Opinion

Indonesia and the Quest for 7% Growth: Overpromise or Underperformance?

April 16, 2019

By Timothy Cheston 
Visualizations by: Nil Tuzcu

Indonesians head to the polls for presidential and legislative elections on April 17, in what is traditionally billed as a clash of titans in the world’s third largest democracy. This time around, voters will find familiar names on the presidential ballot, as Joko Widodo, or Jokowi, faces Prabowo Subianto in the same billing as the 2014 election, with the one exception of Jokowi now having the incumbency of the presidency behind him. If current polls hold, the election appears less of a rematch than a watered-...

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How Not to Fight Income Inequality

November 14, 2018

Ricardo Hausmann - Project Syndicate

Trying to combat income inequality through mandated wage compression is not just an odd preference. It is a mistake, as Mexico's president-elect, Andrés Manuel López Obrador, will find out in a few years, after much damage has been done.

Suppose two people hold different opinions about a policy issue. Is it possible to say that one is right and the other wrong, or do they just...

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The Albanian Miracle

September 27, 2018

Ricardo Hausmann - Project Syndicate

Five years ago, Albania faced a truly ominous situation. With Greece and Italy reeling from the euro crisis, remittances and capital inflows were falling and the economy suffered a severe slowdown. The fiscal deficit ballooned to over 7% of GDP, financed to a large extent by arrears, as access to external financial markets had collapsed and domestic interest rates were sky high.

In addition, the...

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The knowhow path to Sri Lankan development

September 5, 2018

Ricardo Hausmann - DailyFT

When Adam Smith wrote ‘The Wealth of Nations’ in 1776, the richest country in the world was four times richer than the poorest one. Today, Singapore is over 110 times richer than Burundi. What could possibly explain such an extreme divergence of the wealth of nations? 

Economists have shown that these differences are too large to be explained by differences in the availability of land or capital – including human capital. So, they ascribe it to differences in the productivity with which land and capital are used,...

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Nicolás Maduro will not reverse Venezuela’s economic collapse

August 23, 2018

Ricardo Hausmann - Financial Times

When presenting his economic stabilisation plan on August 17, Venezuelan president Nicolás Maduro proudly argued that no government has ever done it this way. He should have wondered why. Venezuela is undergoing an economic collapse without precedent outside of war or the fall of the Soviet Union.

This is accompanied by hyper-inflation. Annual inflation is running at over 80,000 per cent and the IMF has predicted it will hit 1m per cent this year. The price of the dollar has added three zeroes in 15 months.

Venezuelans Deserve Refugee Status

May 30, 2018

Ricardo Hausmann - Project Syndicate

Venezuela is in the news again. Through unprecedented treachery, President Nicolás Maduro awarded himself victory in the presidential election on May 20. Given that the blatantly pro-government electoral council had delisted the three main opposition parties and disqualified two major political leaders, much of the opposition boycotted the process. The two other candidates who participated did not recognize the result, given the many violations that took place. Neither did the United States, Canada, the European Union and most...

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Can Venezuela Resurrect Its Economy?

July 26, 2017

Ricardo Hausmann is interviewed by the Council of Foreign Relations 

The misguided policies of President Nicolas Maduro and his predecessor, Hugo Chavez, along with falling oil prices, have destabilized Venezuela’s economy and triggered shortages of vital supplies, says Ricardo Hausmann, a professor at Harvard Kennedy School and a former minister of planning in Venezuela.

Hausmann argues that it will almost certainly take new leadership in Caracas to introduce the market reforms and debt restructuring he says are needed. “A recovery would...

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The Hunger Bonds

May 26, 2017

Ricardo Hausmann for Project Syndicate

CAMBRIDGE – Investing often creates moral dilemmas over goals: Should we aim to do well or to do good? Is it appropriate to invest in tobacco companies? Or in companies that sell guns to drug gangs?

The recent popularity of so-called impact investment funds, which promise to deliver decent returns while advancing social or environmental goals, is based on this unease. Foundations often find that these investment vehicles help them to do good both with the money that they...

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