The Financial World Five Years after Lehman Brothers

Editor's Note: Welcome to Crash Week! This week marks five years since the bankruptcy of Lehman Brothers and the financial crisis that followed. A lot has happened since then, but how much has changed? All week long we will be exploring this question from a variety of economic angles. Below is the first piece from Institute for New Economic Thinking President Rob Johnson. Stay tuned for contributions from our grantees, community members, leaders, and other prominent economic thinkers! Read more

What Law and Economics Can Tell Us About Money

This past Thursday at Columbia Law School, The Modern Money Network, in partnership with the Institute for New Economic Thinking’s Young Scholars Initiative, hosted a discussion titled, “Money as a Hierarchical System: Legal and Economic Perspectives.” Four panelists—two law professors and two economists—examined power relationships that both establish and emerge from monetary and financial systems. Read more

Lifelines for Poor Children

What’s missing in the current debate over economic inequality is enough serious discussion about investing in effective early childhood development from birth to age 5. This is not a big government boondoggle policy that would require a huge redistribution of wealth. Acting on it would, however, require us to rethink long-held notions of how we develop productive people and promote shared prosperity. Read more

Economic Analysis Isn’t Objective – It’s As Personal As It Gets

What happens when professionals lose touch with the people they’re supposed to serve?

Recently, I came across an article in the New York Times by Nathaniel P. Morris called “Beautiful Pathologies” that told a striking story. The article was about medical students and the transplant observation program, which allows students to shadow the transfer of organs from living or deceased donors. Read more

Financial liberalization, reform and urbanization in INET Shenzhen

This week, Chen Long and I were honored to be invited to the INET-Tsinghua conference in Shenzhen. Sharpest minds gathered at the conference to discuss the most concerned economic issues on China. Titled “The Good Life: The Challenge of Progress in China Today”, the conference addressed topics on China’s institution, shadow banking, financial liberalization and urbanization. Several speeches sparked inspiration in my minds, and I want to share the opinions in the post. Read more

Swimming against the Current: A Remembrance of Ronald Coase (1910-2013)

Ronald Coase, who passed away last week at age 102, spent his academic career swimming against the current.

His earliest work criticized the lack of a well-grounded theory of the firm and suggested that accounting methods do not properly measure costs or profits. It also argued that businessmen did not have anything like the information necessary to maximize profits in the MR = MC way that economic theory suggested. Read more

Inequality – It’s Bad…And It’s About to Get Way Worse

What’s behind rapidly worsening inequality in the United States?

A recent study conducted by Josh Bivens and Lawrence Mishel, “The Pay of Corporate Executives and Financial Professionals as Evidence of Rents in Top 1 Percent Incomes,” takes on this question by discussing the origins of rising trend of inequality and how it could be reversed. And in a study called “Income Inequality, Equality of Opportunity, and Intergenerational Mobility,” Miles Corak examines the impact that high levels of inequality can have on society. Read more

Embracing Wynne Godley, an Economist Who Modeled the Crisis

Check out today's New York Times for an article by Jonathan Schlefer on the economist Wynne Godley and the work he has inspired, particularly in "stock-flow" modeling. Read more

William Janeway: Can China Innovate at the Frontier?

Can China lead the way on innovation?

Institute for New Economic Thinking co-founder William Janeway addressed this question in his keynote speech at the Institute's conference in Shenzhen, China, on Monday. Titled "The Good Life: The Challenge of Progress in China Today," the conference explored the key challenges surrounding China's continued development. Read more

Apple’s Changing Business Model: What Should the World’s Richest Company Do with All Those Profits?

What should Apple, one of the world's most successful companies, do with its profits? Read more