MEMORANDUM

I. Scope of the investigation:
Some markets of non-agricultural products for which sufficient data on
prices, production, consumption and stocks are available; such as:
a. in the sphere of consumer goods: textiles, automobiles, boots and
shoes etc.
b. in the sphere of producers goods: metals, coal, building materials etc.
II. Objective of the investigation:
a. Analysis of the different markets as to kind and magnitude of
their elasticity. Combining Marshall’s distinction between long
and short period elasticities with the usual timing of statistical
series. A fourfold approach would be advisable: 1) long-run
elasticity; 2) elasticity within the business cycle; 3) seasonal
elasticity; 4) elasticity of minor fluctuations.
b. Interdependence of elasticities. This investigation would be of
special importance for some industrial markets, the commodities
of which bear a close relationship to different stages of the
industrial production (f.ex. raw materials, half-finished goods,
consumer goods).
III. Technicalities:
In order to carry through a research of this scope I would need the
constant help of a statistically well-trained person; I assume that the data
and sources which will be needed will be easily provided by your
Bureau.
The project described was straight out of the Eisenaufsatz and can hardly be said to be
about input-output analysis. Point IIb on the interdependence of elasticities is also worth
noting, as it suggested explaining supply through vertical linkages. It is the first inkling of
moving away from Marshallian partial equilibrium and towards a general equilibrium
approach. One might suggest that Leontief was trying to cope with more aspects of an
industrial economy that he was able to confine into a single analytical scheme.
Exploring options
After the feedback he had got on the applications Leontief had become hopeful of the
possibility of visiting USA in the coming year, either at NBER or Brookings. Leontief
hardly gave any thought at all at this point to the possibility for finding permanent
employment in USA. He was instead concerned with his possibilities in Germany, not least
the Konjunkturinstitut in Berlin. Although the Kiel Institute had been a good place to work
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