At first sight, it is difficult to explain why the macroeconomic debate and macroeconomic policy in Germany differ considerably from other countries, despite the same academic textbooks and models being used as elsewhere. This column explains how a specific paradigm of macroeconomics, developed by Walter Eucken and diametrically opposed to Keynesian economics, is behind the German formal theoretical apparatus. The success of German macroeconomic policy can be attributed to the openness of the German economy, which allows it to benefit from macroeconomic policies pursued in other major countries.
Peter Bofinger, 07 June 2016
David Chambers, Elroy Dimson, 20 October 2014
Yale University has generated annual returns of 13.9% over the last 20 years on its endowment – well in excess of the 9.2% average return on US university endowments. Keynes’ writings were a considerable influence on the investment philosophy of David Swensen, Yale’s CIO. This column traces how Keynes’ experiences managing his Cambridge college endowment influenced his ideas, and sheds light on how some of the lessons he learnt are still relevant to endowments and foundations today.
Jeffrey Frankel Frankel, 29 January 2013
2013 marks the 100th anniversary of US federal income tax and the establishment of the Federal Reserve. What lessons have we learnt about macroeconomic policy since then? This column assesses the postwar lessons and argues that fiscal expansion is much more likely to be effective in the short term than any monetary expansion stimulus. Indeed, compared with fiscal policy, monetary policy seems more alchemy than science.
Giovanni Cespa, Xavier Vives, 18 September 2012
Is the ECB right to buy up sovereign bonds in southern Europe? This column argues that the answer depends on who is right: Keynes or Hayek.
Paul Krugman, 21 June 2011
Keynes’ General Theory is 75 years old. In this column, Paul Krugman argues that many of its insights and lessons are still relevant today, but many have been forgotten. A broad swath of macroeconomists and policymakers are applying old fallacies to today’s crisis. As the nostrums being applied by the “pain caucus” are visibly failing, Keynesian ideas may yet make a comeback.
Matthew Luzzetti, Lee Ohanian, 31 January 2011
This month marks the 75th anniversary of the publication of Keynes’s The General Theory of Employment, Interest, and Money. This column examines the book’s influence today. It argues that the General Theory was a flawed idea whose time had come.
Max Corden, 13 January 2010
This new CEPR Policy Insight suggests that the 'Keynesian ambulance' of fiscal stimuli in response to the crisis may have averted a Great Depression.
Max Corden, 13 January 2010
The world economy has had a heart attack. “Ambulance economics” is about the immediate reanimation process, i.e. the fiscal stimulus. This column introduces a new CEPR Policy Insight that reviews practical aspects of fiscal stimulus policies, noting especially the inevitable trade-offs involved. It discusses the relationship between a long-term public debt problem caused usually by demographic factors and the need for short-term fiscal stimulus for Keynesian reasons. Also, it analyses critically seven common arguments against fiscal stimuli.
Max Corden, 19 May 2009
CEPR Policy Insight No.34 takes a close look at the Keynesian theory underlying the policy of fiscal stimulus being undertaken or considered in many countries, led by the US.
Robert J. Gordon, 30 January 2009
Robert Gordon of Northwestern University talks to Romesh Vaitilingam about the causes and consequences of the economic crisis, the emerging consensus on the need for fiscal stimulus, and the challenge to the schools of thought that have dominated macroeconomics in recent decades. He argues that we will see a return to old-fashioned Keynesian (non-market clearing) analysis in macroeconomic teaching and research. The interview was recorded at the American Economic Association meetings in San Francisco in January 2009.