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BRS Professor Interview Series – Prof. Della Posta

Dr. Pompeo Della Posta (PhD, MA) is a specialist in economics and finance who has sharp insights on economics and rich experience in education. He has been associate professor of Political Economy at the University of Pisa in Italy and adjoint professor at Stanford University, Bing Overseas Studies Program in Florence, and Johns Hopkins University Bologna Center in Bologna. He has also been visiting and teaching in many Universities and research centers worldwide, including the USA, Canada, the UK, China, India, Japan and Russia.

Prof. Della Posta has contributed significantly to a wide range of studies, including economic globalization, international economics, international monetary economics, monetary economics, macroeconomics and energy economics. He has also published extensively in journals like International Review of Economics and Finance, Journal of Macroeconomics, Macroeconomic Dynamics, Journal of Policy Modeling, North American Journal of Economics and Finance, The World Economy, Open Economies Review, Technological Forecasting and Social Change, Structural Change and Economic Dynamics, Metroeconomica, among others. He has edited several books and written two books, “The Economics of Globalization. An Introduction” and a book in Italian on the European monetary integration. He is the editor of the Scientific Journal Scienza e Pace/Science and Peace and has been President-elect for 2019 of the International Trade and Finance Association.

Prof. Della Posta offered to serve at the Belt and Road School of Beijing Normal University at Zhuhai starting February 2022. Recently, we had the honor to invite him to share his life experiences and his perspectives on Economics in the background of globalization and COVID-19 pandemic.

Q1: Given your rich teaching experiences in so many countries, what led you to BNU Zhuhai?

When I graduated, I was already working at the University of Pisa as Assistant Professor with tenure. At some point, I and my family started thinking that moving somewhere else in the world would have been nice.

What drove me to Zhuhai is certainly the curiosity and the excitement for the new challenging experience that is ahead of us. But an important motivation is given by the expectation to be doing something useful also for the others and therefore something rewarding in terms of self-satisfaction and self-realization. Belt and Road School is attended by students coming from all over the world, many of them from least developed and developing countries. So, the idea to contribute even a tiny bit to their professional education, to their own future and therefore, although indirectly, to the development of their countries of origin, makes me think that this is a worthwhile endeavor. I am proud to say also that I am doing my best to get ready for these new exciting years that are ahead of me: I have been studying Chinese for the last year and half and passed the HSK2 exam.

Q2: In light of today’s economic globalization, what abilities do you think are most important for college students?

In my mid-twenties, I read a magazine interview given by an Italian movie director, Mr. Mario Monicelli. He was asked what relationship he had with the new generation, with young people and why he kept going to visit many classrooms and give speeches in front of many young students. His reply was along these lines: “I find it very tiresome to go visiting many classrooms and give speeches to students, but I make any effort to go because I find it important to tell them one main thing, to give them a simple advice: Get ahead of yourself!”. He meant “be brave, be ambitious”. Steve Jobs gave the same advice to the Stanford students with the famous “stay hungry, stay foolish!”. So, what does this imply for college students all over the world? It means that yes, they have to be well aware of the difficulties that they are going to face on the way; they have to realize that especially today, not only the economic globalization but also the technological progress is changing the rules of the game, with the many fields opened up by artificial intelligence (AI), automation, robotics, big data, blockchain, you name them; but they should always keep confident in themselves, in their capabilities. They should try to understand where the future is heading and make an effort not only to follow it and to be able to cope with it (therefore learning programming languages to solve problems, software packages to perform econometric analyses, and so on), but also to anticipate it, so as to be part of the construction of that future. We live in a wonderful world and we need to make an effort not only to make the most of it, but also to make it better.

Q3: What drew you to economics, and what has kept your passion in this field for so long?

I decided to go to university (the only one among my siblings) and I chose the faculty of Economics and Banking, especially with the expectation that, once I would have graduated, I could find a good job in a bank, and earn a good salary. While studying, however, I got more and more attracted by the Economics subjects. I found them much more interesting than accounting or business, because Economics dealt with the needs of people, all the people, not with the, well legitimate but limited interest for the prosperity and success of a single business company. And at the time the profession did not seem to be based on the sometimes excessive recourse to the economic modelling which is now dominating it. Such an obsession for the mathematical formalization of economic principles is sometimes such as to obscure the true aim of economic studies, which in the end has to do with the needs of people. So, I think that a balanced approach to Economics is desirable. The analytical formalization and the elegance of the modeling is fine, but it should not be an aim per se. If, for example, to solve a problem in a very elegant and appealing way, I need to make some assumptions that are so restrictive that the economic model that I am building loses any connection with reality. I can do it, of course, I can publish a nice, smart, theoretical paper, but I have to acknowledge the limitations of my approach and─most importantly─ I cannot use it to draw policy prescription affecting the life of people. As the old philosopher taught us, the true knowledge stays in acknowledging what we don’t know.

Q4: In your opinion, what role does the Belt and Road Initiative play in the global economy?

We are living in a period in which the global interconnectedness is experiencing a slowdown, if not a clear retreat. It seems to me that the message of openness coming from the Belt and Road Initiative at the global level is one of the few going in the opposite direction, trying to keep open the perspective in favor of the international exchanges in trade and services, capital mobility and─my case clearly shows this─also labor mobility. And whenever the world is open to the virtuous competition to improve the quality of the products, to provide better services to the people, as long as countries interact with each other for business reasons, the conflicts remain limited to that physiological economic sphere, without taking the risk to move in the self-destructing direction of wars.

Q5: Please share your views on COVID-19’s impact on the global economy. In your opinion, what could be done to boost recovery?

The effects of the Covid-19 pandemic have been dreadful. Not only it has demanded a heavy toll in terms of human lives, but it has also had heavy negative consequences on the world economy. Initially, it looked like Covid-19 could be interpreted as a supply shock, affecting negatively the global value chains, and obliging therefore to reconsider them. Unfortunately, the bottlenecks on the supply side are still there, and this explains the recent increase in the price of natural gas, oil, and energy in more general terms. But the shock has also been very significant on the demand side of the economy. The lockdowns that have been imposed all over the world have caused a dramatic fall of the demand of activities associated to the services on both business travels and tourism. Airplane companies, hotels, restaurants, tourism in general have experienced dramatic contractions. Demand shocks have to be countered by demand policies. Public spending is the most significant one when consumption, investment and net exports stagnate. Public investment is particularly important, in order to create the conditions for the future economic development (this is what Europe is doing with the pathbreaking Next Generation EU plan). But also supply-side policies are important, to increase productivity. In part, the crisis has created by itself the conditions for the future recovery, thanks to the technological change that it has imposed on many people, included myself, increasing largely their productivity.