The 2014 BBVA BBVA Foundation Award in the category of Economics, Finance and Business Management has fallen to Olivier Blanchard, of the Paris School of Economics; Jordi Galífrom the Catalan University Pompeu Fabra, and Michael Woodford, of … Columbia University. These are three of the “central architects of the current Neakeynesian paradigm”, as the jury has been recognized, and three names that have dedicated their time to a theory that the economic future of the last four years has put up.
Precisely, Galí, Woodford and Blachart have studied how to apply public policies that have a stabilizing effect on the economy and create foreseeable expectations, just what happened in Europe after the Covid-19 pandemic and the inflationary crisis that followed the Ukraine War . “The fact that macroeconomics is not in the foreground (public opinion) can be interpreted as a symptom that stabilization policies are successful,” Galí explained to refer to the effect of the trio investigations of which he is part. “Some of our research may have contributed to create a conceptual framework that helps develop policies that tend to stabilize the economy,” he added. For Blachart, meanwhile, “the great success of the credibility of the central banks has been that inflation would not last.”
As has already advanced, Blanchard, Galí and Woodford have had a deep influence on modern macroeconomic analysis by establishing the basis for the study of economic fluctuations. Specifically, “they placed the basis for a new model that tries to avoid fluctuations in economic cycles and maintain unemployment and inflation at relatively stable levels,” said Fabrizio Zilibotti, professor at Yale University. “The new Keynesian theory,” has detailed, “takes into account the role of expectations, while traditional models practically ignored it. In this model, demand depends on the expectations and how the economy of the future will be. That is to say, You look at the future to make decisions in the present. This means investing the classic models, which adopted measures in the present watching what happened in the past «.
Referring to the inflationary crisis of the seventies, which has served as a comparison, the three economists have focused on inflation, which is perhaps the most important indicator on which the central banks focus. This does not mean, and Galí has pointed out, that supervisors should not worry about other indicators. For the Spanish economist, testimony of this has been the acting of the ECB during the post-war inflationary crisis of Ukraine. “A ECB that had only set inflation would have uploaded much more interest rates,” Galí has emphasized, highlighting that the “flexibility” of the European supervisor for that 2% objective has been beneficial.
What really worries citizens are currently the structural economic challenges: productivity, long -term growth, salaries … past the worst of the inflationary crisis, economic fluctuations have become a secondary role in the public debate, and For winners that is testimony that stabilizing policies have been successful and better compared to those of the past (crisis of the seventies).
In reference to the current economic situation, dominated by instability since Trump began his Second Tariff War, Blachart has insisted on claiming the benefits of a predictable political environment. “We have spent the last 80 years building a series of international behavior rules, some that have a very good reason to be there,” he said, before adding that “Europe can play a role in designing safe spaces with countries that want play according to rules and behave ».
A Nobel Prize in the Jury
The act has had the participation of Eric S. Maskin -In the quality of President of the Court-Professor in the Department of Economics of Harvard University (United States) and Nobel Prize in Economics 2007. The Jury Secretary, in turn, has been Professor Manuel Arellano, Professor of Economy at the Center for Monetary and Financial Studies (CEMFI) of the Bank of Spain, as secretary.
The vowels have been Sir Richard Blundell, head of the David Ricardo Chair of Political Economy at the University College London (United Kingdom) and BBVA Foundation Prize Borders of Knowledge 2014 in the category of Economics, Finance and Business Management; Professor Antonio Ciccone, Professor of Economics at the University of Mannheim (Germany); Professor Pinelopi Koujianou Goldberg, head of the Elihu Chair of Economics and Global Affairs at Yale University (United States); Professor Andreu Mas-Colell, Economy Professor of Economics at the Pompeu Fabra University and Barcelona School of Economics and BBVA Foundation Award Borders of Knowledge 2009 in Economics, Finance and Business Management; Professor Lucrezia Reichlin, Professor of Economics at the London Business School (United Kingdom); and Professor Fabrizio Zilibotti, head of the Tuntex Chair of International Economics and Development at Yale University (United States).
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