Rajan has written extensively on banking, corporate finance, international finance, growth and development, and organisational structures. He has collaborated with Douglas Diamond to produce much-cited work on banks, and their interlinkages with macroeconomic phenomena. He has worked with Luigi Zingales on the effect of institutions on economic growth, their research showing that development of free financial markets is fundamental to economic modernisation. The book argued that entrenched incumbents in closed financial markets stifle competition and reforms, thereby inhibiting economic growth.
The finance professor from the University of Chicago was reporting to work as the new economic counsellor and director of the Research Department. But although he was a highly regarded finance economist, he was filling a job that had always been held by a leading macroeconomist. And to the macroeconomists who populate the IMF, Rajan was an unknown entity.
But the IMF picked Rajan for a reason: When asked if he would be interested in being chief economist, Rajan says he told her: A decade later, when Rajan reported for his first day as governor of the Reserve Bank of India RBIno one doubted that he had entered the right building.
It was as if all his academic work since his doctoral thesis on the dangers of cozy bank-firm relationships had been leading up to this day.
Plus his stint at the IMF had given him valuable experience, not only in policymaking but in engaging with advanced economies. In addition, he was one of the few economists to have warned about the risks of financial innovation Raghuram rajan thesis before a devastating financial crisis hit the United States in and then disrupted the global economy.
The demands on, and expectations for, Rajan are high—domestically and globally. How do I make sure that sensible economics prevails?
For most of the next 12 years, Rajan would make Booth his home, teaching banking and finance while undertaking much-cited work with such colleagues as Doug Diamond and Zingales.
This might have seemed doable given that the IMF already had models for handling fiscal and monetary issues. But creating a model for financial issues turned out to be much tougher.
As a result, while Rajan is credited with laying the groundwork, the issue is still very much a work in progress, not just for IMF researchers but for hundreds of academics.
The big difference is that a decade ago creating such a model lacked urgency, whereas now it is a high priority. As Rajan wrote in a Project Syndicate column in August With no significant financial crisis since the Great Depression, it was convenient to take for granted that the financial plumbing worked in the background.
Models, thus simplified, suggested policies that seemed to work—that is, until the plumbing backed up. And the plumbing malfunctioned because herd behavior—shaped by policies in ways that we are only now coming to understand—overwhelmed it. What makes Rajan a key figure in these financial debates is what some colleagues say is his ability to see the forest for the trees.
In contrast, the evolving debate over how to deliver financial stability is much more nuanced, in part because we do not have a standard workhorse model to rely upon.
Raghu has the great advantage of having a clear vision of the financial system and what does well and where it poses challenges. I think this is why he has been at the forefront of many of the financial stability debates. In Augusthe came in for heavy criticism following what turned out to be a prescient speech about the dangers lurking in the financial system.
He was invited to speak on how the financial system had evolved under Alan Greenspan the soon-to-retire chairman of the Federal Reserve Board at the annual symposium of central bankers and other high-powered economists in Jackson Hole, Wyoming.
He says he had expected to find that the dramatic expansion in financial markets had reduced the risks for banks, but instead, the figures that his staff assembled showed the opposite.
Several years later, his warning came true: Not ready for the red flags Was there anything Raghuram Rajan could have done to ensure that his message was heard at Jackson Hole? He thinks not, for two reasons. First, economic times were good, so it was difficult to persuade people to take steps that might slow growth to address a low-probability risk.
Why would they blow up their business? And who are we, you know, low-paid regulators, thinking that we know more about their business than they do? He says it was a tremendous on-the-job learning experience during which he sharpened his macroeconomic skills.
He also immersed himself in the art of global economic policymaking—for example, leading a team to try to help some major economies reduce their huge and unprecedented balance of payments imbalances.
It was also his first stint as a manager—a hundred people worked for him in the Research Department. But that number must now seem incredibly small, as he oversees 17, staffers at the RBI.
Former IMF colleagues say that what is so remarkable about Rajan is his humility, integrity, and intellectual curiosity and rigor. Back to India Rajan may have made his career in the United States, but he never forgot India, making it a frequent topic of speeches and research.Jun 28, · Raghuram Rajan was born in a Tamilian family in Bhopal, He received his Ph.D.
Degree in Finance from MIT Sloan School of Management for a thesis paper named ‘Essay on Banking’ in In the same year he joined the Booth School of Business at University of Chicago as a Finance Professor.
His keen interest lies in . Raghuram Rajan was born in Bhopal in to a Tamil Family. In , he graduated from the Indian Institute of Technology, Delhi with a bachelor`s degree in electrical engineering, and he completed the Post Graduate Diploma in Business Administration at the .
Fault Lines: How Hidden Fractures Still Threaten the World Economy is a book by Indian economist Raghuram Rajan on the underlying causes of the financial crisis, and the structural weaknesses present in the world leslutinsduphoenix.com won the Financial Times and Goldman Sachs Business Book of the Year award in Why is Dr.
Raghuram Rajan not opting for a second term as RBI Governor, and going back to the US at the end of his term? Is India not good or Is Raghuram Rajan overrated? Where can I get the thesis on essay on banks by Raghuram Rajan?
Why is Dr.
Raghuram Rajan not opting for a second term as RBI Governor, and going back to the US at the end of his term? Is India not good or. Raghuram Govind Rajan (born 3 February ) is an Indian economist and an international academician who is the Katherine Dusak Miller Distinguished Service Professor of Finance at the University of Chicago Booth School of Business.