[1][2] He also developed and named the principal component analysis method widely used in finance, statistics and computer science.

Fisher's emphasis on the sampling distribution of a statistic was extended by Jerzy Neyman and Egon Pearson with greater precision and wider applications, which Hotelling recognized.

Hotelling sponsored refugees from European anti-semitism and Nazism, welcoming Henry Mann and Abraham Wald to his research group at Columbia.

Later, at Columbia University (where during 1933-34 he taught Milton Friedman statistics) in the '40s, Hotelling in turn encouraged young Kenneth Arrow to switch from mathematics and statistics applied to actuarial studies towards more general applications of mathematics in general economic theory.

Hotelling pointed out that when local public goods like roads and trains become congested, users create an additional marginal cost of excluding others.

Hotelling became an early advocate of Georgist congestion pricing and stated that the purpose of this unique type of toll fee was in no way to recoup investment costs, but was instead a way of changing behavior and compensating those who are excluded.

Hotelling describes how human attention is also in limited supply at any given time and place, which produces a rental value; he concludes that billboards could be regulated or taxed on similar grounds as other scarcity rents.

[17] Both Sraffa and Hotelling illuminated the market power of producers without competitors, clearly stimulating a literature on the supply-side of the economy.

A disconnected demand implies some discontinuous behavior by the consumer as discussed by Hotelling: If indifference curves for purchases be thought of as possessing a wavy character, convex to the origin in some regions and concave in others, we are forced to the conclusion that it is only the portions convex to the origin that can be regarded as possessing any importance, since the others are essentially unobservable.

They can be detected only by the discontinuities that may occur in demand with variation in price-ratios, leading to an abrupt jumping of a point of tangency across a chasm when the straight line is rotated.

The concave portions of the indifference curves and their many-dimensional generalizations, if they exist, must forever remain in unmeasurable obscurity.