Alan Blinder
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Alan Stuart Blinder (, born October 14, 1945) is an American economics professor at
Princeton University Princeton University is a private university, private Ivy League research university in Princeton, New Jersey, United States. Founded in 1746 in Elizabeth, New Jersey, Elizabeth as the College of New Jersey, Princeton is the List of Colonial ...
and is listed among the most influential economists in the world. He is a leading macroeconomist, politically liberal, and a champion of
Keynesian Keynesian economics ( ; sometimes Keynesianism, named after British economist John Maynard Keynes) are the various macroeconomic theories and models of how aggregate demand (total spending in the economy) strongly influences economic output an ...
economics and policies.''World Economics''
“Keeping the Keynesian Faith”
Brian Snowden, April–June 2001. The year earlier an. 2000interview with Alan Blinder starts on page 6.
Blinder served on President
Bill Clinton William Jefferson Clinton (né Blythe III; born August 19, 1946) is an American politician and lawyer who was the 42nd president of the United States from 1993 to 2001. A member of the Democratic Party (United States), Democratic Party, ...
's
Council of Economic Advisers The Council of Economic Advisers (CEA) is a United States agency within the Executive Office of the President established in 1946, which advises the president of the United States on economic policy. The CEA provides much of the empirical resea ...
from January 1993 to June 1994Princeton Economist to Be Named To Clinton's Council, Aides Say
''New York Times'' (archives), Louis Uchitelle, Jan. 4, 1993.
and as the vice chairman of the Federal Reserve from June 1994 to January 1996. His academic work has focused particularly on
monetary policy Monetary policy is the policy adopted by the monetary authority of a nation to affect monetary and other financial conditions to accomplish broader objectives like high employment and price stability (normally interpreted as a low and stable rat ...
and
central banking Central is an adjective usually referring to being in the center of some place or (mathematical) object. Central may also refer to: Directions and generalised locations * Central Africa, a region in the centre of Africa continent, also known as ...
, and on the "
offshoring Offshoring is the relocation of a business process from one country to another—typically an operational process, such as manufacturing, or supporting processes, such as accounting. Usually this refers to a company business, although state gover ...
" of jobs. His writing has been published in ''
The New York Times ''The New York Times'' (''NYT'') is an American daily newspaper based in New York City. ''The New York Times'' covers domestic, national, and international news, and publishes opinion pieces, investigative reports, and reviews. As one of ...
'', ''
The Washington Post ''The Washington Post'', locally known as ''The'' ''Post'' and, informally, ''WaPo'' or ''WP'', is an American daily newspaper published in Washington, D.C., the national capital. It is the most widely circulated newspaper in the Washington m ...
'', as well as a monthly column in ''
The Wall Street Journal ''The Wall Street Journal'' (''WSJ''), also referred to simply as the ''Journal,'' is an American newspaper based in New York City. The newspaper provides extensive coverage of news, especially business and finance. It operates on a subscriptio ...
''. Regarding the
2008 financial crisis The 2008 financial crisis, also known as the global financial crisis (GFC), was a major worldwide financial crisis centered in the United States. The causes of the 2008 crisis included excessive speculation on housing values by both homeowners ...
, Blinder drew ten lessons for fellow economists, including “Excessive complexity is not just anti-competitive, it's dangerous” and “Illiquidity closely resembles insolvency.”


Early life

Blinder was born to a
Jewish Jews (, , ), or the Jewish people, are an ethnoreligious group and nation, originating from the Israelites of History of ancient Israel and Judah, ancient Israel and Judah. They also traditionally adhere to Judaism. Jewish ethnicity, rel ...
family in
Brooklyn Brooklyn is a Boroughs of New York City, borough of New York City located at the westernmost end of Long Island in the New York (state), State of New York. Formerly an independent city, the borough is coextensive with Kings County, one of twelv ...
,
New York New York most commonly refers to: * New York (state), a state in the northeastern United States * New York City, the most populous city in the United States, located in the state of New York New York may also refer to: Places United Kingdom * ...
. He graduated from Syosset High School in
Syosset, New York Syosset is a Hamlet (New York), hamlet and census-designated place in the Oyster Bay (town), New York, Town of Oyster Bay, in Nassau County, New York, Nassau County, on the North Shore (Long Island), North Shore of Long Island, in New York (state ...
. Blinder attended
Princeton University Princeton University is a private university, private Ivy League research university in Princeton, New Jersey, United States. Founded in 1746 in Elizabeth, New Jersey, Elizabeth as the College of New Jersey, Princeton is the List of Colonial ...
as an undergraduate student and graduated ''
summa cum laude Latin honors are a system of Latin phrases used in some colleges and universities to indicate the level of distinction with which an academic degree has been earned. The system is primarily used in the United States. It is also used in some Sout ...
'' with a B.A. in economics in 1967. He completed a 130-page long senior thesis, titled "The Theory of Corporate Choice". He received a M.Sc. in economics from the
London School of Economics The London School of Economics and Political Science (LSE), established in 1895, is a public research university in London, England, and a member institution of the University of London. The school specialises in the social sciences. Founded ...
in 1968 and received a doctorate in economics from the
Massachusetts Institute of Technology The Massachusetts Institute of Technology (MIT) is a Private university, private research university in Cambridge, Massachusetts, United States. Established in 1861, MIT has played a significant role in the development of many areas of moder ...
in 1971. He was advised by
Robert Solow Robert Merton Solow, GCIH (; August 23, 1924 – December 21, 2023) was an American economist who received the 1987 Nobel Memorial Prize in Economic Sciences, and whose work on the theory of economic growth culminated in the exogenous growth ...
.


Professional life


Academic career

Blinder is the Gordon S. Rentschler Memorial Professor of Economics and Public Affairs at Princeton where he has been since 1971; from 1988 to 1990, he chaired the economics department. Also in 1990, he founded Princeton's Griswold Center for Economic Policy Studies. And he has served as vice-chair of The Observatory Group. Since 1978, Blinder has been a Research Associate of the
National Bureau of Economic Research The National Bureau of Economic Research (NBER) is an American private nonprofit research organization "committed to undertaking and disseminating unbiased economic research among public policymakers, business professionals, and the academic co ...
. He is a past president of the Eastern Economic Association and Vice President of the
American Economic Association The American Economic Association (AEA) is a learned society in the field of economics, with approximately 23,000 members. It publishes several peer-reviewed journals, including the Journal of Economic Literature, American Economic Review, an ...
and was named a Distinguished Fellow of the latter in 2011. He is a Fellow of the
American Academy of Arts and Sciences The American Academy of Arts and Sciences (The Academy) is one of the oldest learned societies in the United States. It was founded in 1780 during the American Revolution by John Adams, John Hancock, James Bowdoin, Andrew Oliver, and other ...
(since 1991), a member of the
American Philosophical Society The American Philosophical Society (APS) is an American scholarly organization and learned society founded in 1743 in Philadelphia that promotes knowledge in the humanities and natural sciences through research, professional meetings, publicat ...
since 1996, and a member of the board of the
Council on Foreign Relations The Council on Foreign Relations (CFR) is an American think tank focused on Foreign policy of the United States, U.S. foreign policy and international relations. Founded in 1921, it is an independent and nonpartisan 501(c)(3) nonprofit organi ...
(since 2008). Blinder's textbook ''Economics: Principles and Policy'', co-written with
William Baumol William Jack Baumol (February 26, 1922 – May 4, 2017) was an American economist. He was a professor of economics at New York University, Academic Director of the Berkley Center for Entrepreneurship and Innovation, and professor emeritus at Prin ...
, was first published in 1979 and, in 2012 was printed in its twelfth edition. In 2009 Blinder was inducted into the
American Academy of Political and Social Science The American Academy of Political and Social Science (AAPSS) was founded in 1889 to promote progress in the social sciences. Sparked by Professor Edmund J. James and drawing from members of the faculty of the University of Pennsylvania, Swarthmor ...
, "for his distinguished scholarship on fiscal policy, monetary policy and the distribution of income, and for consistently bringing that knowledge to bear on the public arena." He is a strong proponent of
free trade Free trade is a trade policy that does not restrict imports or exports. In government, free trade is predominantly advocated by political parties that hold Economic liberalism, economically liberal positions, while economic nationalist politica ...
. Blinder has been critical of the public discussion of the US national debt, describing it as generally ranging from "ludicrous to horrific".


Political career

Blinder is listed among the most influential economists in the world according to IDEAS/RePEc. In 1975, Blinder served as the Deputy Assistant Director of the
Congressional Budget Office The Congressional Budget Office (CBO) is a List of United States federal agencies, federal agency within the United States Congress, legislative branch of the United States government that provides budget and economic information to Congress. I ...
. In the 1990s, he served on President
Bill Clinton William Jefferson Clinton (né Blythe III; born August 19, 1946) is an American politician and lawyer who was the 42nd president of the United States from 1993 to 2001. A member of the Democratic Party (United States), Democratic Party, ...
's
Council of Economic Advisers The Council of Economic Advisers (CEA) is a United States agency within the Executive Office of the President established in 1946, which advises the president of the United States on economic policy. The CEA provides much of the empirical resea ...
from January 1993 to June 1994, and as the 15th
Vice Chair of the Federal Reserve The vice chair of the Board of Governors of the Federal Reserve System is the second-highest officer of the Federal Reserve, after the chair of the Federal Reserve. In the absence of the chair, the vice chair presides over the meetings Board of ...
from June 27, 1994, to January 31, 1996 (more specifically as the Vice Chairman of
Board of Governors of the Federal Reserve System The Board of Governors of the Federal Reserve System, commonly known as the Federal Reserve Board, is the main governing body of the Federal Reserve System. It is charged with overseeing the Federal Reserve Banks and with helping implement the m ...
). As Vice Chairman, Blinder cautioned against raising interest rates too quickly to slow inflation because of the lags in earlier rises feeding through into the economy. He also warned against ignoring the short term costs in terms of unemployment that inflation-fighting could cause. Many have argued that Blinder's stint at the Fed was cut short because of his tendency to challenge chairman
Alan Greenspan Alan Greenspan (born March 6, 1926) is an American economist who served as the 13th chairman of the Federal Reserve from 1987 to 2006. He worked as a private adviser and provided consulting for firms through his company, Greenspan Associates L ...
. By challenging assumptions, Blinder supposedly disrupted "the whole pipeline of Greenspan-arriving-at-decisions." Grim, Ryan (Oct. 23, 2009
Priceless: How The Federal Reserve Bought The Economics Profession
''
Huffington Post ''HuffPost'' (''The Huffington Post'' until 2017, itself often abbreviated as ''HPo'') is an American progressive news website, with localized and international editions. The site offers news, satire, blogs, and original content, and covers ...
''
He was an adviser to
Al Gore Albert Arnold Gore Jr. (born March 31, 1948) is an American former politician, businessman, and environmentalist who served as the 45th vice president of the United States from 1993 to 2001 under President Bill Clinton. He previously served as ...
and
John Kerry John Forbes Kerry (born December 11, 1943) is an American attorney, politician, and diplomat who served as the 68th United States secretary of state from 2013 to 2017 in the Presidency of Barack Obama#Administration, administration of Barac ...
during their respective presidential campaigns in
2000 2000 was designated as the International Year for the Culture of Peace and the World Mathematics, Mathematical Year. Popular culture holds the year 2000 as the first year of the 21st century and the 3rd millennium, because of a tende ...
and
2004 2004 was designated as an International Year of Rice by the United Nations, and the International Year to Commemorate the Struggle Against Slavery and Its Abolition (by UNESCO). Events January * January 3 – Flash Airlines Flight 60 ...
.


Private sector

Blinder was a co-founder and a vice-chair of the Promontory Interfinancial Network, LLC. After his service as the vice chairman of the Federal Reserve, Blinder, along with several former regulators, founded a company that offers a number of services that provide a means for depositors (including governmental entities, nonprofits, businesses, as well as individuals such as retirees) to access millions in Federal Deposit Insurance Corporation (FDIC) coverage at a single institution instead of multiple ones. This provides banks that are members the ability to offer coverage above the FDIC per account/per bank limit by letting those banks place funds into CDs or deposit accounts issued by other network banks. This occurs in increments below the standard FDIC insurance maximum ($250,000) so that both principal and interest are eligible for FDIC insurance. The company acts as a sort of clearinghouse, matching deposits from one institution with another. Through its services it allows access to higher levels of FDIC insurance although limits apply.


"Cash for Clunkers"

Blinder was an early advocate of a " Cash for Clunkers" program, in which the government buys some of the oldest, most-polluting vehicles and scraps them. In July 2008, he wrote an article in ''
The New York Times ''The New York Times'' (''NYT'') is an American daily newspaper based in New York City. ''The New York Times'' covers domestic, national, and international news, and publishes opinion pieces, investigative reports, and reviews. As one of ...
'' advocating such a program, which was implemented by the
Obama administration Barack Obama's tenure as the 44th president of the United States began with his first inauguration on January 20, 2009, and ended on January 20, 2017. Obama, a Democrat from Illinois, took office following his victory over Republican nomine ...
during the summer of 2009. Blinder asserted it could stimulate the economy, benefit the environment, and reduce income inequality. The program was praised by President Obama for "exceeding expectations", but criticized for economic and environmental reasons.


Great Recession of 2008 and 2009, and slow recovery

The
Great Recession The Great Recession was a period of market decline in economies around the world that occurred from late 2007 to mid-2009.
started in December 2007 and bottomed-out in June 2009, at which point the U.S. economy began a slow recovery. Blinder points out that payroll employment didn't regain its previous level until almost five additional years.“What Did We Learn from the Financial Crisis, the Great Recession, and the Pathetic Recovery?”
Alan Blinder, 10 lessons for fellow economists are on pages 6 to 15, 7 lessons for the teaching of economics are on pages 15 to 21, Nov. 2014.
Blinder argues for 10 lessons for fellow economists, including —
4)''“Self-regulation is oxymoronic.”'' 5) ''“Fraud and near-fraud can rise to attain macroeconomic significance.”'' 6) ''“Excessive complexity is not just anti-competitive, it's dangerous.”'' ::''“ . . no one knows what these securities are really worth. .”'' Regarding the teaching of college-level economics, Blinder writes, “If you are not teaching your students that ‘Keynesianism’ is neither conservative nor liberal, you should be.” Economic models with one interest rate — ''“the”'' interest rate — are no longer good enough. He writes, “After all, in the 2000s we saw several dramatic instances of risk spreads first narrowing dangerously, then skyrocketing once fear took over from greed, and then narrowing again as calm returned.” For a beginning class in economics, he recommends including QE, or Quantitative Easing, as practiced by the Fed, the fact that investment bubbles can and do occur, and that “leverage is a double-edged sword.” Regarding other concepts such as “Too Big To Fail,” Blinder recommends including them in advanced courses but not in introductory classes. He thinks the early class(es) should include material which economists largely agree on, the “received wisdom” as it were, although he sees how other teachers might come to different conclusions.“What Did We Learn … ?”
pages 20 - 21.


Criticism of consumption-focused economics

In a 2019 article entitled “The Free-Trade Paradox: The Bad Politics of a Good Idea,” Blinder states that the main focus of the economics profession has been using price signals to produce goods and services as cheaply as possible. Jobs are viewed as secondary, and often as a distinct negative which people put up with only to get the money for their own consumption.“The Free-Trade Paradox: The Bad Politics of a Good Idea,” ''Foreign Affairs,'' Alan S. Blinder, Jan-Feb. 2019. But then he asks, “What if people care as much (or more) about their role as producers — about their jobs — as they do about the goods and services they consume? That would mean economists have been barking up the wrong tree for more than two centuries.” He still thinks there's an excellent case to be made for free trade, just not the case which economists typically make.


Selected works

* (2022), ''A Monetary and Fiscal History of the United States, 1961–2021'', Princeton University Press. * (2014), "What Did We Learn from the Financial Crisis, the Great Recession, and the Pathetic Recovery?" Princeton University Griswold Center for Economic Policy Studies Working Paper No. 243, 22-page paper, November 2014. * (2013), ''After the Music Stopped: The Financial Crisis, the Response, and the Work Ahead'', New York: Penguin Press, 24 Jan. 2013. ISBN is 978–1594205309.After the Music Stopped: The Financial Crisis, the Response, and the Work Ahead
Alan Blinder, Penguin Press, 2013, review by GoodReads.
* (2009), "How Many U.S. Jobs Might Be Offshorable," ''World Economics'', April–June 2009, 10(2): 41–78. * (2009), "Making Monetary Policy by Committee," ''International Finance'', Summer 2009, 12(2): 171–194. * (2008), "Do Monetary Policy Committees Need Leaders? A Report on an Experiment," ''American Economic Review (Papers and Proceedings)'', May 2008, pp. 224–229. * (2006), "Offshoring: The Next Industrial Revolution?" Foreign Affairs", March/April 2006, pp. 113–128. (A longer version with footnotes and references is "Fear of Offshoring," CEPS Working Paper No. 119, December 2005). * (2006), "The Case Against the Case Against Discretionary Fiscal Policy," in R. Kopcke, G. Tootell, and R. Triest (eds.), The Macroeconomics of Fiscal Policy, MIT Press, 2006, forthcoming, pp. 25–61. * (2004), ''The Quiet Revolution'', Yale University Press * (2001, with
William Baumol William Jack Baumol (February 26, 1922 – May 4, 2017) was an American economist. He was a professor of economics at New York University, Academic Director of the Berkley Center for Entrepreneurship and Innovation, and professor emeritus at Prin ...
and Edward N. Wolff), ''Downsizing in America: Reality, Causes, And Consequences'', Russell Sage Foundation * (2001, with
Janet Yellen Janet Louise Yellen (born August 13, 1946) is an American economist who served as the 78th United States secretary of the treasury from 2021 to 2025. She also served as chair of the Federal Reserve from 2014 to 2018. She was the first woman to h ...
), ''The Fabulous Decade: Macroeconomic Lessons from the 1990s'', New York: The Century Foundation Press * (1998, with E. Canetti, D. Lebow, and J. Rudd), ''Asking About Prices: A New Approach to Understanding Price Stickiness'', Russell Sage Foundation * (1998), ''Central Banking in Theory and Practice'', MIT Press * (1991), ''Growing Together: An Alternative Economic Strategy for the 1990s'', Whittle * (1990, ed.), ''Paying for Productivity'', Brookings * (1989), ''Macroeconomics Under Debate'', Harvester-Wheatsheaf * (1989), ''Inventory Theory and Consumer Behavior'', Harvester-Wheatsheaf * (1987), ''Hard Heads, Soft Hearts: Tough‑Minded Economics for a Just Society'', Addison-Wesley * (1983), ''Economic Opinion, Private Pensions and Public Pensions: Theory and Fact''. The University of Michigan * (1979, with
William Baumol William Jack Baumol (February 26, 1922 – May 4, 2017) was an American economist. He was a professor of economics at New York University, Academic Director of the Berkley Center for Entrepreneurship and Innovation, and professor emeritus at Prin ...
), ''Economics: Principles and Policy'' – textbook * (1979), ''Economic Policy and the Great Stagflation''. New York: Academic Press * (co-edited with Philip Friedman, 1977), ''Natural Resources, Uncertainty and General Equilibrium Systems: Essays in Memory of Rafael Lusky'', New York: Academic Press * (1974), ''Toward an Economic Theory of Income Distribution'', MIT Press


See also

* Antifragile#The Alan Blinder problem


References


External links


Blinder's Princeton homepage
*

*



at Penguin Publishers
Promontory Interfinancial Network, LLC
* *
Statements and Speeches of Alan S. Blinder
* * {{DEFAULTSORT:Blinder, Alan 1945 births 20th-century American economists 21st-century American economists Alumni of the London School of Economics 20th-century American Jews The Century Foundation Distinguished fellows of the American Economic Association Social scientists from Brooklyn Fellows of the American Academy of Arts and Sciences Fellows of the Econometric Society Living people New Keynesian economists Academics from Brooklyn People from Syosset, New York Princeton University alumni Princeton University faculty Syosset High School alumni United States Council of Economic Advisers Vice chairs of the Federal Reserve Clinton administration personnel 21st-century American Jews Brookings Institution people Members of the American Philosophical Society