Archive for December 27th, 2011
John Geanakoplos, an economics professor at Yale and has Greece origins. His grandfather migrated to US from Greece in search of a better life.
He explains in this speech how he became an economist and discovered the leverage cycle via trading in financial markets. In this theory he showed the importance of collateral in finance and how it amplifies the financial cycle both ways. In good times less collateral is required amplifying the boom and in bad times more collateral is demanded amplifying the bust.
Why he became an economist is interesting:
A superb literature survey on the state of microfinance. Five economists write this survey - Jonathan Bauchet, Cristobal Marshall, Laura Starita, Jeanette Thomas and Anna Yalouris.
The survey is mainly of random evaluation experiments done around the world in various fields of microfinance- credit, savings, insurance etc. They also look at whether specific design features like community lending, preference to women works or not.