New York, NY, November 24, 2010 --(PR.com
)-- The Institute for New Economic Thinking (INET), launched with a $50 million pledge from George Soros to promote changes in economic theory and practice through research grants, Task Force groups, academic partnerships, and conferences, announced that it has selected Arindrajit Dube of University of Massachusetts, Amherst and Ethan Kaplan of Columbia University to research a spatial approach to macroeconomic inference. The grant program, along with other INET initiatives, was created in direct response to arguably the worst economic crisis in world history, and has been designed to encourage and support new economic thinking. Starting in 2011, INET will conduct two grant cycles annually.
The project is grounded in the observation that many of the most important questions in contemporary macroeconomics have proven elusive and thus have yet to be answered in a convincing way, due to heavy reliance on time series variation by empirical macroeconomists to find answers. The INET grant will fund three separate research projects with a common methodological approach using spatial cross-sectional variation in addition to time series variation to identify effects. The projects will focus on: (1.) estimating fiscal multipliers, (2.) estimating the impact of of anti-predatory lending laws on housing prices, default rates and foreclosures, (3.) estimating the impact of raising wages during recessions. The end product of the project will make both methodological and substantive contributions to modern macroeconomics.
“The project studies the application of fiscal policy and its effects regionally. This approach promises more precise and accurate findings,” said Dr. Robert Johnson, Executive Director of INET. “The development of new approaches such as the spatial approach to macroeconomic inference can overcome limitations present in traditional approaches that contribute to our incomplete understanding fiscal shocks on regional economies.”
Arindrajit Dube is an Assistant Professor of Economics at University of Massachusetts, Amherst. Dube has focused on labor economics-- including employer mandates, immigration and labor market institutions, health economics, political economy, and applied econometrics.
Ethan Kaplan is an Assistant Professor of Economics at Institute for International Economic Studies at Stockholm University and is a Visiting Research Fellow at the Committee on Global Thought at the Economics Department in Columbia University. His research focuses on political economy, applied econometrics and macrofinance.
”Drawing credible and causal inference about fiscal policy using traditional macro approaches has limitations that we aim to overcome by investigating how regions differentially respond to localized fiscal shocks,” said Arindrajit Dube, Assistant Professor of Economics at University of Massachusetts-Amherst. “INET’s funding has enabled us to continue in our research the spatial approach to macroeconomic inferences.”
INET’s Inaugural Grant Program has been designed to harness the new economic thinking we recognize as crucial to effecting change. The program was launched this summer and received more than 500 applications from around the world and has selected 33 initiatives to be awarded grants totaling $7 million. INET's Grant Program will continue with two similar grant cycles annually, the next one commencing in the spring of 2011.
For further details regarding INET’s Grant Program or additional projects and people to be awarded grants please visit the Institute’s website.
About the Institute for New Economic Thinking:
Launched in October 2009 with a $50 million commitment from George Soros and driven by the global financial crisis, the Institute for New Economic Thinking (INET) is dedicated to empowering and supporting the next generation of economists and scholars in related fields through research grants, Task Force groups, academic partnerships, and conferences. INET embraces the professional responsibility to think beyond current paradigms. Ultimately, INET is committed to broadening and accelerating the development of innovative thinking that can lead to insights into and solutions for the great challenges of the 21st century and return economics to its core mission of guiding and protecting society. For more information please visit http://www.ineteconomics.org/