Understanding inflation demands the examination of both monetary policies put in place by central banks, and fiscal policies set by governments. That was one aspect of the 2024 Berkowitz Lecture delivered by 2011 Nobel Laureate Chris Sims. A faculty member at Princeton Sims is also a Fellow of the Econometric Society, a member of the American Academy of Arts and Sciences, and a member of the National Academy of Sciences.
“Professor Sims introduced the fiscal theory of the price level as an alternative approach to Monetarism and New Keynesian models,” explained Professor Jordi Mondria, Director of the MFE Program and a former student of Sims. “The key takeaway is that inflation is mainly influenced by the government’s budget decisions. It diminishes the role of central banks to influence monetary policy unless their actions are coordinated with fiscal policy.”
The Berkowitz Lecture, hosted by the University of Toronto’s Masters in Financial Economics (MFE) program was March 7th. It attracted a stand-room only crowd of current students, alumni, faculty and members of the Berkowitz family. The lecture is presented in memory of Professor Michael Berkowitz (1946 – 2004), former Department of Economics Chair and founder of the Master of Financial Economics program.
“It’s very special to come here and to hear how much work he put into the department, how he really dedicated he was,” said Professor Berkowitz’s grandson, also named Michael.
Return to the Department of Economics website.
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