Posted on May 2, 2011 by iMFdirect
The global financial crisis caused immense hardship and suffering all over the world. To prevent a repeat, we need to rethink…
… what we know about economic theory …. We need to rethink, following this, the policies … coming from the analytical work. And then we will need also to rethink multilateralism.
IMF Managing Director Dominique Strauss-Kahn (April 16, 2011)
A wholesale reexamination of macroeconomic principles in the wake of the crisis was the goal of a conference at the IMF in early March.
But, for Olivier Blanchard and others, the conference was merely “the beginning of a conversation, the beginning of an exploration.”
Here is our list of recommended reads to help you be part of the conversation. (more…)
Filed under: Economic Crisis, Economic research, International Monetary Fund | Tagged: David Romer, global economic crisis, Joseph Stiglitz, Macro and Growth Policies in the Wake of the Crisis, macroeconomic models, macroeconomic policy, macroeconomists' playbook, Michael Spence | 7 Comments »
Posted on April 5, 2011 by iMFdirect
Open, wide-ranging, and balanced discussion. For Olivier Blanchard—and co-hosts David Romer, Michael Spence & Joseph Stiglitz—that was the goal of last month’s conference at the IMF on the future of macroeconomic policies after the global financial crisis. And it is exactly what they got.
The crisis was a wakeup call for theorists and policymakers… Economic models, policy tools, and how they are applied need to catch up with changes in the global economic and financial system.
You’ve heard here about views from the conference, but there’s plenty of discussion going on outside the IMF. Here’s a snapshot…. (more…)
Filed under: Economic research, International Monetary Fund | Tagged: Anders Aslund, David H. Romer, Financial regulation, financial sector risk, global financial crisis, high-frequent trading, Joseph E. Stiglitz, macroeconomic models, Macroeconomic policies, Mark Thoma, Matthew Yglesias, Michael Spence, Olivier Blanchard, Paul Krugman, Perry Mehrling, policy tools, Robert Solow, unemployment | 2 Comments »
Posted on March 13, 2011 by iMFdirect
By Olivier Blanchard
(Version in Français, Español)
The global economic crisis taught us to question our most cherished beliefs about the way we conduct macroeconomic policy. Earlier I had put forward some ideas to help guide conversations as we reexamine these beliefs. I was heartened by the wide online debate and the excellent discussions at a conference on post-crisis macroeconomic policy here in Washington last week. At the end of the conference, I organized my concluding thoughts around nine points. Let me go through them and see whether you agree or not. (more…)
Filed under: Economic Crisis, Economic research, Financial Crisis, Financial regulation, Financial sector supervision, Fiscal policy, growth, International Monetary Fund | Tagged: Adair Turner, agency theory, Andrew Sheng, Behavioral economics, capital controls, cross-border linkages, Dani Rodrik, Financial regulation, inflation targeting, Joseph Stiglitz, liquidity, macroeconomic policy, macroprudential regulation, Michael Spence, Olivier Blanchard, Paul Romer, policy instruments, policy targets, Robert Solow, SDRs, Special Drawing Rights, systemic crisis, Washington Consensus | 23 Comments »
Posted on March 4, 2011 by iMFdirect
By Olivier Blanchard
Before the global economic crisis, mainstream macroeconomists had largely converged on a framework for the conduct of macroeconomic policy. The framework was elegant, and conceptually simple. Caricaturing just a bit, it went like this:
- The essential goal of monetary policy was low and stable inflation. The best way to achieve it was to follow an interest rate rule. If designed right, the rule was not only credible, but delivered stable inflation and ensured that output was as close as it could be to its potential. (more…)
Filed under: Economic Crisis, Economic research, Financial Crisis, Fiscal policy, IMF, International Monetary Fund | Tagged: capital flows, central banks, conference, currency, David Romer, economic imbalances, fiscal policy, Great Moderation, interest rates, Joseph Stiglitz, liquidity, macroeconomics, Michael Spence, monetary policy, Olivier Blanchard, swaps | 32 Comments »