S5 Ep8: Director’s Cut: Is economics asking the right questions?

Bruegel deputy director Maria Demertzis welcomes
Financial Times commentator Martin Sandbu to explore the journey
taken by the field of economics since the financial crisis struck
10 years ago, and discusses what new tools economics has now that
it didn’t have then.


In this Director’s Cut of ‘The Sound of Economics’, we trace the
journey upon which the field of economics has embarked since the
financial crisis, what lessons it has learnt and what it can do
differently now with the benefit of hindsight.


Economists and financial specialists failed to identify the
burgeoning threat of financial imbalances, excessive risk-taking
and housing bubbles that led to the crisis that first broke a
decade ago. Can economics provide answers to the right questions
– and in good time?


Bruegel deputy director Maria Demertzis is joined by Martin
Sandbu of the Financial Times to look at what new tools and
approaches can help economists make a difference in the event
that any similar such crisis strikes again.


For further consideration we recommend another edition of the
Director’s Cut podcast series, featuring a discussion between
Maria Demertzis, Nicola Viegi – South African Reserve Bank
professor of monetary economics at the University of Pretoria –
and Frank Smets – director general of economics at the European
Central Bank – on the topic of macroeconomics’ post-crisis
reinvention and the flourishing of new models.


FURTHER READING


Rebuilding macroeconomics: Initial reflections on a major theory
project


The DSGE Model Quarrel (Again)


Tales from a crisis: diverging narratives of the euro area