War over words erupts as World Bank star economist sidelined

Professor Paul Romer (above) is relinquishing oversight of the Development Economics Group.
Professor Paul Romer (above) is relinquishing oversight of the Development Economics Group.PHOTO: PAULROMER.NET

(BLOOMBERG) - The World Bank's chief economist has been stripped of his management duties after researchers rebelled against his efforts to make them communicate more clearly, including curbs on the written use of "and".

Professor Paul Romer is relinquishing oversight of the Development Economics Group, the research hub of the Washington-based development lender, according to an internal staff announcement seen by Bloomberg.

Ms Kristalina Georgieva, the chief executive for the bank's biggest fund, will take over management of the unit July 1.

Prof Romer will remain chief economist, providing management with "timely thought leadership on trends directly affecting our client countries, including the 'future of work,'" World Bank President Jim Yong Kim said in the note to staff dated May 9.

Prof Romer said he met resistance from staff when he tried to refine the way they communicate. "I was in the position of being the bearer of bad news," he said in an interview.

"It's possible that I was focusing too much on the precision of the communications and not enough on the feelings my messages would invoke."

It's unusual for the World Bank's chief economist, a role once occupied by heavyweights such as Professor Stanley Fischer and Professor Lawrence Summers, not to run the Development Economics Group, known as DEC, which publishes original research, develops the bank's forecasts and oversees its data.

The move raises questions about how much freedom the bank's economists will have to do outside-the-box research on policies to help the world's poorest.

"The chief economist is essentially parachuted into the bank and put in this very exalted position," said Dr Peter Lanjouw, former head of research into poverty and inequality within DEC.

"It takes some effort to become familiar with the individual researchers in the group and the things that are being done. There was a lot of grumbling that Paul didn't seem interested," said Dr Lanjouw, now a professor at VU University in Amsterdam and editor of the World Bank Research Observer.

Dr Lanjouw, who consults for the bank, said he's spoken to DEC researchers about the matter.

Prof Romer, 61, assumed the role in October after taking leave from his position as a professor at New York University.

His appointment was hailed as a coup for the World Bank, which is trying to maintain its status as a leading development voice at a time when governments in some rich nations are increasingly reluctant to finance the development of poor nations.

Prof Romer pioneered research into "endogenous growth," examining how the diffusion of knowledge boosts output.

His name often comes up in short lists for the Nobel Prize in economics.

Macro Cred

But in recent years, his attacks on the credibility of macroeconomic models irritated many of his peers.

His combativeness didn't endear him to some of the more than 600 economists who work in DEC, according to people familiar with the matter.

Prof Romer wanted DEC to set the intellectual agenda among those who think deeply about how to help the world's poorest countries, said one of the people, who spoke on condition of anonymity.

The World Bank is already considered a major source of development research, ranking first among institutions in terms of the number of times its work is cited, ahead of Brown University, the London School of Economics and Harvard University.

But Prof Romer expressed to those around him that the department should communicate more clearly, dive right into public debates, and align its work with the institution's goals of ending extreme poverty and reducing inequality.

It didn't take him long to shake things up. He declared several positions redundant and enforced term limits on senior managers.

In the interview, Prof Romer said he cut more than US$1 million (S$1.39 million) in annual expenses from the group's budget.

Straight Shooter

Prof Romer asked for shorter emails and insisted presentations get straight to the point, cutting staff off if they talked too long, said another person familiar with the matter.

He canceled a regular publication that didn't have a clear purpose, one of the people said.

But researchers didn't like the curt way Prof Romer often conveyed his message, said two people familiar with the matter.

Staff were upset by what they saw as his abrasive emails, and they didn't feel Prof Romer listened to their concerns, these people said.

Researchers were flummoxed by some of his stylistic hangups, including a distaste for the conjunction "and."

Prof Romer was frustrated with what some see as the dense, convoluted style of many of the department's reports. He pushed researchers to write more clearly, using the active voice to be more direct.

Prof Romer said he was surprised by the defensiveness of the group's economists. "They felt under-appreciated," he said. "It reflected a kind of siege mentality that I can't quite understand."

A study by Stanford University's Literary Lab in 2015 found the bank's use of language has become more "codified, self-referential, and detached from everyday language" since the bank's board of governors held their inaugural meeting in 1946.

The study coined the term "Bankspeak," a vague "technical code" that symbolized the lender's organizational drift.

Fewer 'Ands'

In an email to staff obtained by Bloomberg, Prof Romer argued the World Development Report, one of the bank's flagship publications, "has to be narrow to penetrate deeply," comparing his vision for the report to a knife.

"To drive home the importance of focus, I've told the authors that I will not clear the final report if the frequency of 'and' exceeds 2.6 per cent," said Prof Romer, citing the percentage of the word's use in World Bank documents analyzed as part of the "Bankspeak" report.

The "Bankspeak" study noted the penchant of World Bank authors to link long chains of nouns with the word "and" can produce mind-numbing lists that create the impression of activity.

One of the study's authors, Stanford English professor Franco Moretti, was skeptical that eliminating the conjunction would improve the clarity of World Bank communications.

"It will take much more than a few fewer 'ands'," Professor Moretti said in an email.

Writing Gimmick

Prof Romer said the limit on "and" was a "gimmick" he used to show he's serious about good writing.

"They've worked it down to 3.4 per cent. They said, 'We're getting there'." In her new role overseeing DEC, Georgieva will look to strengthen the link between research and the bank's lending operations, Dr Kim said in his note to staff.

But some scholars worry the unit's independence will suffer if the arrangement is permanent.

The World Bank produces research on many countries that aren't covered closely by academics, who are more likely to advance in their careers if they focus on big economies such as the US, said Dr Lanjouw, the former DEC researcher.

"If it's being starved or downgraded in any way, that doesn't bode well for this type of knowledge that isn't really being produced anywhere else in the world," he said.

Prof Romer said the move will give him more time to focus on the intellectual side of the chief economist job, a role he prefers.

"If I can be constructive here, I'll stay. If I'm not having my biggest impact here, I'll go do it someplace else."