Schultz, Theodore W. (30 Apr. 1902-26 Feb. 1998), economist, was born Theodore William Schultz on a farm near Arlington, South Dakota, to Herry E. Schultz, a farmer, and Anna E. Weiss Schultz. The eldest of eight children who were all expected to work on the family farm, young Theodore had a sporadic early education and never attended high school. Over his parents' objections, he enrolled at South Dakota State College when he was in his early twenties and earned a bachelor's degree in agricultural economics in 1926. He went on to graduate study in the same field at the University of Wisconsin, where he received a master's degree two years later and a Ph.D. in 1930. Schultz later noted that he had been born when times were especially hard for farmers, and from an early age he wanted to find a way to improve the situation of his parents and their farm neighbors. Understanding economics, he came to believe, was the key to improving their circumstances.
In the fall of 1930 Schultz joined the faculty of what was then Iowa State College (now University) as an assistant professor of agricultural economics. He was promoted to associate professor a year later, to chairman of the joint department of economics and sociology in 1934, and to full professor in 1935. Here he began making major contributions to the field of agricultural economics, becoming a pioneer in the study of human capital and in particular ways to improve the position of low-income groups in agriculture, rather than pursuing the discipline's heretofore traditional focus on land and other physical capital. His expertise came not only from books but from firsthand observation, and it was not confined to American agriculture: In 1929, as a graduate student at Wisconsin, he had traveled to Central Europe and Russia to study peasant agriculture; and in 1936, while at Iowa State, he toured farms in Scandinavia and Scotland. In 1941 Schultz traveled to South America as chairman of a U.S. government-sponsored agricultural development mission. His first book, Redirecting Farm Policy, was published in 1943, when the United States was embroiled in World War II and farmers were being asked to produce as much as they could for the war effort. At Iowa State, Schultz also edited the Journal of Farm Economics from 1939 to 1942.
When Schultz left Iowa State in 1943 to become a professor of economics at the University of Chicago, it seemed an obvious career move, but Schultz's resignation was prompted by more than the offer of tenure at a major American university: he was protesting the violation of a colleague's academic freedom. A fellow professor on the Iowa State faculty had written an article in a college publication supporting oleomargarine as a wartime substitute for butter, which dairy farmers were vigorously opposing. When the college administration withdrew the article as unpolitic, Schultz spoke out against the action to no avail and promptly resigned in protest.
During his long career at the University of Chicago, Schultz became an acknowledged expert on low-income groups in agriculture and a major authority on the agricultural economies of underdeveloped countries. His areas of expertise were reflected in the titles of the nine books he wrote over more than three decades; many of them became standard texts: Agriculture in an Unstable Economy (1945), Production and Welfare of Agriculture (1949), The Economic Organization of Agriculture (1953), The Economic Value of Education (1963), Transforming Traditional Agriculture (1964), Economic Crises in World Agriculture (1965), Economic Growth and Agriculture (1968), Investment in Human Capital: The Role of Education and of Research (1971), and Human Resources/Human Capital: Policy Issues and Research Opportunities (1972). Schultz was also the principal author of a major study for the United Nations, Measures for Economic Development of Underdeveloped Countries (1951).
In addition to his books, Schultz wrote numerous articles for academic journals, and he also contributed essays to major books on economic issues, including Poverty amid Affluence, edited by Leo Fishman (1966). Schultz remained at the University of Chicago until his retirement as an emeritus professor in 1972, serving as chairman of the economics department from 1946 to 1961 and holding the Charles L. Hutchinson Distinguished Service chair from 1952 until 1972. As an emeritus professor he stayed active as a prominent scholar in his field and was a familiar presence at the university, walking daily across campus to his office no matter how severe the weather. He continued to publish in academic journals and contribute essays to several book-length collections, including Human Migration, edited by William H. McNeill and Ruth Adams (1978). He also edited several collections of essays, including Economics of the Family: Marriage, Children, and Human Capital (1974).
Beginning in the 1950s, Schultz was active as a consultant to a number of U.S. government agencies, including the Federal Reserve Board, the Agency for International Development, and four cabinet departments. In addition, he served as a consultant to several United Nations agencies, including the Food and Agriculture Organization and the International Bank for Reconstruction and Development, and was also a consultant to the Ford and Rockefeller foundations, the Carnegie and RAND corporations, and the Brookings Institution. Between 1949 and 1967 he held a series of administrative posts with the National Bureau of Economic Research. For many years he was a trustee of both the Population Council and the International Agricultural Development Service.
Schultz received a number of awards over the course of his long career, the most important being the Nobel Memorial Prize in economic science when he was seventy-seven years old. He shared the 1979 prize with Sir Arthur Lewis, a West Indian economist who, complementing the work of Schultz, had devoted most of his professional life to the economic betterment of poor countries. In its citation, the Nobel Committee applauded Schultz for arguing strongly against "policies in developing countries that emphasized industry at the expense of agriculture and urban consumers at the expense of farm people and expanded food production. The rapid adoption by low-income countries in the mid-1960s of the new high-yielding varieties of rice and wheat was fully consistent with his conclusions."
Schultz was married to Esther F. Werth; the couple had two daughters and a son. He died at a nursing home in Evanston, Illinois.
The Theodore William Schultz Papers are at South Dakota State University, Brookings, S.Dak. For biographical information, see William Robbins, "Theodore William Schultz," New York Times, 17 Oct. 1979; and "Schultz, Theodore William," in Contemporary Authors, vols. 85-88 (1980). See also "Nobel Economics Prize Shared by Two Professors," New York Times, 17 Oct. 1979; and Leonard Silk, "Human Capital Is Nobel Focus," New York Times, 17 Oct. 1979. An obituary appears in the New York Times, 2 Mar. 1998.
Ann T. Keene
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Ann T. Keene. "Schultz, Theodore W.";
American National Biography Online Sept. 2000 Update.