Ricardo Hausmann

Ricardo Hausmann (born 1956) is the former Director of the Center for International Development currently leading the Center for International Development’s Growth Lab and is a Professor of the Practice of Economic Development at the John F. Kennedy School of Government at Harvard University.

He earned a bachelor's degree in Engineering and Applied Physics (1977) and a PhD in Economics (1981) at Cornell University.

From 1985 to 1991, he was professor of Economics at the Instituto de Estudios Superiores de Administracion in Caracas, where he founded the Center for Public Policy.

He is also a former Venezuelan Minister of Planning and former Head of the Presidential Office of Coordination and Planning (1992–1993).

He co-introduced several regularly used concepts in economics including original sin, growth diagnostics, self-discovery, dark matter, the product space, and economic complexity.

Ricardo is the father of theatre director and producer Michel Hausmann, art historian Carolina Hausmann and comedian Joanna Hausmann.

Hausmann was born to a Jewish family in Venezuela.

His father was a refugee of the Holocaust who was born in Leipzig, Germany and was orphaned as a teenager.

His mother was from Belgium.

From 1992 to 1993, he served as Minister of Planning of Venezuela and as a member of the Board of the Central Bank of Venezuela.

Around the same time, he was Chair of the IMF-World Bank Development Committee.

Hausmann served as the first Chief Economist of the Inter-American Development Bank (1994–2000), where he created the Research Department.

The expression original sin was first used in international finance in a 1999 article by Barry Eichengreen and Hausmann.

The authors define original sin as a situation in which the residents (or government) of a country are unable to borrow in their own domestic currency.

In other words, a poor country is forced to borrow funds denominated in foreign exchange (e.g. the U.S. dollar, the euro, or the yen).

Based on their measure of original sin the authors show that original sin was present in most of the developing economies and independent from histories of high inflation and currency depreciation.

This is seen as problematic because if the borrowing country's domestic currency depreciates, the loan will become more difficult to pay back, since their currency is now worth less relative to the loan.

Later research has mainly focused on the international component of original sin: the inability of most countries to borrow abroad in their own currency.

Barry Eichengreen, Hausmann and Ugo Panizza show that almost all of the countries (except US, Euro area, Japan, UK, and Switzerland) suffered from (international) original sin over time.

The authors argued that this international component of original sin has serious consequences.

It makes debt riskier, increases volatility, and affects a country's ability to conduct an independent monetary policy.

This is because original sin is likely to cause a currency mismatch in the national balance sheet of a country: the currencies of its assets and those of its liabilities do not correspond.

Thus, large swings in the real exchange rate will have an effect on aggregate wealth and it will be more difficult for the country to service its debt.

In September 2000 Hausmann came to Harvard.

Hausmann is director of the Center for International Development (CID) at Harvard University and Professor of the Practice of Economic Development at the Harvard Kennedy School of Government.

He also holds the George A. Cowan chair at the Santa Fe Institute.

Concurrently with his position at CID, Hausmann has also held several positions at profit and non-profit organizations: he was a member of the board of Venezuela's full-service telephone company CANTV (2001–2007), of microfinance institution ACCION International (2009–2011), and of the advisory board of Abengoa, a renewable energy and engineering company based in Spain.

Between 2005 and 2008 he chaired the International Panel on the Accelerated and Shared Growth Initiative for South Africa, an international panel of economists called upon by South African government to advise their economic growth program.

He also teaches two development-related subjects: Development Policy Strategy and Why Are So Many Countries Poor, Volatile, and Unequal?.

He also works on gender issues and has been a co-author of the World Economic Forum's yearly Global Gender Gap Report since its creation in 2006.

He writes a monthly syndicated column for Project Syndicate covering economics of development.

From 2010 to 2011, he was also the elected president of the Latin-American and Caribbean Economic Association.

At CID, Hausmann has concentrated his research efforts in two broad areas: the underlying determinants of macroeconomic volatility, financial fragility and crises; and the determinants of long run growth.

Themes he has been exploring include the causes of growth accelerations and collapses; the causes and consequences of original sin; growth diagnostics, the process of structural transformation and the Product Space; and global imbalances and dark matter.

Country-specific studies he has been involved with have included projects on Argentina, Armenia, Azerbaijan, Belize, Brazil, Colombia, Chile, China, El Salvador, Egypt, Guatemala, India, Kazakhstan, Mexico, Morocco, Paraguay, Peru, South Africa, Tunisia, Venezuela, and the United States.

Since 2014 Hausmann operates his private consulting firm, Ricardo Hausmann Consulting LLC, located in Boston, Massachusetts.

On March 4, 2019, Juan Guaidó named Hausmann as Venezuela's representative to the Inter-American Development Bank (IDB), a Washington-based multilateral agency and the only international financial organization to recognize Guaidó as the legitimate president of Venezuela.

The IDB cancelled its annual meeting in Chengdu, China after Hausmann was denied a visa by the Chinese government.

On September 27, 2019 Hausmann resigned as ambassador to the IDB, writing on Twitter that "his academic duties at Harvard University are incompatible with the job at the IDB".

Hausmann emphasized that he would be available to help Guaidó "any way he could"; he recommended Alejandro Plaz as Venezuela's IDB representative, who was named to the post by Guaidó.