Nobel Prize-winning economist Robert Solow died on Thursday at the age of 99. He was a professor at the Massachusetts Institute of Technology and famous for his analysis of how technological advances drive economic growth. Generations of economics students learned his mathematical model, which he used to prove that economic growth does not depend primarily on labor and capital. Economists had previously assumed this for more than 100 years. But Solow showed that increasing labor and capital does not automatically lead to more growth. The decisive factor for a prosperous economy, he believes, is technological progress.
Solow’s talent became apparent early on. At the age of 16 he was admitted to Harvard University. And in his early 30s, in 1956 and 1957, as a young professor in Massachusetts, he drafted his groundbreaking theory in two essays. In 1987, the Nobel Prize Committee awarded him the Memorial Prize for Economic Sciences, which is considered the Nobel Prize in Economics. His model represents “a framework within which modern economic theory can be structured,” the jury wrote in its justification. Solow himself said at the time: “The interesting thing I found in my work was that technological change – that is, advances in research, engineering and technology – accounted for at least half of all the growth we have in the economy.”
Solow was considered a moderate Keynesian and advocated that the state take an active role in the economy through tax policy and spending. His analyzes convinced many politicians in industrialized countries to invest more money in education and scientific research. In this respect, Solow is one of the most influential economists of the past decades.
His robust health allowed him to intervene in current economic policy debates well into old age. In 2017, he wrote an essay in a book by economist Thomas Piketty, which identified the growing gap between rich and poor as the biggest problem in the global economy. “Piketty is right,” Solow stated.
Solow made the Massachusetts Institute of Technology one of America’s leading economic training centers. He was not only a gifted researcher, but also a brilliant teacher: four future Nobel Prize winners in economics emerged from his school: Peter Diamond, Joseph E. Stiglitz, William D. Nordhaus and George A. Akerlof. One of his students, Princeton University economics professor Alan S. Blinder, delivered a eulogy for Solow in 2013, saying, “All of his former students adore him – all of them, without exception.”