From acclaimed economists George Akerlof and Robert Shiller, the case
for why government is needed to restore confidence in the economy
The global financial crisis has made it painfully clear that powerful
psychological forces are imperiling the wealth of nations today. From
blind faith in ever-rising housing prices to plummeting confidence in
capital markets, "animal spirits" are driving financial events
worldwide. In this book, acclaimed economists George Akerlof and Robert
Shiller challenge the economic wisdom that got us into this mess, and
put forward a bold new vision that will transform economics and restore
prosperity.
Akerlof and Shiller reassert the necessity of an active government role
in economic policymaking by recovering the idea of animal spirits, a
term John Maynard Keynes used to describe the gloom and despondence that
led to the Great Depression and the changing psychology that accompanied
recovery. Like Keynes, Akerlof and Shiller know that managing these
animal spirits requires the steady hand of government--simply allowing
markets to work won't do it. In rebuilding the case for a more robust,
behaviorally informed Keynesianism, they detail the most pervasive
effects of animal spirits in contemporary economic life--such as
confidence, fear, bad faith, corruption, a concern for fairness, and the
stories we tell ourselves about our economic fortunes--and show how
Reaganomics, Thatcherism, and the rational expectations revolution
failed to account for them.
Animal Spirits offers a road map for reversing the financial
misfortunes besetting us today. Read it and learn how leaders can
channel animal spirits--the powerful forces of human psychology that are
afoot in the world economy today. In a new preface, they describe why
our economic troubles may linger for some time--unless we are prepared
to take further, decisive action.
