Economist Edmar Bacha returns to Yale (virtually) to celebrate the program where he found his calling

by Aiden Lee

April 1, 2021

A group of young men in New Haven in the 1960s.
Bacha (far left) on Hillhouse Avenue with IDE classmates (L-R) John Ofosu-Benefor (Ghana), Mario René Gomez (Guatemala), Guillermo Calvo (Argentina), Clóvis Cavalcanti (Brazil), Masamichi Funaoka (Japan), Frank Thompson (Trinidad and Tobago), and Roy Clarke (Barbados), March 1965.

As a specialist in the economy of Brazil, Edmar Bacha MA ’65, PhD ’68 has taught at Yale, Columbia, the Catholic University of Rio de Janeiro, and the University of Brasilia, and held positions as economist at the United Nations, the World Bank, and the International Economic Association. In the 1990s, he was part of a group of economists who came up with a plan based on a virtual currency, Units of Real Value (URV), that succeeded in slowing Brazil’s rampant inflation and helped turn the economy around. 

But when a young Edmar Bacha arrived at Yale in 1964, he was not yet certain which field of economics he would enter. It was during his time in New Haven that he decided to devote his career to the economic development of Brazil. 

From Brazil to New Haven in the 1960s

Bacha arrived in New Haven on September 1, 1964, aged 22. It did not take long for him and peers in the program from 15 countries to become acclimated to New Haven and the greater Yale community. “The atmosphere was very conducive to making one feel at home and progress without feeling the pain of being away from home,” he recalled.

Join Edmar Bacha & Ana Cecilia Fieler in a virtual event on April 9

Edmar Bacha and Ana Cecilia Fieler, Visiting Assistant Professor of Economics, will discuss "The Economy of Brazil, 1980 to Present: Problems and Possibilities".

He studied macroeconomics with Nobel prize winners James Tobin and Edmund Phelps. “Being taught macroeconomics by Tobin and Phelps helped to strengthen my fundamental knowledge of macroeconomics and my appreciation of neo-Keynesian macroeconomics,” he said.

Bacha and Diaz-Alejandro on a street in Brazil.
Edmar Bacha (left) and Carlos Diaz-Alejandro (right) in Ouro Preto, Brazil in June 1980. Photo courtesy of Edmar Bacha.

The first paper Bacha wrote at Yale was for his class on Latin American economics with Professor Carlos Diaz-Alejandro, and the two became close intellectually and personally. Diaz-Alejandro helped Bacha navigate the primitive computers of the time. “Carlos Díaz has unparalleled kindness,” Bacha wrote to his mother, in letters recently published by EGC. “He is interested in each phase of my work and prepares all material in the way the computer likes to swallow, including asking his secretary to poke holes in the cards.” Diaz-Alejandro and Bacha also enjoyed the company of Celso Furtado, a famous Brazilian economist and visiting scholar at EGC.

 Bacha also met Guillermo Calvo, a fellow IDE student and now a professor of economics at Columbia University. The pair would meet in the library to study, occasionally engaging in a bit of friendly competition. “Guillermo was very proficient in mathematics – he has always been.” Bacha recalled. “I was more intuitive, so we competed to see who would finish the exercises faster. He went through mathematics, and I went through intuition.”

Edmar Bacha together with a few prominent economists designed the plan that ultimately ended inflation in Brazil. For me, they represented Economics at its best: applying insights in the service of the poor, the workers, and the entrepreneurs." – Ana Cecilia Fieler

Bacha, Diaz-Alejandro, and Calvo became a self-described “Latin American trio” of economics – and life-long friends.

The people laughing on a couch
Bacha (far right) with Diaz-Alejandro (far left) and fellow economists Maria Conceição Tavares in Rio de Janeiro, Brazil in June 1980. Photo courtesy Edmar Bacha.

Bacha excelled in the IDE program, and graduated in 1965, the first student from his original training program in Brazil ever to be accepted into a doctoral program after a single year of postgraduate coursework. He continued at Yale Economics, receiving his PhD in 1968.

The IDE program continued to have a lasting impact on Bacha’s career and life after his departure. He went on to found a new master’s program in economics at the University of Brasília in 1973, and taught at a new master’s program at the Catholic University of Rio de Janeiro, founded by his friends in 1977. Diaz-Alejandro joined him there as a visiting professor.

Bacha is now founding partner and director at Casa das Garças Institute for Economic Policy Studies in Brazil.

In the April 9 event, Bacha will be in conversation with Ana Cecilia Fieler, Visiting Assistant Professor of Economics at EGC and the Department of Economics. "Edmar Bacha is part of a generation of economists that inspired me to study economics," Fieler said. "I grew up with inflation in Brazil raging at annualized rates of 3,000 percent, sometimes more. The country lost its competitiveness in world markets and the poorer, unbanked population had no access to financing or durable goods. Edmar Bacha together with a few prominent economists designed the plan that ultimately ended inflation in Brazil. For me, they represented Economics at its best: applying insights in the service of the poor, the workers, and the entrepreneurs."

Bacha and Fieler will discuss research on the economy of Brazil from the 1980s to the present in the webinar. “Brazil’s economy grew extremely fast from the 1940s to the late1970s,” Bacha said on the topic. “It has nearly stagnated since then. What went wrong?” Bacha will be in conversation with Ana Cecilia Fieler, an economist whose research focuses on trade, particularly in developing countries. To register for the event, visit the event page.

Two men smiling for the camera at a conference.
Bacha (left) and Clóvis Cavalcanti, his colleague and former roommate during his Yale years, at a seminar at the Casa das Garças Institute for Economic Policy Studies in 2019. Photo courtesy Edmar Bacha.