ECONOMICS
If the Royal Swedish Academy of Sciences intended to signal its disapproval of the Reagan Administration's economic programs, it could not have picked a better week to do so, or a better man to deliver the message. Robert Solow, 63, who last week won the 1987 Nobel Memorial Prize in Economic Science, is a liberal academic who has never hidden his disdain for Reaganomics. And when the Brooklyn-born professor at the Massachusetts Institute of Technology stepped before the cameras to acknowledge his award, he needed little prompting to lay into the policies that led to last week's crash. "The best thing you can say about Reaganomics," he asserted, "is that it probably happened in a fit of inattention."
Solow is a leading advocate of government intervention to correct the natural imbalances of the marketplace, a strategy that has fallen into disfavor under this Administration. He won his prize for a pioneering 1956 study demonstrating that the rate of technological progress does more to determine an industrialized country's growth than the size of its labor force or its investments in new factories or equipment. Solow's "theoretical model had an enormous impact on economic analysis," said the academy's statement. In the years since then, governments around the world have taken his lesson to heart. The revolution in jet aviation and the computers of Silicon Valley can be directly linked to government policies that steered money into technological research and development. "I am delighted," commented 1973 Economics Laureate Wassily Leontief. "He represents the best of our profession."
As senior economist on the staff of the Council of Economic Advisers in the early 1960s, Solow helped shape the interventionist policies that dominated the Kennedy and Johnson years. He has never lost his taste for mixing it up in the public economic debate. An engaging speaker, he is also one of the few economists who can write good English. His popular essays and book reviews leaven economic analysis with a dry, cutting wit. "Only someone with a sense of humor could survive reading this book," he began a review of George Gilder's The Entrepreneur as Hero in the New Republic. "And no one with any trace of a sense of humor could have written it."
When not teaching, Solow and his wife Barbara, an economic historian at Boston University (they have two grown sons and a daughter), divide their time between a waterfront condominium in Boston and a summer house on Martha's Vineyard. At the Vineyard, a 24-ft. sailboat is Solow's primary passion. He plans to use part of his $340,000 Nobel Prize money to equip the boat with a new Genoa jib. "I've been just a poor academic up to now," he says, noting that the value of his only other major asset, his share of the M.I.T. pension fund, was reduced in last week's debacle. But some good may yet come of the Crash of '87, he says, if it lessens the flow of bright graduate students to investment banks. "It may make engineers out of some yuppies," he smiles. "Sweet are the uses of adversity."