Raymond Vernon
   HOME

TheInfoList



OR:

Raymond Vernon (September 1, 1913 – August 26, 1999) was an American
economist An economist is a professional and practitioner in the social sciences, social science discipline of economics. The individual may also study, develop, and apply theories and concepts from economics and write about economic policy. Within this ...
. He was a member of the group that developed the
Marshall Plan The Marshall Plan (officially the European Recovery Program, ERP) was an American initiative enacted in 1948 to provide foreign aid to Western Europe. The United States transferred over $13 billion (equivalent of about $ in ) in economic re ...
after World War II and later played a role in the development of the
International Monetary Fund The International Monetary Fund (IMF) is a major financial agency of the United Nations, and an international financial institution, headquartered in Washington, D.C., consisting of 190 countries. Its stated mission is "working to foster globa ...
and the
General Agreement on Tariffs and Trade The General Agreement on Tariffs and Trade (GATT) is a legal agreement between many countries, whose overall purpose was to promote international trade by reducing or eliminating trade barriers such as tariffs or quotas. According to its pre ...
. He was the Clarence Dillon Professor of International Affairs at
Harvard Kennedy School The Harvard Kennedy School (HKS), officially the John F. Kennedy School of Government, is the school of public policy and government of Harvard University in Cambridge, Massachusetts. The school offers master's degrees in public policy, public ...
, becoming ''
emeritus ''Emeritus'' (; female: ''emerita'') is an adjective used to designate a retired chair, professor, pastor, bishop, pope, director, president, prime minister, rabbi, emperor, or other person who has been "permitted to retain as an honorary title ...
'' on his retirement. His formulation of the
Product life-cycle theory The Product Life Cycle Theory is an economic theory that was developed by Raymond Vernon in response to the failure of the Heckscher-Ohlin model to explain the observed pattern of international trade. The theory suggests that early in a product's ...
of US exports, first published in 1966, in turn influenced the behavior of companies.


Early life and education

Vernon was born Raymond Visotsky in New York; his parents were
Russian Jewish The history of the Jews in Russia and areas historically connected with it goes back at least 1,500 years. Jews in Russia have historically constituted a large religious and ethnic diaspora; the Russian Empire at one time hosted the largest pop ...
immigrants and he and his siblings changed their family name to Vernon. He earned a
B.A. Bachelor of arts (BA or AB; from the Latin ', ', or ') is a bachelor's degree awarded for an undergraduate program in the arts, or, in some cases, other disciplines. A Bachelor of Arts degree course is generally completed in three or four years ...
''
cum laude Latin honors are a system of Latin phrases used in some colleges and universities to indicate the level of distinction with which an academic degree has been earned. The system is primarily used in the United States. It is also used in some Sou ...
'' from the
City College of New York The City College of the City University of New York (also known as the City College of New York, or simply City College or CCNY) is a public university within the City University of New York (CUNY) system in New York City. Founded in 1847, Cit ...
in 1933 and a
Ph.D. A Doctor of Philosophy (PhD, Ph.D., or DPhil; Latin: or ') is the most common degree at the highest academic level awarded following a course of study. PhDs are awarded for programs across the whole breadth of academic fields. Because it is a ...
in economics from
Columbia University Columbia University (also known as Columbia, and officially as Columbia University in the City of New York) is a private research university in New York City. Established in 1754 as King's College on the grounds of Trinity Church in Manhatt ...
in 1941; all three of his siblings also earned doctorates.


Career

Vernon worked at the
Securities and Exchange Commission The U.S. Securities and Exchange Commission (SEC) is an independent agency of the United States federal government, created in the aftermath of the Wall Street Crash of 1929. The primary purpose of the SEC is to enforce the law against market ...
from 1935 to 1946 and then at the
US Department of State The United States Department of State (DOS), or State Department, is an executive department of the U.S. federal government responsible for the country's foreign policy and relations. Equivalent to the ministry of foreign affairs of other ...
, participating in the development and implementation of the Marshall Plan and also helping facilitate the postwar recovery of Japan. He played a role in the development of the International Monetary Fund and the General Agreement on Tariffs and Trade, including negotiating the inclusion of Japan in GATT. In the early 1950s he served as acting director of the Office of Economic Defense and Trade Policy, overseeing US trade with the
Soviet bloc The Eastern Bloc, also known as the Communist Bloc and the Soviet Bloc, was the group of socialist states of Central and Eastern Europe, East Asia, Southeast Asia, Africa, and Latin America under the influence of the Soviet Union that existed du ...
and encouraging those countries to trade with non-Communist countries. He then worked for two years for
Mars Mars is the fourth planet from the Sun and the second-smallest planet in the Solar System, only being larger than Mercury (planet), Mercury. In the English language, Mars is named for the Mars (mythology), Roman god of war. Mars is a terr ...
, heading development of peanut
M&M's M&M's (stylized as m&m's) are multi-colored button-shaped chocolates, each of which has the letter "m" printed in lower case in white on one side, consisting of a candy shell surrounding a filling which varies depending upon the variety of M&M ...
; he was known in the candy industry as "the man who put the crunch in M & M's". In 1956–59, he headed the New York Metropolitan Region Study for the
Harvard Kennedy School The Harvard Kennedy School (HKS), officially the John F. Kennedy School of Government, is the school of public policy and government of Harvard University in Cambridge, Massachusetts. The school offers master's degrees in public policy, public ...
, forecasting the future development of the conurbation. It was funded by the
Ford Foundation The Ford Foundation is an American private foundation with the stated goal of advancing human welfare. Created in 1936 by Edsel Ford and his father Henry Ford, it was originally funded by a US$25,000 gift from Edsel Ford. By 1947, after the death ...
and the
Rockefeller Brothers Fund The Rockefeller Brothers Fund (RBF) is a philanthropic foundation created and run by members of the Rockefeller family. It was founded in New York City in 1940 as the primary philanthropic vehicle for the five third-generation Rockefeller brothe ...
and was a pioneering work of
urban studies Urban studies is based on the study of the urban development of cities. This includes studying the history of city development from an architectural point of view, to the impact of urban design on community development efforts. The core theoretica ...
. From 1959 until his retirement, he was a faculty member at Harvard, initially at the
Harvard Business School Harvard Business School (HBS) is the graduate business school of Harvard University, a private research university in Boston, Massachusetts. It is consistently ranked among the top business schools in the world and offers a large full-time MBA p ...
. In 1965, he headed the Multinational Enterprise Project, studying US and foreign
multinational companies A multinational company (MNC), also referred to as a multinational enterprise (MNE), a transnational enterprise (TNE), a transnational corporation (TNC), an international corporation or a stateless corporation with subtle but contrasting senses, i ...
. From 1981 until his retirement, he was at the Kennedy School of Government, where he was an important member of the Center for Business and Government. He retired as Clarence Dillon Professor of International Affairs and held emeritus status. Vernon was a pioneer of computerized stock-market analysis. He influenced the Harvard Business School to study real-world examples of businesses and business situations, which led in particular to Harvard researchers studying the World's Largest Enterprises. Since he had also worked as a political scientist, one focus of his research was the relationship between states and companies: he pointed to the trend for that relationship to become relatively less important and that between companies and customers more so, as business became more international in the post-war world. His work was also a basis for the movement toward
privatization Privatization (also privatisation in British English) can mean several different things, most commonly referring to moving something from the public sector into the private sector. It is also sometimes used as a synonym for deregulation when ...
in the 1980s. After his death,
Daniel Yergin Daniel Howard Yergin (born February 6, 1947) is an American author, speaker, energy expert, and economic historian. Yergin is vice chairman of S&P Global. He was formerly vice chairman of IHS Markit, which merged with S&P in 2022. He founded Ca ...
, a friend and colleague, referred to him as "the father of globalization".


Product life-cycle theory

In 1966 Vernon published an article, "International Investment and International Trade in the Product Cycle", which he himself characterized as "the one which will appear upon my gravestone". Initially descriptive, showing how
foreign direct investment A foreign direct investment (FDI) is an investment in the form of a controlling ownership in a business in one country by an entity based in another country. It is thus distinguished from a foreign portfolio investment by a notion of direct co ...
by US firms—the movement to offshore production—followed as a response to consumer demand, or to a lag between product innovation and the ability to manufacture enough to satisfy demand, the theory was taken up by companies and underwent modifications in response. Vernon's analysis nonetheless held true, in particular his identification of three imperatives for success in international business: innovation, responsiveness to varying local markets, and cost.


Private life and death

Vernon was an excellent rower; he competed for many years in
crew A crew is a body or a class of people who work at a common activity, generally in a structured or hierarchical organization. A location in which a crew works is called a crewyard or a workyard. The word has nautical resonances: the tasks involve ...
in the
Head of the Charles Regatta The Head of the Charles Regatta, also known as HOCR, is a rowing head race held on the penultimate complete weekend of October (i.e., on the Friday that falls between the 16th and the 22nd of the month, and on the Saturday and Sunday immedia ...
and in his 80s broke the world record in
CRASH-B Sprints The CRASH-B Sprints World Indoor Rowing Championships (CRASH-B Sprints) was the world championship for indoor rowing, raced over a distance of 2,000m. The regatta is sponsored by Concept2, and raced on their C2 rowers. Originally held in Harvard' ...
. He was a member of the Cambridge Boat Club for 40 years, and he and his wife, Josephine, donated a weathervane to the club. They had two daughters. He died at his home in
Cambridge, Massachusetts Cambridge ( ) is a city in Middlesex County, Massachusetts, United States. As part of the Boston metropolitan area, the cities population of the 2020 U.S. census was 118,403, making it the fourth most populous city in the state, behind Boston, ...
, of cancer.


Honors

He was elected a fellow of the
American Academy of Arts and Sciences The American Academy of Arts and Sciences (abbreviation: AAA&S) is one of the oldest learned societies in the United States. It was founded in 1780 during the American Revolution by John Adams, John Hancock, James Bowdoin, Andrew Oliver, and ...
in 1964. The
Association for Public Policy Analysis and Management The Association for Public Policy Analysis and Management (APPAM) is an American organization whose focus is improving public policy and management by fostering excellence in research, analysis, and education. APPAM founded the ''Journal of Policy A ...
instituted the Raymond Vernon Prize in 1984 in honor of Vernon, who was the founder editor of their journal, the ''
Journal of Policy Analysis and Management The ''Journal of Policy Analysis and Management'' is a quarterly peer-reviewed academic journal covering issues and practices in policy analysis and public management. It was established in 1981 and contains books reviews and a department devoted t ...
'', and renamed it the Raymond Vernon Memorial Award following his death.


Selected publications

* * * * * * (and Spar, Debora L.) * (and Spar, Debora L.; Tobin, Glenn)


See also

*
Product lifecycle In industry, Product Lifecycle Management (PLM) is the process of managing the entire lifecycle of a product from its inception through the engineering, design and manufacture, as well as the service and disposal of manufactured products. PL ...


References


External links

* {{DEFAULTSORT:Vernon, Raymond 20th-century American economists Harvard Kennedy School faculty Harvard Business School faculty Columbia Graduate School of Arts and Sciences alumni 1913 births 1999 deaths People from New York (state) Fellows of the American Academy of Arts and Sciences