It is a particular honour to have my paper, “Income Inequality, Equality of Opportunity, and Intergenerational Mobility,” chosen for the 2014 Doug Purvis Memorial Prize. The prize is awarded annually by the Canadian Economics Association “to the authors of a highly significant, written contribution to Canadian economic policy.”
That is certainly honour enough, but I’m particularly grateful for another reason.
Doug Purvis was a macroeconomist, born in Calgary Alberta, a graduate of the University of Victoria and the University of Western Ontario who completed his PhD at the University of Chicago. He taught at Queen’s University beginning in 1971 until his untimely death in 1993. As a doctoral student, I took courses from him in macroeconomics, and open economy macroeconomics, his areas of expertise.
Purvis was gregarious and generous, but he was also analytical and intuitive, having the capacity to use economic models in a clear-sighted way, appropriate to the problem at hand. An excellent example is his understanding of public sector deficits. It is probably not an exaggeration to say, though others would be in a better position to make this judgement, that he was one of the economists who played a central role in changing attitudes toward persistent public sector deficits during the mid 1980s, a perspective that continues to be part of Canadian public policy culture.
His paper, “Public sector deficits, international capital movements, and the domestic economy: the medium term is the message,” published in 1985 as the Innis Lecture to the Canadian Economics Association played a role in this rethink. Another related paper is called “Some Unpleasant Keynesian Arithmetic.” We should worry about deficits over the long-term, he argued, because they hamper our capacity to use them in the short-term. The flexibility the Canadian federal government had to run significant deficits as a response to the recession that began in 2008 is, in some significant measure, due to the guidance this perspective gave to the conduct of macro-economic policy of the 1990s.
I didn’t really know what Purvis’s political leanings were. But the impression he left with at least one student was about the value, not of “right” or “left”, of “saltwater” or “freshwater”—after all he was a University of Chicago trained economist who had great admiration for James Tobin, an admiration that was clearly reciprocated—but of just trying to figure out what was best for public policy, and using economic theory as a toolbox to guide that search.