Jordi Galí (born January 4, 1961) is a Spanish

macroeconomist Macroeconomics (from the Greek prefix ''makro-'' meaning "large" + ''economics'') is a branch of economics dealing with performance, structure, behavior, and decision-making of an economy as a whole. For example, using interest rates, taxes, a ...

who is regarded as one of the main figures in New Keynesian macroeconomics today. He is currently the director of the Centre de Recerca en Economia Internacional (CREI, the Center for Research in International Economics) at

Universitat Pompeu Fabra Pompeu Fabra University ( ca, Universitat Pompeu Fabra, UPF, ; es, link=no, Universidad Pompeu Fabra) is a public university located in the city of Barcelona, Catalonia in Spain. The university was created by the Autonomous Government of Catal ...

and a Research Professor at the

Barcelona Graduate School of Economics The Barcelona School of Economics (BSE) is an institution for research and graduate education in economics, finance, data science, and the social sciences located in Barcelona, Spain. The school's academic offer includes Master's degrees as well ...

. After obtaining his doctorate from MIT in 1989 under the supervision of

Olivier Blanchard Olivier Jean Blanchard (; born December 27, 1948) is a French economist and professor who is a senior fellow at the Peterson Institute for International Economics. He was the chief economist at the International Monetary Fund from September 1, 2 ...

, he held faculty positions at

Columbia University Columbia University (also known as Columbia, and officially as Columbia University in the City of New York) is a private research university in New York City. Established in 1754 as King's College on the grounds of Trinity Church in Manhatt ...

and

New York University New York University (NYU) is a private research university in New York City. Chartered in 1831 by the New York State Legislature, NYU was founded by a group of New Yorkers led by then- Secretary of the Treasury Albert Gallatin. In 1832, th ...

before moving to Barcelona.

Research contributions

Galí's research centers on the causes of

business cycle Business cycles are intervals of expansion followed by recession in economic activity. These changes have implications for the welfare of the broad population as well as for private institutions. Typically business cycles are measured by examin ...

s and on optimal

monetary policy Monetary policy is the policy adopted by the monetary authority of a nation to control either the interest rate payable for federal funds, very short-term borrowing (borrowing by banks from each other to meet their short-term needs) or the money s ...

, especially through the lens of

time series analysis In mathematics Mathematics is an area of knowledge that includes the topics of numbers, formulas and related structures, shapes and the spaces in which they are contained, and quantities and their changes. These topics are represented in m ...

. His studies with

Richard Clarida Richard Harris Clarida (born May 18, 1957) is an American economist who served as the 21st Vice Chair of the Federal Reserve from 2018 to 2022. Clarida resigned his post on January 14th 2022 to return from public service leave to teach at Columbi ...

and Mark Gertler suggest that monetary policy in many countries today resembles the

Taylor rule The Taylor rule is a monetary policy targeting rule. The rule was proposed in 1992 by American economist John B. Taylor for central banks to use to stabilize economic activity by appropriately setting short-term interest rates. The rule consider ...

, whereas the policy makers of the 1970s failed to follow the Taylor rule. Another theme of Galí's research is how central banks should set interest rates. In some of the simplest

New Keynesian New Keynesian economics is a school of macroeconomics that strives to provide microeconomic foundations for Keynesian economics. It developed partly as a response to criticisms of Keynesian macroeconomics by adherents of new classical macroec ...

macroeconomic models, stabilizing the

inflation rate In economics, inflation is an increase in the general price level of goods and services in an economy. When the general price level rises, each unit of currency buys fewer goods and services; consequently, inflation corresponds to a reductio ...

stabilizes the

output gap The GDP gap or the output gap is the difference between actual GDP or actual output and potential GDP, in an attempt to identify the current economic position over the business cycle. The measure of output gap is largely used in macroeconomic ...

too. If this property were roughly true in reality, it would permit central bankers to pursue a simplified

focused only on inflation stabilization, with no need to consider output growth. Jordi Galí and

have called this property the ' divine coincidence', and have argued that in more realistic models which include additional frictions, it no longer holds. Instead, models with additional frictions (such as

frictional unemployment Frictional unemployment is a form of unemployment reflecting the gap between someone voluntarily leaving a job and finding another. As such, it is sometimes called search unemployment, though it also includes gaps in employment when transferring ...

) imply a tradeoff between stabilizing inflation and stabilizing the output gap. Galí is perhaps best known for providing

time series In mathematics, a time series is a series of data points indexed (or listed or graphed) in time order. Most commonly, a time series is a sequence taken at successive equally spaced points in time. Thus it is a sequence of discrete-time data. Ex ...

evidence that improvements in

labour productivity Workforce productivity is the amount of goods and services that a group of workers produce in a given amount of time. It is one of several types of productivity that economists measure. Workforce productivity, often referred to as labor product ...

cause employment to decrease. This finding contradicts the predictions of some well-known

real business cycle Real business-cycle theory (RBC theory) is a class of new classical macroeconomics models in which business-cycle fluctuations are accounted for by real (in contrast to nominal) shocks. Unlike other leading theories of the business cycle, RBC t ...

models promoted by the

New Classical New classical macroeconomics, sometimes simply called new classical economics, is a school of thought in macroeconomics that builds its analysis entirely on a neoclassical framework. Specifically, it emphasizes the importance of rigorous foundat ...

macroeconomic school, but is (according to Galí) consistent with many

models. However, the statistical methods (' structural vector autoregressions') on which this finding is based remain controversial. Galí is the most cited author of

Journal of Monetary Economics The ''Journal of Monetary Economics'' is a peer-reviewed academic journal covering research on macroeconomics and monetary economics. It is published by Elsevier and was established in October 1973 by Karl Brunner and Charles I. Plosser. Beginn ...

and European Economic Review.

Books

In 2008,

Princeton University Press Princeton University Press is an independent publisher with close connections to Princeton University. Its mission is to disseminate scholarship within academia and society at large. The press was founded by Whitney Darrow, with the financial ...

published Galí's monograph ''Monetary Policy, Inflation, and the Business Cycle''. The book provides an introduction to New Keynesian

DSGE Dynamic stochastic general equilibrium modeling (abbreviated as DSGE, or DGE, or sometimes SDGE) is a macroeconomic method which is often employed by monetary and fiscal authorities for policy analysis, explaining historical time-series data, as we ...

models, and analyzes the implications of those models for

. It is written at a level intended for introductory graduate courses in macroeconomics. A second edition was published in 2015.

Awards

In 2005, Galí received the

Yrjö Jahnsson Award Yrjö, a masculine Finnish given name that is the equivalent of George, may refer to: * Yrjö von Grönhagen, (1911–2003), Finnish anthropologist * Yrjö Jylhä, (1903–1956), Finnish poet * Yrjö Kilpinen (1892–1959), Finnish co ...

of the

European Economic Association The European Economic Association (EEA) is a professional academic body which links European economists. It was founded in the mid-1980s. Its first annual congress was in 1986 in Vienna and its first president was Jacques Drèze. The current pres ...

, of which he is also a fellow, in recognition of his work on New Keynesian macroeconomics. He shared the prize with Timothy Besley of the

London School of Economics , mottoeng = To understand the causes of things , established = , type = Public research university , endowment = £240.8 million (2021) , budget = £391.1 milli ...

. Thomson Reuters lists him among the 'citation laureates' who are likely future winners of the

Nobel Prize in Economics The Nobel Memorial Prize in Economic Sciences, officially the Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel ( sv, Sveriges riksbanks pris i ekonomisk vetenskap till Alfred Nobels minne), is an economics award administered ...

References

External links

Galí's website at the

Jordi Galí's Barcelona GSE faculty profile

Barcelona GSE Research Professors
{{DEFAULTSORT:Gali, Jordi 1961 births Living people New Keynesian economists Macroeconomists Economists from Catalonia 20th-century Spanish economists 21st-century Spanish economists Academic staff of Pompeu Fabra University Academic staff of the Barcelona Graduate School of Economics Fellows of the Econometric Society Fellows of the European Economic Association

Research contributions

Books

Awards

See also

References

External links