Day of debate, discussion remembers MIT’s Lester Thurow
Influential “kid from Bozeman, Montana” was one of the first economists to recognize the income gap.
October 26, 2016
Lester Thurow at his desk at MIT
Lester Thurow—the former dean of MIT Sloan who was one of the first economists to recognize a growing income gap—was celebrated on campus Oct. 24 as a public intellectual and a champion of research and global engagement.
MIT faculty members, business executives, and other prominent academics gathered to pay tribute to Thurow, who died March 25 at the age of 77, in a day filled with personal remembrances and debate on a range of policy issues. MIT Sloan Dean David Schmittlein called Thurow “a visionary and transformative leader.”
“Lester was unconstrained by the standard answers to the standard questions,” said Robert Solow, institute professor emeritus at MIT and a Nobel laureate in economics. “He was an unconventional economist.”
An early warning on the income gap
Thurow, a prolific and best-selling author, had a gift for distilling the intricacies and impact of the economy to the public. “He waged a constant lifelong battle to make Americans more aware of the complexity of the global economy and their role in it,” said Eleanor Westney, professor of management emerita.
He was perhaps best known for his prescient warnings about the widening gap between rich and poor Americans. “He was one of the first articulators of this issue in his scholarship,” said Professor Thomas Kochan, co-director of the MIT Sloan Institute for Work and Employment Research. “He made us think by putting tough issues [like this] out on the table.”
Nobel laureate Robert Solow
Not only was Thurow early to notice the “significant and disturbing shift in the distribution of income and wealth in the U.S.,” he was also blunt about its dangerous implications for society, according to Sheldon Danziger, PhD ’76, president of the Russell Sage Foundation. “His views on inequality are now mainstream,” Danziger said.
Professor David Autor, of the MIT Department of Economics, noted that a “market needs some inequality” to function efficiently. “Rewarding ideas and giving incentives to people who produce products and services that are valuable,” tends to spur growth and productivity, he said. “More than almost any other industrialized nation, the U.S. rewards people for their skills.”
But, he said, determining the “right amount of inequality” within an economy is a challenge. “The advantage of our economy is that it creates dynamism. The disadvantage is that it creates dynasticism,” in that the next generation will not do as well as the previous one.
On research and policy
Thurow advocated for long-term investments in research to promote economic growth.
In the spirit of Thurow’s “commitment to basic research,” Harvard Business School Professor Rebecca Henderson, SB ’81, called for increased funding for energy research.
Richard Schmalensee, Rebecca Henderson, and Simon Johnson
“We are vastly underinvesting in energy R&D,” Henderson said. “The federal government should be doing what the private sector seems reluctant to do.”
While accelerating innovation in the energy sector and “decarbonizing the global economy” is a costly endeavor, Henderson maintained that it is cheaper than failing to act on the pressing problem of climate change. “Climate change is a national security risk,” she said. “And if Lester were here, he would say that too.”
Thurow, who relished vigorous debate, believed the U.S. could help shape globalization in productive ways; at the same time, he worried that globalization would have a damaging effect on American workers.
“The global economic crisis has already had a profound effect of public policy,” said MIT Sloan professor Simon Johnson. “What happens to inequality in the Uber-ized economy? What happens to labor standards? And is there a way to shape technology to get better inclusion?”
“Immense dedication to MIT”
MIT Sloan Professor Donald Lessard praised Thurow—who arrived at MIT in 1968 and served as dean of MIT Sloan from 1987 to 1993—for his “energy and immense dedication” to the institute.
Thurow, he said, “laid the foundation” for collaborations and partnerships with schools around the globe. “He provided a roadmap for MIT's international engagement,” said Lessard. “He changed the school’s footprint.”
During his tenure, Thurow launched a series of initiatives that helped MIT Sloan forge alliances in Asia and India. He also helped establish an enduring relationship between China and MIT Sloan. He was instrumental in the development of the MIT-China Management Education Project.
“Thurow understood that the success of these programs likely rests on individual relationships, mutual respect, and trust,” said MIT Associate Provost Richard Lester.
In addition to international engagement, Thurow was invested in developing new faculty members—especially women. He worked to recruit and retain female professors, said MIT Sloan Professor JoAnne Yates.
“His deanship was an inflection point for women and Sloan,” she said. “We will always be grateful to Lester Thurow for starting us on the path of having greater numbers of women on the faculty.”
“The kid from Bozeman, Montana”
Solow said that although Thurow had an impeccable pedigree—Thurow attended Williams College and Oxford, and received his PhD at Harvard—“there was always a little bit of the kid from Bozeman, Montana” in him.
Thurow saw himself as a “public intellectual,” and he believed he had a responsibility to make economics accessible to mass audiences and to interpret and influence economic policy, said Solow. The role of a public intellectual requires bold, provocative predictions—and they may not always be right.
“Lester was early to understand the significance of increasing inequality and what it meant in terms of economic welfare and the quality of society, but he, along with others, overestimated the sustainability of the Japanese model,” he said.
Over the course of his career as a scholar and teacher, Thurow was “always very open to students. He had enormous demands on his time. And in spite of all that, his door was always open,” Solow said.
“The kid from Montana did very well,” he said.