Gustav Cassel

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Gustav Cassel
Born(1866-10-20)20 October 1866
Died14 January 1945(1945-01-14) (aged 78)
InstitutionStockholm University
FieldMathematical economics
School or
Stockholm School
Alma materUppsala University
Gösta Mittag-Leffler
Gunnar Myrdal
Bertil Ohlin
Eli Heckscher
Gösta Bagge
InfluencesLéon Walras
ContributionsPurchasing power parity,
work on interest

Karl Gustav Cassel (20 October 1866 – 14 January 1945) was a Swedish economist and professor of economics at Stockholm University.


Cassel's perspective on economic reality, and especially on the role of interest, was rooted in British neoclassicism and in the nascent Swedish schools. He is perhaps best known through John Maynard Keynes' article Tract on Monetary Reform (1923), in which he raised the idea of purchasing power parity.

"Cassel was beyond doubt one of the outstanding figures in economic science during the inter-war period. His authority was second only to that of Lord Keynes, and his advice was eagerly sought on many occasions by his own Government and by foreign Governments."[1]

He was also a founding member of the Swedish school of economics, along with Knut Wicksell and David Davidson. Cassel came to economics from mathematics. He earned an advanced degree in mathematics from Uppsala University and was made professor at Stockholm University during the late 1890s but went to Germany before the turn of the century to study economics, publishing papers spanning just under forty years.

Apart from the rudiments of a purchasing power parity theory of exchange rates (1921), he produced an 'overconsumption' theory of the trade cycle (1918). He also worked on the German reparations problem. He was a member of many committees dealing with matters of state in Sweden and devoted much labour to the creation of a better system of budget exposition and control (1905–21). He was one of the Swedish representatives at the International Chamber of Commerce meeting in London in 1921. He became a member of Svenska Vetenskapsakademien and correspondent for Sweden to the Royal Economic Society.[2]

Theoretische Sozialökonomie, 1923

In addition to his books in Swedish, he published the following works in other languages: Das Recht auf den vollen Arbeitsertrag (1900), The Nature and Necessity of Interest (1903), Theoretische Sozialökonomie (1919). His Memorandum on the World's Monetary Problems, published by the League of Nations for the International Financial Conference in Brussels in 1920, attracted widespread attention.[2]

Some of his notable students include Nobel Prize in Economics laureates Bertil Ohlin and Gunnar Myrdal, and the future Moderate Party leader Gösta Bagge.


  1. ^ Einzig, P. (10 February 1945). "Obituary". Nature. 155 (3928): 167. doi:10.1038/155167a0.
  2. ^ a b Wikisource Chisholm, Hugh, ed. (1922). "Cassel, Gustav". Encyclopædia Britannica (12th ed.). London & New York.

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