費雪的一生也是頗多坎坷的。就人生而言，費雪的女兒瑪格麗特在1919年由於精神崩潰而去世。與費雪共同愉快地生活了47年的妻子瑪格麗特·哈澤德於1940年去世。費雪本人在1898年感染了當時被稱為不治之症的肺結核。就事業而言，費雪發明了可顯示卡片指數系統，並取得專利，辦了一個獲利頗豐的可顯示指數公司。後來該公司與競爭對手合並為斯佩里·蘭德 (Sperry Rand)公司。這項事業使他致富，但20世紀30年代大危機之前他借款以優惠權購買蘭德公司股份，大危機爆發後，他的股票成為廢紙。據他兒子估計，損失為800~1000萬美元，連妻子、妹妹和其他親屬的儲蓄都賠進去了。他一文不名，耶魯大學只好把他的房子買下，再租給他住，以免被債主趕出去。他的名聲亦受到打擊。
盡管人生有如此多的挫折，費雪還是健康地活了80歲，這就在於他健康的心態。他深信人性本善，而人類優良天性的保持，有賴於優生。他組織優生學研究會(Eugenics Research Association)、美國優生學會(American Eugenics Society)，並任主席，親自寫成《民族活力報告》(Report of National Vitality)，提出建議。相信人性之善，是一個人心態健康的出發點。
1898年費雪患肺結核病之後，深感衛生保健的重要。他在1913年發起成立生命延續研究所(Life Extension Institute),並擔任該所保健指導委員會(Hygiene Reference Board)主席。他與該所醫學專家費斯克(Fisk)合寫了一本《如何生活》(How to Live)的書，暢談養生之道。該書觀念新穎而又切合實際，成為美國大學和高中的衛生保健教科書，共印行90版次，在美國銷量達40萬冊之多，亦有德、法、日等十幾種文字的譯本，比他的經濟學名著影響要大得多。他反對縱欲，主張禁酒，素食主義，鍛煉身體，養成良好衛生習慣，以及呼吸新鮮空氣。這恐怕是他的肺結核在3年後痊愈，他又精力充沛地投入研究工作，並取得了許多成就的原因。他的主要貢獻都是在這次病後做出的。
在今天人們仍然經常提到費雪是由於他對貨幣數量論和宏觀經濟學的貢獻。這方面他的代表作是《貨幣的購買力》 (1911)和《利息理論》。美國加州柏克利大學經濟學教授J.B.迪龍(J.B.De Long)在評論貨幣主義時把費雪稱為「第一代貨幣主義者」。這就是指費雪的貨幣數量論是最早的貨幣主義。費雪貨幣數量論的中心是交易總量 (T)乘價格(P)等於貨幣量(M)乘貨幣流通速度(V)(T·P=M·V)，當T和V不變時，物價水平(P)取決於貨幣數量(M)。這也正是弗里德曼現代貨幣數量論的中心思想。費雪提出，通貨膨脹率加實際利率等於名義利率，強調了預期通貨膨脹對名義利率一對一的影響。這種觀點被稱為費雪效應，現在仍是每一本宏觀經濟學教科書的基本內容。
Irving Fisher (1867-1947)
Irving Fisher was one of America's greatest mathematical economists and one of the clearest economics writers of all time. He had the intellect to use mathematics in virtually all his theories and the good sense to introduce it only after he had clearly explained the central principles in words. And he explained very well. Fisher's Theory of Interest is written so clearly that graduate economics students, who still study it today, often find that they can read—and understand—half the book in one sitting. With other writings in technical economics, this is unheard of.
Although he damaged his reputation by insisting throughout the Great Depression that recovery was imminent, contemporary economic models of interest and capital are based on Fisherian principles. Similarly, monetarism is founded on Fisher's principles of money and prices.
Fisher called interest "an index of a community's preference for a dollar of present [income] over a dollar of future income." He labeled his theory of interest the "impatience and opportunity" theory. Interest rates, Fisher postulated, result from the interaction of two forces: the "time preference" people have for capital now, and the investment opportunity principle (that income invested now will yield greater income in the future). This reasoning sounds very much like B鰄m-Bawerk's. Indeed, Fisher's Theory of Interest was dedicated to "the memory of John Rae and of Eugen von B鰄m-Bawerk, who laid the foundations upon which I have endeavored to build." But Fisher objected to B鰄m-Bawerk's idea that roundaboutness necessarily increases production. Instead, argued Fisher, at a positive interest rate, no one would ever choose a longer period unless it were more productive. So if we look at processes selected, we do find that longer periods are more productive. But, he argued, the length of the period does not in itself contribute to productivity.
Fisher defined capital as any asset that produces a flow of income over time. A flow of income, said Fisher, was distinct from the stock of capital that generated it. Capital and income are linked by the interest rate. Specifically, wrote Fisher, the value of capital is the present value of the flow of (net) income that the asset generates. This still is how economists think about capital and income today.
Fisher also opposed conventional income taxation and favored a tax on consumption to replace it. His position followed directly from his capital theory. When people save out of current income and then use the savings to invest in capital goods that yield income later, noted Fisher, they are being taxed on the income that they used to buy the capital goods and then are being taxed later on the income that the capital generates. This, he said, is double taxation of saving, and biases the tax code against saving and in favor of consumption. Fisher's reasoning is still used by economists today in making the case for consumption taxes.
Fisher was a pioneer in the construction and use of price indexes. James Tobin of Yale has called Fisher "the greatest expert of all time on index numbers." Indeed, from 1923 to 1936, his own Index Number Institute computed price indexes from all over the world.
Fisher was also the first economist to distinguish clearly between real and nominal interest rates. He pointed out that the real interest rate is equal to the nominal interest rate (the one we observe) minus the expected inflation rate. If the nominal interest rate is 12 percent, for example, but people expect inflation of 7 percent, then the real interest rate is only 5 percent. Again, this is still the basic understanding of modern economists.
Fisher laid out a more modern quantity theory of money (i.e., monetarism) than had been done before. He formulated his theory in terms of the Equation of Exchange, which says that MV = PT, where M equals the stock of money; V equals velocity, or how quickly money circulates in an economy; P equals the price level; and T equals the total volume of transactions. Again, modern economists still draw on this equation, although they usually use the version MV = Py, where y stands for real income.
The equation can be a very powerful tool for checking the consistency of one's thinking about the economy. Indeed, Reagan economist Beryl Sprinkel, who was Treasury undersecretary for monetary affairs in 1981, used this equation to criticize his colleague David Stockman's economic forecasts. Sprinkel pointed out that the only way Stockman's assumptions about the growth of income, the inflation rate, and the growth of the money supply could prove true would be if velocity increased faster than it ever had before. As it turned out, velocity actually declined.
Irving Fisher was born in upstate New York in 1867. He gained an eclectic education at Yale, studying science and philosophy. He published poetry and works on astronomy, mechanics, and geometry. But his greatest concentration was on mathematics and economics, the latter having no academic department at Yale. Nonetheless, Fisher earned the first Ph.D. in economics ever awarded by Yale. Upon graduation he stayed at Yale for the rest of his career.
A three-year struggle with tuberculosis beginning in 1898 right Fisher with a profound interest in health and hygiene. He took up vegetarianism and exercise and wrote a national best-seller titled How to Live: Rules for Healthful Living Based on Modern Science, whose value he demonstrated by living until age eighty. He campaigned for Prohibition, peace, and eugenics. He was founder or president of numerous associations and agencies, including the Econometric Society and the American Economic Association. He was also a successful inventor. In 1925 his firm, which held the patent on his "visible card index" system, merged with its main competitor to form what later was known as Remington Rand and then Sperry Rand. Although the merger made him very wealthy, he lost a large part of his wealth in the stock market crash of 1929.
The Nature of Capital and Income. 1906.
The Purchasing Power of Money. 1911.
The Purchasing Power of Money, new and revised edition, 1922.
The Rate of Interest. 1907.
The Theory of Interest. 1930.