The Great Recession: Market Failure or Policy Failure? (Paperback) (ISBN-13: 9781107459601)

Since publication of Robert L. Hetzel's The Monetary Policy of the Federal Reserve (Cambridge University Press, 2008), the intellectual consensus that had characterized macroeconomics has disappeared. That consensus emphasized efficient markets, rational expectations, and the efficacy of the price system in assuring macroeconomic stability. The 2008-2009 recession not only destroyed the professional consensus about the kinds of models required to understand cyclical fluctuations but also revived the credit-cycle or asset-bubble explanations of recession that dominated thinking in the 19th and first half of the 20th century. These "market-disorder" views emphasize excessive risk taking in financial markets and the need for government regulation. The present book argues for the alternative "monetary-disorder" view of recessions. A review of cyclical instability over the last two centuries places the 2008-2009 recession in the monetary-disorder tradition, which focuses on the monetary instability created by central banks rather than on a boom-bust cycle in financial markets.

Author: Robert L. Hetzel
ISBN-10: 1107459605
ISBN-13: 9781107459601
Publisher: Cambridge University Press
Language: English
Published: 10/30/2014
Pages: 400
Format: Paperback
Weight: 1.29lbs
Size: 9.00h x 6.00w x 0.89d