American economist
Andrei Shleifer
(
SHLY
-f?r
; born February 20, 1961) is a
Russian-American
economist and Professor of Economics at
Harvard University
, where he has taught since 1991. Shleifer was awarded the biennial
John Bates Clark Medal
in 1999 for his seminal works in three fields: corporate finance (corporate governance, law and finance), the economics of financial markets (deviations from efficient markets), and the
economics of transition
.
IDEAS/RePEc
ranked him as the second top economist in the world in 2011,
[3]
and the top economist in 2024.
[4]
He is also listed as #1 on the list of "Most-Cited Scientists in Economics & Business".
[5]
On Google Scholar, as of 2024 he had over 400,000 citations.
[6]
Life
[
edit
]
He was born to a
Jewish
family
[7]
in the
Soviet Union
and emigrated to
Rochester, New York
, as a teenager in 1976, where he attended an inner-city school and learned English from episodes of
Charlie's Angels
.
[8]
He then studied
mathematics
, obtaining his BA from
Harvard University
in 1982.
[9]
Following this, he went to graduate school in
economics
, acquiring his
PhD
from
MIT
in 1986 at the age of 25. As a freshman at Harvard, Shleifer took
Math 55
with
Brad DeLong
; he has said that the course made him realize he was not destined to be a mathematician, but the experience gave him a future co-author.
[8]
Shleifer also met his mentor and professor,
Lawrence Summers
, during his undergraduate education at Harvard. The two went on to be co-authors, joint grant recipients, and faculty colleagues.
[10]
He has held a tenured position in the Department of Economics at
Harvard University
since 1991 and was, from 2001 through 2006, the
Whipple V. N. Jones
Professor of Economics.
[11]
Previously, he taught at the
Graduate School of Business
at the
University of Chicago
and briefly at
Princeton University
.
Work
[
edit
]
Shleifer's earliest work was in
financial economics
, where he has contributed to the field of
behavioral finance
. In 1997, he and Robert Vishny published "The Limits to Arbitrage" that addressed efficient markets.
[12]
The article notes that investors who bet against a major overvaluation or undervaluation are exposing themselves to substantial risks if there is uncertainty about how long it will take for the misvaluation to be corrected. This is especially true for a hedge fund for which its investors might withdraw their money if the hedge fund temporarily has disappointing returns, forcing the fund to buy an overvalued asset that it has shorted, or to sell an undervalued asset that it has bought. In
Roger Lowenstein
's 2000 book,
When Genius Failed: The Rise and Fall of Long-Term Capital Management
, the author credits Shleifer and Vishny with describing the problem that led to
LTCM's
1998 collapse.
Shleifer has also written influential papers on political economy, the economics of transition, and economic development, collaborating with his former colleagues in Chicago,
Kevin M. Murphy
and
Robert W. Vishny
. Their paper "Industrialization and the Big Push" was credited by
Paul Krugman
as a major breakthrough which ended a "long slump in development theory".
[13]
With coauthors
Robert W. Vishny
,
Rafael La Porta
,
Simeon Djankov
and
Florencio Lopez de Silanes
, Shleifer has also made significant contributions to the study of corporate governance. In particular, Shleifer and Vishny's 1997 article
A Survey of Corporate Governance
[14]
focused on the big differences across countries in the use of bank debt versus equity financing.
Starting in 1997, his research focused on the
legal origins theory
(also sometimes known as
law and finance
theory), which claims that the legal tradition a country adheres to (such as
common law
or various types of
civil law
) is an important determining factor for a country's development, most of all financial development.
The Clark medal citation described him as a "superb economist, working in the old Chicago tradition of building simple models, emphasizing basic economic mechanisms, and carefully looking at the evidence.... A recurring theme of his research is the respective role of markets, institutions, and governments."
[15]
Asset management
[
edit
]
In 1994 Shleifer founded
LSV Asset Management
with
Josef Lakonishok
and
Robert Vishny
. As of February 2006, it managed about $50 billion. Shleifer has since sold his ownership stake.
[16]
Russian Project
[
edit
]
During the early 1990s, Andrei Shleifer, a native Russian speaker, headed a Harvard project under the auspices of the
Harvard Institute for International Development
's Russian aid project from its inauguration in 1992 until 1997.
[10]
Some people associated with the project made Russian investments, and he settled a lawsuit from the U.S. government for such a violation of HIID's contract.
[17]
Shleifer was also a direct advisor to
Anatoly Chubais
, then vice-premier of
Russia
, who managed the Rosimushchestvo (
Russian
:
росимущество
,
lit.
'Russian assets' or Committee for the Management of State Property) portfolio and was a primary engineer of
Russian privatization
. Shleifer was also tasked with establishing a stock market for Russia that would be a world-class capital market.
[18]
In 1996 complaints about the Harvard project led Congress to launch a
General Accounting Office
investigation, which stated that the Harvard Institute for International Development (HIID) was given "substantial control of the U.S. assistance program.”
[19]
In 1997, the U.S. Agency for International Development (USAID) canceled most of its funding for the Harvard project after investigations showed that top HIID officials Andrei Shleifer and Jonathan Hay had used their positions and insider information to profit from investments in the Russian securities markets. Among other things, the Institute for a Law Based Economy (ILBE) was allegedly used to assist Shleifer's wife,
Nancy Zimmerman
, who operated a hedge fund that speculated in Russian bonds.
[18]
In August 2005, Harvard University, Shleifer and the Department of Justice reached an agreement under which the university paid $26.5 million to settle the five-year-old lawsuit. Shleifer was also responsible for paying $2 million worth of damages, though he did not admit any wrongdoing.
[11]
[20]
Works
[
edit
]
References
[
edit
]
- ^
a
b
Shleifer, Andrei (1986).
The business cycle and the stock market
(PDF)
(PhD).
MIT
. Retrieved
21 May
2017
.
- ^
Andrei Shleifer.
"The Age of Milton Friedman"
. Retrieved
2013-10-19
.
- ^
"Economist Rankings at IDEAS"
. Ideas.repec.org
. Retrieved
2011-09-13
.
- ^
"Economist Rankings | IDEAS/RePEc"
.
ideas.repec.org
. Retrieved
2024-04-24
.
- ^
"Most-Cited Scientists in Economics & Business"
Archived
2015-09-24 at the
Wayback Machine
ISI Web of Knowledge
- ^
Shleifer, Andrei (2024-04-24).
"Andrei Shleifer"
.
Google Scholar
. Retrieved
2024-04-24
.
- ^
The Harvard Crimson: "Was Shleifer Screwed? - Sure, he had to pay a $2 million settlement?but he also got mad loot from Harvard" By Zachary M. Seward
September 29, 2005
- ^
a
b
Bhayani, Paras D. (June 4, 2007).
"Andrei Shleifer and J. Bradford DeLong"
.
Harvard Crimson
. Retrieved
2009-03-12
.
- ^
"Archived copy"
(PDF)
. Archived from
the original
(PDF)
on 2014-01-08
. Retrieved
2014-01-08
.
{{
cite web
}}
: CS1 maint: archived copy as title (
link
)
- ^
a
b
Wedel, Janine. Shadow Elite: How the World's New Power Brokers Undermine Democracy, Government, and the Free Market. New York: Basic, 2009.
- ^
a
b
Bombardieri, Marcella (2006-10-14).
"Harvard professor loses honorary title in ethics violation"
.
Boston Globe
.
- ^
Shleifer, Andrei; Vishny, Robert W. (1997).
"The Limits of Arbitrage"
.
The Journal of Finance
.
52
(1): 35?55.
doi
:
10.2307/2329555
.
ISSN
0022-1082
.
JSTOR
2329555
.
- ^
Paul Krugman.
"The Fall and Rise of Development Economics"
. Retrieved
2013-10-19
.
- ^
Shleifer, Andrei; Vishny, Robert W. (1997).
"A Survey of Corporate Governance"
.
The Journal of Finance
.
52
(2): 737?783.
doi
:
10.2307/2329497
.
ISSN
0022-1082
.
JSTOR
2329497
.
- ^
"Andrei Shleifer, Clark medal citation"
(PDF)
. aeaweb.org. Archived from
the original
(PDF)
on 2013-05-30
. Retrieved
2013-10-19
.
- ^
"How Harvard lost Russia"
. Archived from
the original
on 2007-09-27
. Retrieved
2007-05-06
.
- ^
"How Harvard lost Russia | Institutional Investor"
. Archived from
the original
on 2016-08-27
. Retrieved
2016-05-09
.
- ^
a
b
"How Harvard Lost Russia"
. Institutional Investor. February 27, 2006. Archived from
the original
on July 5, 2014
. Retrieved
May 28,
2016
.
- ^
"Who Taught Crony Capitalism to Russia?"
. The Wall Street Journal Europe. March 19, 2001
. Retrieved
2011-11-11
.
- ^
"Harvard Defendants Pay Over $31 Million to Settle False Claims Act Allegations, Reports... -- re> BOSTON, Aug. 3 /PRNewswire/ --"
. Archived from
the original
on 2013-09-12.
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