921–22 file, COP, HHP; Proceedings of “Business Cycle Meeting,” April 13, 1922, UF — 1922, COP, HHP; Woolley, Clarence, “Getting Customers to Buy Steadily,” System, XLIV (September, 1923), 297–301Google Scholar; Young, Owen D., “Interpreting the Weather Signs of Business,” System, XLVI (September, 1924), 263–267, 338–340Google Scholar.

34 See Economic Advisory Committee, “Permanent Preventive Measures,” 13, UF — Reports of Committees to Unemployment Conference (2), COP, HHP; PCU, Report, 162–163, 168–169; BC&U, 116–117, 174–199, 378–388; Feldman, H., The Regularization of Employment (New York, 1925)Google Scholar. See Metcalf, “Economic Stabilization,” 239–251, for further discussion of the regularization literature of the 1920s.

35 See Feldman, Regularization; Smith, Edwin S., Reducing Seasonal Unemployment (New York, 1931)Google Scholar; and New York Governor's Commission on Unemployment Problems, Less Unemployment Through Stabilization of Operations (Albany, 1931)Google Scholar, for most comprehensive collections of case studies; National Industrial Conference Board (NICB), “Personnel Activities in American Business,” Studies in Personnel Policy, No. 20 (March, 1940), 23Google Scholar. See Metcalf, “Economic Stabilization,” 251–278, for further discussion of the extent of regularization.

36 See, e.g., Willis, H. Parker, “Ten Years' Experience in Business Statistics,” JASA, XIX (June, 1924), 206–217CrossRefGoogle Scholar; Oswald Knauth, “Statistical Indexes of Business Conditions and Their Uses,” in BC&U, Ch. XX; Cox, Garfield V., “Forecasting, Business,” Encyclopaedia of the Social Sciences (New York, 1934), VI, 348–353Google Scholar; Manufacturers' Research Association, “Report of Committee on Regularization of Industry,” January 18, 1926, File 42 — Regularization of Industry, Case 2, Manufacturers' Research Association Papers, Baker Library, Harvard Graduate School of Business Administration; Rogers, Clyde L. and Thayer, Jarvis M. Jr., “Economic and Statistical Research in Private Enterprise,” The Conference Board Economic Record, II (March 5, 1940), 61–66Google Scholar.

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38 Hoover memo to Dr. Gries, Dr. Durand, et al., March 17, 1924, UF — 1923–1928, COP, HHP; Hunt memo to Hoover, September 15, 1927, UF — Business Cycles, COP, HHP; Hoover to F.P. Keppel (Carnegie Corp.), October 26, 1927, ibid.

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