Raghuram Rajan

Raghuram Govind Rajan (born 3 February 1963) is an Indian economist and the Katherine Dusak Miller Distinguished Service Professor of Finance at the University of Chicago's Booth School of Business.

Raghuram Rajan was born on 3 February 1963 in Bhopal, Madhya Pradesh.

Assigned to the Intelligence Bureau, R. Govindarajan, his father, was posted to Indonesia in 1966.

In 1968, he joined the newly created external intelligence unit, the Research and Analysis Wing (R&AW) where he served as staff officer under R. N. Kao and became part of the "Kaoboys".

In 1970, he was posted to Sri Lanka, where Rajan missed school one year because of political turmoil.

After Sri Lanka, R. Govindarajan was posted to Belgium where the children attended a French school.

In 1974, the family returned to India.

Throughout his childhood, Rajan presumed his father to be a diplomat since the family traveled on diplomatic passports.

He was a half-term student of Campion School, Bhopal until 1974.

From 1974 to 1981 Rajan attended Delhi Public School, R. K. Puram, In 1981 he enrolled at Indian Institute of Technology Delhi for a bachelor's degree in electrical engineering.

In the final year of his four-year degree, he headed the Student Affairs Council.

The nature of financial systems had witnessed widespread changes in the 1980s, with markets getting deregulated, information becoming more widely available and easier to process, and competition having increased.

The established orthodoxy claimed that deregulation must necessarily increase competition, which would translate into greater efficiency.

In his thesis, Rajan argued that this might not necessarily be the case.

The first essay focused on the choice available to firms between arm's length credit and relationship-based credit.

The second focused on the Glass-Steagall Act, and the conflict of interest involved when a commercial lending bank enters into investment banking.

The final essay examined why indexation of a country's debt, despite offering potential advantages, seldom featured in debt reduction plans.

He graduated in 1985 and was awarded the Director's Gold Medal as the best all-round student.

In 1987, he earned a Master of Business Administration from the Indian Institute of Management Ahmedabad, graduating with a gold medal for academic performance.

He joined the Tata Administrative Services as a management trainee, but left after a few months to join the doctoral program at the Sloan School of Management at Massachusetts Institute of Technology.

In 1991, he received a PhD for his thesis titled Essays on Banking under the supervision of Stewart Myers, consisting of three essays on the nature of the relationship between a firm or a country, and its creditor banks.

In 1991, Rajan joined as an assistant professor of finance at the Booth School of Business at the University of Chicago, and became a full professor in 1995.

He has taught as a visiting professor at Stockholm School of Economics, Kellogg School of Management, MIT Sloan School of Management, and Indian School of Business.

Rajan has written extensively on banking, corporate finance, international finance, growth and development, and organisational structures.

He is a regular contributor to Project Syndicate.

He has collaborated with Douglas Diamond to produce much-cited work on banks, and their interlinkages with macroeconomic phenomena.

He has worked with Luigi Zingales on the effect of institutions on economic growth, their research showing that development of free financial markets is fundamental to economic modernisation.

Between 2003 and 2006 he was Chief Economist and director of research at the International Monetary Fund.

In 2003, Rajan received the inaugural Fischer Black Prize, given every two years by the American Finance Association to the financial economist younger than 40 who has made the most significant contribution to the theory and practice of finance.

Rajan and Zingales built on their work to publish Saving Capitalism from the Capitalists in 2003.

The book argued that entrenched incumbents in closed financial markets stifle competition and reforms, thereby inhibiting economic growth.

At the 2005 Federal Reserve annual Jackson Hole conference, three years before the 2008 crash, Rajan warned about the growing risks in the financial system, that a financial crisis could be in the offing, and proposed policies that would reduce such risks.

Former U.S. Treasury Secretary Lawrence Summers called the warnings "misguided" and Rajan himself a "luddite".

However, following the financial crisis of 2007–2008, Rajan's views came to be seen as prescient, and he was extensively interviewed for the Academy Awards-winning documentary Inside Job (2010).

His book, Fault Lines: How Hidden Fractures Still Threaten the World Economy, won the Financial Times/Goldman Sachs Business Book of the Year award in 2010.

Rajan's 2010 book Fault Lines: How Hidden Fractures Still Threaten the World Economy examined the fundamental stresses in the American and the global economy that led to the financial crisis of 2007–2008.

He was awarded an honorary doctorate degree by the London Business School in 2012, the Hong Kong University of Science and Technology in 2015, and the Catholic University of Louvain in 2019.

From September 2013 through September 2016 he was the 23rd Governor of the Reserve Bank of India.

In 2015, during his tenure at the RBI, he became the Vice-Chairman of the Bank for International Settlements.

In 2016, he was named by Time in its list of the '100 Most Influential People in the World'.