First Quarter 2011

What Drives Changes in Economic Thought? Why economists study what they do -- and how the crisis might change it

Were economists caught by surprise by the financial crisis because the profession's models and dominant schools of thought are misguided? If so, how did it come to be that way? Will the financial crisis change things? Rather than a fundamental shift in economic thought, many economists seem to hope for a humbler view of what economics can teach us about the world.

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Related Links

Bernanke, Ben S. “Implications of the Financial Crisis for Economics.” Speech at the Conference co-sponsored by the Center for Economic Policy Studies and the Bendheim Center for Finance, Princeton University, Sept. 24, 2010.

Rajan, Raghurham. “Why Did Economists Not Spot the Crisis?” Feb. 5, 2011 post on the University of Chicago Booth School of Business’ “Fault Lines” blog.