Editing James Tobin (section)

==Life and career==

===Early life===
Tobin was born on March 5, 1918, in [[Champaign, Illinois]]. His father was Louis Michael Tobin (b. 1879), a journalist working at the [[University of Illinois at Urbana–Champaign]]. His father had fought in [[World War I]], was a member of the first [[Fraternities and sororities|Greek]] organization at Illinois ([[Delta Tau Delta]] fraternity Beta Upsilon chapter), and was credited as the inventor of "Homecoming." His mother, Margaret Edgerton Tobin (b. 1893), was a social worker. Tobin attended the [[University Laboratory High School of Urbana, Illinois]], a [[laboratory school]] in the university's campus.<ref name="autobio">[http://nobelprize.org/nobel_prizes/economics/laureates/1981/tobin-autobio.html Tobin, James. "Autobiography"], published in ''Nobel Lectures. Economics 1981–1990'', Editor [[Karl-Göran Mäler]], World Scientific Publishing Co., Singapore, 1992</ref>

In 1935, on his father's advice, Tobin took the entrance exams for [[Harvard University]]. Despite no special preparation for the exams, he passed and was admitted with a national scholarship from the university. During his studies he first read [[John Maynard Keynes|Keynes]]' ''[[The General Theory of Employment, Interest and Money]]'', published in 1936. Tobin graduated ''[[summa cum laude]]'' in 1939 with a thesis centered on a critical analysis of Keynes' mechanism for introducing equilibrium [[involuntary unemployment]]. His first published article, in 1941, was based on this senior thesis.<ref name="solowbio">{{cite journal |author=Solow Robert |author-link=Robert Solow |year=2004 |title=James Tobin |journal=Proceedings of the American Philosophical Society |volume=148 |issue=3}}</ref>

Tobin immediately started graduate studies, also at Harvard, earning his [[Master of Arts|AM]] degree in 1940. In 1941, he interrupted graduate studies to work for the [[Office of Price Administration and Civilian Supply]] and the [[War Production Board]] in [[Washington, D.C.]] The next year, after the United States entered [[World War II]], he enlisted in the [[US Navy]], spending the war as an officer on [[destroyers]] including (among possibly others) the {{USS|Kearny|DD-432}}.<ref>Reference to USS ''Kearny'' in c. 1965 letter to fellow shipmate Clitus H. Marvin</ref> At the end of the war he returned to Harvard and resumed studies, receiving his Ph.D. in 1947 with a thesis on the [[consumption function]] written under the supervision of [[Joseph Schumpeter]].<ref name="cowles">{{cite book |first=James |last=Tobin |chapter=James Tobin |title=Lives of the Laureates, Seven Nobel Economists |editor-first=William |editor-last=Breit |editor2-first=Roger W. |editor2-last=Spencer |publisher=The MIT Press |location=Cambridge, Massachusetts, London, England |year=1986 |chapter-url=http://cowles.econ.yale.edu/archive/reprints/tobin_86_laureate.htm |archive-date=August 26, 2003 |url=http://cowles.econ.yale.edu/archive/reprints/tobin_86_laureate.htm |archive-url=https://web.archive.org/web/20030826020431/http://cowles.econ.yale.edu/archive/reprints/tobin_86_laureate.htm |url-status=dead }}</ref> In 1947 Tobin was elected a Junior Fellow of Harvard's [[Society of Fellows]], which allowed him the freedom and funding to spend the next three years studying and doing research.

===Academic activity and consultancy===
In 1950 Tobin moved to [[Yale University]], where he remained for the rest of his career. He joined the [[Cowles Foundation]], which moved to Yale in 1955, also serving as its president between 1955–1961 and 1964–1965. His main research interest was to provide [[microfoundations]] to [[Keynesian economics]], with a special focus on [[monetary economics]]. One of his frequent collaborators was his Yale colleague [[William Brainard]]. In 1957 Tobin was appointed [[Sterling Professor|Sterling Professor of Economics]] at Yale.<ref name="'YaleObit">{{cite news |url=http://www.yale.edu/opa/arc-ybc/v30.n22/story5.html |title=Nobel Prize-winning economist James Tobin dies at 84 |volume=30 |number=22 |date=15 March 2002 |newspaper=Yale Bulletin & Calendar |publisher=Yale Office of Public Affairs & Communications |access-date=4 March 2015 |url-status=dead |archive-url=https://web.archive.org/web/20150402121725/http://www.yale.edu/opa/arc-ybc/v30.n22/story5.html |archive-date=2 April 2015 }}</ref>

Besides teaching and research, Tobin was also strongly involved in the public life, writing on current economic issues and serving as an economic expert and policy consultant. During 1961–62, he served as a member of [[John F. Kennedy]]'s [[Council of Economic Advisers]], under the chairman [[Walter Heller]], then acted as a consultant between 1962 and 1968. Here, in close collaboration with [[Arthur Okun]], [[Robert Solow]] and [[Kenneth Arrow]], he helped design the Keynesian economic policy implemented by the Kennedy administration. Tobin also served for several terms as a member of the Board of Governors of [[Federal Reserve System]] Academic Consultants and as a consultant of the [[United States Department of the Treasury|US Treasury Department]].<ref name=CV>James Tobin's [http://cowles.econ.yale.edu/faculty/vita/cv_tobin.pdf CV at the Cowles Foundation's website]</ref>

Tobin was awarded the [[John Bates Clark Medal]] in 1955 and, in 1981, the [[Nobel Prize in Economics|Nobel Memorial Prize in Economics]]. He was a fellow of several professional associations, holding the position of president of the [[American Economic Association]] in 1971. He was an elected member of the [[American Academy of Arts and Sciences]], the [[American Philosophical Society]], and the United States [[National Academy of Sciences]].<ref>{{Cite web |title=James Tobin |url=https://www.amacad.org/person/james-tobin |access-date=2022-12-08 |website=American Academy of Arts & Sciences |language=en}}</ref><ref>{{Cite web |title=APS Member History |url=https://search.amphilsoc.org/memhist/search?creator=James+Tobin&title=&subject=&subdiv=&mem=&year=&year-max=&dead=&keyword=&smode=advanced |access-date=2022-12-08 |website=search.amphilsoc.org}}</ref><ref>{{Cite web |title=James Tobin |url=http://www.nasonline.org/member-directory/deceased-members/49717.html |access-date=2022-12-08 |website=www.nasonline.org}}</ref>

In 1972 Tobin, along with fellow Yale economics professor [[William Nordhaus]], published ''Is Growth  Obsolete?'',<ref>Nordhaus, W. and J. Tobin, 1972. Is growth obsolete?. Columbia University Press, New York.</ref> an article that introduced the [[Measure of Economic Welfare]] as the first model for economic [[sustainability]] assessment, and economic [[sustainability measurement]].

In 1982–1983, Tobin was Ford Visiting Research Professor of economics at the [[University of California, Berkeley]].<ref>{{cite book|last1=Vane|first1=Howard R.|last2=Mulhearn|first2=Chris|title=The Nobel Memorial Laureates in Economics: An Introduction to Their Careers and Main Published Works|year=2005|publisher=Edward Elgar Publishing|page=121}}</ref> In 1988 he formally retired from Yale, but continued to deliver some lectures as [[Professor Emeritus]] and continued to write. He died on March 11, 2002, in [[New Haven, Connecticut]].

Tobin was a trustee of [[Economists for Peace and Security]].<ref>[http://www.epsusa.org/main/history.htm Economists for Peace and Security History] {{webarchive|url=https://web.archive.org/web/20090414011545/http://epsusa.org/main/history.htm |date=2009-04-14 }}: James Tobin among founding Nobel laureates</ref>

===Personal life===
James Tobin married Elizabeth Fay Ringo, a former [[Massachusetts Institute of Technology|M.I.T.]] student of Paul Samuelson, on September 14, 1946. They had four children.<ref>{{Cite web |date=2002-03-12 |title=Professor, Presidential Adviser and Nobel Laureate James Tobin Dies {{!}} Yale News |url=https://news.yale.edu/2002/03/12/professor-presidential-adviser-and-nobel-laureate-james-tobin-dies |access-date=2025-04-29 |website=news.yale.edu |language=en}}</ref>

===Legacy===
In August 2009 in a [[Round table (discussion)|roundtable]] interview in [[Prospect (magazine)|Prospect ''magazine'']], [[Adair Turner]] supported the idea of new global taxes on financial transactions, warning that the "swollen" financial sector paying excessive salaries had grown too big for society. Lord Turner's suggestion that a "[[Tobin tax]]" – named after James Tobin – should be considered for financial transactions made headlines around the world.

Tobin's [[Tobit model|Tobit model of regression]] with [[Censoring (statistics)|censored endogenous variables]] (Tobin 1958a) is a standard econometric technique.  His [[Tobin's q|"q" theory]] of investment (Tobin 1969), the [[Baumol–Tobin model]] of the transactions demand for money (Tobin 1956), and his model of liquidity preference as behavior toward risk (the asset demand for money) (Tobin 1958b) are all staples of economics textbooks.

In his 1958 article Tobin also led the way in showing how to deal with utility maximization under uncertainty with an infinite number of possible states. As Palda explains "One way to get out of the mess of figuring out asset prices using a model of maximizing the expected utility of investing in stocks is to make assumptions about either preferences or the probabilities of the different possible states of the world. Nobellist James Tobin (1958) took this line and discovered that in some cases you do not need to worry about the utility of income in thousands of states, and the attached probabilities, to solve the consumer's choice on how to spread income among states. When preferences contain only a linear and a squared term (a case of diminishing returns) or the probabilities of different stock returns follow a normal distribution (an equation that contains a linear and squared terms as parameters), a simple formulation of a person's investment choices becomes possible. Under Tobin's assumptions we can reformulate the person's decision problem as being one of trading off risk and expected return. Risk, or more precisely the variance of your investment portfolio creates spread in the returns you expect. People are willing to assume more risk only if compensated by a higher level of expected return. One can thus think of a tradeoff people are willing to make between risk and expected return. They invest in risky assets to the point at which their willingness to trade off risk and return is equal to the rate at which they able to trade them off. It is difficult to exaggerate how brilliant is the simplification of the investment problem that flows from these assumptions. Instead of worrying about the investor's optimization problem in potentially millions of possible states of the world, one need only worry about how the investor can trade off risk and return in the stock market."<ref>Palda, Filip (2013). ''The Apprentice Economist: Seven Steps to Mastery''. Ottawa: Cooper-Wolfling Press. {{ISBN|978-0987788047}}</ref>