Who is Abba Lerner?

Born on 28 October 1903, Abraham (Abba) Ptachya Lerner was a Russian-born British economist who was influenced by socialist movements in economics. Lerner entered London School of Economics in 1929 where he published several top-rank papers about international trade theory and general equilibrium theory that brought him attention. After his student career in London School of Economics, he met with John Maynard Keynes, the founder of Keynesian economics in Cambridge. His works with John Maynard Keynes have made him famous and he is seen as one of the pioneers of Keynesian revolution. In 1937 he moved to United States where he began his teaching career in universities.

In 1934 Lerner published his well-known paper about Pareto-optimality, where he introduced all the important Paretian rule for efficiency. His contributions to Paretian theory have led him to join the Socialist Calculation debate with Oskar Lange. In most of his works, he emphasized the efficiency that can be attained by the P=MC rule. While he adopted the socialism, Lerner was never a narrow-minded economist, he always stated that private enterprise should take over any industry in a socialist economy if it’s more efficient. In 1944, Lerner published “The Economics of Control” where he gathered his works on socialism, trade, welfare and Keynesian theory together. He also brought new ideas in this book about optimal distribution of income arguing that equal distribution of income is optimal, which led to a debate with Milton Friedman. After 1944 he mostly focused on economic policy rather than economic theory. 

With his many contributions in the field of economics, Abba Lerner is considered as one of the pioneers of Keynesian revolution and one of the most important economists of 20th century. His works on international trade, welfare, investments and savings in Keynesian theory have brought different points of view to economics which could have easily won a Nobel Prize.