Paul Romer

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Paul Romer
Paul Romer in 2005.jpg
Chief Economist of the World Bank
In office
October 2016 – 24 January 2018
President Jim Yong Kim
Preceded by Kaushik Basu
Succeeded by Shanta Devarajan (Acting)
Personal details
Born (1955-11-07) 7 November 1955 (age 62)
Denver, Colorado, U.S.
Education University of Chicago (BSc, MA, PhD)
Massachusetts Institute of Technology
Queen's University
Scientific career
Fields Economics
Institutions New York University
Stanford University
University of Rochester
Doctoral advisor José Scheinkman
Robert Lucas Jr.
Other academic advisors Russell Davidson
Ivar Ekeland
Doctoral students Sérgio Rebelo
Influences Joseph Schumpeter
Robert Solow

Paul Michael Romer (born November 7, 1955) is an American economist and pioneer of endogenous growth theory. He was Chief Economist and Senior Vice President of the World Bank until January 24, 2018,[1] being on leave from his position as professor of economics at the Stern School of Business at New York University.[2] Prior to that, Romer was a professor of economics at Stanford University's Graduate School of Business and a senior fellow at Stanford's Center for International Development, the Stanford Institute for Economic Policy Research, and the Hoover Institution,[3] as well as a fellow at the Center for Global Development.

Romer graduated from Phillips Exeter Academy, and earned a B.S. in mathematics in 1977 and a MA in economics in 1978 as well as a Ph.D. in economics in 1983, both from the University of Chicago, after graduate studies at Massachusetts Institute of Technology and Queen's University.[4] He taught at the University of California at Berkeley, the University of Chicago, and the University of Rochester. He temporarily left academia, focusing his energy on his 2001 start-up company Aplia which developed online homework problem sets for college students; Aplia was purchased in 2007 by Cengage Learning. Romer was named one of America's 25 most influential people by Time magazine in 1997.[5] Romer was awarded the Horst Claus Recktenwald Prize in Economics in 2002. He is the son of former Colorado governor Roy Romer.[6]

Academic contributions[edit]

Romer's most important work is in the field of economic growth. Economists studied long-run growth extensively during the 1950s and 1960s.[7] The Solow–Swan model, for example, established the primacy of technological progress in accounting for sustained increases in output per worker. Romer's 1983 dissertation, supervised by José Scheinkman and Robert Lucas Jr., amounted to constructing mathematical representations of economies in which technological change is the result of the intentional actions of people, such as research and development. It led to two Journal of Political Economy articles published in 1986 and 1990, respectively, which started endogenous growth theory.

Romer is credited with the quote "A crisis is a terrible thing to waste," which he said during a November 2004 venture-capitalist meeting in California. Although he was referring to the rapidly rising education levels in other countries compared to the United States, the quote became a sounding horn by economists and consultants looking for a positive take away from the economic downturn of 2007–2009.[8]

Charter cities[edit]

His latest contribution has been in trying to replicate the success of charter cities and make it an engine of economic growth in developing countries. He promoted this idea in a TED talk in 2009.[9] Romer has argued that with better rules and institutions, less developed nations can be set on a different and better trajectory for growth.[10] In his model, a host country would turn responsibility for a charter city over to a more developed trustee nation, which would allow for new rules of governance to emerge. People could "vote with their feet" for or against these rules.[6]

The government of Honduras has recently considered creating charter cities, though without the oversight of a third-party government, which some argue is neo-colonialism.[6] Romer served as chair of a "transparency committee" but resigned in September 2012 when the Honduran government agency responsible for the project signed agreements with international developers without involvement of the committee.[11]

Influences[edit]

Romer has influenced the "Peoples' Capitalism" concept put forth by James S. Albus—arguably a form of basic income guarantee.[12]

Publications[edit]

  • "Growth Cycles", with George Evans and Seppo Honkapohja (American Economic Review, June 1998). JSTOR 116846
  • "Preferences, Promises, and the Politics of Entitlement" (Individual and Social Responsibility: Child Care, Education, Medical Care, and Long-Term Care in America, Victor R. Fuchs (ed.), Chicago: University of Chicago Press, 1995).
  • "New Goods, Old Theory, and the Welfare Costs of Trade Restrictions," Journal of Development Economics, No. 43 (1994), pp. 5–38.
  • "Looting: The Economic Underworld of Bankruptcy for Profit" with George Akerlof (Brookings Papers on Economic Activity 2, William C. Brainard and George L. Perry (eds.), 1993, pp. 1–74). JSTOR 2534564
  • "Economic Integration and Endogenous Growth," with Luis Rivera-Batiz (Quarterly Journal of Economics CVI, May 1991, pp. 531–55). JSTOR 2937946
  • "Endogenous Technological Change" (Journal of Political Economy, October 1990). JSTOR 2937632
  • "Increasing Returns and Long Run Growth" (Journal of Political Economy, October 1986). JSTOR 1833190
  • "Cake Eating, Chattering and Jumps: Existence Results for Variational Problems" (Econometrica 54, July 1986, pp. 897–908). JSTOR 1912842

See also[edit]

References[edit]

  1. ^ Donnan S. Outspoken World Bank chief economist Paul Romer exits // FT. January 24, 2018.
  2. ^ "N.Y.U. Lands Top Economist for Cities Project". New York Times. 2011-05-27. Retrieved 2011-05-27. 
  3. ^ "Risk and Return". Hoover Digest. No. 2. 1996. Archived from the original on 2012-08-02. 
  4. ^ Warsh, David (2007). Knowledge and the Wealth of Nations. New York: Norton. pp. 196–201. ISBN 978-0-393-32988-9. 
  5. ^ "Time's 25 Most Influential Americans". Time Magazine. Time Inc. 1997-04-21. Retrieved 2007-12-21. 
  6. ^ a b c "The Politically Incorrect Guide to Ending Poverty". The Atlantic. July–August 2010. 
  7. ^ Solow, Robert M. (1994). "Perspectives on Growth Theory". Journal of Economic Perspectives. 8 (1): 45–54. doi:10.1257/jep.8.1.45. JSTOR 2138150. 
  8. ^ Rosenthal, Jack (2009-07-31). "A Terrible Thing to Waste". The New York Times. Retrieved 2011-10-09. 
  9. ^ Paul Romer: Why the world needs charter cities, TED talk August 2009
  10. ^ Gunn, Dwyer (2009-09-29). "Can "Charter Cities" Change the World? A Q&A With Paul Romer". The New York Times. Retrieved 2010-05-22. 
  11. ^ "Plan for Charter City to Fight Honduras Poverty Loses Its Initiator". New York Times. 30 September 2012. 
  12. ^ PeoplesCapitalism.org

External links[edit]

Diplomatic posts
Preceded by
Kaushik Basu
Chief Economist of the World Bank
2016–2018
Succeeded by
Shanta Devarajan
Acting