“This book develops a revolutionary approach to teaching in macroeconomics. By confronting existing macroeconomic paradigms to the challenge of explaining recent economic events and of guiding policy making, it provides the reader with a deeper understanding of macroeconomic models and their limits, and also with many potential ideas on how to improve these models or how to combine them -or even move beyond them- when elaborating a coherent and effective macroeconomic policy. This book will undoubtedly influence researchers and policy makers for many years to come.”
Philippe Aghion, Harvard University
“The authors bring together concepts, data and real-world experience in a serious effort to make whole a field rocked by the global financial crisis. What they offer is a unique combination of positive and normative analysis that integrates the insights of political economy - paving the way for a fresh approach to understanding and teaching economics. And do not miss the inspiring foreword by Olivier Blanchard!”
Erik Berglöf, Chief Economist, European Bank for Reconstruction and Development
“This book is a remarkable achievement that made me want to stand up and cheer. Graduate macroeconomics normally teaches students quite a lot about models and techniques, both theoretical and econometric, but almost nothing about real economies, including the events and issues they face. Economic Policy neatly turns the tables. The models are there, plenty of them. But they are the supporting cast, not the stars of the show. The authors focus, instead, on equipping students to understand real economies and real policy issues—through the eyes of economic models, of course. Let’s hope Economic Policy becomes widely used. If so, it will revolutionize the teaching of macroeconomics.”
Alan S. Blinder, Princeton University, former Vice-Chairman of the Board of Governors of the Federal Reserve System
“Economic Policy – Theory and Practice provides an impressive tour d'horizon of the current state of the art of economic policy making and its theoretical underpinnings. It is indeed extremely useful not only for graduate students but also for policy makers and practitioners like myself. The volume covers massive ground, yet conveys the authors' deep understanding of the issues. I was particularly impressed by the seamless transition from the discussion of standard economic concepts and analytical tools in the first seven chapters of the book to the discussion of the new challenges for economic policy in the face of the crisis in the final chapter. It clearly gets the message across that the foundations of economic policy are being reshaped, with the emphasis shifting from single-country management to international coordination in the face of cross-border spillovers – which is at the core of the European integration project that is now experiencing a quantum leap.”
Marco Buti, Director-General for Economic and Financial Affairs, European Commission
“In the wake of the financial crisis, the need to bridge the gulf between economic theory and economic policy has never been clearer. Here four leading economists show how to build that bridge, girder by girder.”
Barry Eichengreen, University of California Berkeley
“This exciting new book covers all major areas of economic policy. It makes a unique and much needed contribution by combining deep theoretical insights with practical policy problems at the level of a graduate course. The book also provides an in-depth and highly relevant discussion of the Great Financial Crisis. Students and policy makers alike will find this book useful, engaging and thought provoking.”
Philipp Hildebrand, Chairman of the Governing Board, Swiss National Bank
“This is one of the most remarkable books published recently on economic policies. Wide in its reach, well documented, it provides one of the clearest and facts-based analysis of national and international economic and financial issues. An indispensable guide for economists, policymakers and students”.
Jacques de Larosière, BNP-Paribas, former Managing Director of the International Monetary Fund
“This is an unusual book in that it combines facts, theory, and practice on economic policy making in a way that is simply not available anywhere else. It is written in simple and clear language and will be useful to students of economics who want to understand policy making and policy makers who want to understand the economic choices they are faced with. It does a superb job of laying out the underlying economic theories even while describing real life constraints and trade-offs that constrain polices. It is a must-read for anyone who wants to understand the turbulent times we live in.”
Raghuram Rajan, University of Chicago, Booth School of Business
“This book has grown out of ten years of teaching macroeconomics. It is a fascinating example of how economics can be used to explain a complicated world and come up with convincing policy conclusions.”
Hans-Werner Sinn, University of Munich and President of CESifo Institute
“Economics is most relevant and fun when it addresses policy issues. But this is difficult to do with both rigor and detailed empirical knowledge. This is why this book is so important: it brings to bear an impressive amount of knowledge on the most relevant policy questions of the day. A remarkable achievement, that fills an enormous gap”.
Guido Tabellini, Rector, Bocconi University
“This is an excellent textbook. It not only presents basic economic theories succinctly, but also the evolution of policy thinking and practice in a comprehensive way. The most unique feature of the book, in my view, is its fine combination of theories and practice. In a sense, this book is not just a textbook but also a reflection of the fundamental thinking of the authors on the causes and effects of the current global financial and economic crisis. I enjoyed reading this book very much.”
Yongding Yu, Member of the Chinese Academy of Social Sciences, former member of the People Bank of China’s Monetary Policy Committee
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