Question A:
When evaluating the consequences of any shifts in economic policy regimes, it is essential to consider potential changes in the behavior of economic agents due to revised expectations.
Responses
Responses weighted by each expert's confidence
Question B:
The empirical evidence on how monetary policy affects the economy in the short run is most consistent with the assumption that economic agents form rational expectations.
Responses
Responses weighted by each expert's confidence
Question C:
Economic research has established that the welfare consequences of differences in countries’ growth and level of development are substantially higher than the welfare costs of business cycles.
Responses
Responses weighted by each expert's confidence
Question A Participant Responses
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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Rational expectations is a very useful benchmark. But there seems to be much heterogeneity and some systematic biases. E.g. it took a long while for inflationary expectations to adjust in Turkey after central bank lost independence and very low interest rate policy got cemented.
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 Joseph Altonji |
Yale | Did Not Answer | 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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 Abhijit Banerjee |
MIT | Bio/Vote History | ||
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Depends on what exactly we mean by rational expectations and by people. Bond traders do try to project government strategies based incentives and constraints but they often have systematic biases. In other words RE may be more useful as a concept than as a description of reality.
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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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Agent rationality can often fail. The implications for monetary policy effectiveness are, for me, uncertain.
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 Aaron Edlin |
Berkeley | Bio/Vote History | ||
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 Barry Eichengreen |
Berkeley | 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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 Michael Greenstone |
University of Chicago | Bio/Vote History | ||
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 Robert Hall |
Stanford | Bio/Vote History | ||
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 Oliver Hart |
Harvard | Bio/Vote History | ||
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 Bengt Holmström |
MIT | Bio/Vote History | ||
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 Caroline Hoxby |
Stanford | 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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 Steven Kaplan |
Chicago Booth | Bio/Vote History | ||
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 Anil Kashyap |
Chicago Booth | Bio/Vote History | ||
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Rational expectations are the right place to start, but the empirical models of monetary transmission (and especially of inflation dynamics) have a very hard time telling whether price setters are backward looking or forward looking
-see background information here |
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 Pete Klenow |
Stanford | Bio/Vote History | ||
 Jonathan Levin |
Stanford | Bio/Vote History | ||
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 Eric Maskin |
Harvard | Bio/Vote History | ||
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don't know enough to comment
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 William Nordhaus |
Yale | Did Not Answer | Bio/Vote History | |
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 Maurice Obstfeld |
Peterson Institute for International Economics | Bio/Vote History | ||
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 Emmanuel Saez |
Berkeley | Bio/Vote History | ||
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 Larry Samuelson |
Yale | Bio/Vote History | ||
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Whether people exhibit rational expectations is difficult to separate from other explanations.
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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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In response to monetary policy shocks, agents revise their expectations about the state of the economy, consistent with rational expectations. There is less evidence on how systematic monetary policy rules affect expectations.
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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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Whose expectations? How measured?
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 Christopher Udry |
Northwestern | Bio/Vote History | ||
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Question C Participant Responses
| Participant | University | Vote | Confidence | Bio/Vote History |
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Daron Acemoglu |
MIT | Bio/Vote History | ||
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The only caveat is really dysfunctional monetary policy and hyperinflation leading to conflict and loss of state capacity, then impacting medium-term growth.
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Joseph Altonji |
Yale | Did Not Answer | 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'm pretty certain of this based on first principles
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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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Too narrow a definition of welfare. People hurt by business cycles can come for us with pitchforks in a way that poor people in Burkina Faso do not.
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Darrell Duffie |
Stanford | Bio/Vote History | ||
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Aaron Edlin |
Berkeley | Bio/Vote History | ||
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Barry Eichengreen |
Berkeley | 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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Michael Greenstone |
University of Chicago | Bio/Vote History | ||
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Robert Hall |
Stanford | Bio/Vote History | ||
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Read Hall and Jones
-see background information here |
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Oliver Hart |
Harvard | Bio/Vote History | ||
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Bengt Holmström |
MIT | Bio/Vote History | ||
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Caroline Hoxby |
Stanford | 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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Steven Kaplan |
Chicago Booth | Bio/Vote History | ||
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Anil Kashyap |
Chicago Booth | Bio/Vote History | ||
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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 | Did Not Answer | Bio/Vote History | |
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Maurice Obstfeld |
Peterson Institute for International Economics | Bio/Vote History | ||
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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 spread of performance across countries is much larger than the spread across time within countries.
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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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Not sure you need economic research to see this, but you do need to decide how to measure aggregate welfare.
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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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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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It's more arithmetic than economics...
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