August 5: Vasily Leontief, an economist from Petrograd who became a Nobel laureate
On August 5, 1905, Wassily Leontief, an economist, creator of the theory of inter-industry analysis, and Nobel Prize laureate, was born in Munich to a family of professors. He spent his childhood in Petrograd and achieved international fame after emigrating to the United States.
Childhood in Petrograd
Leontiev's father taught economics at the university, and his mother was a teacher and graduated from the Bestuzhev Women's Courses. The parents married in London while expecting a son. Less than a month after Vasily's birth, when his father defended his doctoral dissertation in Germany, the family returned to Russia and settled in Petrograd. The boy was educated at home: his mother taught him several languages, and other subjects were taught by student tutors.
At the age of 16, having completed the two senior classes of the unified labor school, Leontyev entered the Faculty of Social Sciences at Petrograd University.
Arrest and banned article
Leontyev was a member of an underground socialist bloc, which included opposition-minded students. In 1922, at the age of 17, he was arrested for posting RSDLP (Menshevik) leaflets and spent several weeks in custody.
He translated Karl Schaeffer's new book, "Classical Systems of Currency Stabilization," from German, and it was published in the USSR. However, his own article, reflecting on the future of science, was banned from publication. After this, Leontiev decided to emigrate:
It was a historical and analytical article, terribly removed from politics and ideology. And if even that was banned, I realized it would be impossible to do research here.
He didn't leave right away. In 1924, at the age of 19, he graduated from university and spent several more months working at universities—at the Leningrad Institute of National Economy and the Polytechnic Institute.
Germany and China
In 1925, 20-year-old Leontiev was allowed to travel to Germany for treatment for a tumor. The OGPU believed he was dying anyway, mistaking the tumor for a malignant sarcoma. German doctors later refuted this diagnosis.
Leontiev studied economics at the University of Berlin under the guidance of the classic German sociologist Werner Sombart. After defending his doctoral dissertation, "The Cycle of the Economy," he worked at the Institute for World Economics in Kiel. In 1928, he was invited to China to serve as an advisor to the Minister of Railways. For a year, he worked on optimizing the country's transportation routes and freight transport.
Emigration to the USA
In 1931, Leontief left for America. He joined the National Bureau of Economic Research, headed by Wesley Mitchell, and taught at Harvard and New York University. In 1932, after marrying an American, he received US citizenship.
I've always been too independent. It's hard to be independent in America when you need to finance your work. But in the USSR, I'm afraid, it would have been much worse.
The Input-Output Matrix and the Nobel Prize
After the outbreak of World War II, Leontief consulted for the US Air Force. Under his leadership, an input-output matrix was developed for the German economy, which served as the basis for target selection by the US military. In 1973, he received the Nobel Prize in Economics.
In the 1970s, Leontief consulted on major UN projects, founded the Institute for Economic Analysis at New York University, and made history as an innovator in the field of macroeconomic modeling and input-output theory.
Returning with advice for restructuring
In 1988, Leontyev was invited to the Soviet Union as an expert on perestroika. He compared managing the country's economy to navigating a yacht at sea:
For things to go well, you need a wind—that's interest. The rudder is government regulation. The American economy has a weak rudder. In the Soviet Union, on the contrary, the wind doesn't fill the sails—then the rudder doesn't help. The Japanese are more correct: they have private initiative and a strong government role.
In the early 1990s, Leontyev visited Russia and offered his assistance in reforming the post-Soviet economy. Returning to America, he said:
I won't go there again. They don't listen to anything.
Recognition and recent years
In 1992, Leontiev signed the "Warning to Humanity"—a manifesto by more than 1700 scientists declaring that humanity was on the brink of catastrophe and urgent change was needed. He was the recipient of several prestigious professional awards, the French Legion of Honor, and the Japanese Order of the Rising Sun.
Vasily Leontiev died in New York in 1999, at the age of 93, from cardiac arrest.
