An Economist and a Gentleman

Published January 25, 2018, 10:00 PM

by Mario Casayuran and Vanne Elaine Terrazola

Dr. Bernardo M. Villegas
Dr. Bernardo M. Villegas

By Dr. Bernardo M. Villegas


(Part 1)

I would like to share with my readers an article I contributed to the Philippine Review of Economics on the late Dr. Amado Castro, the first dean of the School of Economics of the University of the Philippines and a pioneer in the teaching of development economics, Philippine economic history, and international economics to several generations of university students in UP and the University of Asia and the Pacific. Backed up by his Harvard education, Dr. Castro helped produce the economists who played a leading role in formulating and implementing economic policies during the first 30 years of the Philippine Republic. We owe him a debt of gratitude not only for his professional competence but also for his very warm personal approach to the education of the university students who were fortunate enough to have been in his classes, as attested to in the testimonials below.

I first met Dr. Amado Castro in 1958 when he sat in the Fulbright panel organized by the US embassy. At that time, he was already associate professor in the College of Arts and Sciences of the University of the Philippines as well as head of the Economics Department. I was being interviewed for a possible scholarship to go to Harvard to take up the doctoral program in economics. I had just passed the CPA board exam, having majored in accounting during my undergraduate years. Since accounting was not in the priority list for the Fulbright scholarship, I decided to opt for the closest allied specialization, economics.

During the interview, I had the first good impression of Amado as a gentle but firm person. I knew that I did not impress him with my scarce background in economic analysis since the economics subjects I took within the Accounting specialization were taught with an emphasis on economic history and economic institutions, with very little economic theory. He immediately realized this handicap when I could hardly distinguish between the upward movement of the demand curve and the movement along the same curve. He was quite frank about my lack of preparation for the Harvard course. Nevertheless, he still encouraged me to pursue my application just in case my other qualifications could make up for this gap in my knowledge of economic theory. Thanks to his positive attitude, I did get the scholarship and the rest is history.

While I was preparing to go to Harvard, he was generous with his advice, not only about academic matters but also about the general living environment in Cambridge, Massachusetts. I got to know him as a highly cultured person and as a Catholic who took his faith seriously. On the Cambridge campus, I learned about how he was well known in the parish as an active member of the choir. His interest in music was part of his well-rounded personality which included a keen interest in literature, the arts, and the humanities in general.

As I plunged deeper into the study of economic theory, economic history, and quantitative methods, I started comparing him to the great minds in the Harvard faculty who also looked at economics, not as an exclusively quantitative study of economic phenomena but as a multidisciplinary social science more along the line of the founders of economic science in England such as Adam Smith, David Ricardo, and Thomas Malthus who combined philosophy, politics, and economics (the PPE that is still the main fare in Oxford and Cambridge). It is not a coincidence that the great Joseph Aloysius Schumpeter, the Austrian economist who taught at Harvard in the late forties, must have influenced the thinking of Amado.

Upon my return to the Philippines, as dean of the newly established School of Economics of the UP, he encouraged me to teach part-time Economics 11 or Introductory Course in Economics for students of the College of Arts and Sciences. I continued to be influenced by his multidisciplinary approach to the study of economic phenomena as a counterbalance to the increasing quantification of the science of economics.

Today, when it is increasingly obvious that the so-called quantitative economists have failed miserably to give the right advice about how to solve such problems as massive poverty and inequality of incomes, not to mention how to avoid recessions, especially in the developed world, I look back at those conversations I had with Amado about how important it is to learn the lessons of history. His stint as director of the Institute of Economic Development and Research at the UP convinced him even more about relating economics to the other sciences. It helped that his wide interest in culture and arts was reinforced by his stay in the Harvard environment where professors and students are encouraged to be “renaissance men and women.”

I must admit that we did not always completely agree on how to explain the backwardness of the Philippine economy in relation to our East Asian neighbors. I would see him wince whenever I referred to the Latin American “formula for economic disaster,” the inward-looking, import-substitution, and ultra-nationalist policy of industrialization based on the dependency theory of Raoul Prebisch, a Latin American economist. He would always come to the defense of the import-substitution policy that the Philippine government adopted after the period of rehabilitation was over. I would always listen to his arguments since he was very well known as the leading Filipino specialist on international economics. He would always point out that the period of import substitution lasted only for a short while, from 1954 to 1961 and that decontrol started during the administration of President Diosdado Macapagal under whom he served as governor and acting chairman of the Development Bank of the Philippines. I would argue, however, that the decontrol in the 1960s was very limited and that we continued to have very high tariff walls against imports, a very unrealistic exchange rate that kept the Philippine peso artificially strong, and an interest rate regime that subsidized highly capital-intensive industries, while completely discouraging the growth of the export-oriented, labor-intensive industries that propelled our neighbors to become the tiger economies of the last century. Despite this difference of opinion, we continued our friendly conversations so that when he retired from the University of the Philippines, I invited him to teach Economic History in our fledgling School of Economics, first at the Center for Research and Communication and later at the University of Asia and the Pacific that was launched in 1995. Until his death, he was the main professor who made sure that the economists we were producing were steeped in economic history, both of the world and of the Philippines. I was gratified to learn that he was using the always relevant reading lists on economic history that we used at Harvard.

As attested to by both the students and his colleagues in the faculty, Amado took his teaching very seriously. He fitted in to a T in our personal mentoring system, in which the professors personally guided the students not only on academic matters but on their whole-person development. It helped that he had a wide interest in different fields so that he could really assist in shaping the minds and hearts of the students according to the ideals of Christianity, especially as regards the social doctrine of the Church. He gave a very good example from his personal life and behavior of how one’s faith should influence one’s daily life and work. Even as his health was failing, especially during the time that he suffered a serious accident when his foot was run over by a car, he did not hesitate to receive his teaching assignments since he realized we were really short of economic historians. As recounted below by those who were his students and other faculty members, he was the teacher par excellence, both demanding and understanding of the limitations of his students. He always made time for them after class when they needed personal advice and encouragement.


(To be continued)