- Emeritus Professor of Economics and International Affairs at Princeton University
- Con to the question "Should the United States Return to a Gold Standard?"
“Say this for the GOP: by resurrecting the very bad, no good, truly awful idea of a gold standard, they’ve given us something to talk about…
[A]nyone who believes that the gold standard era was marked by price stability, or for that matter any kind of stability, just hasn’t looked at the evidence. The fact is that prices have been far more stable under that dangerous inflationist Ben Bernanke than they ever were when gold ruled.
I’d like to offer a different take. There is a remarkably widespread view that at least gold has had stable purchasing power. But nothing could be further from the truth…
[There is] a pretty clear (and economically understandable) relationship between the real price of gold and the real interest rate: when real rates are low, real gold prices are high.
And when are real rates low? High inflation can do that, as it did in the late 1970s; but so can a severe economic slump due to a deleveraging shock, as in recent years.
What does that tell us about how a gold standard would work? Faced with the kind of shock we’ve just experienced, the real price of gold would ‘want’ to rise. But under a gold standard, the nominal price of gold would be fixed, so the only way that could happen would be through a fall in the general price level: deflation.
So if we’d had a gold standard operating in this crisis, there would have been powerful deflationary forces at work; not exactly what the doctor ordered.
The truth is that returning to gold is an almost comically (and cosmically) bad idea.”
“Golden Instability,” krugman.blogs.nytimes.com, Aug. 26, 2012
- Theoretical Expertise Ranking:
Individuals with PhDs or equivalent advanced degrees in fields relevant to the gold standard. Also top-level government officials (such as foreign leaders, US presidents, Founding Fathers, Supreme Court Justices, members of legislative bodies, cabinet members, military leaders, etc.) with positions relevant to the gold standard.
- Involvement and Affiliations:
- Emeritus Professor of Economics and International Affairs, Princeton University, 2015-present
- Distinguished Professor of Economics, Graduate Center, City University of New York (CUNY), 2015-present
- Core Faculty, Stone Center on Socio-Economic Inequality, CUNY, 2015-present
- Op-Ed Columnist, New York Times, 1999-present
- Senior Scholar, LIS Cross-National Data Center, Luxembourg
- Professor of Economics and International Affairs, Princeton University, 2000-2015
- Centenary Professor, London School of Economics (United Kingdom)
- Research Associate, National Bureau of Economic Research, 1979-2012
- Recipient, Nobel Memorial Prize in Economic Sciences, 2008
- Former Ford International Professor of Economics, Massachusetts Institute of Technology (MIT)
- Former Professor, Yale University and Stanford University
- Fellow, American Academy of Arts and Sciences (AAAS), 1992
- Staff Member, Council of Economic Advisers, Reagan White House, 1982-1983
- PhD, Economics, Massachusetts Institute of Technology (MIT), 1977
- BA, Economics, summa cum laude, Yale University, 1974
- Twitter handle: @paulkrugman
- Recipient, Doctor of Human Letters honoris causa, Haverford College, 2004
- Recipient, Fundacion Principe de Asturias (Spain), Prince of Asturias Awards in Social Sciences, 2004
- Recipient, Columnist of the Year, Editor and Publisher, 2002
- Recipient, H.C. Recktenwald Prize in Economics, University of Erlangen-Nuremberg (Germany), 2000
- Recipient, Doctor honoris causa in Economics, Free University of Berlin (Germany), 1998
- Recipient, Adam Smith Award, National Association for Business Economics, 1995
- Quoted in:
- Pro & Con Quotes: Should the United States Return to a Gold Standard?