Tinbergen Institute Economics Lectures 2016

Markus K. Brunnermeier (Princeton University)
13-15 June 2016
Tinbergen Institute AmsterdamNetherlands

Markus Brunnermeier (Princeton University) gave the Tinbergen Institute Economics lectures 2016.

Markus K. Brunnermeier (Landshut Germany, 1969) is the Edwards S. Sanford professor at the department of economics at Princeton University. He is the director of the Bendheim Center for Finance and the founding and former director of the Julis Rabinowitz Center for Public Policy and Finance at Princeton’s Woodrow Wilson’s School. He is a member of several advisory groups, including to the IMF, the Federal Reserve Bank of New York, the German Bundesbank and the U.S. Congressional Budget Office. He holds a PhD form the London School of Economics (1990).

Brunnermeier received several prestigious career awards and was an associate editor of several journals. He is one of the most distinct voices in the debate over financial markets in the United States. His research emphasizes international financial markets and the macro economy and he holds a special interest in bubbles, liquidity, financial crises and monetary policy. He promoted the concepts of liquidity spirals, CoVaR as co-risk measure, the volatility paradox, and the I Theory of Money. In exploring these research themes, Brunnermeier’s models incorporate frictions as well as behavioral components.

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Lecture topic

The Tinbergen lectures covers macroeconomic models with financial frictions in a continuous time settings. The financial sector diversifies idiosyncratic risk and creates (inside) money. The value of money is endogenous and adverse shocks that impair the balance sheet of the financial sector lead to disinflationary pressure a la Fisher. In addition to endogenous levels and flows, the risk dynamics is also endogenous, exhibiting tail risk and the volatility paradox. The welfare analysis addresses normative questions about the inefficiencies of financial crises and interaction between (redistributive) monetary policy and macro-prudential policy. Models on the build-up of imbalances in form of bubbles and international aspects are optional.


  • Liquidity concepts & amplification models (Mo morning)
    • BGG, Kiyotaki-Moore
    • Market and Funding Liquidity
  • Endogenous risk dynamics & “Volatility Paradox” (Mo afternoon)
    • BruSan A Macroeconomic model with financial sector
    • BruSan Handbook chapter
  • Monetary Economics (Tue morning and afternoon)
    • Safe assets
    • The I theory of money, Paradox of Prudence
    • On the optimal inflation rate
    • The reversal rate
    • Financial Dominance
      – Baffi Lecture
  • Bubbles (We morning)
    • Rational Bubbles
    • Bubbles and Crashes
    • Bubbles and Central Banks
  • Extras (We afternoon)
    • “The euro and the battle of ideas”
    • International Economics and Pecuniary Externalities (Optional)
    • Predatory Trading (Optional)