The primary goal of the NBER has always been to sponsor and promote the objective, scientific investigation of economics. It concentrates on four main types of research: (1) the development of statistical measures of the economy, (2) the estimation of quantitative models of human behavior, (3) the analysis of how existing government policies are affecting the economy, and (4) the analysis of how proposed government policies are likely to affect the economy.

A Little Background

The NBER emerged as an objective, scientific research organization largely due to the leadership of Wesley C. Mitchell, the original Director of Research and the man who guided the NBER for the first twenty-five years of its existence. Prior to his work with the NBER, Mitchell was a Professor of Economics at Columbia University, specializing in the quantitative analysis of business cycles.

The first research project completed under Mitchell's directorship was a ground breaking quantitative analysis of the structure, composition, and distribution of national income. This particular project was important for several reasons.

• First, it established the NBER as an objective, scientific research organization. It clearly demonstrated to policy makers, business leaders, and other economists that the NBER was serious about pursuing scientific economic research.


• Second, it created the standard for future scientific studies of economics. The methods and data used in the quantitative analysis of national income was thoroughly documented for any inquiring mind to peruse.


• Third, it developed some of the measurement methodology for what later became the National Income and Product Accounts that measure gross domestic product and related income and expenditure components.


• Fourth, it laid the foundation for the theoretical analysis of macroeconomic phenomena, especially the development of Keynesian economics. It also created the necessary data used to investigate the nuts and bolts that makeup the structure of the macroeconomy.

Business Cycles

Among other things, this research led to the creation of the business cycle indicators (leading, coincident, and lagging economic indicators) and the dating of business cycle turning points--peaks and troughs. The NBER remains the "official" designator of "official" business cycle peaks, troughs, expansions, and contractions.

A Distinguished Cast

• Simon Kuznets: A Nobel Prize winner who pioneered work on national income accounting while at the NBER. He also had a hand in ground breaking research in business cycles and economic development.


• Milton Friedman: Another Nobel Prize winner and major proponent of monetarism who investigated the demand for money and the determinants of consumer spending while affiliated with the NBER.


• Arthur F. Burns: In addition to his work on business cycles at the NBER, he also spent a little time as Chairman of the Federal Reserve System, President of the NBER, Chairman of the Council of Economic Advisors, President of the American Economic Association, and even U.S. Ambassador to Germany.


• Martin Feldstein: Another President of the NBER who also served as a Chairman of the Council of Economic Advisors. He is noted for his work on the study of tax policies and the federal deficit.