Mr. Free Market, Raghuram Rajan, Goes to India

Raghuram Rajan fit in quite comfortably at the University of Chicago. Like other free-marketers, the Indian-born economist and professor at Chicago’s Booth School of Business was inspired by Friedrich Hayek, the Austrian thinker. On the wall of his Hyde Park office, Rajan had an autographed photo of conservative icons Milton and Rose Friedman. Rajan warned of a global economic crash three years before it happened, and his 2010 book on the financial crisis, Fault Lines, got a scathing review from Princeton professor and Keynesian guru Paul Krugman, cementing Rajan’s Chicago School credentials.

Today Rajan’s office is in the red sandstone headquarters of India’s Ministry of Finance, where he has served as chief economic adviser to the government since last August under the direction of Finance Minister Palaniappan Chidambaram. Instead of the Friedmans, portraits of two well-known local critics of capitalism, Mahatma Gandhi and Jawaharlal Nehru, gaze down at him.