Monetary Policy & Inflation | US
How the Princeton School Shaped US Policy in the 21st Century
- By Julius Probst, PhD
- 6 min read
Summary
• Since the 1990s, five Princeton economists have significantly advanced New Keynesian theory.
• This ‘Princeton School’ comprises Paul Krugman, Ben Bernanke, Lars Svensson, Michael Woodford, and Gauti Eggertsson.
• They developed the now-standard view of monetary policy in the 21st century and provided early insights into quantitative easing, forward guidance, and the ‘whatever it takes’ approach.
• Central banks adopted their policy recommendations to great success during the pandemic.
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