50 Years Since the Tobin Report on Puerto Rico

On October 10, the Center for a New Economy (CNE) and Yale University’s Tobin Center for Economic Policy co-hosted a commemorative event marking the 50th anniversary of the Tobin Report on Puerto Rico.

Authored by Nobel laureate James Tobin and a team of experts, the report offered a bold critique of Puerto Rico’s development model, and helped spark a deeper, data-driven policy debate that still resonates today.

Fifty years ago, James Tobin and his colleagues modeled what it means to bring intellectual honesty and analytical depth to public policy, even in moments of profound crisis. That spirit guided our conversations last week and continues to shape CNE’s mission today. As Puerto Rico faces new challenges, we believe rigorous, independent analysis is not only relevant, it is essential.

See the event highlights below.

Welcoming Remarks

Rosanna Torres

President
Center for a New Economy

Introductory Remarks

Hon. Pablo José Hernández

Resident Commissioner
for Puerto Rico

Remembering James Tobin

Richard C. Levin

Beinecke Professor Emeritus of Economics
Former President of Yale University

Economist Panel: Tobin Report in Puerto Rico’s History

Steven T. Berry

Sterling Professor of Economics
Inaugural Faculty Director
Tobin Center
Yale University

Heidie Calero

President
H. Calero Consulting Group

Sergio M. Marxuach

Policy Director
CNE

Introductory Remarks

Hon. Sebastián Negrón Reichard

Secretary
Puerto Rico Department of Economic Development and Commerce

Academic Input into Government and Policy: History and Future

Hon. Sebastián Negrón Reichard

Secretary
Puerto Rico Department of Economic Development and Commerce

Mike A. Soto-Class

Founder & Chairman
CNE

Dave Wilkinson

Executive Director
Tobin Center
Yale University

Closing Keynote: Role and Value of Universities and Think Tanks

Laura Arnold

Co-Founder & Co-Chair
Arnold Ventures

Historical Spotlight
The Road to the Tobin Report

In the decades after World War II, Puerto Rico pursued rapid industrialization by attracting U.S. firms with tax incentives and access to a low-cost labor force. This strategy fueled impressive economic growth and improved living standards, but left key issues unresolved: persistent unemployment, regional disparities, and heavy reliance on external capital. 

By the early 1970s, an oil shock and deepening fiscal crisis exposed the fragility of the island’s development model. In 1974, Governor Rafael Hernández Colón commissioned a team led by economist James Tobin to assess the situation. The resulting 1975 Tobin Report offered a frank evaluation of Puerto Rico’s economic dependence and warned about overreliance on outside investment and federal aid. 

It urged greater fiscal discipline, reduced public spending, and caution around policies that inflated labor costs, recommendations that foreshadowed later austerity measures. The Report remains a key document in Puerto Rico’s economic history for its clarity and candor about the limits of the existing economic model. 

Fifty years later, the Tobin Report’s insights still resonate. As Puerto Rico grapples with debt burdens, federal oversight under PROMESA, and debates over economic sovereignty, its warnings about external dependence and the need to develop internal productive capacity are more urgent than ever.