Frederic M. “Mike” Scherer, a scholar and economist who focused on technological innovation, passed away on May 25, 2025 at the age of 92.
Prof. Scherer was Aetna Professor Emeritus in economics at Harvard Kennedy School, and the author, co-author, or editor of more than 20 books and 200 articles and case studies. From 1974-76, he was chief economist at the Federal Trade Commission, among other things leading successful efforts to implement the Commission's Line of Business corporate reporting program. He was a longtime and valued member of the Mossavar-Rahmani Center for Business and Government community.
“I will miss Mike Scherer. He wrote the textbook for the first economics course I took when I was in college,” said M-RCBG Director Lawrence H. Summers. “His writing and thinking on the structure of industry, and especially on technological change, had a large impact on my thinking and that of many other economists. His intellect and his warmth will surely be missed in these challenging times.”
Throughout his career, Mike pursued a research and teaching strategy emphasizing the crucial role of technological innovation for economic prosperity. His best-known work was Industrial Market Structure and Economic Performance, the leading textbook in the field of economics known as “industrial organization” in the 1970s and 1980s. First published in 1970, with revised second and third editions to follow in 1980 and 1990, the book was noteworthy for its emphasis on technological innovation as a key dimension of industrial performance and for its comprehensive coverage of the prior literature.
Another book, Mergers, Sell-Offs, and Economic Efficiency (1987), co-authored with David Ravenscraft of the University of North Carolina, analyzed in unprecedented detail the contours and consequences of the 1960s merger wave, showing how on average conglomerate mergers failed to increase acquiring company profits, how money-losing mergers were undone through sell-offs, and how the merger wave’s effects aggravated the productivity slump of the 1970s.
“Mike was an exceptional individual, both as a scholar and human being,” said M-RCBG Co-Director John Haigh. “I learned so much from him about industrial organization and policy, and the importance of innovation for growth and the well-being of society. His thoughtfulness and caring for colleagues and students were obvious to all who knew him. He will be missed.”
Prior to Harvard, Mike held economics professorships at Princeton University, the University of Michigan, Northwestern University, and Swarthmore College. He was a gifted teacher and mentor and was known for his witty, self-deprecating sense of humor.
Mike testified as an expert witness in various antitrust cases as well as in regulatory, patent, and international trade proceedings. The antitrust cases involved IBM, the four leading breakfast cereal companies, a thwarted Mobil Oil-Marathon Oil merger, Associated Brewing Co., Archer-Daniels-Midland, Toys R Us, Intel, Microsoft, and others. His writings have been cited extensively in federal court decisions, among others by the Supreme Court in the Brooke Group (predatory pricing) and Leegin (resale price maintenance) cases. As principal economic consultant to the U.S. Committee on Government Patent Policy, he advised the research effort culminating in the Bayh-Dole and Stevenson-Wydler Technology Innovation Acts of 1980. These shifted the prime locus of patent rights on government-supported work from the government as funder to industry and academia. In 2001, he presented (with Jayashree Watal) at a World Trade Organization-World Health Organization conference an analysis demonstrating the rationale for differentially lower patented pharmaceutical product prices in low-income nations. The conference recommendations, implemented in the Doha and Cancun rounds of international trade negotiations, led to a greatly enhanced use of drugs against such scourges as HIV-AIDS and (later) Hepatitis C in the developing world.
Following his formal retirement from full-time teaching at Harvard, Mike melded his profession with his passion for classical music. The result in 2004 was Quarter Notes and Bank Notes, a book on the economics of classical music composition. Based in part upon biographical and statistical information on 646 composers born between 1650 and 1849, the book analyzed how the composition of music evolved over two centuries from a non-market, patronage-oriented profession to a market-oriented, often free-lance, activity. It also shed new light on the economics of sheet music publishing and how the evolution of copyright laws affected composers' composition efforts.
