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Joseph E. Stiglitz

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Joseph E. Stiglitz
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Joseph E. Stiglitz

Joseph Stiglitz (born February 9, 1943) is an American economist. He is a recipient of the John Bates Clark Medal (1979) and the Bank of Sweden Prize in Economic Sciences in Memory of Alfred Nobel (2001). Former Senior Vice President and Chief Economist of the World Bank, he is famous for his critical view of globalization and international institutions like the International Monetary Fund or the World Bank. In 2000 Stiglitz founded the Initiative for Policy Dialogue (IPD), a think tank on international development based at Columbia University. Since 2001 he has been a member of the Columbia faculty, and has held the rank of University Professor since 2003. He also advises the University of Manchester's World Poverty Institute.

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Biography

Stiglitz was born in Gary, Indiana, to Charlotte and Nathaniel Stiglitz. From 1960 to 1963, he studied at Amherst College, where he was a highly active member of the debate team. He went to the Massachusetts Institute of Technology (MIT) for his fourth year as an undergraduate, where he later pursued graduate work. From 1965 to 1966, he moved to Chicago to do research under Hirofumi Uzawa who had received a NSF grant. He studied for his PhD from MIT from 1966 to 1967, during which time he also held an MIT assistant professorship. From 1969 to 1970, he was a Fulbright research fellow at the University of Cambridge. In subsequent years, he held professorships at Yale University, Stanford University, Oxford University and Princeton University. Stiglitz is currently a Professor at Columbia University, with appointments at the Business School, the Department of Economics and the School of International and Public Affairs (SIPA), and is editor of The Economists' Voice journal with J. Bradford DeLong and Aaron Edlin.

In addition to making numerous influential contributions to microeconomics, Stiglitz has played a number of policy roles. He served in the Clinton Administration as the chair of the President's Council of Economic Advisors (1995 – 1997). At the World Bank, he served as Senior Vice President and Chief Economist (1997 – 2000), in the time when unprecedented protest against international economic organizations started, most prominently with the Seattle WTO meeting of 1999.

Leaving the World Bank

Stiglitz always had a poor relationship with Treasury Secretary Lawrence Summers. In 2000 Summers successfully petitioned for Stiglitz's removal, supposedly in exchange for World Bank President James Wolfensohn's re-appointment - an exchange that Wolfensohn denies took place. Whether Summers ever made such a blunt demand is questionable - Wolfensohn claims he would "have told him to fuck himself" (Mallaby, The World's Banker, p266).

Stiglitz promptly resigned his post as chief Economics advisor but stayed on as 'Special advisor to the President'. In this role, he continued criticism of the IMF, and, by implication, the US treasury department. In April 2000, in an article for the New Republic, he wrote on the IMF :

"They’ll say the IMF is arrogant. They’ll say the IMF doesn’t really listen to the developing countries it is supposed to help. They’ll say the IMF is secretive and insulated from democratic accountability. They’ll say the IMF’s economic ‘remedies’ often make things worse – turning slowdowns into recessions and recessions into depressions. And they’ll have a point. I was chief economist at the World Bank from 1996 until last November, during the gravest global economic crisis in a half-century. I saw how the IMF, in tandem with the U.S. Treasury Department, responded. And I was appalled".
The article was published a week before the annual meetings of the World Bank and IMF and provoked a strong response. It proved too strong for Summers, yet more lethally, Stiglitz's protector-of-sorts at the World Bank, Wolfensohn. Wolfensohn had privately empathised with Stiglitz's views, yet this time he had gone too far. Wolfensohn, worried for his second term - which Summers had threatened to veto - and with it, his Nobel Peace prize, had little other option left. Stiglitz was fired by Wolfensohn (see US Hegemony and the World Bank, p222-223, by Wade in 2002, Review of the International Political Economy).

Contribution to economics, life after the World Bank

In July 2000 Stiglitz founded the Initiative for Policy Dialogue (IPD) to help developing countries explore policy alternatives, and enable wider civic participation in economic policymaking.

Stiglitz' most famous research was on screening, a technique used by one economic agent to extract otherwise private information from another. It was for this contribution to the theory of information asymmetries that he shared the Nobel prize with George A. Akerlof and A. Michael Spence.

Along with his technical economic publications, Stiglitz is the author of Whither Socialism, a non-mathematical book providing an introduction to the theories behind economic socialism's failure in Eastern Europe, the role of imperfect information in markets, and misconceptions about how truly "free market" the free market capitalist system is. In 2002, he wrote Globalization and Its Discontents, where he asserts that the International Monetary Fund puts the interest of "its largest shareholder," the United States, above those of the poorer nations it was designed to serve. Stiglitz offers some reasons why globalization has engendered the hostility of protesters, such as those at Seattle and Genoa. This book sold over a million copies worldwide and was translated into more than 30 languages.

In 2003, Stiglitz published The Roaring Nineties, his analysis of the boom and bust of the 1990s. In 2004 he published "New Paradigm for Monetary Economics" (Cambridge University Press) and in 2005, Oxford University Press published his book "Fair Trade for All." Norton and Penguin will bring out "Making Globalization Work" in September, 2006.

Personal Information

Stiglitz's first two marriages ended in divorce. He was married for the third time on October 28, 2004, to Anya Schiffrin, who works at the School of International and Public Affairs at Columbia University.

Publications

[Online access to his published papers at his own website]

External Links

Video lectures

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Nobel Memorial Prize in Economics: Laureates (2001- )
2001: Akerlof, Spence, Stiglitz | 2002: Kahneman, Smith | 2003: Engle, Granger | 2004: Kydland, Prescott | 2005: Aumann, Schelling

 

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