Data Resources Inc (DRI): A Legacy of Econometric Modeling and Economic Data
Founded in 1969, Data Resources Inc (DRI) emerged as a powerhouse in the field of economic analysis and research. Based in Lexington, Massachusetts, the company revolutionized how economic data was distributed and analyzed, eventually becoming the largest non-governmental distributor of economic data globally.
The company was co-founded by Donald Marron, later the CEO of PaineWebber and founder of Lightyear Capital, and Otto Eckstein. Eckstein was a distinguished Harvard University economics professor and a member of the Council of Economic Advisors who served as an economic consultant to President Lyndon Baines Johnson. He is most recognized for developing the theory of core inflation, which filters out volatile price changes to identify long-term inflation trends.
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Key Facts
- Founded: 1969 by Donald Marron and Otto Eckstein.
- Specialization: Econometric models, research, and economic data distribution.
- Technological Milestone: Developed the largest macroeconometric model of its era.
- Major Acquisition: Sold to McGraw-Hill in 1979 for over $100 million.
- Evolution: Merged with WEFA to form Global Insight in 2001, later acquired by IHS Inc. in 2008.
Technological Innovation and Software Development
DRI was a pioneer in the application of computing to economics. The company relied heavily on Burroughs Computer mainframes, specifically the 6700 and 7700 models, to power its massive calculations. To support these operations, DRI developed a suite of innovative software tools designed for complex data management and modeling.
The Evolution of DRI Software
The company's software journey began with specialized languages and tools, including:
- PRIMA and AID: Database languages used for data retrieval and management.
- EPL (Econometric Programming Language): A dedicated language for economic programming.
- MODSIM and MODEL: Tools specifically designed for solving general and econometric models.
Under the leadership of chief architect Robert P. Lacey, along with programmers John Ahlstrom, Greg George, and Joe Polak, these disparate tools were eventually merged into a single, comprehensive platform known as the EPS (Econometric Programming System).
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Operational Reach and Market Influence
DRI did not just build models; it translated complex data into actionable insights for the business and policy communities. The company published the DRI Review, a monthly publication that summarized economic outlooks based on their models. These findings were further disseminated through educational seminars and specialized outlook conferences.
The technical architecture of their massive macroeconometric model was led by Allen Sinai, with significant maintenance work performed by Richard Hokenson.
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Corporate Evolution and Timeline
The trajectory of DRI reflects the broader shift in the computing industry from centralized mainframes to personal computing.
| Year | Event | Details |
|---|---|---|
| 1979 | Sale to McGraw-Hill | Sold for over $100 million. |
| 1981 | Leadership Change | Joseph Kasputys named president. |
| 1984 | Technological Stagnation | Slow adoption of PCs following Otto Eckstein's death. |
| 2001 | Merger | Merged with WEFA to form Global Insight. |
| 2008 | Acquisition | Bought by IHS Inc. |
Frequently Asked Questions
Who were the founders of Data Resources Inc?
DRI was co-founded in 1969 by Donald Marron and Otto Eckstein.
What was the significance of Otto Eckstein's work?
Beyond co-founding DRI, Otto Eckstein was a Harvard professor and economic consultant to President Lyndon Baines Johnson, best known for developing the theory of core inflation.
What software did DRI develop for econometric modeling?
DRI created several tools including PRIMA, AID, EPL, MODSIM, and MODEL, which were eventually integrated into the EPS (Econometric Programming System) by Robert P. Lacey.
Why did DRI struggle in the mid-1980s?
Following the death of Otto Eckstein in 1984, the company was slow to transition from mainframe computers to personal computers, while the rest of the analytic industry was moving toward PC-based work.
What happened to DRI in the 21st century?
DRI merged with Wharton Econometric Forecasting Associates (WEFA) in 2001 to form Global Insight, which was subsequently acquired by IHS Inc. in 2008.