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Growth, trade, development, institutions, aid, oil, India, Africa, the WTO, intellectual property
Arvind Subramanian is a senior fellow (on leave) at the Center for Global Development. He is the chief economic advisor to the government of India.
Greenprint: A New Approach to Cooperation on Climate Change, written with Aaditya Mattoo, was published by CGD in 2012; Eclipse: Living in the Shadow of China's Economic Dominance was published in September 2011. Foreign Policy named him one of the world's top 100 global thinkers in 2011. India Today magazine named him one of India’s top 35 “Masters of the Mind” over the last 35 years.
He has written on growth, trade, development, institutions, aid, oil, India, China, Africa, and the World Trade Organization. He has published widely in academic and other journals, including the American Economic Review (Papers and Proceedings), Review of Economics and Statistics, Journal of International Economics, Journal of Monetary Economics, Journal of Public Economics, Journal of Economic Growth, Journal of Development Economics, Brookings Papers on Economic Activity, Oxford Review of Economic Policy, International Monetary Fund Staff Papers, Foreign Affairs, World Economy, and Economic and Political Weekly. He is currently ranked among the top 2 percent of the world’s academic economists in terms of citations of academic research, according to the widely used REPEC rankings.
He has also published or been cited in leading magazines and newspapers, including the Economist, Financial Times, Washington Post, New York Times, Wall Street Journal, Newsweek, and New York Review of Books. He contributes frequently to the Financial Times and is a columnist for India's leading financial daily, Business Standard.
He advises the Indian government in different capacities, including as a member of the Finance Minister's Expert Group on the G-20. Subramanian was assistant director in the Research Department of the International Monetary Fund. He served at the GATT (1988–92) during the Uruguay Round of trade negotiations and taught at Harvard University's Kennedy School of Government (1999–2000) and at Johns Hopkins' School for Advanced International Studies (2008–10).
He obtained his undergraduate degree from St. Stephens College, Delhi; his MBA from the Indian Institute of Management at Ahmedabad, India; and his M.Phil. and D.Phil. from the University of Oxford, UK.
“Does Aid Affect Governance?” American Economic Review Papers and Proceedings, (with Raghuram Rajan), May 2007.
“Africa’s Growth Prospects: Benchmarking the Constraints,” NBER Working Paper, 13120 (with Simon Johnson and Jonathan Ostry).
“Foreign Capital and Economic Development,” Brookings Papers on Economic Activity, March 2007, (with Eswar Prasad and Raghuram Rajan).
“How to Help Poor Countries,” Foreign Affairs, (with Nancy Birdsall and Dani Rodrik), 2005.
“Aid and Growth: What Does the Cross-Section Evidence Really Show?” National Bureau of Economic Research (NBER) Working Paper, No. 11513, (with Raghuram Rajan), 2005; forthcoming Review of Economics and Statistics.
“What Undermines Aid’s Impact on Growth,” NBER Working Paper, No. 11657, (with Raghuram Rajan), 2005.
“Institutions Rule: The Primacy of Institutions Over Geography and Integration in Economic Development,” Journal of Economic Growth, (with Dani Rodrik and Francesco Trebbi), 2004.
“Saving Iraq from its Oil,” Foreign Affairs, (with Nancy Birdsall), 2004.
“What Determines Long-Run Macroeconomic Stability? Democratic Institutions,” IMF Working Staff Papers, (with Shanker Satyanath), 2007.
“The Natural Resource Curse: An Illustration from Nigeria,” NBER Working Paper, with Xavier Sala-i-Martin), 2003.
“The Primacy of Institutions and What it does or does not Mean,” Finance and Development, (with Dani Rodrik), June 2003.
“Who can Explain the Mauritian Miracle: Meade, Romer, Sachs or Rodrik,” In Search of Prosperity, edited by Dani Rodrik, Princeton University Press, (with Devesh Roy), 2002.
“Policies, Enforcement, and Customs Evasion: Evidence from India,” IMF Working Paper, (with Prachi Mishra and Petia Topalova), forthcoming.
“The Intriguing Relationship between Growth and Institutions in India,” Oxford Review of Economic Policy, forthcoming.
“India’s Pattern of Development: What Happened, What Follows,” Journal of Monetary Economics, (with K. Kochhar, U. Kumar, R. Rajan, and I. Tokatlidis), 2006.
“From ‘Hindu Growth’ to Productivity Surge: The Mystery of the Indian Growth Transition,” IMF Staff Papers, (with Dani Rodrik), 2004.
“Why India can grow at 7 Percent a year or More?” Economic and Political Weekly, (with Dani Rodrik), 2004.
Trade and Intellectual Property
“The WTO promotes trade strongly, but unevenly,” Journal of International Economics, (with Shang-Jin Wei), 2007.
“Why Prospects for Doha Trade Talks are not Bright?” Finance and Development, (with Aaditya Mattoo), March 2005.
“Medicines, Patents and TRIPs,” Finance and Development, March 2004.
“The Africa Growth and Opportunity Act and Its Rules of Origin: Generosity Undermined?” The World Economy, Vol. 26, No. 6, (with Aaditya Mattoo and Devesh Roy), 2003.
“The WTO and Poorest Countries: The Stark Reality,” World Trade Review, (with Aaditya Mattoo), 2003.
“Measuring Services Trade Liberalization and Its Impact on Economic Growth: An Illustration,” Journal of Economic Integration, (with Aaditya Mattoo and Randeep Rathindran), 2002.
“Dynamic Gains from Trade – Evidence from South Africa,” IMF Staff Papers Vol. 48 No. 1, (with Gunnar Jonsson), 2001.
“Can TRIPS Serve as An Enforcement Device in the WTO?” Journal of International Economic Law, (with J. Watal), 2000.
“Trade and the Environment: A Nearly Empty Box?” The World Economy, 1992.
“TRIPs and the Paradigm of the GATT: A Tropical, Temperate View,” World Economy, 1990.
“The International Economics of Intellectual Property Right Protection: A Welfare-Theoretic Trade Policy Analysis,” World Development, Vol. 19, No. 8.
“Regulatory Autonomy and Multilateral Disciplines: the Dilemma and a Possible Resolution,” Journal of International Economic Law, Vol. 9 No. 2, (with Aaditya Mattoo.)
India: Trade and Intellectual Property
“India as User and Creator of Intellectual Property: The Challenges Post-Doha,” in India and the WTO, edited by A. Mattoo and R. Stern, World Bank), 2003.
“India and the Multilateral Trading System Post-Doha: Defensive or Proactive?” in India and the WTO, edited by A. Mattoo and R. Stern, World Bank, (with A. Mattoo), 2003.
“The Case for a US-India Free Trade Agreement,” Economic and Political Weekly, (with A. Mattoo), 2003.
“Putting Some Numbers on the TRIPS Pharmaceutical Debate,” International Journal of Technology Management, 1994.
Book, op-eds and other
“Efficiency, Equity, and Legitimacy: The Multilateral Trading System at the Millenium,” Brookings/Harvard University Press, (edited with Roger Porter and Pierre Sauvé), 2002.
Profile of Paul Krugman: “Economist as Crusader,” Finance and Development, June 2006.
“The Bangalore Bug,” op-ed in the Financial Times, (with Raghuram Rajan), 2006.
“China’s exchange rate,” op-ed in the Financial Times, (with Raghuram Rajan), 2005.
Profile of Jagdish Bhagwati: “The Globalization Guru,” Finance and Development, September 2005.
In a Q&A published today, CGD non-resident fellow Peter Timmer estimates that soaring global food prices and panicky starve-thy-neighbor rice export restrictions in Asia could lead to 10 million or more premature deaths in the region if the current high prices are passed along to poor rice consumers.
Two aspects of global imbalances -- undervalued exchange rates and sovereign wealth funds -- require a multilateral response. For reasons of inadequate leverage and eroding legitimacy, the International Monetary Fund has not been effective in dealing with undervalued exchange rates. In this working paper, CGD senior fellow Arvind Subramanian and his co-author propose new rules in the World Trade Organization to discipline cases of significant undervaluation that are clearly attributable to government action. Placing exchange rates and sovereign wealth funds on the trade negotiating agenda may help revive the Doha Round by rekindling the interest of a wide variety of groups, many of whom are currently disengaged from the round.
In this CGD Essay, Birdsall and Subramianian argue that the World Bank faces twin crises of relevance and legitimacy in a rapidly changing world. The solution, they argue, is for the bank to become a more active catalyst for generating global public goods and knowledge and a more reluctant lender to governments. The World Bank should move, in effect, from being a bank to being a global development cooperative. The essay suggests specific, practical steps for such reforms.
Senior Fellow Arvind Subramanian writes an op-ed for the Financial Times on the next director-general of the World Trade Organization.
The following op-ed originally appeared in the Financial Times.
The list of candidates to succeed Pascal Lamy as director-general of the World Trade Organisation has just been finalised. Astonishingly, not one of the nine aspirants is from the world’s four big major trading entities – the US, Europe, Japan or China – that together account for more than 55 per cent of global merchandise exports. That is both a metaphor for what ails the supervisory body for global trade and a signal of its bleak prospects.
Over time the WTO has become an institution where smaller and poorer countries have acquired a stake and voice. This transformation may seem a welcome sign of legitimacy. But it has gone too far. For its future effectiveness, indeed survival, the WTO needs to be de-democratised, with the large countries reasserting themselves. Otherwise, trade will become more fragmented and friction-prone, undermining the very system from which the smaller countries stand to benefit and slowing global growth momentum.
The multilateral trading system faces an existential threat with liberalisation increasingly taking place outside the WTO, either through unilateral reform or via increasingly popular regional trade agreements.
But these agreements did not jeopardise the WTO for the important reason that none of them was between the large trading nations themselves. Ominously, that now stands to change. The US has thrown its weight behind the trans-Pacific Partnership which could potentially include Japan. It is also seriously contemplating a transatlantic agreement with Europe.
Soon, there will be a scramble among other large nations to conclude deals with each other. Multilateral trade as we have known it will progressively become history. So too might the WTO’s importance and relevance because it was the institution where the US, Europe, Japan and China liberalised trade and settled disputes.
Leaving aside the experience of European integration, which had its unique post-second world war imperatives, it is the US that will bear history’s burden for these new developments. The US, which began the process of undermining the non-discriminatory trading system by negotiating regional agreements with Israel and Canada in the 1980s, will have effectively ensured its completion by embarking on these new agreements.
How can this be addressed? The effectiveness of the WTO as a forum for fostering further liberalisation has been undermined by at least two factors. The first is the Doha Round of multilateral trade negotiations. Launched in the aftermath of 9/11, the world has neither been able to conclude nor bury them successfully.
As a result, it has become impossible to move to a more relevant agenda that can expand market opportunities for the private sector and deal with the current concerns of governments. An example is food, where a decade ago subsidies and barriers to imports were the important issue. Today, high prices and barriers on exports are more important.
Similarly, currency manipulation is now a pressing issue – but is not on the Doha agenda. Emerging powers such as China and India must be more active in shaping this new agenda and constructive about liberalisation in the WTO or risk their trading partners seeking alternatives to it.
But interring Doha will not be enough to revitalise the WTO’s effectiveness. Unlike the IMF which has suffered from a democratic deficit and legitimacy problem, the WTO has suffered from too much democracy and associated blocking powers. A few small countries can effectively exercise their veto if, say, cotton subsidies – an issue of legitimate concern to them but not necessarily of systemic importance – are not addressed.
This veto must be taken away or future negotiations could be stymied by any of the WTO’s 157 members. This outcome can be achieved by allowing the larger countries to negotiate among themselves while offering assurances to the smaller countries that they would receive the benefits of such negotiations and be spared any burdens.
Unless this change occurs, the WTO cannot deliver on its key mandate of being a forum for further liberalisation. And if it cannot, it will be reduced to a body that settles trade disputes between countries based on rules that are increasingly overtaken by those negotiated under regional agreements.
Recently the legitimacy of the IMF and World Bank was under question because the procedure for selecting their leaders appeared rigged in favour of Europe and the US. It is perhaps ironic that, in the case of the other part of the Bretton Woods troika – the WTO – the absence of candidates from the most economically powerful countries would be seen as lamentable. But it is, as it signals that the world’s largest trading nations have relinquished responsibility in making it an effective and relevant multilateral institution. That is a situation that threatens to make everyone a loser.
Read it here.
This blog post was originally published in the Business Standard.
The Greatest Depression that could so easily have happened in 2009 but did not is the tribute that the world owes to economics.
In 2008, as the global financial crisis unfolded, the reputation of economics as a discipline and economists as useful policy practitioners seemed to be irredeemably sunk. Queen Elizabeth captured the mood when she asked pointedly why no one (in particular economists) had spotted the crisis coming. And there is no doubt that, notwithstanding the few Cassandras who had correctly prophesied gloom and doom, the profession had failed colossally.