Ragnar Anton Kittil Frisch was born on 3 March 1895 in Kristiania (Oslo), Norway.

His father, Anton Frisch, was a jeweller descending from a mining specialist from Saxony who had come to Norway in the seventeenth century. Ragnar was the only child and groomed to continue the family business.

He credited his mother, Ragna Fredrikke Kittilsen, for having influenced his general outlook on life and for having insisted that he took up a university study along with his apprenticeship to become a silversmith. The short (two-year) study of economics was chosen (Nobel Foundation 1969b).

Ragnar Frisch is known in particular for his role in creating econometrics. He coined ‘econometrics’ as the name of a new discipline in economics outlining an ambitious research program (Frisch 1926). He gathered support for the idea by initiating and being the driving force behind the establishment of the Econometric Society in 1930, for a long time the only international organization in economics. Frisch launched during 1926-36 a number of ground-breaking ideas for the new econometric discipline, one of which was his propagation-impulse explanation of business cycles (Frisch 1933a), alluded to in the caption for the first Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel awarded to Ragnar Frisch in 1969 (jointly with Jan Tinbergen) “for having developed and applied dynamic models for the analysis of economic processes” (Nobel Foundation 1969a).

At his graduation in economics in 1919, Frisch ended his examination paper in public finance as follows: “Man must not be deterred by the apparently impossible. History has shown that the human beings have had a wonderful ability for obeying the maxim of Aristotle: Make the unmeasurable measurable!”. By these unusual words in an examination paper Frisch stated an overriding concern in his future work, not least in the measurement of utility.

Shortly after graduation Frisch completed his probation work as a silversmith.

His father made him partner in the jeweller’s shop which at the time was a flourishing business. This allowed the newlywed Ragnar and Marie Frisch to spend two to three years abroad for Ragnar’s studies, mostly in Paris but also visiting England, Germany and Italy. In 1926 the doctoral degree was conferred on Ragnar Frisch at the University of Kristiania for a dissertation in mathematical statistics.

During 1927-28 Frisch visited the United States on a Rockefeller Fellowship. It allowed him to propagate the idea of an association and a journal to promote econometrics in the USA. He found partners for this venture in Irving Fisher, Charles Roos, and Joseph Schumpeter. Soon after his return to Europe his father died while the jeweller’s shop was in dire economic straits. Frisch was facing having to give up a scientific career. A generous offer from Irving Fisher for Frisch to visit Yale University 1930-31 became decisive. During the visit Fisher and Frisch joined forces in founding the Econometric Society. Frisch was later elected as Editor of Econometrica, a position he held for 22 years. While Frisch was still in the USA he was appointed professor in Oslo in an effort to pre-empt Frisch from accepting an offer from Yale University. Frisch returned to Norway, negotiated a grant from the Rockefeller Foundation allowing him to establish the Institute of Economics in 1932. It became his econometric laboratory. His student Trygve Haavelmo became a co-worker and his later well-known contribution to econometrics was rooted in the fertile research environment of Frisch.

As author of path-breaking econometric works, a most forceful participant of the early European meetings of the Econometric Society, and at the same time Editor of Econometrica, Ragnar Frisch put a strong mark on the emerging econometric community. In Paul Samuelson’s words “Frisch dominated analytical economics from the early 1930’s founding of the Econometric Society to his wartime internment...

combining fertility and versatility with depth” (Samuelson 1974: 7). Frisch’s small laboratory institute, which served as a model for research facilities in other countries, was visited by a number of young scholars until World War II subdued the activity. In 1943 Frisch was arrested and put in a detention camp by the wartime Nazi regime. In the long postwar period until his death in 1973 Frisch continued to be very active in research but no longer at centre stage on the international scene. Some of his old ideas appeared in new and fruitful settings. He vented his dissatisfaction with aspects of the development within econometrics - labelling it playometrics - at the first World Congress of the Econometric Society in 1965.

Frisch’s econometric research program may in general terms best be described as turning economics into a real science “by constructive and rigorous thinking similar to that which has come to dominate in the natural sciences” (as quoted from the Constitution of the Econometric Society). The tenor of this pursuit can best be assessed from lecture series at Yale 1930 and at the Sorbonne 1933, recently issued as Bjerkholt and Qin (2010) and Bjerkholt and Dupont-Kieffer (2009). The remarkable early work of Frisch (1926) was devoted to demonstrating that marginal utility could be “quantified” as a theoretical concept, as had been the “dream of Jevons”. The approach, influenced by Irving Fisher, was to establish a set of choice axioms from which the existence of a utility indicator could be derived. Frisch’s further work on measuring utility comprised New Methods of Measuring Marginal Utility (Frisch 1932) and a penetrating contribution to index theory (Frisch 1936). Frisch’s utility measurement ebbed out in the mid- 1930s at criticism that his results were based on too narrow assumptions and under the impact of the new demand theory of Hicks, Allen and others which rejected the implied cardinalism of Frisch’s approach. A late spin-off was the much cited Frisch (1959).

Frisch (1933a) in “Propagation problems and impulse problems”, embodying Knut Wicksell’s deceptively simple simile of the rocking-horse, explained economic fluctuations as the interaction of a system of dynamic structural equations and a stream of random shocks hitting the economy. The penetrating analysis of the role of random shocks in the economy was inspired by Eugen Slutsky. Methodologically, Frisch was way ahead of all other attempts at the time of explaining business cycles. His article introduced the idea of a macroeconomic model with macroeconomic aggregates quantified from (not yet existing) national accounts.

Ragnar Frisch made profound contributions towards developing statistical methods for use in economics. He realized at an early stage the limitations inherent in economic observations being “passive observations” resulting from economic mechanisms representing simultaneous equations. He criticized sharply empirical analysis applying regression methods in studies not properly guided by theory and for neglecting that economic relationships typically are part of a system of simultaneous relations. Another early work, the “Pitfalls” treatise (Frisch 1933b) was the first analytic discussion of the identification problem in the two-variable, two-equation problem of supply/demand curves. Then followed Statistical Confluence Analysis (Frisch 1934a), designed as a general tool for the determination of structural economic relations. The non-probabilistic approach of the confluence analysis caused it to be left by the wayside when the Cowles Commission approach became popular in the late 1940s.

In the area of production theory Frisch pursued the general econometric programme of providing a conceptually rich mathematized structure of production suitable for applied theoretical work and applicable to empirical quantification. Frisch’s innovative mathematization of production theory stemmed from around 1930 but was not published internationally until much later.

Frisch applied the production theory in an analysis which is recognized as the first specimen of an “engineering production function” approach (Forsund 1999).

After World War II, Frisch’s interest shifted towards issues relevant for national (and international) economic development and he took little part in the international theoretical development. Frisch developed at his institute a series of policy-oriented models, his own term was “decision models”. The first of these, “Price-wage-tax-subsidy policies as instruments in maintaining optimal employment” (Frisch 1949), was developed while Frisch was chairing a UN Commission on Employment and Economic Stability and designed to address the unemployment problems in constrained post-war economies. Frisch’s modelling approaches and modelling philosophy was set out in a number of papers; see Kloc (1972). Frisch spent a year in India in the mid-1950s working with Prasanta Mahalanobis on the Indian five-year plan. He exerted an influence on national planning in the United Arab Republic through several visits during the 1960s.

Important elements in Frisch’s concept of national economic modelling were (1) objective functions reflecting the policy makers’ preferences, and (2) computational methods for achieving optimal solutions. He put considerable effort into developing methods for eliciting explicit macroeconomic preference functions through a sophisticated interview technique (Bjerkholt and Strom 2002). On optimization, Frisch pioneered in the mid-1950s new approaches to the solution of linear programming problems. Frisch’s interest in this field can be traced back to his formulation of linear and linear-quadratic programming problems in the 1930s. His logarithmic potential method from 1956 for solving linear programming problems anticipated by 28 years Karmarkar’s interior-point algorithm beating the simplex method for all large problems (Konker 2000). In both these accounts Frisch’s ventures were much ahead of their time.

Frisch was more of a methodological problem solver than a theoretician. His general attitude towards problem solving is revealed in a quote from a 1934 paper on remedies counteracting market collapse during a depression: “We have here one of those cases - so frequent in economic practice - where it can be ‘proved’ by abstract reasoning that a solution is not possible, but where life itself compels us nevertheless to find a way out” (Frisch 1934b: 274). Examples of originality in Frisch’s work can be found in Frisch (1933c), an early work outlining a game-theoretic approach to market solutions, and the intriguing “On welfare theory and Pareto regions” (Frisch 1954 [1959]). Frisch’s rather unusual Nobel speech (Frisch 1970) touched upon a number of widely different topics, including his epistemological view suggesting that the regularities we observe in economics are really figments of the human mind, while the outer world is entirely chaotic.

Many of Frisch’s theoretical contributions and ideas were accompanied with new terms and concepts, some of which entered the basic vocabulary of economics, such as econometrics, macroeconomics, and microeconomics. In production theory he introduced, for example, isoquant, isocline, substitumal, pari-passu, ultra-passum, and passus coefficient. Frisch (1959) gave us Slutsky elasticity and Slutsky equation. It also introduced want elasticity, in the literature later renamed as Frisch elasticity. Samuelson (1974: 8) made the remark that the term “model” as used in economics had been introduced by Frisch. It may seem to hint at an argument in Bjerkholt and Qin (2010: 31-2) comprising the following passage:

The observational world itself, taken as a whole in its infinite complexity... is impossible to grasp.... we make an intellectual trick: In our mind we create a little model world of our own, a model world which is not too complicated to be overlooked... And then we analyze this little model world instead of the real world. This mental trick is the thing which constitutes the rational method, that is, theory.

Frisch was born into the liberal bourgeoisie. At the depth of depression in the 1930s he affiliated with the Labour Party of Norway, which he abandoned in the 1960s. Frisch joined forces with Joan Robinson (but was opposed by Jan Tinbergen) in scepticism toward the Treaty of Rome, denoting it as representing “unenlightened financialism”. The wringing pains of the European monetary union in recent years would hardly have surprised him.

Outside economics Frisch had other passionate callings. He kept bees, specializing on queen bee rearing; it was more than a hobby and also a field for publication. Frisch seemed quite dependent upon spending weeks in often remote mountain areas, hiking by day and working on economic and econometric problems at night.

Olav Bjerkholt

Ragnar Anton Kittil Frisch was born on 3 March 1895 in Kristiania (Oslo), Norway.

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