Robert M. Townsend is a leading development economist. His recent work focuses on analyzing the role and impact of financial systems on developing economies by studying applied general equilibrium models and contract theory.
Townsend's contributions in economic theory include the role of financial intermediaries in general equilibrium Arrow-Debreu models; the revelation principle; the costly state verification approach; optimal multi-period contracts; decentralization of economies with private information; money with spatially separated agents; financial institutions and economic growth; and forecasting the forecasts of others. His econometrics research includes the study of risk and insurance in developing countries.
Since 1997, Townsend has undertaken large-scale village surveys in Thailand to analyze the interaction between household decisions and community behavior at family, village, region, and country-wide levels. The Townsend Thai study was the first of its kind and has been the stepping stone for many other applied and theoretical projects in economic development and contract theory. Townsend's work has demonstrated innovation in the combination of theory and data, as well as the ability to work across various subfields.
His work in a village in India was awarded the Frisch Medal in 1998. He won the medal again in 2012, becoming the first two-time winner, for his work with Joseph Kaboski in creating a structural attempt to model and comprehensively evaluate the impact of a large-scale microfinance program in Thailand.
Townsend is the Elizabeth and James Killian Professor of Economics in the Department of Economics at the Massachusetts Institute of Technology. Previously, he was the Charles E. Merriam Distinguished Service Professor in the Department of Economics at the University of Chicago, where he remains a research associate. He also is a fellow both of the American Academy of Arts and Sciences and of the Econometric Society.
Townsend leads several grants related to his research interests. He serves as principal investigator and faculty director of the Consortium on Financial Systems and Poverty based at the University of Chicago. Supported by the Bill and Melinda Gates Foundation, this program brings together scholars to work on research projects to better understand the role of financial services in the developing world. As principal investigator and project director of the Enterprise Initiative, he explores entrepreneurship and wealth creation through the lens of Applied General Equilibrium Enterprise Economics (AGE-3).
Townsend is the 2016-17 Thornber Fellow, a post supported by a generous gift from Hodson and Ludmilla Thornber.
- 2012: November 8–13
- 2013: May 1–8, May 16–22
- 2014: February 17–21
- 2015: May 11–22. September 28-October 2
Professor Townsend will give a series of four lectures for faculty and graduate students on the themes of liquidity, the design of payments systems, and monetary policy and on financial platforms and intermediation. Dates will be announced in April.