MIT Department of Economics

Robert M. Townsend
Elizabeth & James Killian Professor of Economics

A theorist, macroeconomist, and development economist, Townsend analyzes the role and impact of economic organization and financial systems through applied general equilibrium models, contract theory, and the use of micro data. 




This website attempts to capture the scope of my work throughout my career, up through and including present day. It organizes the work formally -- so you can hopefully find what you are looking for or discover something new -- as well as loosely, around a series of themes and ideas that I am currently pursuing.


What’s New?

New Courses

Last spring semester, I taught Advanced Macroeconomics and Development Economics at MIT. These focus on the analysis of financial systems in emerging markets and in more developed economies. I like to feature the unity in this approach, bringing together the common elements -- that is, theory and the use of data -- and by identifying obstacles to and potential remedies for achieving efficiency. This approach supports the creation of policy that is based on first principles. I am also struck by the relevance of past work in general equilibrium and its continued relevance today, as well as the importance of contract theory with limited commitment and private information. Market design, financial intermediaries, money and payments are important topics in this approach.

Recent Lectures

In September, I presented a lecture at the 2016 Money and Banking Conference hosted by theBanco Central de la República Argentina. My talk focused on financial development where I addressed not only conceptual foundations, but I also introduced a practical guide of methods and tools for executing financial development.   View slidesView video

As I prepared my spring classes and to help organize my thinking, I gave several versions of a new lecture, “Measurement, Analysis, and Design of Financial Systems: First Principles as the Foundation for Policy” (external link). The lecture outlines my belief that economic policymaking can be informed first by measurement and, ideally, a mapping of the financial system, and then by the application of a set of first principles.

The first lecture was delivered earlier this year as The Fishelson Lecture at Tel Aviv University (external link), which honors the memory of economist Gideon Fishelson.  I gave similar versions to the Shanghai Association of Internet Finance, the Bank of Thailand, and at the Federal Reserve Bank of New York. 

Working Group on IO & Finance

In October of 2015, I helped organize a conference at Norges Bank in Norway, "Banking and Financial Intermediation: Frictions, Regulation and Optimal Design." I also presented a paper at this conference titled, “Spatial Competition among Financial Service Providers and Optimal Contract Design” (external link).  This event led to the planning of a forthcoming working group that James Poterba, Dean Corbae, and I are organizing on the same topic. More will be posted here when it launches.


Teaching & Students

In addition to the two new courses mentioned above, I also teach first-year MIT students in a course that emphasizes general equilibrium theory. It covers the nuts and bolts of the approach while emphasizing its applications. The class brings theory and data together, which is what I see as the unifying force.


This page features current and past classes that I have taught at MIT going back to 2011. It also includes syllabi.


Some of my lectures can be found online: Development Economics, Macroeconomics; Measurement in Economics; An Overview of Micro-Founded Macro Models; Applying an Applied General Equilibrium Approach in Development Economics; and Optimal Risk Sharing Among Households in Developing Countries

Harvard Lectures

This past year I also lectured in classes at Harvard University on Development Economics (external link).

Former and Current Students

Finally, the site features a list of current students as well as former students I have worked with in the past.


Working Papers & Publications

My complete archive of working papers and publications are posted with several search feature options. Below I highlight some of my most recent papers.

Recent Working Papers

"A Market Based Solution for Fire Sales and Other Pecuniary Externalities." Weerachart T. Kilenthong and Robert M. Townsend. NBER Working Paper No. 22056, 2016. 

"Risk and Return in Village Economies." Krislert Samphantharak and Robert M. Townsend, revised 2016; see also NBER Working Paper No. 19738, 2013.

"Economic Development, Flow of Funds and the Equilibrium Interaction of Financial Frictions." Benjamin Moll, Robert M. Townsend, Victor Zhorin. 2016. NBER Working Paper No. 19618, 2014.

"Curbing Shocks to Corporate Liquidity: The Role of Trade Credit," Niklas Amberg, Tor Jacobson, Erik von Schedvin, Robert M. Townsend. 2016.

"The Economics of Bank Supervision," Thomas M. Eisenbach, David O. Lucca, and Robert M. Townsend. 2016.


Working Groups

In addition to the new IO & Finance working group mentioned earlier, I organize and participate in several other active groups:  Flow of Funds Accounts and Mapping Financial Systems; Financial Systems, Industrial Organization, and Economic Development; Optimal Design of Payment Systems; Financial Underpinnings of Macro Models.



I have written five books, identified below:


Data & Measurement

My current research projects include the Townsend Thai Project, which I began in 1997 with many collaborators and continues today. It is one of the longest running panel datasets in the developing world. Many people have enjoyed watching the video documentary that was made about this project titled, "Emerging Thailand: The Spirit of Small Enterprise." 

All the data from the Townsend Thai Project can be found by following this link: http://cier.uchicago.edu/data/ or by visiting my Dataverse site. 

You can also find an archive for earlier research projects of mine: Consortium of Financial Systems and PovertyImpact of Financial Services in MexicoChicago Neighborhoods ProjectThe Enterprise Initiative; and the Aurepalle Village Project.


Media & News

An archive of media coverage and more public discussion of my work can be found in the News section of the site.


About & Contact Information

My bio statement outlines the path of my career and my work. My most current cv is also available for download via the top of this page or under the About tab. My assistant, Deborah Jamiol, is a good way to go about getting in touch with me. More information about reaching her can be found on my Contact Page.