Question A:
Taking into account all of the economic consequences — including the incentives of banks to ensure their own liquidity and solvency in the future — the benefits of bailing out U.S. banks in 2008 will end up exceeding the costs.
Responses
© 2025. Kent A. Clark Center for Global Markets.
15%
0%
0%
13%
13%
49%
10%
Responses weighted by each expert's confidence
© 2025. Kent A. Clark Center for Global Markets.
0%
13%
19%
51%
17%
Question B:
Because GM and Chrysler were bailed out in 2008-09, the U.S. unemployment rate was lower at the end of 2010 than it would it have been if Congress and the executive branch had not intervened.
Responses
© 2025. Kent A. Clark Center for Global Markets.
15%
0%
0%
3%
10%
56%
15%
Responses weighted by each expert's confidence
© 2025. Kent A. Clark Center for Global Markets.
0%
3%
8%
64%
24%
Question C:
Taking into account all of the economic consequences — including effects on corporate managers' incentives and on creditors' expectations of how their claims will be treated in future bankruptcies — the benefits of bailing out GM and Chrysler will end up exceeding the costs.
Responses
© 2025. Kent A. Clark Center for Global Markets.
15%
0%
0%
10%
26%
44%
5%
Responses weighted by each expert's confidence
© 2025. Kent A. Clark Center for Global Markets.
0%
15%
31%
46%
8%
Question A Participant Responses
Participant |
University |
Vote |
Confidence |
Bio/Vote History |
|---|---|---|---|---|
 Daron Acemoglu |
MIT | Bio/Vote History | ||
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 Alberto Alesina |
Harvard | Did Not Answer | Bio/Vote History | |
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 Joseph Altonji |
Yale | Bio/Vote History | ||
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 Alan Auerbach |
Berkeley | Bio/Vote History | ||
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 David Autor |
MIT | Bio/Vote History | ||
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Long term unemployed workers are costly; many collect SSDI. Aiding GM was likely a cost effective welfare/employment program, all else aside
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 Katherine Baicker |
University of Chicago | Bio/Vote History | ||
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 Marianne Bertrand |
Chicago | Bio/Vote History | ||
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 Raj Chetty |
Harvard | Bio/Vote History | ||
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 Judith Chevalier |
Yale | Bio/Vote History | ||
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On net I agree, but the future costs are difficult to measure.
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 Janet Currie |
Princeton | Bio/Vote History | ||
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 David Cutler |
Harvard | Bio/Vote History | ||
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 Angus Deaton |
Princeton | Bio/Vote History | ||
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 Darrell Duffie |
Stanford | Bio/Vote History | ||
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Absent those bailouts, a depression was much more likely. The moral hazard is now being reduced by new rules, such as for capital.
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 Aaron Edlin |
Berkeley | Bio/Vote History | ||
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The past bailout, by itself, won't ensure the next one, nor would a refusal to bail firms out set a binding precedent.
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 Barry Eichengreen |
Berkeley | Bio/Vote History | ||
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"Bailing out the banks" is not a very precise characterization of the policies of 2008-9.
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 Ray Fair |
Yale | Bio/Vote History | ||
|
Too many possibilities, and hard to measure costs and benefits.
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 Pinelopi Goldberg |
Yale | Bio/Vote History | ||
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The consequenses (economic and social) of a potential financial collapse would have been immense.
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 Claudia Goldin |
Harvard | Bio/Vote History | ||
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 Austan Goolsbee |
Chicago | Bio/Vote History | ||
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may not cost $ but was still an outrage we got to that point
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 Michael Greenstone |
University of Chicago | Bio/Vote History | ||
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Yes. Credit markets were frozen and that was having a terrible impact on the economy. Check out a graph of the TED spread.
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 Robert Hall |
Stanford | Bio/Vote History | ||
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Not compared to an ideal policy of an orderly reorganization imposing losses on creditors according to seniority. But better than chaotic.
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 Bengt Holmström |
MIT | Did Not Answer | Bio/Vote History | |
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 Caroline Hoxby |
Stanford | Did Not Answer | Bio/Vote History | |
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 Kenneth Judd |
Stanford | Bio/Vote History | ||
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 Anil Kashyap |
Chicago Booth | Bio/Vote History | ||
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Bankruptcy and liquidation would have been worse, but could have nationalized a couple of the weakest ones, especially Citi.
-see background information here |
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 Pete Klenow |
Stanford | Bio/Vote History | ||
 Edward Lazear |
Stanford | Did Not Answer | Bio/Vote History | |
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 Jonathan Levin |
Stanford | Bio/Vote History | ||
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 Eric Maskin |
Harvard | Bio/Vote History | ||
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 William Nordhaus |
Yale | Bio/Vote History | ||
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 Maurice Obstfeld |
Berkeley | Bio/Vote History | ||
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 Emmanuel Saez |
Berkeley | Bio/Vote History | ||
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 José Scheinkman |
Columbia University | Did Not Answer | Bio/Vote History | |
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 Richard Schmalensee |
MIT | Bio/Vote History | ||
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 Hyun Song Shin |
Princeton | Bio/Vote History | ||
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 Nancy Stokey |
University of Chicago | Bio/Vote History | ||
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 Richard Thaler |
Chicago Booth | Bio/Vote History | ||
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Many details could have been improved but you could do nothing.
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 Christopher Udry |
Northwestern | Did Not Answer | Bio/Vote History | |
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 Luigi Zingales |
Chicago Booth | Bio/Vote History | ||
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Question B Participant Responses
Participant |
University |
Vote |
Confidence |
Bio/Vote History |
|---|---|---|---|---|
|
Daron Acemoglu |
MIT | Bio/Vote History | ||
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Alberto Alesina |
Harvard | Did Not Answer | Bio/Vote History | |
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Joseph Altonji |
Yale | Bio/Vote History | ||
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Alan Auerbach |
Berkeley | Bio/Vote History | ||
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David Autor |
MIT | Bio/Vote History | ||
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Putting costs aside, this is almost certainly true since many displaced workers would not have found reemployment by now in bad economy.
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Katherine Baicker |
University of Chicago | Bio/Vote History | ||
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Marianne Bertrand |
Chicago | Bio/Vote History | ||
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Raj Chetty |
Harvard | Bio/Vote History | ||
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Judith Chevalier |
Yale | Bio/Vote History | ||
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Janet Currie |
Princeton | Bio/Vote History | ||
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David Cutler |
Harvard | Bio/Vote History | ||
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Angus Deaton |
Princeton | Bio/Vote History | ||
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Darrell Duffie |
Stanford | Bio/Vote History | ||
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To answer this would require a reliable and detailed quantitative macroeconomic model, or at least expert empirical knowledge.
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||||
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Aaron Edlin |
Berkeley | Bio/Vote History | ||
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Barry Eichengreen |
Berkeley | Bio/Vote History | ||
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While I agree, I would have preferred seeing the gov stand behind warantees and provide debtor in possession finance only.
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||||
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Ray Fair |
Yale | Bio/Vote History | ||
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Probably yes, but a very small effect.
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Pinelopi Goldberg |
Yale | Bio/Vote History | ||
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In the short run, it seems uncontroversial.
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Claudia Goldin |
Harvard | Bio/Vote History | ||
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Austan Goolsbee |
Chicago | Bio/Vote History | ||
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as with banks, even if true, outrageous we ever got to that position
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Michael Greenstone |
University of Chicago | Bio/Vote History | ||
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the strongest argument is US auto manufacturing would be better off in the long run, which may or may not be true, but v doubtful by 2010
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Robert Hall |
Stanford | Bio/Vote History | ||
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Again, it would have been better to reorganize with suitable losses on the junior creditors. This would not have resulted in higher unemp.
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Bengt Holmström |
MIT | Did Not Answer | Bio/Vote History | |
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Caroline Hoxby |
Stanford | Did Not Answer | Bio/Vote History | |
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Kenneth Judd |
Stanford | Bio/Vote History | ||
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||||
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Anil Kashyap |
Chicago Booth | Bio/Vote History | ||
|
But traditional bankruptcy and restructuring was an option too. Challenges for financial and non-financial firms are totally different.
-see background information here |
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Pete Klenow |
Stanford | Bio/Vote History | ||
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Edward Lazear |
Stanford | Did Not Answer | Bio/Vote History | |
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Jonathan Levin |
Stanford | Bio/Vote History | ||
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Eric Maskin |
Harvard | Bio/Vote History | ||
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William Nordhaus |
Yale | Bio/Vote History | ||
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||||
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Maurice Obstfeld |
Berkeley | Bio/Vote History | ||
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Emmanuel Saez |
Berkeley | Bio/Vote History | ||
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||||
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José Scheinkman |
Columbia University | Did Not Answer | Bio/Vote History | |
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||||
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Richard Schmalensee |
MIT | Bio/Vote History | ||
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||||
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Hyun Song Shin |
Princeton | Bio/Vote History | ||
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||||
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Nancy Stokey |
University of Chicago | Bio/Vote History | ||
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Richard Thaler |
Chicago Booth | Bio/Vote History | ||
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There was no private money available.
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||||
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Christopher Udry |
Northwestern | Did Not Answer | Bio/Vote History | |
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||||
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Luigi Zingales |
Chicago Booth | Bio/Vote History | ||
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||||
Question C Participant Responses
Participant |
University |
Vote |
Confidence |
Bio/Vote History |
|---|---|---|---|---|
|
Daron Acemoglu |
MIT | Bio/Vote History | ||
|
|
||||
|
Alberto Alesina |
Harvard | Did Not Answer | Bio/Vote History | |
|
|
||||
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Joseph Altonji |
Yale | Bio/Vote History | ||
|
|
||||
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Alan Auerbach |
Berkeley | Bio/Vote History | ||
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|
||||
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David Autor |
MIT | Bio/Vote History | ||
|
|
||||
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Katherine Baicker |
University of Chicago | Bio/Vote History | ||
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|
||||
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Marianne Bertrand |
Chicago | Bio/Vote History | ||
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|
||||
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Raj Chetty |
Harvard | Bio/Vote History | ||
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|
||||
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Judith Chevalier |
Yale | Bio/Vote History | ||
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|
||||
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Janet Currie |
Princeton | Bio/Vote History | ||
|
|
||||
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David Cutler |
Harvard | Bio/Vote History | ||
|
|
||||
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Angus Deaton |
Princeton | Bio/Vote History | ||
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|
||||
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Darrell Duffie |
Stanford | Bio/Vote History | ||
|
The bankruptcy law was circumvented. Absent unstated exigent (e.g. systemic) reasons, upsetting creditor rights is inefficient.
|
||||
|
Aaron Edlin |
Berkeley | Bio/Vote History | ||
|
Incentive effects are real. Incentive effects from a decision to bail out are overstated.
|
||||
|
Barry Eichengreen |
Berkeley | Bio/Vote History | ||
|
|
||||
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Ray Fair |
Yale | Bio/Vote History | ||
|
Again, hard to measure costs and benefits.
|
||||
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Pinelopi Goldberg |
Yale | Bio/Vote History | ||
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|
||||
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Claudia Goldin |
Harvard | Bio/Vote History | ||
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|
||||
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Austan Goolsbee |
Chicago | Bio/Vote History | ||
|
|
||||
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Michael Greenstone |
University of Chicago | Bio/Vote History | ||
|
|
||||
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Robert Hall |
Stanford | Bio/Vote History | ||
|
See previous answer
|
||||
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Bengt Holmström |
MIT | Did Not Answer | Bio/Vote History | |
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||||
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Caroline Hoxby |
Stanford | Did Not Answer | Bio/Vote History | |
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|
||||
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Kenneth Judd |
Stanford | Bio/Vote History | ||
|
|
||||
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Anil Kashyap |
Chicago Booth | Bio/Vote History | ||
|
Costs will appear in the next crisis; the precedent for a bailout is now set. Reduced incentives for the private sector to hold dry powder.
|
||||
|
Pete Klenow |
Stanford | Bio/Vote History | ||
|
Edward Lazear |
Stanford | Did Not Answer | Bio/Vote History | |
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|
||||
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Jonathan Levin |
Stanford | Bio/Vote History | ||
|
Not at all obvious at the time decision was made, and I expect many would disagree now.
|
||||
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Eric Maskin |
Harvard | Bio/Vote History | ||
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||||
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William Nordhaus |
Yale | Bio/Vote History | ||
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|
||||
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Maurice Obstfeld |
Berkeley | Bio/Vote History | ||
|
|
||||
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Emmanuel Saez |
Berkeley | Bio/Vote History | ||
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|
||||
|
José Scheinkman |
Columbia University | Did Not Answer | Bio/Vote History | |
|
|
||||
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Richard Schmalensee |
MIT | Bio/Vote History | ||
|
Moral hazard seems less of a problem with non-financial corporations.
|
||||
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Hyun Song Shin |
Princeton | Bio/Vote History | ||
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||||
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Nancy Stokey |
University of Chicago | Bio/Vote History | ||
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||||
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Richard Thaler |
Chicago Booth | Bio/Vote History | ||
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||||
|
Christopher Udry |
Northwestern | Did Not Answer | Bio/Vote History | |
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||||
|
Luigi Zingales |
Chicago Booth | Bio/Vote History | ||
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