Introduction

Econometrics, as an organised discipline within the wider field of economics, has not yet celebrated its fiftieth anniversary: the Econometric Society was established at the end of 1930 and its journal Econometrica began publication in 1933. The aim of the Society, as stated in its constitution, is to advance economic theory in its relation to statistics and mathematics. The meaning of this phrase was elaborated by the editor, Ragnar Frisch, in the first issue of Econometrica. He pointed out that ‘Experience has shown that each of these three view-points, that of statistics, economic theory, and mathematics, is a necessary, but not by itself a sufficient, condition for a real understanding of the quantitative relations in modern economic life. It is the unification of all three that is powerful. And it is this unification that constitutes econometrics.’ A similar point of view was expressed by the Evaluative Committee for Econometrica (Paul Samuelson, chairman, Tjalling Koopmans and the present writer) whose report was published in Econometrica for April 1954. This committee was concerned with the kind of journal that Econometrica should be, its size and the kind of editorial organisation it should have. As a prelude to making recommendations on these issues the committee defined econometrics as ‘the quantitative analysis of actual economic phenomena based on the concurrent development of theory and observation, related by appropriate methods of inference.’ The committee went on to suggest that ‘editorial policy should be aimed even more, and by additional means, at increasing the proportion of space devoted to empirical studies meeting a high standard of quality and relevance.’