Timeline
- 1943
- Born in Gary, Indiana.
- 1965
- Researcher at University of Chicago.
- 1966
- Appointed Assistant Professor at Massachusetts Institute of Technology.
- 1967
- Received PhD from Massachusetts Institute of Technology.
- 1969
- Fulbright Research Fellow at the University of Cambridge.
- 1979
- Received the John Bates Clark Medal.
- 1995
- Appointed Chairman of the Council of Economic Advisers.
- 1997
- Appointed Chief Economist of the World Bank.
- 2000
- Founded the Initiative for Policy Dialogue.
- 2001
- Appointed a Professor at Columbia University.
- 2001
- Received the Nobel Memorial Prize in Economic Sciences.
- 2002
- Publication of Globalization and Its Discontents.
- 2003
- Appointed University Professor at Columbia University.
- 2003
- Publication of The Roaring Nineties.
- 2006
- Publication of Making Globalization Work.
- 2008
- Publication of The Three Trillion Dollar War.
Life and Career
Joseph Stiglitz is an economist, a writer on globalization and its effects, and a former senior vice-president and chief economist of the World Bank. He has held professorships at Yale, Duke, Stanford, Oxford, and Princeton universities, and currently teaches at Columbia. He chairs the University of Manchester’s Brooks World Poverty Institute, Columbia’s Committee on Global Thought, and is President Elect of the International Economic Association. He is the most cited economist in the world, and has served in the Clinton Administration, as chair of the President’s Council of Economic Advisors, in which capacity he also served as a member of the cabinet. He has been a member of the Intergovernmental Panel on Climate Change, and was recently appointed to chair a Commission on the Measurement of Economic Performance and Economic Progress.
Key Thinking
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Stiglitz helped develop a new branch of economics, “the economics of information”, which explores information asymmetries; it was based on his research on screening, for which he was awarded the Nobel Memorial Prize.
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He has been a critic of the management of globalization, free-market economists, and international institutions such as the International Monetary Fund, and the World Bank.
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His tenure at the World Bank was during protests against globalization, and he was fired as Chief Economist for expressing dissent with its policies.
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In his book, Stability with Growth, he focused on macroeconomic policy and capital market liberalization, and developed a new framework for assessing alternative policies, based on real stability and long-term, sustainable, and equitable growth.
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Making Globalization Work considers the global economy, and the mechanisms by which developed countries exert an excessive influence over developing nations.
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He argues that through tariffs, subsidies, a complicated patent system, and pollution, economies are being economically and politically destabilized, and that strong, transparent institutions are needed to redress the balance.
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In Globalization and Its Discontents, he argues that developing economies are not really developing at all, and blames the IMF for stifling growth and information.
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In Whither Socialism?, he analyzes information economics and the theory of markets with imperfect information and imperfect competition, and offers a critique of both free-market and socialist approaches.
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This research counters prevailing neoclassical economics, arguing that markets are only efficient under exceptional circumstances.
In Perspective
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Stiglitz has made major contributions to macroeconomics and monetary theory, to development economics and trade theory, to public and corporate finance, to the theories of industrial organization and rural organization, and to the theories of welfare economics, and of income and wealth distribution.
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He also pioneered such concepts as adverse selection and moral hazard, which have now become standard tools of researchers and policy analysts.
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The Shapiro–Stiglitz model of efficiency wages, which he developed with the economist Carl Shapiro, examines unemployment, and why wages are not bid down to enable full employment.
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The model states that unemployment is driven by the information structure of employment, and dependent on the cost to firms in knowing how much effort their workers are putting in.
Quotation
“Economists often like startling theorems, results which seem to run counter to conventional wisdom.”
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