by Jim Patterson

photo by Steve Green

How do you solve poverty? How do developing countries catch up? How does a nation grow?

These “big questions” are what inspired India-born Kamal Saggi to take up economics as an undergraduate at Ohio Wesleyan University. He’s devoted his career to chipping away at solutions, and going forward, he’ll do his research from Nashville.

After 15 years at Southern Methodist University, Saggi abandoned a named chair there to head up Vanderbilt’s prestigious Graduate Program in Economic Development. He is the new director of GPED and also a professor of economics.

“I thought I could be useful here,” Saggi said from his office at Calhoun Hall. “The program I’m being hired to run has a distinguished history, and I hope to move it toward an equally distinguished future.”

The Graduate Program in Economic Development, established in 1956, has educated students from more than 120 countries, many of whom have gone on to careers as finance ministers, ambassadors, heads of central banks and other important posts. Among its alumni is Muhammad Yunus, the 2006 Nobel Peace Prize recipient for his work pioneering microfinance – the lending of small loans to struggling people in Bangladesh and elsewhere.

Saggi says the program will continue to serve its traditional clientele of policy makers from developing nations, but also will expand to accommodate the needs of students from nations such as China and India, whose economies are rapidly expanding.

“A lot of places in the world are growing really fast,” Saggi said. “People in these economies are interested in development, but they’re also interested in growth. Those are not exactly the same thing.”

Development involves things such as strategies to make sure food gets distributed to people who need it, rather than rotting in government warehouses. Growth is about absorbing new technologies and pushing forward to become economic leaders in the world market.

“If you are a developing country, you can benefit from being able to make something that is of world-class quality cheaper than everybody else,” Saggi said. “But that game is only going to take you so far. Ultimately, you have to be the one that innovates and comes up with new products.”

Saggi came to America intending to study science – physics and engineering in particular. But as a freshman he took an economics course and got hooked.

“It was thrilling to be thinking about big, big questions like eradicating poverty rather than building a circuit. I don’t have all the answers, but I can work toward answers to smaller, well-defined questions that help answer the big questions.”

In light of economic troubles in America, Saggi wishes to make clear that research economists are not in the business of predicting the stock market or helping anyone in particular make money. It’s about the “big picture.”

“I don’t think economists are soothsayers,” he said. “But I think they are very good at analyzing why things work and why they don’t work and how you can realign institutions and rules so that things work better.”

Saggi’s wife, Rupi Saggi, will teach economics at Vanderbilt. The couple has 8-year-old twins.   

posted 10/01/10