He is one of the most celebrated economists in the world, who predicted the Global Financial crisis of 2007-08. From explaining “Dosanomics” to criticizing the Modi government’s demonetisation move, Rajan had always made it to the headlines of the Business dailies in India. Taking all of us by surprise, this year Raghuram Rajan’s name has appeared in the list of possible winners of Nobel Prize in economics brought out by Clarivate Analytics, according to IANS. The prize will be announced at Stockholm on Monday. Clarivate Analytics, a company involved in academic and scientific research, has made a list of dozens of possible Nobel Prize winners based on their research citations. Rajan is one of the six economists to make their way is this year’s list. His name made its entry into the list for his “contributions illuminating the dimensions of decisions in corporate finance,” according to The Wall Street Journal report.
Raghuram Rajan was one of the most outspoken governors of the Reserve Bank of India, who took over when India was one of the countries in fragile five. Recently, he launched his new book in India clearing the air on note ban. The former Reserve Bank of India governor Raghuram Rajan, in his book ‘I Do What I Do: On Reforms Rhetoric and Resolve’, has revealed that he was never in favour of demonetisation as the short-term economic costs would outweigh any longer-term benefits from it.
Rajan was quite open to legitimate criticisms. He was quite often criticised for not cutting the interest rates. In 2014, he had given an alternative to Modi government’s ‘Make In India’ scheme, arguing that the domestic market, however, was so large that the policy should be ‘Make for India’. He later clarified that both the things would complement each other. “Given all the uncertainty in the world, it is better to Make for India… How would one Make In India instead of Making for India, ” Rajan said.
At the age of 40, Rajan became the youngest chief economist to be appointed at the International Monetary Fund. At the Federal Reserve annual Jackson Hole conference in 2005, Rajan predicted the Global Financial Crisis. He was even called as “Luddite” by Lawrence Summers, after he presented his paper– “Has Financial Development Made the World Riskier?” at the same conference.
Rajan argued that a ‘developed’ financial market had become a more complicated one and not necessarily a safer one. Essentially, he said financial instruments like mortgage-backed securities and credit default swaps – though they sound high falutin’ and advanced – have actually made the market a lot riskier.
Rajan, who is presently a Chicago Booth School professor, has also criticised protectionist policies of US President Donald Trump. He said, “There is lot of policy uncertainty right now because of the work the (US) administration is going to do and how much it can achieve.” He also indicated that there is also a geo-political risk in the world. “We have a bunch of new leaders who need to prove themselves that they are strong,” he added.
Rajan did his BTech degree from IIT Delhi, then he took admission at IIM Ahmedabad to pursue his post-graduate degree in Business Mangement. Later he earned his PhD degree at MIT Sloan School of Management.