I discuss three passages from George Akerlof and Paul Romer’s ) and Paul Romer explained in their famous article (“Looting: The. I have often written and spoken of my frustration that economists refuse to read George Akerlof and Paul Romer’s classic article (“Looting. Looting: The Economic Underworld of Bankruptcy for Profit. Our theoretical analysis shows that an economic underground can come to life if.

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Ripley Harry A. You would think in the internet age, some rabble-rouser and in this case rabble is not a pejorative would rise up and start the revolution … or at least put some of these swine in prison. He has never claimed any anti-fraud expertise. By continuing to use this website, you agree to their use. The italicized portion of the quotation should be read with care for it is so obviously the definitive explanation of our current crisis as we read the passage today over decades after it was written.

George Akerlof

Franco Modigliani Eomer R. No economist outside the small circle that work with me alerted his or her readers to the compelling data establishing the three accounting control fraud epidemics. Pissarides Thomas J. Coase Gary S. Black and tagged accounting control fraudackerlof and romerControl Fraudlooting. Mills Sumner Slichter Edwin G.

Hadley Richard T. That is their paramount akerloc, not preventing the looting that drives our recurrent, intensifying financial crises. Proudly powered by WordPress. Bill, They truly live in a strange, closed world.


I think this is the attitude that seems to be taken. He is on the advisory board of the Institute for New Economic Thinking. Klein James Tobin George J.

George Akerlof – Wikipedia

Nor, unaware of the concept, could they have known how serious it would be. Akerolf Lewis Charles L. By using this site, you agree to the Terms of Use and Privacy Policy. No elite CEO who became exceptionally wealthy by leading these fraud epidemics has had the wealth they gained through the frauds clawed back.

The link I followed to get to the paper http: Adams Fred M.

This strategy has many colorful descriptions: The second concept that needs to be understood is the critical role of underwriting documentation. Nobel Prize recipients 91 92 93 94 95 96 97 98 99 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15 16 17 Michael SpenceJoseph E. Furthermore, banks that held these opaque securities faced major refinancing problems. The published report put three quotations on the cover.

Lawrenceville School Yale University B. BobbyGvegas April 4, at 4: Sherwin Rosen Robert Lucas Jr.

DOJ has not convicted, clawed back, or even forced the resignation of any non -elite CEO for leading these any of these three frauds. But that understates how little DOJ has done. The first thing that struck me was their framing of the root of the problem as being government guaranteed debt. Appraisal Fraud by the Lenders By — a decade before the world recognized the crisis — the honest real estate appraisers were already organizing an effort to warn the U. Bogart George E.


Conference site and details are found here. Certainly, a number of economic models exist for understanding things like panics, liquidity problems and moral hazard. Samuelson Simon Kuznets John R.

Schelling Edmund S. Information asymmetry Efficiency wages. That means that there had to be an epidemic of fraudulent mortgage sales to the secondary market. They can be found in my book and in scores of articles. Romer 23 December Klein Jacob Marschak Tjalling C.

Boulding William J. Subscribe Enter your email address to akerlor this blog and receive notifications of new posts by email. Prescott Robert J. Krueger Arnold C. Akerlof proposed a new agenda for macroeconomics, using social norms to explain macroeconomic behavior.

Economists should have little difficulty understanding these three concepts, but they have a primitive tribal taboo about fraud by business elites.

Akerlof and Romer expressly endorsed our analysis summarized above in the second bullet point, citing my work in footnote 5 of their paper.

Shapley Eugene F.

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