Bernanke, really? This has to be a joke.
Nobel Prize in Economics Awarded to Ben Bernanke, Douglas Diamond, Philip Dybvig
11–20 of 84 posts
Re: Nobel Prize in Economics Awarded to Ben Bernanke, Douglas Diamond, Philip Dybvig
#12You can feel however you feel about Bernanke during his tenure as Fed Chair. He was certainly hard to like at times, perhaps sometimes too smug. But his work laying out the pernicious effects of deflationary feedback loops as as an academic is probably one of the most influential works of monetary economics out there. I suggest people actually reading his papers before making a knee jerk reaction.
> pernicious effects of deflationary feedback loops
Serious question: were those results really put to the test? Apart from looking back at the New Deal era and getting from there whatever it's politically convenient at any one point.
Re: Nobel Prize in Economics Awarded to Ben Bernanke, Douglas Diamond, Philip Dybvig
#13It's the "Nobel Memorial Prize in Economic Sciences", and it's Bernanke prize for his work before, after or during the crisis? https://en.wikipedia.org/wiki/Nobel_Memorial_Prize_in_Econom... "Bernanke Admits Fed Made Mistakes Combating Crisis 10 Years Ago" "...Former Federal Reserve Chairman Ben Bernanke acknowledged that policy makers made two critical errors fighting the financial crisis a decade ago: They failed t…
Its the prize from the central bank of Sweden for bailing out banks with tax money and giving them clear sign they can leverage and risk as much as they want, if anything goes bad tax payers will have to pay for it.
Re: Nobel Prize in Economics Awarded to Ben Bernanke, Douglas Diamond, Philip Dybvig
#14> Their discoveries improved how society deals with financial crises
> This year’s laureates in the Economic Sciences, Ben Bernanke, Douglas Diamond and Philip Dybvig, have significantly improved our understanding of the role of banks in the economy, particularly during financial crises. An important finding in their research is why avoiding bank collapses is vital.
> Modern banking research clarifies why we have banks, how to make them less vulnerable in crises and how bank collapses exacerbate financial crises. The foundations of this research were laid by Ben Bernanke, Douglas Diamond and Philip Dybvig in the early 1980s. Their analyses have been of great practical importance in regulating financial markets and dealing with financial crises.
> For the economy to function, savings must be channelled to investments. However, there is a conflict here: savers want instant access to their money in case of unexpected outlays, while businesses and homeowners need to know they will not be forced to repay their loans prematurely. In their theory, Diamond and Dybvig show how banks offer an optimal solution to this problem. By acting as intermediaries that accept deposits from many savers, banks can allow depositors to access their money when they wish, while also offering long-term loans to borrowers.
> However, their analysis also showed how the combination of these two activities makes banks vulnerable to rumours about their imminent collapse. If a large number of savers simultaneously run to the bank to withdraw their money, the rumour may become a self-fulfilling prophecy – a bank run occurs and the bank collapses. These dangerous dynamics can be prevented through the government providing deposit insurance and acting as a lender of last resort to banks.
> Diamond demonstrated how banks perform another societally important function. As intermediaries between many savers and borrowers, banks are better suited to assessing borrowers’ creditworthiness and ensuring that loans are used for good investments.
> Ben Bernanke analysed the Great Depression of the 1930s, the worst economic crisis in modern history. Among other things, he showed how bank runs were a decisive factor in the crisis becoming so deep and prolonged. When the banks collapsed, valuable information about borrowers was lost and could not be recreated quickly. Society’s ability to channel savings to productive investments was thus severely diminished.
> “The laureates’ insights have improved our ability to avoid both serious crises and expensive bailouts,” says Tore Ellingsen, Chair of the Committee for the Prize in Economic Sciences.
https://www.nobelprize.org/prizes/economic-sciences/2022/pre...
Re: Nobel Prize in Economics Awarded to Ben Bernanke, Douglas Diamond, Philip Dybvig
#15It's the "Nobel Memorial Prize in Economic Sciences", and it's Bernanke prize for his work before, after or during the crisis? https://en.wikipedia.org/wiki/Nobel_Memorial_Prize_in_Econom... "Bernanke Admits Fed Made Mistakes Combating Crisis 10 Years Ago" "...Former Federal Reserve Chairman Ben Bernanke acknowledged that policy makers made two critical errors fighting the financial crisis a decade ago: They failed t…
https://www.nobelprize.org/prizes/economic-sciences/2022/pop... Bernanke’s research shows that bank crises can potentially have catastrophic consequences. This insight illustrates the importance of well-functioning bank regulation, and was also the reasoning behind crucial elements of economic policy during the financial crisis of 2008–2009. At this time, Bernanke was head of the US central bank, the Federal Reserve,…
The consequences of the FED money printing are just starting to show. The everything bubble this time might become much worse than the housing bubble of 2008.
Re: Nobel Prize in Economics Awarded to Ben Bernanke, Douglas Diamond, Philip Dybvig
#16I would like to see Taleb's reaction to this.
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Re: Nobel Prize in Economics Awarded to Ben Bernanke, Douglas Diamond, Philip Dybvig
#17Please be precise, this prize has nothing to do with the original Nobel prices. It's the Sveriges Riksbank's (central bank of Sweden) Prize in Economic Sciences in Memory of Alfred Nobel - as the headline of TFA also tells us.
Which are awarded in name of the Nobel Prizes as you can check in their official website [1].
Nobel Prizes are awarded by different institutions [2].
There's nothing else to be precise about, you are being pedantic.
[1] https://www.nobelprize.org/prizes/lists/all-nobel-prizes/
[2] https://www.nobelprize.org/the-nobel-prize-organisation/priz...
Re: Nobel Prize in Economics Awarded to Ben Bernanke, Douglas Diamond, Philip Dybvig
#18It's the "Nobel Memorial Prize in Economic Sciences", and it's Bernanke prize for his work before, after or during the crisis? https://en.wikipedia.org/wiki/Nobel_Memorial_Prize_in_Econom... "Bernanke Admits Fed Made Mistakes Combating Crisis 10 Years Ago" "...Former Federal Reserve Chairman Ben Bernanke acknowledged that policy makers made two critical errors fighting the financial crisis a decade ago: They failed t…
The scientific background of this year’s prize cites the work of the 3 economists in the 1980s.
> Specifically, Diamond and Dybvig (1983) presented a theory of maturity transformation and showed that an institution using demand deposits to finance long-term projects is the most efficient arrangement, but that, at the same time, this arrangement has an inherent vulnerability: bank runs may arise
> Diamond (1984) developed a theory of a bank’s provision of delegated monitoring services and showed that banks can ensure that projects with high (but risky) long-run returns obtain funding by monitoring borrowers on behalf of lenders.
> Bernanke (1983) showed, in particular, that the downturn became so deep and so protracted in large part because bank failures destroyed valuable banking relationships, and the resulting credit supply contraction left significant scars in the real economy.
https://www.nobelprize.org/uploads/2022/10/advanced-economic...
Re: Nobel Prize in Economics Awarded to Ben Bernanke, Douglas Diamond, Philip Dybvig
#19Please be precise, this prize has nothing to do with the original Nobel prices. It's the Sveriges Riksbank's (central bank of Sweden) Prize in Economic Sciences in Memory of Alfred Nobel - as the headline of TFA also tells us.
Semantics… even the Associated Press calls it the Nobel Prize in Economics: > STOCKHOLM (AP) — This year’s Nobel Prize in economic sciences has been awarded to the former chair of the U.S. Federal Reserve, Ben S. Bernanke, and two U.S.-based economists, Douglas W. Diamond and Philip H. Dybvig, “for research on banks and financial crises https://apnews.com/article/nobel-economy-bernanke-2bb3eaee67...
It's semantics, but it's still incorrect...
Alfred Nobel never intended to award a prize in economics (and neither one in Mathematics, though the background of _that_ might be more interesting).
From https://www.nobelprize.org/alfred-nobel/alfred-nobels-will/
"The interest is to be divided into five equal parts and distributed as follows: one part to the person who made the most important discovery or invention in the field of physics; one part to the person who made the most important chemical discovery or improvement; one part to the person who made the most important discovery within the domain of physiology or medicine; one part to the person who, in the field of literature, produced the most outstanding work in an idealistic direction; and one part to the person who has done the most or best to advance fellowship among nations, the abolition or reduction of standing armies, and the establishment and promotion of peace congresses."
Re: Nobel Prize in Economics Awarded to Ben Bernanke, Douglas Diamond, Philip Dybvig
#20It's the "Nobel Memorial Prize in Economic Sciences", and it's Bernanke prize for his work before, after or during the crisis? https://en.wikipedia.org/wiki/Nobel_Memorial_Prize_in_Econom... "Bernanke Admits Fed Made Mistakes Combating Crisis 10 Years Ago" "...Former Federal Reserve Chairman Ben Bernanke acknowledged that policy makers made two critical errors fighting the financial crisis a decade ago: They failed t…
First, if you want to be pedantic it's actually the "Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel". But nobody cares about about formal names if they're unwieldy[1].
Second, the comittee based the award on academic works from the 1980s. For Bernanke, that would be mostly his AER papers [2,3,4,5]. (The AER is one of the top journals in economics and 2 or 3 publications will probably get you a tenure position at most top universities.) The full papers are paywalled, but the interested can get the unpaywalled NBER versions of them (with the same title) for free.
[1] https://dilbert.com/strip/2015-04-02
[2] https://econpapers.repec.org/article/aeaaecrev/v_3a71_3ay_3a...
[3] https://econpapers.repec.org/article/aeaaecrev/v_3a73_3ay_3a...
[4] https://econpapers.repec.org/article/aeaaecrev/v_3a76_3ay_3a...
[5] https://econpapers.repec.org/article/aeaaecrev/v_3a78_3ay_3a...