Ricardo Hausmann
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Ricardo Hausmann is a former Venezuelan Minister of State and Head of the "Presidential Office of Coordination and Planning" (1992-1993) and current Director of Harvard's Center for International Development and a Professor of the Practice of Economic Development at John F. Kennedy School of Government at Harvard University.[1]
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[edit] Career
Hausmann earned a Bachelor's degree in Engineering and Applied Physics (1977) and a PhD in Economics (1981) at Cornell University. Before coming to Harvard in 2000, he served as the first Chief Economist of the Inter-American Development Bank (1994-2000), where he created the Research Department. He has served as Minister of Planning of Venezuela (1992-1993) and as a member of the Board of the Central Bank of Venezuela. He also served as Chair of the IMF-World Bank Development Committee. He was Professor of Economics at the Instituto de Estudios Superiores de Administracion (IESA) (1985-1991) in Caracas, where he founded the Center for Public Policy.[1]
[edit] Original Sin
The expression Original Sin was first used in international finance in a 1999 article by Barry Eichengreen and Ricardo Hausmann. In that setting the authors defined original sin as "a situation in which the domestic currency is not used to borrow abroad or to borrow long-term even domestically" (p. 330). This definition suggests that original sin can be divided into two parts: international original sin and domestic original sin.
Barry Eichengreen, Ricardo Hausmann and Ugo Panizza focused on the international component of original sin and, using Bank of International Settlement (BIS) data on outstanding international securities, showed that the great majority of these securities are denominated in five currencies (US Dollar, Euro, Yen, Swiss Franc, and British Pound) and that this situation is not due to the fact the residents of the countries that issue these five currencies also issue most of the international bonds.
The same authors argued that international original sin has serious consequences. If a country affected by original sin has net foreign debt, then this country is likely to have a currency mismatch in its national balance sheet and large swings in the real exchange rate will have an effect on aggregate wealth and affect a country's ability to service its debt. As a consequence, original sin tends to make debt riskier, increase volatility, and affect a country's ability to conduct an independent monetary policy.
When they studied the causes of original sin, Barry Eichengreen, Ricardo Hausmann and Ugo Panizza found that country size is the only variable that is robustly correlated with original sin. Surprisingly, they found no significant correlation between original sin and several variables aimed at capturing economic and institutional development, lack of monetary credibility, and fiscal profligacy.
[edit] Previous assignments
- First Chief Economist of the Inter-American Development Bank (1994-2000)
- Created a Research Department
- Minister of Planning in Venezuela (1992-1993)
- Member of the Board of the Central Bank of Venezuela
- Chair of the IMF-World Bank Development Committee
- Professor of Economics at the Instituto de Estudios Superiores de Administracion (IESA) (1985-1991) in Caracas
- Founded the Center for Public Policy
[edit] References
- ^ a b Ricardo Hausmann (html). John F. Kennedy School of Government. Retrieved on 2007-05-20.
