TN Srinivasan: A Veteran Economist

With the passing away of Thirukodikaval Nilakanta Srinivasan—fondly called as TN—in Chennai on November 11 at the age of 85, India has lost a great economist—who, along with Jagadish Bhagwati and Padma Desai, provided an intellectual framework for economic reforms that India launched in the wake of balance of payments crisis in 1991 which indeed improved the lives of millions of people—and the world a true scholar.

TN’s writings in a large number of fields such as international trade, development economics, public finance, econometrics, economic theory, multilateral trading system and developing countries, regionalism and multilateralism well reflect his complete mastery over mathematical techniques, which incidentally is not a surprise, for before getting his PhD in economics from Yale, he obtained a BA (Hons) and MA in mathematics from the University of Madras in 1953 and 1954 respectively followed by two-year professional training in statistics at the Indian Statistical Institute in Calcutta under the baton of stalwarts like PC Mahalanobis and CR Rao. It was from here that TN, having attracted the attention of Tjalling Koopmans, Nobel laureate in Economics in 1975, moved to Yale, where he earned his Master’s degree in economics, followed by PhD in 1962.

TN then served on the faculty of several institutions in India and abroad: Indian Statistical Institute, Delhi, Stanford University, the Massachusetts Institute of Technology and Johns Hopkins University in the US. During 1977-80, he served as special adviser to the World Bank’s Development Research Center. Finally, he joined Yale’s faculty as a full professor in 1979 and served as chair of the department of economics from 1997 to 2000.

TN, “a giant of the economic profession”, began his career by working on the problem: “Investment criteria and choice of techniques of production” in which he attempted to develop a dynamic model—as against the earlier models that analyzed the problem of growth in a static framework—with explicit constraints operative at each point in time to throw light on a clear understanding of the problem of choice of investment criteria.

It is while working from the planning unit of ISI, Delhi in the 60s that TN came in close contact with Jagadish Bhagwati—the “doyen of international trade economists”—and over time these two becoming close collaborators published many highly influential papers in the field of international trade theory. Their joint publications spreading across theory of distortions, non-economic objectives, effective protection, smuggling, transfer paradox, tariff-jumping investment, and most importantly, policy rankings to tackle market failures had thrown open new avenues of research for younger economists to pursue. Incidentally, commenting on the work of Jagdish Bhagwati and TN on “the theory of ranking different policies to tackle economic failures”, Avinash Dixit of Princeton University said that they surely deserve a Nobel. 

TN, a strong votary of free trade and multilateralism, regularly wrote on Indian economic policies right from the 1960s till his last breath. He, along with Jagadish Bhagwati and Padma Desai, questioned the wisdom of India’s inward-looking development strategy of the 1950s and 1960s. His singular contribution to this debate was the book that he co-authored with Jagadish Bhagwati in 1975: Foreign Trade Regimes and Economic Development: India—a profound critique of the Indian economic policy—that rigorously established the economic costs of India’s extreme anti-trade bias that was practiced till the 1980s.

Later in the 1990s, at the behest of the then finance minister Manmohan Singh, he, taking stock of the then launched economic reforms, co-authored the book, India’s Economic Reforms, with Bhagwati, wherein the duo gave a well-articulated road map for fresh reforms. Again in 2003, writing a working paper, “Indian Economy: Current Problems and Future Prospects”, he argued for certain corrective actions to revive the investment climate in India such as: fiscal consolidation, tax and expenditure reforms, further opening up of the economy to foreign trade and investment, a clearly drawn path for the capital account convertibility of the rupee, steps to alleviate infrastructure constraints, and labor and insolvency reforms. Of course, some of these ideas were addressed by the successive governments, albeit slowly over a period of time.

He had authored quite a few books on Indian economy: Growth, Sustainability and India’s Economic Reforms, Reintegrating India with the World Economy, Eight Lectures on India’s Economic Reforms, and Agriculture, Growth and Redistribution of Income: Policy Analysis with a General Equilibrium Model of India. Amongst his vast contributions to the scholarly literature, mention must be made of his co-editing the Handbook of Development Economics, besides co-authoring books, viz., Lectures on International Trade with Bhagwati, and General Equilibrium Trade Policy Modeling with John Whalley.

TN, a brilliant proponent of market-oriented economics, was highly critical of the ‘nationalism’ that is today sweeping the world. At the same time, he was deeply sceptical about the market’s ability to take care of all problems as is evident from what he wrote about basic minimum income for all: “The stage has come when we should sharply focus our efforts on providing an assured minimum income to every citizen of the country within a reasonable period of time. Progressively, this minimum itself should be raised as development goes apace.”

It is his deep concern for the poor that perhaps aroused interest in him for empirical economics in the pursuit of which he attached highest importance to survey data. He strongly believed that it is the data that allows a researcher to know where the problems are and in this regard he claims to be guided by his three Gurus: PC Mahalanobis and CR Rao brilliant statisticians from ISI and his PhD adviser at Yale, Tjalling Koopmans from whom he acquired the credo that there is no measurement without an antecedent theory. He hated misuse of data and had always been incisive and attentive to every detail and it is with brutal honesty pursued his research, which indeed made TN a great source of inspiration   to so many youngsters.

In 2007, the Government of India honored him with Padma Bhushan Award—India’s third highest civilian honor—for his contributions to the Indian economy. He was a Foreign Associate of the National Academy of Sciences and Fellow of the American Philosophical Society, the Econometric Society and the American Academy of Arts and Sciences. He was named Distinguished Fellow of the American Economic Association in 2003.

To rightly draw the sketch of this multifaceted and iconoclastic economist, your most obedient has to borrow the definition Keynes gave for an ideal economist: He is a “mathematician, historian, statesman, philosopher—in some degree… stud[ied] the present in the light of the past for the purposes of the future… [is] purposeful and disinterested in a simultaneous mood; as aloof and incorruptible as an artist, yet sometimes as near to earth as a politician.” TN, an economist who could juggle the worlds of academia and policy at ease and known to have “never craved for public recognition and was immersed in the world of scholarship till the very end”, is certain to inspire the young economists for generations to come.