The 1940s saw the reconciliation of mathematical wartime techniques with social scientific theorizing. This chapter examines how the economy was depicted as a huge optimization problem that would soon be solvable by electronic computers. Investigating input–output analysis as it was done at the Harvard Economic Research Project (HERP) under the directorship of Wassily Leontief illustrates the difficulties of making an economic abstraction work in measurement practice. Chapter 3 draws a trajectory to the Conference of Activity Analysis of 1949, where mathematical economists combined techniques of linear programming with what they saw as conventional economics. The move from planning tools to devices for theoretical speculation came along with a shift in modeling philosophies and notions of realism. Focusing entirely on mathematical formalisms and abandoning the concern with measurement brought about the main research object of the economics profession in the subsequent years: The economy as a flexible and efficient system of production in the form of a system of simultaneous equations. This was the economy that provided the primary point of reference for Solow’s model.

This chapter first looks at important theoretical and statistical critiques of Douglas’s production function research that appeared during WWII. A theoretical line of criticism used neoclassical models to infer what relationship, if any, would exist between parameters of firm production functions and the coefficients estimated by Douglas. A critique from the perspective of the Cowles Commission econometric research program was provided by Marschak and Andrews. The Marschak and Andrews article can be read as a devastating criticism of Douglas’s work, a list of problems that fatally marred the program, but their tone suggested a different conclusion: that Douglas’s pioneering vision of statistically estimating the key relationships of neoclassical value and distribution theory could be realized, given better data and the methods of the Cowles econometricians. The chapter also analyzes Douglas’s 1947 AEA presidential address, which reveals his own understanding (as opposed to that of his coauthors and those who reacted to his work) of what he had accomplished with his 20-year research program.