In Memoriam: Prominent Economist Allen C. Kelley Dies at Age 80

Monday, December 18, 2017
In Memoriam: Prominent Economist Allen C. Kelley Dies at Age 80

Allen C. Kelley, a James B. Duke Professor Emeritus of Economics, died Dec. 9 at the age of 80. Kelley was a prominent leader in the profession, and throughout his nearly 50 years as an economist — 38 of which were spent at Duke University — Kelley’s research and writing helped to transform the then-emerging fields of development economics and economic demography.

“In the 1970s, the field of development economics had been transformed by a small group who developed the first computational general equilibrium (CGE) simulation models,” said Professor Charles Becker, who first met Kelley in January 1981 but had heard of him long before then. “The first and most profound of these was Allen Kelley’s book with Jeffrey Williamson and Russell Cheetham, ‘Dualistic Economic Development: Theory and History.’ The ‘KWC’ model, as it was commonly known, explained economic development using tools that would be considered simple today, but which at the time were revolutionary — a multi-sector, multi-factor, market clearing model with capital accumulation.”

Becker said he was also fascinated by Kelley’s work as an economic demographer: “He had the fortune to be most active during a period of huge demographic transition: plummeting mortality, followed only with a significant lag by declining fertility, and hence rapid population growth in the interim. Allen was one of a new generation of nuanced scholars in the area, committed to exploring the effects of demographic change on a wide range of economic variables, and also to linking economic events to demographic change.”

Kelley’s research took him — and his wife and children — all over the world, and his office memorialized these adventures abroad. “Allen told me stories of his time at Melbourne and Monash Universities in Australia and in Kenya, adventures that I too coveted, and ultimately achieved,” said Professor Edward Tower. “His wall was decorated by long, slender spears with a variety of spearheads, and wildlife photos from Kenya.”

Born Sept. 5, 1937 in Everett, Wash., Kelley first attended Linfield College in McMinnville, Ore. but ultimately graduated Phi Beta Kappa from Stanford University in 1959. He was awarded a Ph.D. in economics, also from Stanford, in 1964. Kelley held an appointment at the University of Wisconsin at Madison prior to joining the faculty at Duke University in 1973. A year into his tenure at Duke, he began a six-year term as chair of the Department of Economics.

“During his time as chair, Allen aggressively recruited some very distinguished senior faculty to complement the excellent senior faculty in place. Team Allen greatly sharpened the research focus of the department. Most crucially, it underscored the importance of a strong graduate program for a top-flight department,” said Professor George Tauchen, who took his first economics course from Allen at Wisconsin in 1968 and was hired at Duke as a new Ph.D. in 1977 when Allen was chair.

In fact, one of Allen’s most important contributions to the department was the generation of endowment funds for first-year Ph.D. students, which enables all new Ph.D. students to focus on core coursework without the added responsibilities of TA or RA duties. The outcome of this effort, made nearly 40 years ago, still directly benefits the department’s Ph.D. program today.

Professor Thomas Nechyba recalled the mentorship and advice Kelley offered to him back in the early 2000s, when he, like Kelley had so many years ago, found himself in the unexpected position of becoming department chair at a young age.

“Allen also imparted much wisdom to me that benefitted me personally and, though few knew about it, the department as a whole. ‘Get the administration’s commitments in writing,’ he told me. I used that many times — and to this day, the agreements are there in writing. I am not sure we could have succeeded without this, and many other pearls of wisdom, Allen imparted to me, and I am sure to others. And so his legacy lives on. Even after I was done with my tour of duty, Allen and I continued to have lunch, and I will always treasure his generosity. I know there are thousands of students who feel the same way.”

Alumni may remember Kelley for his passion for undergraduate education, particularly the introductory economics course for freshmen, and he inspired that same passion in those who knew him.

“Allen shunned the idea that first-class teaching was for second-class scholars. In fact, Allen gave me the courage to give a lecture to 1,200 first-year economics students whilst I was a new graduate student at the University of Wisconsin,” recalled Simon Fraser University Professor Emeritus Don J. DeVoretz, whose research interests on the economic impact of citizenship and immigrant labor market outcomes were largely shaped by Kelley’s work on population economics. “That experience alone taught me the importance of preparation for first-class teaching and the joy you could get from teaching.”

“Allen was determined to use the course to engage students and make them reason, at least occasionally, like economists,” Becker said. Over the years, he also studied the determinants of student learning at the undergraduate level, as well as the status and prospects of economics majors.

He was a pioneer in the use of technology in economics education, specifically the Teaching Information Processing System (TIPS), a computerized instructional system he developed at the University of Wisconsin in the late 1960s to simulate the type of personalized and immediate feedback in classes with hundreds of students that he provided in his Stanford classes of 25. It was adapted for use at Duke for many years.

The course that Tauchen took as a sophomore at Wisconsin, macroeconomic principles, had 500-plus students. The TIPS program required students to take weekly quizzes, and depending upon the answers, adaptively guided students towards more intensive study of the relevant sections of text and lecture notes where particular weaknesses were detected.

But Kelley’s class offered more than just a novel use of technology.

“Allen’s enthusiastic introduction to macroeconomics significantly influenced my choice of economics as a major. (He) played a role in there now being one more econometrician than accountant in this world,” Tauchen said.

Another of his students, Professor Robert Schmidt (MAE ’76, Ph.D. ’81), said he is especially indebted to Kelley. In his words, “Allen opened the eyes of a small-town Wisconsin boy to a much larger and more fascinating world. I worked as his research assistant while an undergraduate at Wisconsin and graduate student at Duke and eventually as a collaborator while at the University of Richmond. I worked with him on TIPS and more extensively on his research into the interplay between demographic change and economic growth. In the process, Allen opened up wonderful opportunities for international travel, highlighted by the eight months spent in Vienna during his 1979 sabbatical at the International Institute for Applied Systems Analysis.”

Kelley is survived by his wife of 58 years, Patty, and their children, Brian (Marian), Mark (Amber), and Michael (Leslie), and grandchildren, Grant (Laura), Allison, Zoe, Aidan, Campbell, Amelia, Thomas, and John.

A private family service will be planned. Memorial donations can be made to The Durham Rescue Mission, Duke University, or the Lewy Body Dementia Association.