Peter Howitt (79, Canada), a professor at Brown University in the United States who won this year's Nobel Prize in economics, is the mentor of Ha Jun-kyung, senior secretary for economic growth in the presidential office and the economic strategist to President Lee Jae-myung. Ha earned his doctorate at Brown University, where Howitt supervised his dissertation.
Ha said in a phone call with ChosunBiz on the 13th that it was "a very joyful and congratulatory event," adding that he plans to send a congratulatory message to Howitt soon.
On this day, Professor Howitt received the Nobel Prize in economics together with Professor Philippe Aghion. Howitt and Aghion showed how new technology can drive sustained growth. Their 1992 paper is well known for proving with a mathematical model Joseph Schumpeter's theory that "creative destruction" through technological innovation drives economic growth.
This paper became a textbook for economists around the world who study growth theory. Ha is one of them. In 2007, Ha co-authored a paper with Howitt analyzing the relationship between long-term research and development (R&D) investment and the total factor productivity (TFP) growth rate. It demonstrated that, rather than unconditionally increasing R&D investment, a strategy of investing a certain share of gross domestic product (GDP) in R&D is more effective.
Ha said, "The field Professor Howitt studied is Schumpeterian growth theory," adding, "There, innovation by corporations is important, and the optimal behavior for that innovation is R&D investment."
He continued, "Depending on what kind of incentive structure the government creates and how it supports R&D, more innovation may occur, or less may occur," and added, "This theory was published in papers in the early 1990s and has since advanced significantly to become the mainstream view, and I think it is naturally being reflected in Korea's policies."
Ha said that Professor Howitt also has a strong interest in Korea's economic growth and technological innovation. Ha noted, "Any scholar who studies growth theory is interested in how Korea is doing," and said, "Professor Howitt not only writes papers on technological innovation in advanced countries but also on catching-up countries, and he is interested in issues around the world."