MEMORANDUM

As soon as the July 1929 issue of Weltwirtschaftliches Archiv with Leontief’s supply
and demand study had been published some copies were sent to Leontief in Shanghai
together with a fairly long list of names of economists to whom offprints had been sent. As
the journal and the offprints were distributed around the world letters of the
acknowledgement were returned in a steady flow to Harms, some of them addressed to
Leontief. It was an immediate and largely positive response, although superficial. Proper
comments and journal reviews took longer time.
One of the first scholarly comments came from Arthur Bowley at London School of
Economics and arrived early, already at the end of July 1929. Bowley wrote that he was
“greatly interested in Dr. Leontief’s brilliant analysis” and had reworked the mathematics
from another point of view and arrived at a resulting equation he claimed to be simpler but
equivalent to that of Leontief. He had prepared a note about his analysis. As Bowley was
going on vacation somewhere in Holstein, he suggested a meeting at the Kiel Institute to
discuss the issues. 114
Bowley came to the Institute on Monday 19 August 1929. Colm was not present as he
was vacationing in Switzerland. In a letter on the following day Meyer gave Colm an
account of the proceedings with copy sent to Leontief in Shanghai. Meyer’s impression
was that Bowley had substantial points to make but would rather have enjoyed his vacation
than having a drawn-out confrontation with the Institute staff when Leontief was not
present.
The discussion was conducted in English and it was mostly left to Robert Schmidt to
speak for the Institute. Schmidt was (partly) responsible for the mathematics that Bowley
had objected to and had to admit that Bowley’s mathematical reasoning achieved to a great
extent what Schmidt had tried to do through more complicated and less transparent
reasoning.
A key point in Leontief’s paper was the splitting the time series into two periods.
Bowley argued that splitting the material into two equal periods had no advantage over
practically any other way of splitting the material; any way of splitting it was equally
useful. He even argued that it could be just as useful to ignore the time dimension
altogether. Schmidt insisted against Bowley that splitting the data in two equal sub-periods
had advantages over all other alternatives and elaborated on his criterion of
Prägnanzmassdeveloped for this problem but not yet completely worked through, see
Schmidt 1930.
In the evening there was a social gathering at Löwe’s. During the evening Bowley had
said that Keynes didn’t understand mathematics. Meyer passed this on to Colm with the
remark that Roberts Schmidt had said pretty much the same about Bowley’s
114 Bowley to Harms, 20 July 1929.
45