I just got the sad news that Bob Lucas has passed away. He was truly a giant among economists, and a wonderful warm person.
I will only pass on three remembrances that others will not likely mention.
Bob was incredibly welcoming to me, a young brash and fairly untutored young economist from Berkeley.
In the fall of 1985 I gave what was no doubt the most disastrous first seminar by a new assistant professor in the Department’s history. It was something about random walks and real business cycles, and was going nowhere. Bob stopped by my office, and expressed doubt about this random walk stuff. He said, if you look at longer and longer horizons, GNP volatility goes down. At least I had the wit to recognize what had just been handed to me on a silver platter, dropped everything and wrote the “Random walk in GNP,” my first big paper. Without that, I doubt I would be where I am today. Thank you Bob. He and Nancy were kind to us socially as well.
The first Lucas paper that I recall reading, while I was still at Berkeley, was his review of a report to the OECD. I don’t think anyone else writing about Bob will mention this masterpiece. If you get annoyed by policy blather, read this article. Reading it as a grad student, I loved the way he sliced through loose prose like warm butter. No BS with Bob. Only clear thinking please. I mentioned it later, and he laughed saying he wrote it in a bad mood because he was getting divorced. Like “After Keynesian Macroeconomics,” Bob could wield a pen.
Much later, I attended a revelatory money workshop. Bob presented an early version of, I think, “Ideas and growth.” In the model, people have ideas, and bump into each other randomly and share ideas. Questioner after questioner complained that there wasn’t any economics in the model. Why not put in some incentive for people to bump in to each other, or something non mechanical. Time after time, Bob answered each suggestion that he had tried it, but it didn’t make much difference to the outcome, so he stripped it out of the model. Clearly, he had been playing with this model over a year, working to eliminate needless ingredients, not to add more generality. It’s great to see the production function at work.
Bob is known as a theorist, but he had a great handle on empirical work as well. His Carnegie Rochester money demand paper basically reinvented cointegration, and saw clearly what dozens of others missed. “Mechanics of economic development” starts by putting together facts. “International evidence on inflation-output tradeoffs” 1973 makes one stunning graph. And more.
There is so much to say about Bob the great economist, superb colleague and tremendous human being, but I will stop here for now. RIP Bob. And thank you.