Professional Documents
Culture Documents
Biography
• Early adulthood
Fisher's father was a teacher and Congregational
minister, who raised his son to believe he must be
a useful member of society. The young Irving had
mathematical ability and a flair for invention. A
week after he was admitted to Yale University, his
father died at age 53. Irving carried on, however,
supporting his mother, brother, and himself, mainly
by tutoring. He graduated from Yale with a B.A
degree in 1888, where he was a member of Skull &
Bones.
Fisher's best subject was mathematics, but
economics better matched his social concerns. He
went on to write a doctoral thesis combining both
subjects, on mathematical economics. Irving was
granted the first Yale Ph.D. in economics, in 1891.
His advisors were the physicist Willard Gibbs and
the economist William Graham Sumner. Fisher did
not realise at the outset that there was already a
substantial European literature on mathematical
economics. Nevertheless, his thesis made a
contribution European masters such as Francis
Edgeworth recognised as first rate. He constructed
a wonderful machine of pumps and levers to
complement and illustrate his thesis. While his
books and articles on economic topics exhibited
unusual (for the time) mathematical sophistication,
Fisher always wished to bring his analysis to life
and to present his theories in a very lucid manner.
This research into basic theory did not touch
the great social issues of the day. Monetary
economics did and this became the main focus of
Fisher’s work. In the 1890s the United States was
divided over the question of the monetary
standard. Should the dollar float, be fixed in terms
of gold or silver, or some combination of the two?
To opt for one system was to choose between West
and East, farmer and financier, debtor and creditor,
…. Fisher’s Appreciation and interest was an
abstract analysis of the behaviour of interest rates
when the price level is changing. It emphasised the
distinction between real and monetary rates of
interest which is fundamental to the modern
analysis of inflation. However Fisher believed that
investors and savers—people in general—were
afflicted in varying degrees by “money illusion”;
they could not see past the money to the goods
the money could buy. In an ideal world, changes in
the price level would have no effect on production
or employment. In the actual world with money
illusion, inflation (and deflation) did serious harm.
Economic theories.
• Money and the price level
Fisher's theory of the price level was the following
variant of the quantity theory of money. Let
M=stock of money, P=price level, T=amount of
transactions carried out using money, and V= the
velocity of circulation of money. Fisher then
proposed that these variables are interrelated by
the Equation of exchange:
MV=PT.
Later economists replaced the amorphous T with y
or "Q", real output, nearly always measured by real
GDP.
Fisher was also the first economist to distinguish
clearly between real and nominal interest rates:
Debt-Deflation:
Personal ideals:
The lay public perhaps knew Fisher best as a
health campaigner and eugenicist. In 1898 he
found that he had tuberculosis, the disease that
killed his father. After three years in sanatoria,
Fisher returned to work with even greater energy
and with a second vocation as a health
campaigner. He advocated vegetarianism, avoiding
red meat, and exercise, writing How to Live: Rules
for Healthful Living Based on Modern Science, a
USA best seller.
In 1912 he also became a member of the scientific
advisory to the Eugenics Record Office and served
as the secretary of the American Eugenics Society.
Fisher was also a strong believer in the now-
ridiculed "focal sepsis" theory of physician Henry
Cotton, who believed that mental illness was
attributable to infectious material residing in the
roots of the teeth, recesses in the bowels, and
other places in the human body, and that surgical
removal of this infectious material would cure the
patient's mental disorder. Fisher believed in these
theories so thoroughly that when his daughter
Margaret Fisher was diagnosed with schizophrenia,
Fisher had numerous sections of her bowel and
colon removed at Dr. Cotton's hospital, eventually
resulting in his daughter's death.
Selected publications:
• Primary