Economist's View

Ten Years after the Crisis: Discredited Ideas (Video - Krugman)

Monetary Policy in a New Era (Video) - Ben Bernanke

Rethinking Macroeconomic Policy Conference (Video): Blanchard and Summers

Pessimism and the ZLB

A Better Way to Elect Presidents (Video) - Eric Maskin

The systems that most countries use to elect presidents are deeply flawed. In particular, candidates A and B may each be more popular than C (in the sense that either would beat C in a head-to-head contest), but nevertheless each may lose to C if they both run. The systems therefore fail to reflect voters’ preferences adequately. In this lecture, I will illustrate this point with examples from U.S. and French political history. I will also propose an election system that is far superior to the current ones.

New Conditions for Monetary and Fiscal Policy?

The Marriage of Psychology with Multiple Equilibria in Economics

Roger Farmer:

The Marriage of Psychology with Multiple Equilibria in Economics: This is the first of a new weekly blog series, Monday’s Macro Memo with Roger Farmer, which will discuss a wide range of economic issues of the day. The blog will appear on both the NIESR site and on Roger Farmer’s Economic Window and in the first few weeks, I will be posting a series of videos, recorded at a conference held at the Bank England  on July 3rd and 4th of 2017.  The conference was titled "Applications of Behavioural Economics and Multiple Equilibrium Models to Macroeconomic Policy"...

I had been planning, for some time, to run a conference on the topic of multiple equilibria sponsored by Warwick University. Andy Haldane and Sujit Kapadia had been talking with Alan Taylor of U.C. Davis about organizing a conference on the topic of behavioural economics. After talking with Andy, Sujit and Alan, we decided it would be ideal to combine our plans into a single conference that would highlight the promise of studying the marriage of psychology with multiple equilibria in economics. The video ... explains why this is a fruitful idea.

Roger goes on to discuss how "psychology enters the picture," and why the Robert Lucas idea that "the expectations of market participants are determined by economic fundamentals ... makes little or no sense in models ... where there are multiple equilibria." Also:

In addition to the introductory video, linked above, we also recorded videos from many of the conference presenters and discussants. I will be releasing these videos in a series of posts in the coming weeks and I will discuss the research associated with the accompanying topic. You can find links to the original papers on the conference website linked here. Stay tuned.

Rodrik: Doing (and Teaching) Economics [Video]

(Starts at 7:00 min. The sound is a bit buzzy.)

Nobel Laureates Give Advice to Young Economists (Video)

Trade, Jobs, and Inequality (Video)

Participants:

Paul Krugman, Nobel Prize-winning economist, New York Times columnist, and distinguished professor at the Graduate Center.

David Autor, leading labor economist; professor at MIT, where he directs the School Effectiveness and Inequality Initiative; and editor in chief of the Journal of Economic Perspectives.

Brad DeLong, economics professor at U.C. Berkeley; weblogger for the Washington Center for Equitable Growth; and former U.S. deputy assistant secretary of the treasury, in the Clinton administration.

Anne Harrison, professor at the Wharton School, University of Pennsylvania; former director of development policy at the World Bank; and author of Globalization and Poverty.

The Demand for Education

One of the most rewarding parts of deciding to go online 12 years ago has little to do with the things I post here (the blog’s 12 year anniversary passed earlier this month, but I forgot until a day or two ago).

Amazingly, my YouTube class videos have had over 1,200,000 views. Even more surprising, the most popular are – by far, not even close – econometrics videos (just started a new series that will cover time series – something I’ve had a lot of requests for over the years, plus other things such as quasi-experimental techniques).

One time, at the AEA’s in Chicago, I was on my way to meet Noah Smith for the first time (at a Starbucks). As I was walking across a bridge to meet him I noticed someone running up behind me. It was a student on the market that year, and she had chased me down to tell me that the econometrics videos really helped her. I was quite amazed. I had no idea. I just posted the videos for my classes never thinking anyone else would watch.. She insisted on a picture together – I was embarrassed, but happy to comply at the same time.

At the same meeting, it happened again – another person in an elevator with the same story, and also wanted a picture. I have heard similar things many times over the years. Email about the videos from developing countries – where educational access is limited – has been especially nice. They come several times a week.

My videos are nothing special, they are just there. There is a huge, unmet demand for education, and not just the basics, technical things like econometrics. That’s what I have concluded.

FOMC Press Conference March 15, 2017 (Video)

Economic Policy (Video)

Panelists:

• Paul Krugman, Nobel Prize-winning economist, New York Times columnist, and distinguished professor at the Graduate Center.
• Jason Furman, senior fellow at Peterson Institute of International Economics and former chairman of President Obama’s Council of Economic Advisers.
• Dan Alpert, managing partner of Westwood Capital, fellow at the Century Foundation, and author of The Age of Oversupply.
• James Pethokoukis, CNBC contributor, columnist and blogger at the American Enterprise Institute, and former Washington columnist for Reuters.

Krugman did, as promised, wear his long tie...both of them.

Nobel Laureates Give Advice to President Donald Trump

Prize lecture: Oliver Hart, Laureate in Economic Sciences 2016 (Video)

Paul Krugman on Brexit, U.S. Election, and Fed Policy (Video)

Krugman on Trump TV and the Future of Right-Wing Media (Video)

Using Big Data: An Interview with Christian Hansen (Video)

More econometrics: Special Session: Model Selection and Inference (Technical)

Alan Krueger on the Minimum Wage (Video)

Full session: Plenary Session: Minimum Wages Presented by: Alan. B. Krueger
(Lecture starts at 6:35)

Discussants:
1 Richard Blundell, University College London and Institute of Fiscal Studies
2 Arindrajit Dube, University of Massachusetts Amherst

Economics Rules: The Rights and Wrongs of the Dismal Science (Video)

Bernanke's Mundell-Fleming Lecture (Video)

Krugman and Blanchard (Video): Saving The World Economy

Explaining Inequality (Piketty, Murphy, Durlauf Video)

(At the Becker-Friedman Institute)

Economic Impossibilities For Our Grandchildren? Examining Secular Stagnation

Professor Kevin O'Rourke

Video: Sir David Hendry on Big Data and Econometrics

Thomas Piketty: New Thoughts on Capital in the Twenty-First Century

[Transcript]

Video: NBER Feldstein Lecture by Alan Krueger on Labor Force Participation

'Cyclical Variation in Real Wages'

More than 75 years ago, the EJ – under Keynes’ editorship - published a series of papers on the behavior of real wages that have had a lasting impact on the discipline – this special anniversary session discusses debates then and now about real wage dynamics, unemployment fluctuations and wage flexibility.

Presentations:

• Keynesian Controversies on Compensation; Presented by John Pencavel (Stanford University)
• Unemployment and Business Cycles; Presented by Lawrence Christiano (Northwestern University)
• Unemployment Fluctuations, Match Quality and Wage Cyclicality of New Hires: Presented by Christopher Huckfeldt (Cornell University) and Antonella Trigari (Bocconi University)
• Does the New Keynesian Model have a Uniqueness Problem? Presented by Benjamin Johannsen (Federal Reserve Board)

I really enjoyed this session, particularly the history of "Keynesian controversies" over wages by John Pencavel at the beginning of the session.

Short Video: Regret Theory: Looking Back, Looking Forward

Robert Sugden talks to Mark Thoma about his work on 'Regret Theory', as featured in The Economic Journal 125th Anniversary Special Issue, available for free online here: http://onlinelibrary.wiley.com/doi/10.1111/ecoj.12230/abstract

Here's an example: Regret theory in practice. (Update: Maybe this isn't the best example -- it should be that the anticipation of regret alters the choice that is made).

Inequality - What To Do About It?

A follow up to yesterday's post on what to do about inequality:

Inequality has been on the rise since the 1970s - Tony Atkinson and Sabine Alkire ask what can be done about it? Inequality was a topic covered in The Economic Journal 125th Anniversary Special Issue, available for free online: http://onlinelibrary.wiley.com/doi/10.1111/ecoj.12230/abstract

Watch the full session here: https://www.youtube.com/watch?v=XpdhdUkza88

Video: Interest Rates, Inflation & Clear Communication

Another interview, this one with Sir Professor Charles Bean, former Deputy Governor at the Bank of England and past President of the Royal Economic Society. I thought this one went well.

Video: Economics Of The Family, with Robert Pollak & Mark Thoma - RES 2015

Video: Buying, Selling & Efficiency - RES 2015

Efficiency matters! It can make the economy better off. Understanding efficiency in manufacturing and retail markets can help guide policy, according to prize-winning research by Daniel Muller and Fabian Herweg in The Economic Journal. See the summary here: http://www.res.org.uk/details/mediabr...

The interview was recorded at the Royal Economic Society annual conference at The University of Manchester in Spring 2015 and produced by Econ Films.

Video: On Econometrics - Koen Jochmans & Mark Thoma - RES 2015

Koen Jochmans of Sciences Po speaks to Mark Thoma about his research and winning the Sargan Prize for outstanding research in the Econometric Journal. http://www.res.org.uk/details/econome...

The interview was recorded at the Royal Economic Society annual conference at The University of Manchester in April 2015 and produced by Econ Films.

[This is the first of three interviews I did -- will save the best for last.]

'Why You Shouldn't Copy In Class'

Video: Stiglitz on Inequality, Wealth, and Growth: Why Capitalism is Failing

Video: Game Theory

Video: Closing the Income Inequality Gap

 A widening gap between haves and have-nots is shrinking the American middle class and making it tougher than ever to move up the economic ladder. The U.S. problem reflects a worldwide concentration of wealth. The top 1 percent control 48 percent of the world's assets, up from 44 percent in 2009. Disparate voices ranging from Pope Francis to IMF Director Christine Lagarde warn that the gulf between rich and poor diminishes hope and raises serious political and economic issues. Some companies are listening. Late last year, Walmart Stores pledged to end minimum-wage pay by raising the hourly rate of 500,000 workers. Other companies followed with similar increases for their lowest-paid workers. Will their announcements spur broader efforts to reduce income equality? What else can be done to lift the standard of living for the working poor?

Moderator: Alan Schwartz, Executive Chairman, Guggenheim Partners

Speakers: Jared Bernstein, Economic Policy Fellow, Milken Institute; Senior Fellow, Center on Budget and Policy Priorities; Former Chief Economist to Vice President Joe Biden, Beth Ann Bovino, U.S. Chief Economist, Global Economics and Research, Standard & Poor's Ratings Services, Arthur Brooks, President, American Enterprise Institute, Jeff Greene, Investor and Philanthropist, Kristin Oliver, Executive Vice President, People, Walmart U.S.

Video: Geithner, Paulson, and Rubin

In this session, Sheryl Sandberg, chief operating officer of Facebook, interviews former U.S. Treasury Secretaries Timothy Geithner, Henry Paulson and Robert Rubin about global economic trends, public finance and capital markets.

Video: Rethinking Macro Policy

Rethinking Macro Policy III: Session 3. Monetary Policy in the Future
Chair: José Viñals, Ben Bernanke, Gill Marcus, John Taylor

Rethinking Macro Policy: Session 4. Fiscal Policy in the Future
Chair: Vitor Gaspar, Marco Buti, Martin Feldstein, Brad DeLong,

Summers (Video): New Lending For A New Economy

INET Video: Varoufakis and Stiglitz

INET Video: Piketty and Stiglitz

"Thomas Piketty and Joseph E. Stiglitz discuss the causes of, consequences of, and remedies for inequality. With opening remarks from Clive Cowdery, George Soros, OECD Secretary General Angel Gurria, Institute President Rob Johnson and Institute Board Members Anatole Kaletsky and Lord Adair Turner."

The Economics of Inequality: Emmanuel Saez and Laura Tyson

"In a panel discussion moderated by Dean Rich Lyons, Laura Tyson, professor of business administration and economics at the Haas School of Business, and Emmanuel Saez, economics professor and head of the Center for Equitable Growth at UC Berkeley, focus on income inequality, drawing from ideas central to Thomas Piketty's bestselling book Capital in the Twenty-First Century."

[Note: The discussion is summarized here.]

Adair Turner: The Consequences of Money-Manager Capitalism

This is from INET:

The Consequences of Money-Manager Capitalism: In the wake of World War II, much of the western world, particularly the United States, adopted a new form of capitalism called “managerial welfare-state capitalism.”

The system by design constrained financial institutions with significant social welfare reforms and large oligopolistic corporations that financed investment primarily out of retained earnings. Private sector debt was small, but government debt left over from financing the War was large, providing safe assets for households, firms, and banks. The structure of this system was financially robust and unlikely to generate a deep recession. However, the constraints within the system didn’t hold.

The relative stability of the first few decades after WWII encouraged ever-greater risk-taking, and over time the financial system was transformed into our modern overly financialized economy. Today, the dominant financial players are “managed money”—lightly regulated “shadow banks” like pension funds, hedge funds, sovereign wealth funds, and university endowments—with huge pools of capital in search of the highest returns. In turn, innovations by financial engineers have encouraged the growth of private debt relative to income and the increased reliance on volatile short-term finance and massive uses of leverage.

What are the implications of this financialization on the modern global economy? According to Adair Lord Turner, a Senior Fellow at the Institute for New Economic Thinking and a former head of the United Kingdom’s Financial Services Authority, it means that finance has become central to the daily operations of the economic system. More precisely, the private nonfinancial sectors of the economy have become more dependent on the smooth functioning of the financial sector in order to maintain the liquidity and solvency of their balance sheets and to improve and maintain their economic welfare. For example, households have increased their use of debt to fund education, healthcare, housing, transportation, and leisure. And at the same time, they have become more dependent on interest, dividends, and capital gains as a means to maintain and improve their standard of living.  

Another major consequence of financialized economies is that they typically generate repeated financial bubbles and major debt overhangs, the aftermath of which tends to exacerbate inequality and retard economic growth. Booms turn to busts, distressed sellers sell their assets to the beneficiaries of the previous bubble, and income inequality expands. 

In the view of Lord Turner, we have yet to come up with a sufficiently robust policy response to deal with the consequences of our new “money manager capitalism.” The upshot likely will be years more of economic stagnation and deteriorating living standards for many people around the world. 

'How Mainstream Economic Thinking Imperils America'

Econometrics Mini-Course (NBER): Theory and Application of Network Models

Summer Institute 2014 Theory and Application of Network Models, July 22, 2014 Daron Acemoglu and Matthew O. Jackson, Organizers:

Matthew O. Jackson, Stanford University Social and Economic Networks: Backgound

Slides accompany this lecture. Click here to view them.

Daron Acemoglu, MIT Networks: Games over Networks and Peer Effects

Slides accompany this lecture. Click here to view them.

Matthew O. Jackson, Stanford University Diffusion, Identification, Network Formation

Slides accompany this lecture. Click here to view them.

Daron Acemoglu, MIT Networks: Propagation of Shocks over Economic Networks

Slides accompany this lecture. Click here to view them.

FRB Explanatory Video: Changes in Family Finances

A Conversation with Lars Hansen

See also conversations with Peter Diamond and Edmund Phelps.

A Conversation with Edmund Phelps