MEMORANDUM

considered to illuminate the calculability of his formula through calculation by hand some
examples in very small dimension.
As is well known he found a middle way by the help of Professor John B. Wilbur of
MIT and his Simultaneous Calculator which could solve – “nearly automatically” –
systems of nine linear equations and given that limitations was very well suited for
Leontief’s purpose.
Outside the normal time for submitting applications Leontief got the Committee’s
permission to submit in November an application for a project called “Computation of
price-quantity changes on basis of an empirical general equilibrium pattern.” The content
of it was set out as follows:
“The problem is that of finding a solution for a very large system of (43) linear
equations. The difficulty of accomplishing a computation task of this sort can
hardly be exaggerated. Reasonable estimates indicate, however, that no more time
will be required than that for the calculation of a long index number series. Should
the general equilibrium theory be ever put to practical use, computations of this
type and often of even far greater proportions appear to be unavoidable. I am
inclined to consider the present project as a test case.”
The required assistance was “One computer” at estimated cost $300, i.e. 600 hours at
50 cents an hour. Wilbur and his Simultaneous Calculator were not mentioned but it seems
pretty obvious that Leontief’s contact with Wilbur must have been established before the
application was sent. The Committee considered the application right away and granted the
amount asked for. Interrelation of prices, output, savings, and investment (Leontief 1937)
was published 8 months later with a lot of calculations in between. 226
Hence Leontief chose, wisely one may add, to rush to publish his results by using an
outdated table and computer equipment which allowed only what he called a “preliminary
study” based on a much smaller table than he had compiled.
The result was – eventually – the Interrelation paper in 1937 (Leontief 1937) which
comprised (1) the input-output structure: (2) the formulae for calculating what the
“impulses of any local primary change into the remotest corners of the economic system”
(p.110); and (3) the numerical calculations. It laid the foundation for the input-output
analysis.
* * *
226 Readers were offered to be supplied on request all relevant minors of the two key determinants
in Leontief ‘s system. (Leontief 1937, p.131n1).
105