Lindahl and Frisch: Linking macroeconomics and national accounting in the interwar years for economic policies and planning

Abstract

The specific Scandinavian contribution to national accounting relates to the links knitted by Ragnar Frisch and Erik Lindahl between macroeconomics and national accounts in the 1930's. They share a common epistemological aim and a common theoretical inheritance. Firstly they were both driven by the ambition to get concepts and analytical framework for understanding business cycles and for designing economic policies. This conceptual work is strongly embodied to empirical investigations, national accounts being viewed as the experimental basis for macroeconomics and the base for policy and planning purposes. Secondly we will show that their common methodological ambition was rooted in sharing of the legacy of Wicksell's theoretical proposals. This could explain why Frisch and Lindahl both distinguish real items from financial items, real from financial accounts, real from financial economic circulation in order to stress the impact of money on real economic phenomena. They also attempted to carry on in their respective national accounts an ex ante/ex post analysis in order to underline the role of the agents' anticipations in the economic processes and cycles.