Richard Stone
Richard Stone was a Keynesian economist and trailblazer in the development of systems of national accounting, for which he received the 1984 Nobel Prize in economics.
Stone is the writer of Input-Output and National Accounts, and Mathematical Models of the Economy and Other Essays.
Richard Stone kicked the bucket on Dec. 6, 1991.
Early Life and Education
Richard Stone was brought into the world on Aug. 30, 1913, in London, England. He earned a degree in economics from Cambridge University in 1935. As a member of the Political Economy Club at King's College, Stone examined with economist John Maynard Keynes.
During World War II, he filled in as an economist for the Central Economic Information Service of the Offices of the War Cabinet. In 1945, Stone was selected director of the department of applied economics at Cambridge University, where he stayed as a teacher until 1980.
Twofold Entry Accounting
Stone was the principal economist to integrate [double-passage accounting](/twofold section) into national accounts. Generally alluded to as balancing the books, this method requires each income thing on a balance sheet to be offset by a relating expenditure.
As a member of the Central Economic Information Service of the Offices of the War Cabinet in 1940, Richard Stone assisted future Nobel Laureate James Meade in reviewing the economic situation of the United Kingdom during World War II.
The pair developed the United Kingdom's most memorable national accounting of economic statistics, enumerating all government income and consumption. Under the guidance of John Maynard Keynes, their white paper, named "An Analysis of the Sources of War Finance and an Estimate of the National Income and Expenditure in 1938 and 1940," gave a system that undeniable the beginning of a national account.
Richard Stone's method of measuring investment, government spending, and consumption at the national level characterized the System of National Accounts (SNA), the international standard for measuring a nation's economic activity. Starting around 1947, the SNA has been executed globally and utilized by international organizations like the United Nations.
Striking Accomplishments
In 1962, Richard Stone helped to establish the Cambridge Growth Project with Alan Brown. Utilizing economic statistics and econometrics, the team made a complete study of the British economy soon after World War II.
At the Cambridge Growth Project, Stone and Brown standardized the utilization of a social accounting matrix (SAM), which addresses the flow of all economic transactions that happen inside an economy. It is a matrix representation of the national accounts for a given country and can be extended to incorporate non-national accounting flows for a whole region.
In 1970, Stone turned into the chair of the Faculty Board of Economics and Politics at Cambridge University. He filled in as leader of the Royal Economic Society from 1978 to 1980.
The Bottom Line
Richard Stone's contribution to national income accounting resonates globally today. His incorporation of the twofold passage method made an international standard for nations and international organizations.
Features
- He earned the Nobel Prize in economics for standardizing national accounts in view of twofold section accounting.
- Richard Stone was a Keynesian economist known as the "father of national income accounting."
- Sir Richard Stone was respected with a knighthood by Queen Elizabeth II in 1978.
FAQ
How Did Richard Stone's Statistical Work in the United Kingdom Influence Other Nations?
Richard Stone's Cambridge Growth Project concentrated on the British economy utilizing his Social Accounting Matrix (SAM), a matrix representation of the national accounts for the United Kingdom. Nonetheless, this method interpreted globally and furnished any nation with a snapshot of its economy utilizing input-output analysis.
How Did Richard Stone Influence Global Accounting Standards?
Richard Stone characterized the System of National Accounts. Planned for use by all countries at all phases of economic development, the SNA gives a system to working out economic statistics and a method for overseeing national accounts.
What Was Richard Stone's Publication "Patterns?"
Richard Stone's most memorable examinations of British economic conditions were definite in Trends, a small London publication that Stone composed consistently and right off the bat in his career. Stone covered points like employment, output, consumption, retail trade, investment, and foreign trade.
