The making of the Leif Johansen multi-sectoral model

The paper traces the roots of Leif Johansen’s 1960 monograph A Multi-Sectoral Study of Economic Growth, recognized as the first computable general equilibrium (cge) model. Although Johansen might have been much attracted towards a purely theoretical study of a multi-sectoral equilibrium growth process he chose to construct an empirical model, calibrated to fit the Norwegian economy in 1950. Johansen’s Model combined Leontief ’s input-output analysis with Solow-type production functions and a Frisch-influenced specification of consumption demand. His work became influential on the further cge development. Johansen died at the age of 52 in 1982 and is regarded as the (only) intellectual heir of his teachers Ragnar Frisch and Trygve Haavelmo in originality and profoundness.