The Great Moderation
Contents
Unveiling the Great Moderation: A Comprehensive Analysis
Exploring the Phenomenon
Dive into the concept of the Great Moderation, a period characterized by reduced macroeconomic volatility in the United States from the mid-1980s to the financial crisis in 2007. Discover the factors that contributed to this era of stability and the subsequent challenges it faced.
Understanding the Historical Context
Gain insights into the economic landscape preceding the Great Moderation, marked by tumultuous swings in economic performance and inflation. From the Vietnam War inflation to the collapse of Bretton Woods, explore the events that paved the way for this period of stability.
The Role of Monetary Policy
Delve into the role of monetary policy in shaping the Great Moderation, as portrayed by influential figures such as Paul Volcker, Alan Greenspan, and Ben Bernanke. Explore Bernanke's hypothesis regarding the causes of this phenomenon and the structural changes that influenced economic stability.
The Downfall and Aftermath
Examine the downfall of the Great Moderation with the onset of the financial crisis and the Great Recession. Discover how imbalances in the economy, fueled by easy money policies, led to a catastrophic crash and the unraveling of the stability achieved during this period.