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The Shaping of Public Economic Discourse in Postwar America: The 1947 Meat Shortage and Franco Modigliani’s Meat Plan

In: A Research Annual

Author

Listed:
  • Michele Alacevich
  • Pier Francesco Asso
  • Sebastiano Nerozzi

Abstract

This paper discusses the American debate over price controls and economic stabilization after World War II, when the transition from a war economy to a peace economy was characterized by bottlenecks in the productive system and shortages of food and other basic consumer goods, directly affecting the living standard of the population, the public opinion, and political discourse. Specifically, we will focus on the economist Franco Modigliani and his proposal for a “Plan to meet the problem of rising meat and other food prices without bureaucratic controls.” The plan prepared by Modigliani in October 1947 was based on a system of taxes and subsidies to foster a proper distribution of disposable income and warrant a minimum meat consumption for each individual without encroaching market mechanisms and consumers’ freedom. We will discuss the contents of the plan and its further refinements, and the reactions it prompted from fellow economists, the public opinion, and the political world. Although the Plan was not eventually implemented, it was an important initiative for several reasons: first, it showed the increasing importance of fiscal policy among postwar government tools of intervention in the economic sphere; second, it showed a third way between direct government intervention and full-fledged laissez faire, in tune with the postwar political climate; third, it proposed a Keynesian macroeconomic approach to price and income stabilization, strongly based on econometric and microeconomic foundations. The Meat Plan was thus a fundamental step in Modigliani’s effort to build the “neoclassical synthesis” between Keynesian and Neoclassical economics, which would deeply influence his own career and the evolution of academic studies and government practices in the United States.

Suggested Citation

  • Michele Alacevich & Pier Francesco Asso & Sebastiano Nerozzi, 2015. "The Shaping of Public Economic Discourse in Postwar America: The 1947 Meat Shortage and Franco Modigliani’s Meat Plan," Research in the History of Economic Thought and Methodology, in: A Research Annual, volume 33, pages 3-42, Emerald Group Publishing Limited.
  • Handle: RePEc:eme:rhetzz:s0743-415420150000033001
    DOI: 10.1108/S0743-415420150000033001
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    More about this item

    Keywords

    Price controls; Franco Modigliani; postwar reconstruction; postwar economic policy; B3; B22; N52;
    All these keywords.

    JEL classification:

    • B3 - Schools of Economic Thought and Methodology - - History of Economic Thought: Individuals
    • B22 - Schools of Economic Thought and Methodology - - History of Economic Thought since 1925 - - - Macroeconomics
    • N52 - Economic History - - Agriculture, Natural Resources, Environment and Extractive Industries - - - U.S.; Canada: 1913-

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