My father had left school
in Montreal after the 8th grade because he was eager to make money. My
mother - whose family emigrated from Eastern Europe to New York City when
she was six months old - also left after the 8th grade because girls were
not expected to get much education. There were only a few books in our
house, but my father kept up with the political and financial news, and
my older sister read a lot. After my father lost most of his sight, I had
the task of reading him stock quotations and other reports on financial
developments. Perhaps that stimulated my interest in economics, although
I was rather bored by it.
We had many lively discussions in
the house about politics and justice. I believe this does help explain
why by the time I finished high school, my interest in mathematics was
beginning to compete with a desire to do something useful for society.
These two interests came together during my freshman year at Princeton,
when I accidentally took a course in economics, and was greatly attracted
by the mathematical rigor of a subject that dealt with social organization.
During the following summer I read several books on economics.
To be financially independent more
quickly, I decided at the end of my first year to graduate in three years,
a seldom used option at Princeton. I had to take a few extra courses during
the next year, and I chose reading courses in modern algebra and differential
equations for the summer afterwards. For the equations course, I was given
a set of unpublished lectures that emphasized existence proofs and uniqueness
of solutions to differential equations. I learned a lot about such proofs,
but very little about actually solving one of these equations. Still, my
heavy investment in mathematics at Princeton prepared me well for the increasing
use of mathematics in economics.
I began to lose interest in economics
during my senior (third) year because it did not seem to deal with important
social problems. I contemplated transferring to sociology, but found that
subject too difficult. Fortunately, I decided to go to the University of
Chicago for graduate work in economics. My first encounter in 1951 with
Milton Friedman's course on microeconomics renewed my excitement about
economics. He emphasized that economic theory was not a game played by
clever academicians, but was a powerful tool to analyze the real world.
His course was filled with insights both into the structure of economic
theory and its application to practical and significant questions. That
course and subsequent contacts with Friedman had a profound effect on the
direction taken by my research.
While Friedman was clearly the intellectual
leader, Chicago had a first class group of economists who were doing innovative
research. Especially important to me were Gregg Lewis's use of economic
theory to analyze labor markets, T.W. Schultz's pioneering research on
human capital, Aaron Director's applications of economics to anti-trust
problems, and industrial organization more generally, and L.J. Savage's
research on subjective probability and the foundation of statistics.
I published two articles in 1952,
based on my research at Princeton. But I realized shortly after arriving
in Chicago that I had to begin to learn again what economics is all about.
I published nothing else until an article written with Friedman and a book
based on my Ph.D. dissertation came out in 1957. The book contains the
first systematic effort to use economic theory to analyze the effects of
prejudice on the earnings, employment and occupations of minorities. It
started me down the path of applying economics to social issues, a path
that I have continued to follow.
The book was very favorably reviewed
in a few major journals, but for several years it had no visible impact
on anything. Most economists did not think racial discrimination was economics,
and sociologists and psychologists generally did not believe I was contributing
to their fields. However, Friedman, Lewis, Schultz, and others at Chicago
were confident I had written an important book. Support by the people I
respected so highly was crucial to my willingness to persevere in the face
of much hostility.
After my third year of graduate study
I became an Assistant Professor at Chicago. I had a light teaching load
and could concentrate mainly on research. However, I felt that I would
become intellectually more independent if I left the nest and had to make
it on my own. After three years in that position, I turned down a much
larger salary from Chicago to take a similar appointment at Columbia combined
with one at the National Bureau of Economic Research, then also located
in Manhattan. I have always believed this was the correct decision, for
I developed greater independence and self-confidence than seems likely
if I remained at Chicago.
For twelve years I divided my time
between teaching at Columbia and doing research at the Bureau. My book
on human capital was the outgrowth of my first research project for the
Bureau. During this period I also wrote frequently cited articles on the
allocation of time, crime and punishment, and irrational behavior.