M. Kathryn Eickhoff

Margaret Kathryn Eickhoff (born April 11, 1939), known as M. Kathryn Eickhoff, is an American business economist. She worked for Alan Greenspan at the consulting firm Townsend-Greenspan & Co. for more than two decades, running it while Greenspan chaired the Council of Economic Advisers, and was associate director for economic policy at the Office of Management and Budget under President Ronald Reagan. In 1980 she became the youngest president of the National Association of Business Economists.

Early life and education

Margaret Kathryn Eickhoff was born in Sedalia, Missouri, on April 11, 1939, to Leo Eickhoff and E. Magdalene (Piatt) Eickhoff. She graduated with distinction from the University of Missouri in Columbia in 1960, and in 1971 received an MA in economics from New York University.

Career

Townsend-Greenspan

In 1962 Eickhoff joined Townsend-Greenspan & Co., the economic consulting firm headed by Alan Greenspan, where she worked for the next twenty-three years and became one of his closest associates. She became the firm's corporate treasurer in 1966, responsible for its assets and cash flow, its profit-sharing trust and its employees' investment fund, and a vice president in 1972. From 1974 to 1977, while Greenspan was chairman of President Gerald Ford's Council of Economic Advisers, she ran the firm. She became its executive vice president in 1980.

Office of Management and Budget

In 1985 she was appointed associate director for economic policy at the Office of Management and Budget, a post she held for two years. In a 1986 speech to the International Conference on Privatization she endorsed the Reagan administration's efforts to privatize federal activities.

Eickhoff Economics

When Greenspan became chairman of the Federal Reserve in 1987, he closed Townsend-Greenspan because of conflict-of-interest rules. Eickhoff then founded her own consulting firm, Eickhoff Economics, which she presented as the "intellectual successor" to Townsend-Greenspan; it advised clients on the economic outlook, strategic planning and portfolio analysis and published a newsletter.

She served on the boards of directors of AT&T, Fleet Bank, Pharmacia & Upjohn, Tenneco Automotive, the Manhattan Institute for Policy Research and the New York Futures Exchange.

Professional organizations

Eickhoff was president of the National Association of Business Economists in 1980, the youngest person to hold the office, and was named a fellow of the association in 1982. In 1991 she chaired the Conference of Business Economists. She was also active in the Economic Club of New York, the New York Association of Business Economists and the National Association of Female Executives.

Work

In a 1974 chapter written with Greenspan for a handbook on business forecasting, Eickhoff predicted that economic consulting would become "an industry in its own right" and one of the country's fastest-growing, as an increasing share of output came from intellectual rather than physical services.

The Eickhoff curve

In a presentation to the Cleveland Business Economists Club and the National Association of Business Economists in Cleveland on February 2, 1977, later published in Business Economics, Eickhoff analyzed the pace of capital investment. She described an upward-sloping relationship between capacity expansion and operating rates, and argued that heightened uncertainty, arising from inflation, fear of renewed wage and price controls, increasing regulation and the growing use of injunctions to halt projects, shifted it so that businesses would add capacity only at higher rates of capacity utilization. The Wall Street Journal discussed the analysis in an editorial titled "The Eickhoff Curve". James and Julianne Cicarelli write that her analysis anticipated that the economic stimulus proposed by President Jimmy Carter, which emphasized consumer demand rather than investment, would raise prices without a corresponding increase in output.

Inflation and fiscal policy

In her presidential address to the National Association of Business Economists in September 1981, Eickhoff argued that inflation stemmed from "a massive preemption of resources by the government sector at the expense of the private sector" and that "a free society cannot coexist indefinitely with inflation". In a 1990 speech to the American Institute for Economic Research she proposed arbitration to settle budget disputes between the executive and legislative branches, warning that the budget process might otherwise break down. She also wrote the entry on business anticipation surveys for the McGraw-Hill Encyclopedia of Economics (1994).

Recognition

In 1988 the Executive Women of New Jersey named Eickhoff Outstanding Woman Director, and in 1993 she received the Directors' Choice Award of the National Women's Economic Alliance Foundation.

Personal life

In 1973 she married A. James Smith Jr.

Selected works

• (with Alan Greenspan) "Economic Consulting". In W. F. Butler, R. A. Kavesh and R. B. Platt (eds.), Methods and Techniques of Business Forecasting. Englewood Cliffs, N.J.: Prentice-Hall, 1974, pp. 629–635.
• "Plant and Equipment Considerations in the Capital Goods Outlook". Business Economics 12 (4), September 1977: 50–54.
• "Inflation versus Political Freedom". Business Economics, January 1982: 17–20.
• "Anticipation Surveys, Business". In Douglas Greenwald (ed.), The McGraw-Hill Encyclopedia of Economics. New York: McGraw-Hill, 1994, pp. 26–28.