ECONOMICS: ELEGANT NUMBERS

By John Greenwald

Although they are now considered essential measures of economic performance, such vital yardsticks as the gross national product and the consumer price index have come into widespread use only in recent decades. During the 1940s economists made rapid strides in their ability to sift through the billions of transactions that make up economic behavior and distill them into key statistics that indicate the state of the economy. Few experts have been more crucial in turning the numerical potpourri into some kind of order than Sir Richard Stone, 71, who last week won the 1984 Alfred Nobel Memorial Prize in Economic Science. A professor emeritus at Cambridge University, Stone is the fourth British economist to receive the award since it was created in 1969, and the first non- American winner since 1979.

Stone worked out his ideas during World War II, and later pioneered a na tional accounting system that continues to provide a framework for countries around the world. As assistants of John Maynard Keynes, Stone and 1977 Nobel Laureate James Meade helped prepare a wartime study that organized mountains of data into a profile of the British economy. That herculean task enabled the country's leaders to assess accurately its resources.

After the war, Stone headed a United Nations project that developed a standard accounting model for other countries. Few if any nations had effective methods of summarizing their economic activity. Under Stone's guidance, the U.N. prepared a monumental set of guidelines used today by more than 100 countries, making international comparisons possible. While some economists have argued that the sophisticated system is ill-suited for those underdeveloped countries in which record keeping may be sparse and unreliable, it is still widely followed.

Tall, soft-spoken and described by friends as courteous and modest, Stone collects books and has more than 10,000 volumes. But his deepest interest remains organizing numbers. Says Terence Barker, Stone's successor as head of the Cambridge Growth Project, which has developed a model of the British economy: "He is passionately enthusiastic about economic statistics. All his professional life has been devoted to the measurement of income and wealth, and he is very keen on getting it systematized." Adds George Jaszi, director of the U.S. Commerce Department's Bureau of Economic Analysis: "There is a tremendous sense of system to his work, and also tremendous elegance. He was and is a giant."

As an economist, Stone is more interested in laboring in the library than in the spotlight of public-policy making. Says he: "The economists who talk policy are striking figures, not a retiring, backroom boy like me." The new Nobel laureate is somewhat critical of his own profession, maintaining that too many economists today overspecialize and do not know enough history and psychology. "Economists," he says, "propose remedies to government and do not take into account the ability or inability of people to change." --By John Greenwald.

Reported by Lisa Mesdag/Cambridge

With reporting by Lisa Mesdag