Francisco Rodríguez (economist)

For other uses, see Francisco Rodriguez.

Francisco Rodríguez
Rodríguez during an interview, December 2019
Born	Venezuela
Academic career
Institution	Torino Economics, Bank of America Merrill Lynch, United Nations Human Development Report Office, Wesleyan University
Alma mater	Harvard University, Andrés Bello Catholic University

Francisco R. Rodríguez is a Venezuelan economist and currently director and founder of the Oil for Venezuela foundation. He received an M.A. and Ph.D. in economics from Harvard University, and an undergraduate degree in economics from Venezuela's Universidad Católica Andrés Bello.

Rodríguez has taught economics and Latin American studies at the University of Maryland at College Park, the Instituto de Estudios Superiores de Administración (IESA) and Wesleyan University. From 2000 to 2004, he served as the head of the Economic and Financial Advisory of the Venezuelan National Assembly (Spanish: Oficina de Asesoría Económica y Financiera de Asamblea Nacional).

He has been an associate editor of Economía: Journal of the Latin American and Caribbean Economic Association since 2008. He is also a frequent contributor in a number of publications such as Foreign Affairs, Financial Times, The New York Times, Americas Quarterly, Foreign Policy and Prodavinci, among others.

Academic contributions

Rodríguez has written more than 50 papers on economic growth, development economics, political economy and the Venezuelan economy. These include "Trade Policy and Economic Growth: A Skeptic's Guide to the Cross-National Evidence" (joint with Dani Rodrik), "Why Do Resource-Abundant Economies Grow More Slowly?" (joint with Jeffrey Sachs), "Inequality, Redistribution and Rent-Seeking" and "Cleaning Up the Kitchen Sink:Specification tests and average derivative estimators for growth econometrics" (joint with Cameron Shelton). He has also co-edited, jointly with Ricardo Hausmann, the book Venezuela Before Chávez: Anatomy of an Economic Collapse.

He is a regular participant at public forums on Venezuela's democracy and economic reforms hosted by organizations and universities such as the Americas Society, NYU, Yale and the Atlantic Council, among others.

Rodríguez is one of the foremost experts on the Venezuelan economy. An important strand of his research has dealt with the economic and social implications of policies implemented by the administrations of Hugo Chávez and Nicolás Maduro. This is summarized for a lay audience in his Foreign Affairs article "An Empty Revolution: The Unfulfilled Promises of Hugo Chávez". He is regularly quoted in media reports on the Chávez and Maduro governments. He also published several assessments of Chávez-era social end economic policies in academic journals, including "Freed from Illiteracy? A Closer Look at Venezuela´s Misión Robinson Literacy Campaign" and "The price of political opposition: Evidence from Venezuela's Maisanta".

Policy contributions

Rodríguez is a fierce critic of Maduro's economic policies and human rights violations. He has written that the government's “gross mismanagement” of the economy is the primary cause of the deep economic contraction:

“In my view, it is a settled case that Venezuelans are much worse off today than they would have been under saner economic policies. The government’s decisions not to correct the huge real exchange rate and other relative price misalignments, to maintain expensive fuel subsidies while monetizing a double-digit budget deficit, and to persecute the private sector for responding to relative price signals all contributed to making Venezuelans’ lives miserable under Maduro.”

He has also said that “abundant evidence of serious human rights abuses during [2014] protests…merit an international investigation to determine the potential complicity of high-ranking members of government.”

At the same time, Rodríguez is critical of economic sanctions on Venezuela, which he argues have not forced Maduro out but have contributed to deepening Venezuela's economic crisis.  In a 2018 article, he showed that the rate of decline of Venezuelan oil production accelerated rapidly after the imposition of financial sanctions by the United States. While cautioning that this observation could not be taken as “decisive proof that sanctions caused the output collapse” because of inherent difficulties in establishing causality using non-experimental data, he argued that the findings were “suggestive enough to indicate the need for extreme caution in the design of international policy initiatives that may further worsen the lot of Venezuelans.”

In this regard, Rodríguez has proposed the creation of an oil-for-food program under UN auspices and under the supervision of the opposition-controlled Oversight Commission of the National Assembly in order to avoid the famine that could be caused by the imposition in January 2019 of draconian sanctions on Venezuela's oil sector. In 2019, Rodríguez co-authored two articles with Columbia economist Jeffrey Sachs arguing that the best solution to Venezuela's political impasse would be the creation of an interim cohabitation government with a limited mandate to organize elections and stabilize the economy.

Venezuelan Congressional Budget Office (2000–2004)

In 2000, Rodríguez was elected with the support of both opposition and government parties to head the National Assembly's Economic and Financial Advisory Office. Although the appointment occurred under Chávez's presidency, the rules governing the office required appointment by a supermajority, requiring consensus between government and opposition forces. This consensus was made possible by Rodríguez's candidacy. Under his tenure, the office produced several reports that were critical of official economic policy, eventually leading to his ouster by the pro-government majority in March 2004. He returned to academia at Wesleyan University in 2005.

This extract from his Foreign Affairs article illustrates Rodríguez's differences with the Chávez administration:

In September 2000, I left American academia to take over a research team with functions broadly similar to those of the U.S. Congressional Budget Office. I had high expectations for Chávez's government and was excited at the possibility of working in an administration that promised to focus on fighting poverty and inequality. But I quickly discovered how large the gap was between the government's rhetoric and the reality of its political priorities.

Soon after joining the National Assembly, I clashed with the administration over underfunding of [the program] which had been created by Chávez to coordinate the distribution of resources to antipoverty programs. The law establishing the fund included a special provision to ensure that it would benefit from rising oil revenues. But when oil revenues started to go up, the Finance Ministry ignored the provision ... When my office pointed out this inconsistency, the Finance Ministry came up with [a] creative accounting gimmick ... [whose] effect was to direct resources away from the poor even as oil profits were surging.

— Francisco Rodríguez, An Empty Revolution: The Unfulfilled Promises of Hugo Chávez, Foreign Affairs March/April 2008.

DePaul University and the Financial Times have hosted discussions focused on the debate over Chávez's economic policies between Mark Weisbrot and Rodríguez.

UNDP (2008–2011)

In 2008, Rodríguez became the Head of Research of the United Nations Human Development Report Office. He coordinated the research for three influential reports: Overcoming barriers: Human mobility and development The Real Wealth of Nations: Pathways to Human Development and Sustainability and Equity: A Better future for All.

Financial sector (2011–2019)

Rodríguez joined Bank of America Merrill Lynch in August 2011 as Chief Andean Economist, covering the economies of Colombia, Ecuador, Peru and Venezuela. In 2012 he successfully called the Venezuelan presidential elections with an out-of-consensus prediction that Chávez would be re-elected by a comfortable margin. He argued that Venezuela carried out an external adjustment via quantities instead of prices at the start of the Maduro administration, making the potential output and inflationary costs of internal price adjustment lower than was believed at the time. In September 2014 he responded to a Project Syndicate article by Ricardo Hausmann and Miguel Angel Santos which had criticized the Maduro administration for continuing to honor debt service despite pervasive scarcities of basic goods. In his response, Rodríguez argued that scarcity was driven by relative price distortions and should be addressed by loosening the country's tight price and exchange controls rather than defaulting on its debt.

He joined Torino Economics, the economic analysis branch of New-York based Torino Capital in July 2016 as Chief Economist. His research on Venezuela and Ecuador has been quoted in multiple media outlets, such as Bloomberg, The New York Times, Reuters, The Wall Street Journal, Financial Times, among others.  Bloomberg news has called him “one of the most insightful voices in the community of Venezuelan investors and analysts.”

Rodríguez left Torino Economics on September 3, 2019, claiming that he wanted to focus on designing "solutions to Venezuela’s humanitarian and economic crisis."

Policy assistance (2016–present)

In May 2016, Rodríguez led a team of experts under an initiative promoted by the Union of South American Nations (UNASUR) to present an economic stabilization program to the government of Nicolás Maduro, who until then had refused to implement necessary monetary and fiscal reforms to contain prices, stabilize the exchange rate and foster production recovery. The plan was shelved by the Maduro administration.

In 2018, Rodríguez joined former Lara governor Henri Falcón's team as Policy Chief during Falcón's presidential campaign against Nicolás Maduro. He advocated dollarization as the best way to halt Venezuela's hyperinflation, arguing that it was the only strategy that guaranteed the eradication of credibility problems stabilization programs usually face amid highly inflationary environments, and that are commonly accountable for their failure.

On May 20, Falcón accused Maduro of rigging the elections and refused to recognize the results. Both him and Rodríguez claimed the election was not valid. In a 2018 Foreign Affairs article, Rodríguez defended the decision to contest the elections, writing that “to be fair, Venezuelans had many good reasons not to vote… Yet the boycott was misguided. Many authoritarian leaders, from Augusto Pinochet in Chile to Slobodan Milosevic in Serbia, have been driven from power after losing an election. When dictatorships call elections to shore up their legitimacy, the electorate can use them to break the regime’s hold on power.”

Special Attorney General appointed by Juan Guaidó, José Ignacio Hernández, pointed out in an interview with Panorama that his office is looking into an oil-for-food programme similar at the one Rodríguez is proposing.