Maurice Allais was a French physicist and economist who contributed pioneering work in the theory of markets and efficient use of resources. He won the Nobel Memorial Prize in Economics in 1988, along with John Hicks, for his contributions to economics. In this article by Zatrun.com, you can find everything you need to know about Maurice Allais.
Who is Maurice Allais?
Allais received his education from various institutions, including Lycée Lakanal and École Polytechnique, and worked as a professor of economics at the École Nationale Supérieure des Mines de Paris, where he also served as the director of the Economic Analysis Center.
Maurice Allais initially focused on concrete sciences and fundamental physics experiments, but he shifted his focus to economics after a trip to the United States in 1933. Allais was a defender of Keynesian liberalism and a proponent of the public sector. He also attended the opening meeting of the Mont Pelerin Society but was the only person to refuse to sign the declaration. Allais had a significant impact on French economists after the war, and he is considered a giant in the world of economic analysis.
Allais received his doctorate in engineering from the Faculty of Science at the University of Paris and went on to teach at various universities throughout France. He was particularly influenced by economists such as Léon Walras, Wilfredo Pareto, and Irving Fisher, and he defended Keynesian liberalism. Allais contributed to the concept of neoclassical synthesis in the book “Traité d’économie pure” which he co-authored with Hicks and Samuelson.
His Major Works and Ideas
In “Traité d’économie pure” book, Maurice Allais made general and detailed formulations of many theorems and propositions previously suggested by other economists, particularly Arrow and Debreu’s theorem of maximum efficiency. He also addressed the dynamics and growth of capitalist economies by defining time and currency units.
Allais introduced the overlapping generations model (OLG model), defined the optimal growth golden rule and monetary rule, and was one of the first to work in the field of behavioural economics. Paul Samuelson commented that the Nobel Prize should have been awarded to Allais much earlier, and Lars Olof Lindbeck described Allais as a giant in the world of economic analysis.
Although Maurice Allais joined the Mont Pelerin Society, he acknowledged the close relationship between liberalism and socialism: “For a true liberal or socialist, it is not very important whether the means of production are privately or collectively owned, the key is to achieve the goals of efficiency and justice.” Allais supported the “synthesis of liberalism and socialism” by advocating for competitive planning. He, along with other French members such as Jacques Rueff, founded the “Movement for a Free Society,” which aimed to go beyond “social liberalism.”
Maurice Allais and his Position Against Globalisation
In his book “La Mondialization: Struction des Emplois et de la Croissance” (1990), Allais dedicates it to the numerous victims of the ideology of free trade worldwide: “The ideology of free trade is as deadly as it is lethal to anyone who is not blinded by partisan passions.” Allais believed that Ricardo’s theory was only valid in a static state, but disappeared when specialisations developed, and capital became mobile.
According to Maurice Allais, “Globalisation can only bring instability, unemployment, and injustice everywhere…and ‘widespread globalisation is neither inevitable, necessary, nor desirable.'” Furthermore, he believed that reasonable protectionism is necessary between different-income countries and that the lack of protectionism would lead to the destruction of all industries.
Allais believed that the crisis and globalisation were interconnected, and that “the financial and banking crisis is a striking sign of the deregulation of competition in the global labour market.” He also stated that the current unemployment was caused by the wholesale liberalization of trade, which created an incredible paradox.
Allais criticised the emphasis on free trade in the Maastricht Treaty in 1992 and expressed similar concerns about the European Constitution in 2005.
