Agent Provocateur

AuthorJeremy Clift
PositionPublisher of the IMF and a former Editor-in-Chief of Finance & Development.

Rey presents Felix Neubergh Lecture

On warmer days, Hélène Rey likes to scoot across Regent’s Park to her work amid the white colonnades of the London Business School. She shows off her skills down the narrow corridor outside her small, book-lined office, deftly touching the back brake of the scooter’s aluminum frame with her left foot as she speeds along.

“My house is just across the park, so it’s convenient,” says the prize-winning economics professor. “There’s wild herons, bright green parakeets, and lots of ducks. Even the occasional black swan—turns out they are not so rare,” she says with a chuckle. Indeed a couple of Regent’s Park black swans, which traditionally mate for life, made headlines in the global media a while ago because they had to be separated by park keepers when they squabbled too much during courting.

Best-selling author Nassim Nicholas Taleb adopted the term black swan events to describe rare happenings that have major repercussions in the business and financial sectors but were completely unpredictable or thought unlikely, as black swans are in nature.

“In reality though,” says Rey, “black swans are not totally abnormal,” referring to the Taleb version. “I don’t think big shocks are a very unusual thing. It depends on the system and the incentives you give to people.”

Going after the big issues

Rey—who lives with her husband and eight-year-old daughter in two modernized townhouses that have been knocked together—has made a reputation by challenging accepted wisdom, particularly about the international financial system, the role of the dollar, and other big macroeconomic issues. Fellow economists call her work and ideas “provocative” and “influential.”

“It’s the big issues in economics that have always interested me,” says Rey. She is married to economist Richard Portes—also a professor at the London Business School—who founded the Centre for Economic Policy Research, a network of European economists, in 1983. “You had to do international macro to understand this stuff,” she said in an interview with F&D in London.

“A common thread is that she’s always looking for some of the deeper forces that affect the international monetary system or the financial world that we live in,” says Pierre-Olivier Gourinchas, a professor at the University of California, Berkeley, who like Rey is a French national.

“Her work is characterized by patience and commitment,” says Philip Lane, a professor at Trinity College, Dublin. “She has developed large-scale, long-running projects that ultimately deliver significant advances in knowledge, rather than being satisfied with ‘quick-win’ research projects.”

Since getting separate doctorates in the same year from the London School of Economics and the Ecole des Hautes Etudes en Sciences Sociales in Paris in 1998, she has won a string of top European prizes in economics for her thought-provoking research and has become an advocate for more women at senior levels of the economics profession.

“Hélène takes big ideas and then examines the data incredibly carefully to answer these big questions,” said Olivier Blanchard, the IMF’s chief economist. “That’s the optimal combination if you want to make a mark on the profession, and she has already made a substantial mark,” he observed when introducing her at a Washington research conference last year.

String of awards

Her awards include the 2006 Bernácer Prize (best European economist working in macroeconomics and finance under the age of 40) for her research on the causes and consequences of external trade and financial imbalances, the internationalization of currencies, and improving understanding of financial crises.

In 2012 she received the inaugural Birgit Grodal Award of the European Economic Association, honoring a European-based female economist who has made a significant contribution to the economics profession. And a year later, she became the first woman to win the biannual YrjÖ Jahnsson Award, sharing the prize with fellow French national Thomas Piketty, well-known author of Capital in the Twenty-First Century, on wealth and income inequality.

Rey won the 2013 award for her original contributions to international finance, especially the determination of exchange rates and international capital flows. The committee said she had...

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