Question A:
Research on the nature and impact of bank runs has made it possible to limit substantially the wider economic damage from financial crises.
Responses
Responses weighted by each expert's confidence
Question B:
Reforms of financial regulation since 2008 (and macroprudential policies in some countries) will not substantially reduce the probability of financial crises.
Responses
Responses weighted by each expert's confidence
Question A Participant Responses
| Participant | University | Vote | Confidence | Bio/Vote History |
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 Daron Acemoglu |
MIT | Bio/Vote History | ||
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Research on financial crises has generated theoretical insights, but unsure whether they have translated into policy. It is uncertain how much of policy during the 2008 crisis was driven by economics and how much by politics.
-see background information here -see background information here |
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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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 Katherine Baicker |
University of Chicago | Did Not Answer | Bio/Vote History | |
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 Abhijit Banerjee |
MIT | Bio/Vote History | ||
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 Marianne Bertrand |
Chicago | Bio/Vote History | ||
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 Markus Brunnermeier |
Princeton | Bio/Vote History | ||
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 Raj Chetty |
Harvard | Did Not Answer | Bio/Vote History | |
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 Judith Chevalier |
Yale | 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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Yes, this research has made a big difference, with respect to bank runs. But we must bear in mind the Global Financial Crisis, which came well after this research was understood by regulators. Much more needs to be done.
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 Aaron Edlin |
Berkeley | Bio/Vote History | ||
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 Barry Eichengreen |
Berkeley | Did Not Answer | Bio/Vote History | |
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 Liran Einav |
Stanford | Bio/Vote History | ||
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 Ray Fair |
Yale | Bio/Vote History | ||
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 Amy Finkelstein |
MIT | Did Not Answer | Bio/Vote History | |
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 Pinelopi Goldberg |
Yale | Did Not Answer | Bio/Vote History | |
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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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here is a somewhat related paper
-see background information here |
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 Robert Hall |
Stanford | Bio/Vote History | ||
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Not nearly enough adoption of good ideas like single point of entry. There is still a presumption that the government will bail out financial institutions.
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 Oliver Hart |
Harvard | Bio/Vote History | ||
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Many of the problems appear in shadow banking institutions where deposit insurance does not help. Central bank actions to stabilize these institutions while effective may have adverse political repercussions.
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 Bengt Holmström |
MIT | Bio/Vote History | ||
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Made it possible, but not executed
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 Caroline Hoxby |
Stanford | Did Not Answer | Bio/Vote History | |
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 Hilary Hoynes |
Berkeley | Bio/Vote History | ||
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 Kenneth Judd |
Stanford | Bio/Vote History | ||
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I would emphasize the phrase "made it possible". Earlier work by Kareken and Wallace explored the moral hazard effects of deposit insurance, factors ignored in Diamond-Dybvig. Together they make it possible to deal better with financial stability.
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 Steven Kaplan |
Chicago Booth | Bio/Vote History | ||
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 Anil Kashyap |
Chicago Booth | Bio/Vote History | ||
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Research has helped us spot and understand risks, but not always limit the damage substantially. Lots of constraints, for instance look at the money market funds. They have been a risk in plain sight yet they are still not safe. See the IGM Brookings report for more examples
-see background information here |
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 Pete Klenow |
Stanford | 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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I think practice ran ahead of theory. This is why the Fed was created. But Thornton, for example, understood the principles more than 200 years ago.
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 Emmanuel Saez |
Berkeley | Bio/Vote History | ||
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 Larry Samuelson |
Yale | Bio/Vote History | ||
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The research indicates that we should never expect to have perfect control of the financial system, but provides tools to improve our reaction to crises.
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 José Scheinkman |
Columbia University | Bio/Vote History | ||
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 Richard Schmalensee |
MIT | Bio/Vote History | ||
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 Carl Shapiro |
Berkeley | Bio/Vote History | ||
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 Robert Shimer |
University of Chicago | Bio/Vote History | ||
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This research has mitigated short-term damage to the financial system from a financial crisis, but the overall cost to the economic and political system from the policies used since 2008 remains unclear.
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 James Stock |
Harvard | Bio/Vote History | ||
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 Richard Thaler |
Chicago Booth | Bio/Vote History | ||
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 Christopher Udry |
Northwestern | Bio/Vote History | ||
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Question B Participant Responses
| Participant | University | Vote | Confidence | Bio/Vote History |
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Daron Acemoglu |
MIT | Bio/Vote History | ||
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I am not convinced that these reforms have tackled the main institutional problems related to excessive risk-taking and political connections by major banks.
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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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I suspect that financial crises are inevitable. But financial regulation + improved economic understanding of crises may reduce the damage.
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Katherine Baicker |
University of Chicago | Did Not Answer | Bio/Vote History | |
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Abhijit Banerjee |
MIT | Bio/Vote History | ||
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Marianne Bertrand |
Chicago | Bio/Vote History | ||
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Markus Brunnermeier |
Princeton | Bio/Vote History | ||
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Raj Chetty |
Harvard | Did Not Answer | Bio/Vote History | |
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Judith Chevalier |
Yale | 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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Reforms have more than doubled big-bank capital buffers and significantly increased their liquidity coverage--big improvements. But, as we have seen recently (Gilt market), non-bank financial stability concerns remain, bond market design is weak, and much more needs to be don
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Aaron Edlin |
Berkeley | Bio/Vote History | ||
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Barry Eichengreen |
Berkeley | Did Not Answer | Bio/Vote History | |
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Liran Einav |
Stanford | Bio/Vote History | ||
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Ray Fair |
Yale | Bio/Vote History | ||
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Amy Finkelstein |
MIT | Did Not Answer | Bio/Vote History | |
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Pinelopi Goldberg |
Yale | Did Not Answer | Bio/Vote History | |
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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 | ||
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See previous
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Oliver Hart |
Harvard | Bio/Vote History | ||
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Look at what just happened in the U.K. with pension funds. The Bank of England had to engage in bond buying to keep them afloat.
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Bengt Holmström |
MIT | Bio/Vote History | ||
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Caroline Hoxby |
Stanford | Did Not Answer | Bio/Vote History | |
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Hilary Hoynes |
Berkeley | Bio/Vote History | ||
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Kenneth Judd |
Stanford | Bio/Vote History | ||
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Reforms may have dealt with details of 2008 but the basic problem is too many people take risks knowing others will cover losses. S&L crisis was also an example. Printing money can fix crises, but that creates other problems. I see no progress.
-see background information here |
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Steven Kaplan |
Chicago Booth | Bio/Vote History | ||
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Anil Kashyap |
Chicago Booth | Bio/Vote History | ||
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Too much activity has migrated into the shadow banking system. The banks, at least in US and UK, are definitely stronger and safer, but the 2008 reforms were incomplete. See the same report
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Pete Klenow |
Stanford | 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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The reforms have helped but they have had side effects, including the migration of activity to nonregulated entities. We need to understand this better and to extend the regulatory perimeter substantively beyond the banking system.
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Emmanuel Saez |
Berkeley | Bio/Vote History | ||
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Larry Samuelson |
Yale | Bio/Vote History | ||
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Some useful reforms were taken, but these are somewhat limited and potentially confounded by political considerations; their effectiveness is yet to be seen.
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José Scheinkman |
Columbia University | Bio/Vote History | ||
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Richard Schmalensee |
MIT | Bio/Vote History | ||
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Carl Shapiro |
Berkeley | Bio/Vote History | ||
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Robert Shimer |
University of Chicago | Bio/Vote History | ||
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There's a lot of variation in the quality of regulation across countries
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James Stock |
Harvard | Bio/Vote History | ||
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Richard Thaler |
Chicago Booth | Bio/Vote History | ||
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not my thing
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Christopher Udry |
Northwestern | Bio/Vote History | ||
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