Awarded the 13th BBVA Frontiers of Knowledge Award in Economics, Mark Gertler explains how the interactions between banks, credit, and firms account for macroeconomic fluctuations. His collaborative work with Kiyotaki has redefined our understanding of the financial system and its role in crises.
The BBVA Foundation Frontiers of Knowledge Award in the Economics, Finance and Management category has gone in this thirteenth edition to Ben S. Bernanke (The Brookings Institution, Washington DC), Mark Gertler (University of New York), Nobuhiro Kiyotaki (Princeton University) and John Moore (University of Edinburgh and London School of Economics) “for fundamental contributions to our understanding of how financial market imperfections can amplify macroeconomic fluctuations and generate deep macroeconomic recessions,” in the words of the award citation. In the above video, committee chair, Er
Awarded the 13th BBVA Frontiers of Knowledge Award in Economics, Mark Gertler explains how the interactions between banks, credit, and firms account for macroeconomic fluctuations. His collaborative work with Kiyotaki has redefined our understanding of the financial system and its role in crises.
The BBVA Foundation Frontiers of Knowledge Award in the Economics, Finance and Management category has gone in this thirteenth edition to Ben S. Bernanke (The Brookings Institution, Washington DC), Mark Gertler (University of New York), Nobuhiro Kiyotaki (Princeton University) and John Moore (University of Edinburgh and London School of Economics) “for fundamental contributions to our understanding of how financial market imperfections can amplify macroeconomic fluctuations and generate deep macroeconomic recessions,” in the words of the award citation. In the above video, committee chair, Eric S. Maskin, Adams University Professor at Harvard University and Nobel Laureate in Economics, reads out the award citation.
00:00 Introduction
00:05 What does your research, together with that of Professor Bernanke, show about the interrelationship between the real economy and the financial market?
01:20 Could you explain the concept of the financial accelerator in the simplest possible terms?
02:33 How is your research in this area related to, or different from, the Kiyotaki–Moore credit cycle model?
03:55 And how does this link to monetary policy?
04:43 Did the research carried out by the four of you provide any academic support for the unconventional monetary policies adopted by the Federal Reserve (Fed) during the Great Recession?
06:18 As you know, in the European Union the pandemic triggered a severe economic crisis, with a drop in GNP not seen in decades, in a context that began with zero or even negative interest rates. Has the time for monetary policy come to an end, making fiscal policy more important than ever?
