Ben Bernanke and the Zero Bound
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Nomination of Ben S. Bernanke
S. HRG. 111–206 NOMINATION OF BEN S. BERNANKE HEARING BEFORE THE COMMITTEE ON BANKING, HOUSING, AND URBAN AFFAIRS UNITED STATES SENATE ONE HUNDRED ELEVENTH CONGRESS FIRST SESSION ON THE NOMINATION OF BEN S. BERNANKE, OF NEW JERSEY, TO BE CHAIRMAN OF THE BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM DECEMBER 3, 2009 Printed for the use of the Committee on Banking, Housing, and Urban Affairs ( Available at: http://www.access.gpo.gov/congress/senate/senate05sh.html U.S. GOVERNMENT PRINTING OFFICE 54–239 PDF WASHINGTON : 2010 For sale by the Superintendent of Documents, U.S. Government Printing Office Internet: bookstore.gpo.gov Phone: toll free (866) 512–1800; DC area (202) 512–1800 Fax: (202) 512–2104 Mail: Stop IDCC, Washington, DC 20402–0001 COMMITTEE ON BANKING, HOUSING, AND URBAN AFFAIRS CHRISTOPHER J. DODD, Connecticut, Chairman TIM JOHNSON, South Dakota RICHARD C. SHELBY, Alabama JACK REED, Rhode Island ROBERT F. BENNETT, Utah CHARLES E. SCHUMER, New York JIM BUNNING, Kentucky EVAN BAYH, Indiana MIKE CRAPO, Idaho ROBERT MENENDEZ, New Jersey BOB CORKER, Tennessee DANIEL K. AKAKA, Hawaii JIM DEMINT, South Carolina SHERROD BROWN, Ohio DAVID VITTER, Louisiana JON TESTER, Montana MIKE JOHANNS, Nebraska HERB KOHL, Wisconsin KAY BAILEY HUTCHISON, Texas MARK R. WARNER, Virginia JUDD GREGG, New Hampshire JEFF MERKLEY, Oregon MICHAEL F. BENNET, Colorado EDWARD SILVERMAN, Staff Director WILLIAM D. DUHNKE, Republican Staff Director MARC JARSULIC, Chief Economist AMY FRIEND, Chief Counsel JULIE CHON, Senior Policy Adviser JOE HEPP, Professional Staff Member LISA FRUMIN, Legislative Assistant DEAN SHAHINIAN, Senior Counsel MARK F. OESTERLE, Republican Chief Counsel JEFF WRASE, Republican Chief Economist DAWN RATLIFF, Chief Clerk DEVIN HARTLEY, Hearing Clerk SHELVIN SIMMONS, IT Director JIM CROWELL, Editor (II) CONTENTS THURSDAY, DECEMBER 3, 2009 Page Opening statement of Chairman Dodd ................................................................. -
Christina and David Romer
The Region Christina and David Romer In times of financial turmoil, it is comforting—or at a minimum, illuminating— to receive counsel from those with long-term perspective. Tempered with the lessons of history, their views extract true trend from distracting noise. Guided by precedent, shaped by narrative, checked against data, the conclusions of economic historians are formed slowly and carefully. In the realm of U.S. monetary history, few economists are as qualified to provide such counsel as Christina Romer and David Romer of the University of California, Berkeley. Since 1985, when both received their doctorates from the Massachusetts Institute of Technology, the two have co-authored some of the field’s central analyses of Federal Reserve policymaking, based on thorough scrutiny of Fed documents and painstaking empirical investigation. They’ve made fundamental contributions to the literature on fiscal policy as well. Individually, Christina is well known for her research on the Great Depression and David for his work on microeconomic foundations of Keynesian economics. While their topics and methods are orthodox, their conclusions are often unsettling. Attempts by members of the Federal Open Market Committee to add information to Fed staff forecasts “may lead to misguided actions,” the Romers wrote recently. Monetary policymaking has improved since World War II but not steadily, they’ve concluded; policymakers have gone astray when they deviated from sound economic theory. Contrary to conventional wisdom, the Romers have found, government spending is not reined in by tax cuts. And, according to a celebrated, if “offbeat,” analysis by David, football coaches should be much more aggressive on fourth down. -
API-119: Advanced Macroeconomics for the Open Economy I, Fall 2020
Sep 1, 2020 API-119: Advanced Macroeconomics for the Open Economy I, Fall 2020 Harvard Kennedy School Course Syllabus: prospectus, outline/schedule and readings Staff: Professor: Jeffrey Frankel [email protected] Faculty Assistant: Minoo Ghoreishi [email protected] Teaching Fellow: Can Soylu Course Assistants: Julio Flores, Alberto Huitron & Yi Yang. Email address to send all questions for the teaching team: [email protected]. Times: Lectures: Tuesdays and Thursdays, 10:30-11:45 a.m. EST.1 Review Sessions: Tuesdays, 12:30-1:30 pm; Fridays, 1:30-2:30 pm EST.2 Final exam: Friday, Dec. 11, 8:00-11:00 am EST. Prospectus Course Description: This course is the first in the two-course sequence on Macroeconomic Policy in the MPA/ID program. It particularly emphasiZes the international dimension. The general perspective is that of developing countries and other small open economies, defined as those for whom world income, world inflation and world interest rates can be taken as given, and possibly the terms of trade as well. The focus is on monetary, fiscal, and exchange rate policy, and on the determination of the current account balance, national income, and inflation. Models of devaluation include one that focuses on the price of internationally traded goods relative to non-traded goods. A theme is the implications of increased integration of global financial markets. Another is countries’ choice of monetary regime, especially the degree of exchange rate flexibility. Applications include Emerging Market crises and problems of commodity-exporting countries. (Such topics as exchange rate overshooting, speculative attacks, portfolio diversification and debt crises will be covered in the first half of Macro II in February-March.) Nature of the approach: The course is largely built around analytical models. -
The Fair Wage-Effort Hypothesis and Unemployment Author(S): George A
The Fair Wage-Effort Hypothesis and Unemployment Author(s): George A. Akerlof and Janet L. Yellen Source: The Quarterly Journal of Economics, Vol. 105, No. 2 (May, 1990), pp. 255-283 Published by: Oxford University Press Stable URL: http://www.jstor.org/stable/2937787 . Accessed: 09/10/2013 09:57 Your use of the JSTOR archive indicates your acceptance of the Terms & Conditions of Use, available at . http://www.jstor.org/page/info/about/policies/terms.jsp . JSTOR is a not-for-profit service that helps scholars, researchers, and students discover, use, and build upon a wide range of content in a trusted digital archive. We use information technology and tools to increase productivity and facilitate new forms of scholarship. For more information about JSTOR, please contact [email protected]. Oxford University Press is collaborating with JSTOR to digitize, preserve and extend access to The Quarterly Journal of Economics. http://www.jstor.org This content downloaded from 216.164.44.3 on Wed, 9 Oct 2013 09:57:21 AM All use subject to JSTOR Terms and Conditions THE QUARTERLY JOURNAL OF ECONOMICS Vol. CV May 1990 Issue 2 THE FAIR WAGE-EFFORT HYPOTHESIS AND UNEMPLOYMENT* GEORGE A. AKERLOF AND JANET L. YELLEN This paper introduces the fair wage-effort hypothesis and explores its implica- tions. This hypothesis is motivated by equity theory in social psychology and social exchange theory in sociology. According to the fair wage-effort hypothesis, workers proportionately withdraw effort as their actual wage falls short of their fair wage. Such behavior causes unemployment and is also consistent with observed cross- section wage differentials and unemployment patterns. -
Statement / by Donald Kohn ... Before the Subcommittee On
Testimony Donald L. Kohn, Vice Chairman Federal Reserve independence Before the Subcommittee on Domestic Monetary Policy and Technology, Committee on Financial Services, U.S. House of Representatives, Washington, D.C. July 9, 2009 Chairman Watt, Ranking Member Paul, and other members of the Subcommittee, I appreciate the opportunity to discuss with you the important public policy reasons why the Congress has long given the Federal Reserve a substantial degree of independence to conduct monetary policy while ensuring that we remain accountable to the Congress and to the American people. In addition, I will explain why an extension of the Federal Reserve’s supervisory and regulatory responsibilities as part of a broader initiative to address systemic risks would be compatible with the pursuit of our statutory monetary policy objectives. I also will discuss the significant steps the Federal Reserve has taken recently to improve our transparency and maintain accountability. Independence and Accountability A well-designed framework for monetary policy includes a careful balance between independence and accountability. A balance of this type conforms to our general inclination as a nation to have clearly drawn lines of authority, limited powers, and appropriate checks and balances within our government; such a balance also is conducive to sound monetary policy. The Federal Reserve derives much of the authority under which it operates from the Federal Reserve Act. The act specifies and limits the Federal Reserve’s powers. In 1977, the Congress amended the act by establishing maximum employment and price stability as our monetary policy objectives; the Federal Reserve has no authority to establish different objectives. -
High Frequency Identification of Monetary Non-Neutrality
NBER WORKING PAPER SERIES HIGH FREQUENCY IDENTIFICATION OF MONETARY NON-NEUTRALITY Emi Nakamura Jón Steinsson Working Paper 19260 http://www.nber.org/papers/w19260 NATIONAL BUREAU OF ECONOMIC RESEARCH 1050 Massachusetts Avenue Cambridge, MA 02138 July 2013 We thank Matthieu Bellon, Vlad Bouchouev, Nicolas Crouzet, Jesse Garret and Shaowen Luo, for excellent research assistance. We thank Michael Abrahams, Tobias Adrian, Richard K. Crump, Matthias Fleckenstein, Michael Fleming, Refet Gurkaynak, Hanno Lustig, Emanuel Moench, and Eric Swanson for generously sharing data and programs with us. We thank Marco Bassetto, Gauti Eggertsson, Mark Gertler, Refet Gurkaynak, Samuel Hanson, Sophocles Mavroeidis, Emanuel Moench, Serena Ng, Roberto Rigobon, David Romer, Christoph Rothe, Eric Swanson, Michael Woodford, Jonathan Wright and seminar participants at various institutions for valuable comments and discussions. We thank the National Science Foundation (grant SES-1056107) and the Columbia Business School Dean’s Office Summer Research Assistance Program for financial support. The views expressed herein are those of the authors and do not necessarily reflect the views of the National Bureau of Economic Research. NBER working papers are circulated for discussion and comment purposes. They have not been peer- reviewed or been subject to the review by the NBER Board of Directors that accompanies official NBER publications. © 2013 by Emi Nakamura and Jón Steinsson. All rights reserved. Short sections of text, not to exceed two paragraphs, may be quoted without explicit permission provided that full credit, including © notice, is given to the source. High Frequency Identification of Monetary Non-Neutrality Emi Nakamura and Jón Steinsson NBER Working Paper No. 19260 July 2013, Revised December 2013 JEL No. -
The Political Economy of the Bretton Woods Agreements Jeffry Frieden
The political economy of the Bretton Woods Agreements Jeffry Frieden Harvard University December 2017 1 The Allied representatives who met at Bretton Woods in July 1944 undertook an unprecedented endeavor: to plan the international economic order. To be sure, an international economy has existed as long as there have been nations, and there had been recognizable international economic orders in the recent past – such as the classical era of the late nineteenth and early twentieth century. However, these had emerged organically from the interaction of technological, economic, and political developments. By the same token, there had long been international conferences and agreements on economic issues. Nonetheless, there had never been an attempt to design the very structure of the international economy; indeed, it is unlikely that anybody had ever dreamed of trying such a thing. The stakes at Bretton Woods could not have been higher. This essay analyzes the sources of the Bretton Woods Agreements and the system they created. The system grew out of the international economic experiences of the previous century, as understood through the lens of both history and theory. It was profoundly influenced by the domestic politics of the countries that created the system, in particular by the United States and the United Kingdom. It was molded by the conflicts, compromises, and agreements among the signatories to the agreement, as they bargained their way up to and through the Bretton Woods Conference. The results of those complex domestic and international interactions have shaped the world economy for the past 75 years. 2 The historical setting The negotiators at Bretton Woods could look back on recent history to help guide their efforts. -
Former Fed Chairman Ben Bernanke Reflects on His Career, the Economy, and the Way Forward
FORMER FED CHAIRMAN BEN BERNANKE REFLECTS ON HIS CAREER, THE ECONOMY, AND THE WAY FORWARD Dr. Ben S. Bernanke Distinguished Fellow in Residence, Economic Studies, Brookings Institution Former Chairman, Federal Reserve Board of Governors Author: The Courage to Act: A Memoir of a Crisis and Its Aftermath (W.W. Norton and Company, 2015) February 10, 2016 Excerpts from Dr. Bernanke's Remarks Do you miss the power when you were running the Fed and running the financial world? No, not at all, because the power – [laughter].... Now I can get the newspaper in the morning, you know, look at the story and say, gee, that’s a significant problem. Somebody ought to do something about that. [Laughter, chuckles.] Do you ever say, well, geez, maybe I’ll just send an email to Janet Yellen1, say, here’s some advice, or do you stay out of that? No, I wouldn’t do that. In high school, you got a 1590 out of 1600 on your SATs, the highest in the state. Missed one question. You reveal in your book, that going to Harvard was not something that was on your mind, but an African-American who had befriended you had gone to Harvard, really persuaded you.... His name is Ken Manning... His family knew our family.... And Ken was and is a very brilliant, precocious man. And he had gone...to some kind of program, which got him eventually into Harvard, and then he went to Harvard Graduate School, and now he’s an MIT professor. And he took it on himself, you know, to persuade my parents that I should go to Harvard. -
"What Can an Economic Adviser Do When the President Adopts Bad Economic Policies?"
"What Can An Economic Adviser Do When the President Adopts Bad Economic Policies?" Jeffrey Frankel, Harpel Professor, KSG, Harvard University The Pierson Lecture, Swarthmore, April 21, 2005 Summary: What would you do if you were appointed Chair of the Council of Economic Advisers under a president who was committed to one or more specific policies that you considered to be inconsistent with good economics? A look at the experiences of your predecessors over the last 40 years might help illustrate your alternative options. The lecture will review the history. It will then go on to suggest that such conflicts should be particularly acute in the current Administration. The reason is that Republican presidents have increasingly adopted policies-- with regard particularly to budget deficits, trade, the size of government, and inflation -- that deviate from the principles of good economics, and that used to be considered the weaknesses of Democratic presidents. It is a great honor to be giving the Pierson lecture.1 I must confess that I never had Frank Pierson for a course. But he was the senior eminence of the Economics Department when I attended Swarthmore in the early 1970s, having already been associated with the department more than 40 years. In that time, Frank Pierson was known as one of the last professors who still regularly held his honors seminars at his house, with an impressive series of desserts, including make-your-own sundaes, and Irish coffee. The early 1970s were a volatile time of course, with the War in Viet Nam still on.2 In 1972 the big split on campus was between those of us working for McGovern on the left, and the 1 The author wishes to acknowledge help from Peter Jaquette, Arnold Kling, Jeff Miron, Stephen O’Connell, Francis Bator, Michael Boskin, David Cutler, Jason Furman, Gilbert Heebner, William Gale, Jeff Liebman, Peter Orszag, Roger Porter, Charles Schultze, Phillip Swagel, Laura Tyson, Murray Weidenbaum, Marina Whitman, and Janet Yellen. -
1 April 2009 DAVID ROMER Department of Economics University of California Berkeley, California 94720-3880
April 2009 DAVID ROMER Department of Economics University of California Berkeley, California 94720-3880 (510) 642-1785 International Monetary Fund 700 19th St., N.W. Washington, D.C. 20431 (202) 623-7026 Current Positions Herman Royer Professor in Political Economy, University of California, Berkeley, 2000- present Senior Resident Scholar, International Monetary Fund, 2009-present Previous Positions University of California, Berkeley: Professor, 1993-2000 Associate Professor, 1990-1993 Acting Associate Professor, 1988-1990 Assistant Professor, Princeton University, 1985-1988 Visiting Professor, Stanford University, Fall Quarter, 1995 Visiting Associate Professor, Stanford University, Spring Quarter, 1993 Visiting Assistant Professor, Massachusetts Institute of Technology, 1988 Visiting Scholar, National Bureau of Economic Research, 1987-1988 Junior Staff Economist, Council of Economic Advisers, 1980-1981 Education Ph.D., Massachusetts Institute of Technology, 1985 A.B., Princeton University, 1980 Honors, Fellowships, and Grants National Science Foundation Grants: SES-0550912 (Co-Principal Investigator with Christina D. Romer), 2006-2009 SBR-9911443 (Co-Principal Investigator with Christina D. Romer), 2000-2004 SBR-9422584 (Principal Investigator), 1995-1999 SES-9122325 (Co-Principal Investigator with Laurence Ball), 1992-1994 1 SES-9008977 (Principal Investigator), 1990-1992 SES-8707950 (Co-Principal Investigator with Laurence Ball), 1987-1989 Henry George Lecturer, University of Scranton, October 2007 Fellow, American Academy of Arts -
The Ben Bernanke and Janet Yellen Investment Portfolios | Seeking Alpha 7/31/15, 5:33 PM
The Ben Bernanke And Janet Yellen Investment Portfolios | Seeking Alpha 7/31/15, 5:33 PM The Ben Bernanke And Janet Yellen Investment Portfolios "I never attempt to make money on the stock market. I buy on the assumption that they could close the market the next day and not reopen it for five years" - Warren Buffett When it comes to financial security, one could argue that the chairman of the Federal Reserve Board of Governors would be a great role model to emulate. As an obligation of duty, the chairman and all members of the board are required to disclose their assets and income to the U.S. Office of Government Ethics. U.S. President Barack Obama made it clear that when Ben Bernanke's second term expires on 1-31-2014, there will be a new chairman of which current Vice Chairman of the Board of Governors, Janet Yellen, is the current front-runner. By analyzing their respective investment portfolios, one can gain insight into astute money management techniques as well as their individual stock selections. The Man On February 1, 2006, Ben Bernanke was sworn in as a 14-year term member of the Federal Reserve Board of Governors, as well as Fed Chairman, which was a 4-year term. U.S. President Bush appointed him just before the beginning of the Global Financial Crisis, where Bernanke, along with U.S. Treasury Secretary Henry Paulson and the president of the Federal Reserve Bank of New York Timothy Geithner organized the economic bailout that arguably sidelined a global depression. -
Fall 2018 Christina Romer University of California, Berkeley David Romer ECONOMICS 210C / ECONOMICS 236A MACROECONOMIC HISTORY
Fall 2018 Christina Romer University of California, Berkeley David Romer ECONOMICS 210C / ECONOMICS 236A MACROECONOMIC HISTORY SUPPLEMENTAL READINGS DECEMBER 5 – THE DETERMINANTS OF MACROECONOMIC POLICY Scrimgeour, Dean. 2008. “The Great Inflation Was Not Asymmetric: International Evidence.” Journal of Money, Credit and Banking 40 (June): 799–815. Romer, Christina D. 2005. “Comments on ‘Origins of the Great Inflation’ by Allan H. Meltzer.” Federal Reserve Bank of St. Louis Review 87 (March/April): 177–186. Rudebusch, Glenn D. 2002. “Term Structure Evidence on Interest Rate Smoothing and Monetary Policy Inertia.” Journal of Monetary Economics 49 (September): 1161– 1187. Coibion, Olivier, and Yuriy Gorodnichenko. 2012. “Why Are Target Interest Rate Changes So Persistent?” American Economic Journal: Macroeconomics 4 (October): 126– 162. Taylor, John B. 1999. “A Historical Analysis of Monetary Policy Rules.” In John B. Taylor, ed., Monetary Policy Rules (Chicago: University of Chicago Press for NBER): 319– 348. Orphanides, Athanasios. 2003. “The Quest for Prosperity without Inflation.” Journal of Monetary Economics 50 (April): 633–665. Calomiris, Charles W., and David Wheelock. 1998. “Was the Great Depression a Watershed for American Monetary Policy?” In Michael Bordo, Claudia Goldin, and Eugene White, eds., The Defining Moment: The Great Depression and the American Economic in the Twentieth Century (Chicago: University of Chicago Press for NBER): 23–66. Romer, Christina D., and David H. Romer. 2002. “A Rehabilitation of Monetary Policy in the 1950’s.” American Economic Review 92 (May): 121–127. Meltzer, Allan H. 2005. “Origins of the Great Inflation.” Federal Reserve Bank of St. Louis Review 87 (March/April, Part 2): 145–176. Weise, Charles L.