Hendrik Houthakker, 83; Economist, Nixon Adviser

Economist Hendrik S. Houthakker was known for his work on consumer behavior theories.
Economist Hendrik S. Houthakker was known for his work on consumer behavior theories. (Family Photo Photo By Harvard U. Foto - Family Photo Photo By Harvard U. Foto)
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By Adam Bernstein
Washington Post Staff Writer
Wednesday, April 23, 2008

Hendrik S. "Hank" Houthakker, 83, a Harvard University economist and presidential adviser renowned for his work advancing theories of consumer behavior, died April 15 at Genesis HealthCare in Lebanon, N.H. He had myasthenia gravis, a neuromuscular disorder that makes swallowing difficult.

Mr. Houthakker (pronounced HOW-tak-er) was the Henry Lee Professor of Economics at Harvard University, where he taught from 1960 to 1994.

He was briefly a senior staff economist to the White House Council of Economic Advisers before serving on the three-member panel from 1969 to 1971 under President Richard M. Nixon.

Among economists, Mr. Houthakker may be best remembered for pivotal contributions he made to the technical analysis of consumer decision-making.

His work on that subject, which first appeared in the journal Economica in 1950, later earned him the American Economic Association's John Bates Clark Medal for the most promising economist younger than 40.

Economics professor Robert A. Pollak of Washington University in St. Louis said Mr. Houthakker resolved an important technical problem in the theory of consumer behavior.

His work emerged from Nobel laureate Paul Samuelson's open question about the relationship between utility theory, in which people make consistent choices over what brings them most happiness, and revealed preference theory that explores complex chains of choices.

Pollak said Mr. Houthakker "found conditions under which the revealed preference approach and the utility approach are observationally equivalent," which settled an important question in the field.

His empirical work on consumer demand developed techniques for estimating relations that could predict consumption or expenditure patterns using prices, incomes and demographic variables such as numbers of people per household.

Hendrik Samuel Houthakker, whose father was a prominent art dealer, was born Dec. 31, 1924, in Amsterdam.

He entered a business high school at his father's urging -- and with the hope he would take over the family's gallery -- but his exposure to economics took him in other directions. He graduated in 1949 from the University of Amsterdam before joining the research staff at Cambridge University's applied economics department.

In 1952, he was invited to the United States to work for the Cowles Commission for Research in Economics at the University of Chicago. He then spent seven years teaching at Stanford University, where he became an economics professor, before joining the Harvard faculty.

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