Graduate Studies and Careers in Public Service: an Interview with Professor Iqbal Zaidi – Part 1

In one of my previous posts about taking advanced courses in Princeton, I mentioned that I ended up taking two courses with Professor Iqbal Zaidi – ECO 353 (International Monetary Economics) and this fall, ECO 322 (Econometric Tools for Research in Macroeconomics) – both of which turned out to be some of my favorite experiences at Princeton. I recently interviewed him to know more about his career and how he came to specialize in international macroeconomics. After completing his Ph.D. from Princeton, Professor Zaidi worked for three decades at the International Monetary Fund (IMF), working in several positions and going on to serve on its Executive Board and manage IMF offices in Africa and Asia. He is now back at his alma mater, teaching specialized courses in macroeconomics. He also serves as an A.B. Academic Adviser.

I am dividing the interview into two parts. In the first part of my interview with Professor Zaidi, I concentrate on his career – specifically, what made him join the IMF after completing his Ph.D. at Princeton. The second part continues with his experience at the IMF and we then segue into his life in academia and what he loves about teaching and advising in Princeton.

Manyu Banerjee: What motivated you to pursue a Ph.D.? Why did you choose to study Economics? How did you decide on whether to stay in academia after graduate school vs. working at the IMF? And finally, what drew you back to academia and return to Princeton?

Professor Iqbal Zaidi: I came to the USA from Pakistan with the intention of becoming a doctor. So, I started taking the pre-med courses. I ended up taking some economics courses for distribution requirements – and liked them and did very well in them. I particularly excelled in mathematics and economics (and incidentally, that’s a very good combination if you want to do a Ph.D. in economics). Some of my professors suggested that I should think seriously about doing a Ph.D. in economics.

Not only was it a field in which I could do well, but I also came to this recognition that the primary intellectual and moral problem at that time was economic development. Living in a developing country, I had seen poverty up close. I wanted to contribute to that area.

When I graduated from Princeton, I had the option to go into academia, and many of my professors encouraged me to do just that. It’s a good idea, because I could have published my research and then move on, if I so wished, to policymaking.  However, I was very clear: I wanted to get back to Pakistan sooner rather than later. As a graduate student, I was lucky to get a couple of summer internships at the IMF. I enjoyed the experience and I knew that it would also help me get a good job with the Pakistan government. And so I joined the IMF. And then I got married and I had children and then I thought, “let’s work a few more years before we go back home.”  Which I did, after more than a decade at the IMF, when I was lucky to go back to Pakistan and work as an advisor to the governor of the State Bank of Pakistan. I was a member of the prime minister’s task force on bank restructuring, since a lot of banks in Pakistan were failing. It was a very demanding job, and I would say that that was the hardest I ever worked in my life. It was also very fulfilling. But there was a concern about security, especially in Karachi, and so we decided to come back to America.

After some years at the IMF, I wanted to come back into academia, and I did return to Princeton in 2001-2002 and taught some courses at what is now the SPIA. I continued working for the IMF to qualify for the pension there – and then, at an opportune time, I came back to Princeton. I’ve now been here for 13 years, and I love it. I am lucky that I can look at economics from the policy-making side and then also from the execution side: there were many years when I was not working from the IMF headquarters, but within the former Soviet Union and then in sub-Saharan Africa and dealing with the unique policy questions that came across my way.  It’s been a very rewarding experience: having that field experience and then coming back to Princeton and teaching the students and passing on what I have learned. We have outstanding students, full of energy, full of questions, who challenge you, so it’s nice to be learning and exchanging. 

MB: You mentioned that you had identified economic development as one of the most important intellectual and moral challenges of the time. In retrospect, was going to work for the IMF after graduate school a useful experience, and how did it prepare you for the work you eventually did for the government of Pakistan?

IZ: I should preface my response by saying that I still feel that economic development and eliminating poverty was the major problem of that time. Nowadays, of course, there’s no question that one of the pressing problems of our era is climate change (which I get to see more in the seniors’ theses).

During my graduate studies, as a foreign student, there were very stringent rules about working outside of the campus during the summer – I couldn’t work on Wall Street, for example. The World Bank and the IMF were the only options. Thankfully, I liked the experience and they liked me, so I decided to join them upon graduation.

I learned a lot at the IMF. You visit different countries, you face new and different problems, you are working with a team of outstanding economists and you learn a lot from them. They let me work with many other central banks, like the Bank of England, which also have very good training programs. So, I thought that by going to the IMF for four or five years, I will learn and then utilize that knowledge when I work for the government of Pakistan. I think that it’s a very good idea for somebody who’s getting a Ph.D. and wants to go and serve their home country, to first work for the IMF or the World Bank. One of my tasks in the State Bank was to set up a good training program – and I implemented one by taking ideas from what was being done at the IMF. So, I feel that I became more valuable to the State Bank with my IMF experience.

In the social sciences, where oftentimes the theory is still evolving, the classroom experience is enriched if your instructor has a lot of experience from actual practice, since their teaching is informed and modulated by that experience. Professor Zaidi’s experience with the IMF and with governments of developing economies around the world helps him imbue his teaching with a unique perspective. This has helped students like me gain a deeper understanding of both the theory and its practice.