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TPIC: ROBERT MUNDELL (Economist nobel price winner in 1999)

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Bindu Mam

Shamna M

Social science

Social Science

Robert Alexander Mundell

Robert Alexander Mundell, CC (born October 24, 1932) is a Nobel Prizewinning Canadian economist. Mundell is a professor of economics at Columbia
University and the Chinese University of Hong Kong.
He received the Nobel Memorial Prize in Economics in 1999 for his pioneering
work in monetary dynamics and optimum currency areas. Mundell is known as the
"father" of the euro, as he laid the groundwork for its introduction through this
work and helped to start the movement known as supply-side economics. Mundell
is also known for the MundellFleming model and MundellTobin effect.

About him

Mundell was born in Kingston, Ontario, Canada. He earned his BA in Economics

at the University of British Columbia in Vancouver, Canada, and his MA at the
University of Washington in Seattle. After studying at the University of British
Columbia and at The London School of Economics in 1956, he then attended the
Massachusetts Institute of Technology (MIT), where he obtained his PhD in
Economics in 1956. In 2006 Mundell earned an honorary Doctor of Laws degree
from the University of Waterloo in Canada. He was Professor of Economics and
Editor of the Journal of Political Economy at the University of Chicago from 1965
to 1972, Chairman of the Department of Economics at the University of Waterloo
1972 to 1974 and since 1974 he was Professor of Economics at Columbia
University. He also held the post of Repap Professor of Economics at McGill
University.
Career

Since 1974 he has been a professor in the Economics department at Columbia

University; since 2001 he has held Columbia's highest academic rank University
Professor. After completing his post-doctoral fellowship at the University of
Chicago in 1957, he began teaching economics at Stanford University, and then
Paul H. Nitze School of Advanced International Studies at Johns Hopkins
University during 19591961. In 1961, he went on to staff the International
Monetary Fund. Mundell returned to academics as professor of economics at the
University of Chicago from 1966 to 1971, and then served as professor during
summers at the Graduate Institute of International Studies in Geneva until 1975. In
1989, he was appointed to the post of Repap Professor of Economics at McGill
University., In the 1970s, he laid the groundwork for the introduction of the euro
through his pioneering work in monetary dynamics and optimum currency forms
for which he won the 1999 Nobel Prize in Economics. During this time he
continued to serve as an economic adviser to the United Nations, the IMF, the
World Bank, the European Commission, the Federal Reserve Board, the United
States Department of Treasury and the governments of Canada and other countries.
He is currently the Distinguished Professor-at-Large of The Chinese University of
Hong Kong.
Among his major contributions are:

 Theoretical work on optimum currency areas

Contributions to the development of the euro
Helped start the movement known as supply-side economics
Historical research on the operation of the gold standard in
different eras
Predicted the inflation of the 1970s
MundellFleming model

MundellTobin effect
Awards

Mundell was awarded the Guggenheim Fellowship in 1971 and the Nobel
Memorial Prize in Economics in 1999. In 2002 he was made a Companion of the
Order of Canada.
In 1992, Mundell received the Docteur Honoris Causa from the University of
Paris. Mundell's honorary professorships and fellowships were from Brookings
Institution, the University of Chicago, the University of Southern California,
McGill University, the University of Pennsylvania, the Bologna Center and
Renmin University of China. He became a fellow of the American Academy of
Arts and Sciences in 1998. In June 2005 he was awarded the Global Economics
Prize World Economics Institute in Kiel, Germany and in September 2005 he was
made a Cavaliere di Gran Croce del Reale Ordine del Merito sotto il Titolo di San
Ludovico by Principe Don Carlo Ugo di Borbone Parma.
The Mundell International University of Entrepreneurship in the Zhongguancun
district of Beijing, People's Republic of China is named in his honor.

International monetary flows

Mundell is best known in politics for his support of tax cuts and supply-side
economics; however, in economics it is for his work on currency areas and
international exchange rates that he was awarded the Sveriges Riksbank Prize in
Economic Sciences in Memory of Alfred Nobel by the Bank of Sweden
(SverigesRiksbank). Nevertheless, supply-side economics featured prominently in
his Bank of Sweden prize speech.
In the 1960s, Canada, of which Mundell is a native, floated its exchange: this
caused Mundell to begin investigating the results of floating exchange rates, a
phenomenon not widely seen since the 1930s "Stockholm School" successfully
lobbied Sweden to leave the gold standard.
In 1962, along with Marcus Fleming, he co-authored the MundellFleming model
of exchange rates, and noted that it was impossible to have domestic autonomy,
fixed exchange rates, and free capital flows: no more than two of those objectives
could be met. The model is, in effect, an extension of the IS/LM model applied to
currency rates.
Robert Mundell and the Theoretical Foundation for the
European Monetary Union

Mundell won the Nobel Memorial Prize in Economic Science in 1999 and gave as
his prize lecture a speech titled "A Reconsideration of the Twentieth Century".
According to the Nobel Prize Committee, he got the honor for "his analysis of
monetary and fiscal policy under different exchange rate regimes and his analysis
of optimum currency areas".
Mundell concluded in that lecture that "the international monetary system depends
only on the power configuration of the countries that make it up". With the
destruction of the old monetary system, a new international monetary system was
finally founded. Controlling inflation by each country became a main topic during
this era.
Robert Mundell laid the theoretical foundations for the European Monetary
Union. His theory of optimum currency areas, highlighted in the Nobel

Committee's citation as one of his most significant scientific contributions, has

served since the 1960s as an analytical framework for numerous debates on the
validity of the creation of a European currency. Mundell was an ardent supporter of
the euro, of which he is considered the godfather. Paradoxically, his theory has
been used by numerous economists to oppose the European Monetary Union and
question its chances of success.