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The author John H. Cochrane
John H. Cochrane
In real life I'm a Senior Fellow of the Hoover Institution at Stanford. I was formerly a professor at the University of Chicago Booth School of Business. I'm also an adjunct scholar of the Cato Institute. I'm not really grumpy by the way!

John Cochrane – Grumpy Economist

John Cochrane, Senior Fellow of the Hoover Institution at Stanford, is The Grumpy Economist. But he claims to not actually be grumpy. On this blog, he provides detailed commentary backed with data and exceptional reasoning on current economic news, finance and policy policy.

Climate risk to the financial system

I wrote a piece for Project Syndicate, here,  on climate financial risk.  (This resulted from a presentation on a panel at the NBER summer institute risks of financial institutions meeting, program here. There should be a video version on YouTube but I can't find it. The panel discussion was excellent. You will recognize ideas from my earlier climate finance testimony. I recycle and refine. ) I titled it "an answer in search of a question," but PS didn't like that so we have the...

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Rossi-Hansberg on the effects of a carbon tax

I was inspired to think again about climate economics from Esteban Rossi-Habnsberg's excellent presentation at the  Hoover Economic Policy Working Group. Link here in case the above embed does not work. Paper here, (with Jose Luis Cruz Alvarez), slides here. Previous introductory post here. There is a lot in this paper and presentation, and I'm going to try to stick to one topic per post. Like most economists, my knee jerk reaction to climate change is "carbon tax." In...

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How much does climate change actually affect GDP? Part I: An illogical question.

How much does climate change* actually affect GDP? How much will currently-envisioned climate policies reduce that damage, and thereby raise GDP? As we prepare to spend trillions and trillions of dollars on climate change, this certainly seems like the important question that economists should have good answers for. I'm looking in to what anyone actually knows about these questions. The answer is surprisingly little, and it seems a ripe area for research. This post begins a series.  I...

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Lessons learned? Review of a great review.

After great events, will the US government and political system learn from mistakes? Or will we raise the bridges and enshrine whatever was done last time as holy writ, to be repeated again? Reputations of people in power push for the latter. But learning from mistakes is the only way to get ahead. Bailouts and stimulus from 2008 seem to have followed the latter possibility. Will the lesson from covid look skeptically on the disastrous performance of CDC and FDA, evaluate whether...

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Fast grants and the economics of subsidizing science

One of the great insights of modern growth theory -- Paul Romer's Nobel Prize -- is that ideas are the foundation of economic growth. Ideas are also "nonrivial." If you use my car, I can't use it, but if you use our family recipe for road-oil chocolate cake (yum), we can still enjoy it as much as ever. Once an idea has been had, economics says it should be used as widely as possible as soon as possible  But coming up with ideas is expensive. And aside patent protections, I can't charge...

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Even Finance Professors Lean Left

You may have thought of finance professors at business schools as likely to be a fairly conservative lot, or at least to include a good number of them. You might think finance would be an exception to the growing political monoculture in US academia. You would be mostly wrong.  Emre Kuvvet tracked down the party affiliation of finance professors in the top 20 US departments, and wrote up the results in "Even Finance Professors Lean Left. Berkeley has more Republicans than Chicago? I...

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Garicano’s conversations with economists

Luis Garicano has just posted a very interesting free e-book, "Capitalism after covid: Conversations with 21 economists." I was honored to be one of his interviewees, video here. Luis has a VoxEU column summarizing conversations, and twitter thread if you like reading such things. Luis is a great interviewer. This is not an endorsement of all the ideas! Luis found a wide spectrum of ideas, and I think that is the strong thing about the project. You can see how really smart people, on top...

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Adrian Woolridge wrote a thought-provoking essay titled "Meritocracy, Not Democracy, Is the Golden Ticket to Growth," advertising a forthcoming book. Meritocracy, the secret sauce of growth?  To Woolridge, meritocracy is the secret sauce of prosperity: The surest sign that a country will be economically successful is not the health of its democracy, as some liberals like to think, or the leanness of its government, as some free-marketers imagine, but its commitment to...

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Vaccine slowdown?

 Source. Everyone seems tired of covid. And sure, inflation, debts, "infrastructure," competing voting narratives and so on are more fun. But covid is still with us. The graph summarizes what I've read in lots of news stories: vaccination is slowing down. There is plenty of supply, but we are running in to people who do not go get the vaccine. This strikes me as a tragedy. (Disclaimer: this is an exploratory post, and I'm anxious to hear about it from more knowledgeable...

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