Joseph Stiglitz: Difference between revisions - Wikipedia

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|name = Joseph Stiglitz

|image = Joseph E. Stiglitz, 2019 (cropped).jpg

|caption = Stiglitz in 2019

|office = [[Chief Economist of the World Bank]]

|president = [[James Wolfensohn]]

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| repec_id = pst33}}

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{{Infobox academic | child=yes

| thesis_title = Studies in the theory of growth and income distribution

| thesis_url = https://www.proquest.com/docview/302270117/

| thesis_year = 1967

}}

'''Joseph Eugene Stiglitz''' ({{IPAc-en|ˈ|s|t|ɪ|g|l|ɪ|t|s}}; born February 9, 1943) is an American [[New Keynesian economics|New Keynesian]] [[economist]],<ref>{{Cite book |last=Free |first=Rhona C. |url=https://books.google.com/books?id=nQBzAwAAQBAJ&pg=PA317 |title=21st Century Economics: A Reference Handbook |date=14 May 2010 |publisher=SAGE Publications |isbn=978-1-4522-6631-2 |pages=317 |language=en}}</ref> a [[public policy analyst]], political activist, and a ~~full~~ professor at [[Columbia University]]. He is a recipient of the [[Nobel Memorial Prize in Economic Sciences]] (2001)<ref name="NOBEL1">{{Cite web|date=2002|title=Joseph E. Stiglitz, Biographical. The Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel 2001|url=https://www.nobelprize.org/prizes/economic-sciences/2001/stiglitz/biographical/|access-date=2021-05-05|website=NobelPrize.org|language=en-US}}</ref> and the [[John Bates Clark Medal]] (1979).<ref>{{Cite web|date=2021|title=Joseph Stiglitz, Clark Medalist 1979|url=https://www.aeaweb.org/about-aea/honors-awards/bates-clark/joseph-stiglitz|access-date=2021-05-05|website=[[American Economic Association]]}}</ref> He is a former senior vice president and [[World Bank Chief Economist|chief economist]] of the [[World Bank]]. He is also a former member and chairman of the (US ~~president's)~~ [[Council of Economic Advisers]].<ref>{{cite web |url=http://econ.worldbank.org/WBSITE/EXTERNAL/EXTDEC/0,,contentMDK:20437078~menuPK:4319683~pagePK:64165401~piPK:64165026~theSitePK:469372,00.html |title=Former Chief Economists |website=worldbank.org |publisher=World Bank |access-date=2012-11-27 |archive-url=https://web.archive.org/web/20171104225502/http://econ.worldbank.org/WBSITE/EXTERNAL/EXTDEC/0,,contentMDK:20437078~menuPK:4319683~pagePK:64165401~piPK:64165026~theSitePK:469372,00.html |archive-date=2017-11-04 |url-status=dead }}</ref><ref>{{cite web|url=https://obamawhitehouse.archives.gov/administration/eop/cea/about/Former-Members |title=Former Members of the Council |url-status=live |archive-url=https://web.archive.org/web/20170121012254/https://obamawhitehouse.archives.gov/administration/eop/cea/about/Former-Members |via=[[NARA|National Archives]] |work=[[whitehouse.gov]] |archive-date=2017-01-21 }}</ref> He is known for his support for the [[Georgist]] public finance theory<ref>Gochenour, Zachary, and Bryan Caplan. "An entrepreneurial critique of Georgism." The Review of Austrian Economics 26.4 (2013): 483–491.</ref><ref>{{cite news|last1=Orszag|first1=Peter|title=To Fight Inequality, Tax Land|url=https://www.bloomberg.com/view/articles/2015-03-03/to-fight-inequality-tax-land|access-date=12 November 2016|publisher=Bloomberg View|date=March 3, 2015}}</ref><ref>{{cite news|last1=Lucas|first1=Edward|title=Land-value tax: Why Henry George had a point|url=https://www.economist.com/blogs/freeexchange/2015/04/land-value-tax|newspaper=The Economist|access-date=12 November 2016}}</ref> and for his critical view of the management of [[globalization]], of ''[[laissez-faire]]'' economists (whom he calls "[[Market fundamentalism|free-market fundamentalists]]"), and of international institutions such as the [[International Monetary Fund]] and the [[World Bank]].

In 2000, Stiglitz founded the [[Initiative for Policy Dialogue]] (IPD), a [[think tank]] on international development based at [[Columbia University]]. He has been a member of the Columbia faculty since 2001, and received the university's highest academic rank ([[University Professor (Columbia)|university professor]]) in 2003. He was the founding chair of the university's Committee on Global Thought. He also chairs the [[University of Manchester]]'s [[Brooks World Poverty Institute]]. He was a member of the [[Pontifical Academy of Social Sciences]]. In 2009, the [[President of the United Nations General Assembly]] [[Miguel d'Escoto Brockmann]], appointed Stiglitz as the chairman of the U.N. Commission on Reforms of the International Monetary and Financial System, where he oversaw suggested proposals and commissioned a report on reforming the international monetary and financial system.<ref>{{cite web |url=https://www.un.org/ga/president/63/commission/members.shtml |title=The Commission of Experts of the President of the UN General Assembly on Reforms of the International Monetary and Financial System |website=un.org | publisher = [[United Nations]] }}</ref> He served as the chair of the international [[Commission on the Measurement of Economic Performance and Social Progress]], appointed by the French President [[Nicolas Sarkozy|Sarkozy]], which issued its report in 2010, ''Mismeasuring our Lives: Why GDP doesn't add up,''<ref>{{Cite book|title = Mismeasuring Our Lives: Why GDP Doesn't Add Up|publisher = The New Press|date = 2010-05-18|isbn = 9781595585196|language = en|first1 = Joseph E.|last1 = Stiglitz|first2 = Amartya|last2 = Sen|first3 = Jean-Paul|last3 = Fitoussi}}</ref> and currently serves as co-chair of its successor, the High Level Expert Group on the Measurement of Economic Performance and Social Progress. From 2011 to 2014, Stiglitz was the president of the [[International Economic Association]] (IEA).<ref>{{cite web |url=http://www.iea-world.org/ |title=The International Economics Association |publisher=International Economics Association |date=October 14, 2013}}</ref> He presided over the organization of the IEA triennial world congress held near the [[Dead Sea]] in [[Jordan]] in June 2014.<ref>{{cite web |url=http://www.iea-world.org/JordanCongress_GeneralInfo.php |title=IEA World Congress 2014 |publisher=International Economics Association |date=October 14, 2013 |url-status=dead |archive-url=https://web.archive.org/web/20131017182743/http://www.iea-world.org/JordanCongress_GeneralInfo.php |archive-date=October 17, 2013 }}</ref>

In 2011, Stiglitz was named as one of the [[Time 100|100 most influential people in the world]]<ref>{{cite news |url=http://www.time.com/time/specials/packages/article/0,28804,2066367_2066369_2066440,00.html |archive-url=https://web.archive.org/web/20110425093948/http://www.time.com/time/specials/packages/article/0,28804,2066367_2066369_2066440,00.html |url-status=dead |archive-date=April 25, 2011 |title=The 2011 TIME 100 |publisher=time.com |date=April 21, 2011 |first=Gordon |last=Brown}}</ref> by ~~the~~ ''[[Time (magazine)|Time]]'' magazine. Stiglitz's work focuses on income distribution from a Georgist perspective, asset risk management, corporate governance, and international trade. He is the author of several books, the latest being ''People, Power, and Profits'' (2019), ''The Euro: How a Common Currency Threatens the Future of Europe'' (2016), ''The Great Divide: Unequal Societies and What We Can Do About Them'' (2015), ''Rewriting the Rules of the American Economy: An Agenda for Growth and Shared Prosperity'' (2015), and ''Creating a Learning Society: A New Approach to Growth Development and Social Progress'' (2014).<ref>{{cite news|last=Taylor |first=Ihsan |url=https://www.nytimes.com/best-sellers-books/2012-08-26/hardcover-nonfiction/list.html |title=Best Sellers – The New York Times |work=[[The New York Times]] |access-date=October 29, 2013}}</ref> He is also one of the 25 leading figures on the Information and Democracy Commission launched by [[Reporters Without Borders]].<ref>{{Cite web|date=2018-09-09|title=Joseph E. Stiglitz|url=https://rsf.org/en/joseph-e-stiglitz|access-date=2021-05-05|website=Information and Democracy Commission, Reporters Without Borders|language=en}}</ref> According to the [[Open Syllabus Project]], Stiglitz is the fifth most frequently cited author on college syllabi for economics courses.<ref>{{Cite web | url=https://opensyllabus.org/results-list/authors?size=50&fields=Economics | title=Open Syllabus Project | access-date=2021-02-12 | archive-date=2020-02-10 | archive-url=https://web.archive.org/web/20200210115528/https://opensyllabus.org/results-list/authors?size=50&fields=Economics | url-status=dead }}</ref>

==Life and career==

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From 1966 to 1970 he was a research fellow at the [[University of Cambridge]].<ref name=":6" /> Stiglitz initially arrived at [[Fitzwilliam College, Cambridge]] as a [[Fulbright Scholar]] in 1965, and he later won a Tapp Junior Research Fellowship at [[Gonville and Caius College, Cambridge]] which was instrumental in shaping his understanding of [[Keynes]] and [[Macroeconomics|macroeconomic theory]].<ref name="Optima1">{{cite web|url=http://www.fitz.cam.ac.uk/mi-client/media/import/documents/Optima8.pdf |title=A shilling in the meter and a penny for your thoughts ... An Interview with Professor Joseph E Stiglitz |year=2005 |publisher=Optima |access-date=April 27, 2011 |url-status=dead |archive-url=https://web.archive.org/web/20111014034802/http://www.fitz.cam.ac.uk/mi-client/media/import/documents/Optima8.pdf |archive-date=October 14, 2011 }}</ref> In subsequent years, he held academic positions at [[Yale]], [[Stanford University|Stanford]], [[Oxford University|Oxford]]—where he was [[Drummond Professor of Political Economy]]—and [[Princeton University|Princeton]].<ref>{{cite book|last=Stiglitz |first=Joseph |title=CV |url=http://www2.gsb.columbia.edu/faculty/jstiglitz/download/Stiglitz_CV.pdf |publisher=[[Columbia University]] |url-status=dead |archive-url=https://web.archive.org/web/20110513134138/http://www2.gsb.columbia.edu/faculty/jstiglitz/download/Stiglitz_CV.pdf |archive-date=2011-05-13 }}</ref> Since 2001, Stiglitz has been a professor at [[Columbia University]], with appointments at the [[Columbia Business School|Business School]], the Department of Economics and the [[School of International and Public Affairs]] (SIPA), and is an editor of ''[[The Economists' Voice]]'' journal with [[J. Bradford DeLong]] and [[Aaron Edlin]].<ref>{{Cite news|last=Uchitelle|first=Louis|date=2001-07-21|title=Columbia University Hires Star Economist|language=en-US|work=The New York Times|url=https://www.nytimes.com/2001/07/21/business/columbia-university-hires-star-economist.html|access-date=2020-05-31|issn=0362-4331}}</ref>

He ~~also takes~~teaches classes for a double-degree program between [[Sciences Po Paris]] and [[École Polytechnique]] in 'Economics and Public Policy'.<ref>{{cite news |last1=Kattan |first1=Emmanuel |title=The Year of Joseph Stiglitz, From New York to Paris |url=https://news.columbia.edu/news/joseph-stiglitz-paris-economics-nobel |access-date=27 June 2024 |work=Columbia News |date=3 December 2019}}</ref> He has chaired the [[Brooks World Poverty Institute]] at the [[University of Manchester]] since 2005.<ref>{{cite web | title = Staff: Professor Joseph E Stiglitz | archive-url = https://web.archive.org/web/20070112171724/http://www.bwpi.manchester.ac.uk/aboutus/staff/index.html | archive-date = 12 January 2007 | url = http://www.bwpi.manchester.ac.uk/aboutus/staff/index.html | website = manchester.ac.uk | publisher = [[University of Manchester]] }}</ref><ref>{{cite web | title = Master Economics and Public Policy | url = http://www.sciences-po.fr/formation/master_scpo/mentions/economics/index.htm | archive-url = http://arquivo.pt/wayback/20091015173458/http://www.sciences-po.fr/formation/master_scpo/mentions/economics/index.htm | url-status = dead | archive-date = 2009-10-15 | website = sciences-po.fr | publisher = Edudier à Sciences Po }}</ref> Stiglitz is widely considered a [[New Keynesian economics|New-Keynesian]] economist,<ref>Bruce C. Greenwald & Joseph E. Stiglitz: ''Keynesian, New Keynesian and New Classical Economics.'' Oxford Economics Papers, 39, March 1987, pp. 119–33. ([http://www2.gsb.columbia.edu/faculty/jstiglitz/download/papers/1987_Keynesian_New_Keynesian_and_New_Classical_Economics.pdf PDF; 1,62 MB]) {{webarchive|url=https://web.archive.org/web/20110513135341/http://www2.gsb.columbia.edu/faculty/jstiglitz/download/papers/1987_Keynesian_New_Keynesian_and_New_Classical_Economics.pdf |date=2011-05-13 }}</ref><ref>Bruce C. Greenwald & Joseph E. Stiglitz: ''Examining Alternative Macroeconomic Theories.'' Brookings Papers on Economic Activity, No. 1, 1988, pp. 201–70. ([http://www2.gsb.columbia.edu/faculty/jstiglitz/download/papers/1988_Examining_Alternative_Macroeconomic_Theories.pdf PDF; 5.50 MB]) {{webarchive|url=https://web.archive.org/web/20110513134227/http://www2.gsb.columbia.edu/faculty/jstiglitz/download/papers/1988_Examining_Alternative_Macroeconomic_Theories.pdf |date=2011-05-13 }}</ref> although at least one economics journalist says his work cannot be so clearly ~~categorised~~categorized.<ref name='NoahSmith'>{{cite news |last=Smith |first=Noah |date=13 January 2017 |title=Tribal warfare in economics a thing of the past |newspaper=The Australian Financial Review |publisher=Fairfax Media |agency=[[Bloomberg L.P.|Bloomberg]] |quote=Look on the Wikipedia pages of economists Joseph Stiglitz and Greg Mankiw or any of a number of prominent economists. On the sidebar on the right, you'll see an entry for "school or tradition". Both Stiglitz and Mankiw are listed as "New Keynesian". That makes absolutely no sense whatsoever. Stiglitz and Mankiw's research is in totally different areas. Stiglitz did work on asymmetric information, efficiency wages, land taxes and a host of other microeconomic phenomena ... Nor are their policy positions even remotely similar – Stiglitz is a hero to the left, while Mankiw is a small-government conservative. In fact, Mankiw did important research on some models called "New Keynesian". Stiglitz did not.}}</ref>

Stiglitz has played a number of policy roles throughout his career. He served in the [[Bill Clinton|Clinton administration]] as the chair of the President's [[Council of Economic Advisers]] (1995–1997).<ref name=":6" /> At the [[World Bank]], he served as a senior vice-president and the chief economist from 1997 to 2000.<ref>{{Cite news|title=Joe Stiglitz and the IMF have warmed to each other|newspaper=The Economist|url=https://www.economist.com/finance-and-economics/2020/04/08/joe-stiglitz-and-the-imf-have-warmed-to-each-other|access-date=2020-05-31|issn=0013-0613}}</ref> He was fired by the World Bank for expressing dissent with its policies.<ref>{{cite web|author=Greg Palast |url=http://www.gregpalast.com/the-globalizer-who-came-in-from-the-cold/ |title=multi-day interview with Greg Palast |publisher=Gregpalast.com |date=October 10, 2001 |access-date=October 29, 2013}}</ref> Stiglitz has advised American president [[Barack Obama]], but has criticized the [[Obama Administration]]'s financial-industry rescue plan.<ref>{{Cite news|last=Kakutani|first=Michiko|date=2010-01-18|title=Skepticism for Obama's Fiscal Policy (Published 2010)|language=en-US|work=The New York Times|url=https://www.nytimes.com/2010/01/19/books/19book.html|access-date=2021-02-17|issn=0362-4331}}</ref> He said whoever designed the Obama administration's bank rescue plan is "either in the pocket of the banks or they're incompetent."<ref>{{Cite news |date=April 17, 2009 |title=Stiglitz Says Ties to Wall Street Doom Bank Rescue |url=https://www.bloomberg.com/apps/news?pid=20601087&sid=afYsmJyngAXQ&refer=home~~|work=Bloomberg~~ ~~News~~|~~date~~url-status=~~April~~dead ~~17, 2009~~|access-date=April 18, 2009 |work=Bloomberg News}}</ref>

In October 2008, he was asked by the President of the United Nations General Assembly to chair a commission drafting a report on the reasons for and solutions to the [[2007–2008 financial crisis]].<ref>{{cite web|title= Commission of Experts of the President of the UN General Assembly on Reforms of the International Monetary and Financial System |url= https://www.un.org/ga/president/63/commission/background.shtml | website = un.org | publisher = United Nations }}</ref> In response, the commission produced the [[Stiglitz Report]].

On July 25, 2011, Stiglitz participated in the "I ~~Foro~~Forro Social del 15M" organized in [[Madrid]], expressing his support to the [[2011 Spanish protests|15M Movement]] protestors.<ref name="15M SPEECH" />

Stiglitz was the president of the International Economic Association from 2011 to 2014.<ref>{{cite web |url=http://www.iea-world.com/general_info.php |title=International Economic Association (IEA) |publisher=Iea-world.com |access-date=October 29, 2013 |url-status=dead |archive-url=https://web.archive.org/web/20130518131322/http://www.iea-world.com/general_info.php |archive-date=May 18, 2013 }}</ref>

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Stiglitz's most famous research was on [[Screening (economics)|screening]], a technique used by one economic agent to extract otherwise private information from another. It was for this contribution to the theory of [[information asymmetry]] that he shared the Nobel Memorial Prize in Economics<ref name=NOBEL1 /> with [[George A. Akerlof]] and [[A. Michael Spence]] in 2001 "for laying the foundations for [[information asymmetry|the theory of markets with asymmetric information]]".

Much of Stiglitz's work on [[information economics]] demonstrates situations in which incomplete information prevents markets from achieving social efficiency. His paper with [[Andrew Weiss (economist)|Andrew Weiss]] showed that if banks use interest rates to infer information about borrowers' types (adverse selection effect), or to encourage their actions following borrowing (incentive effect), then credit will be rationed below the optimal level, even in a competitive market.<ref>{{~~Cite~~cite report ~~journal~~|~~last1~~ last=Stiglitz |~~first1~~ first=Joseph | last2=Weiss | first2=Andrew~~|date=February~~ ~~1987~~| title=Macro-Economic Equilibrium and Credit Rationing (Working Paper No. 2164) |~~location~~ publisher = National Bureau of Economic Research | publication-place=Cambridge, MA | date=February 1987 | doi=10.3386/w2164~~|doi-access=free~~ }}</ref> Stiglitz and [[Michael Rothschild|Rothschild]] showed that in an insurance market, firms have an incentive to undermine a 'pooling equilibrium', where all agents are offered the same full-insurance policy, by offering cheaper partial insurance that would only be attractive to the low-risk types, meaning that a competitive market can only achieve partial coverage of agents.<ref>{{Citation|last1=Rothschild|first1=Michael|title=Equilibrium in Competitive Insurance Markets: An Essay on the Economics of Imperfect Information|date=1976|work=Foundations of Insurance Economics|pages=355–375|publisher=Springer Netherlands|isbn=9789048157891|last2=Stiglitz|first2=Joseph|series=Huebner International Series on Risk, Insurance and Economic Security |volume=14 |doi=10.1007/978-94-015-7957-5_18}}</ref> Stiglitz and [[Sanford J. Grossman|Grossman]] showed that trivially small information acquisition costs prevent financial markets from achieving complete informational efficiency, since agents will have an incentive to free-ride on others' information acquisition, and acquire this information indirectly by observing market prices.<ref>{{cite web|url=http://terpconnect.umd.edu/~wermers/ftpsite/FAME/grossman_stiglitz_(1980).pdf|title=On the impossibility of informationally efficient markets}}</ref>

=== Monopolistic competition ===

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Some key implications of this model are:<ref>{{cite web|url=http://coin.wne.uw.edu.pl/lwincenciak/docs/lecture_4.pdf|title=Lecture 4|date=May 22, 2007|website=coin.wne.uw.edu.pl|access-date=March 16, 2008|archive-url=https://web.archive.org/web/20110715112948/http://coin.wne.uw.edu.pl/lwincenciak/docs/lecture_4.pdf|archive-date=July 15, 2011|url-status=dead}}</ref><ref name=SHAPIROSTGLTZMATH>{{cite web |url=http://coin.wne.uw.edu.pl/lwincenciak/docs/lecture_4.pdf |title=Efficiency wages, the Shapiro-Stiglitz Model |access-date=October 29, 2013 |archive-url=https://web.archive.org/web/20110715112948/http://coin.wne.uw.edu.pl/lwincenciak/docs/lecture_4.pdf |archive-date=July 15, 2011 |url-status=dead }}</ref>

# Wages do not fall enough during recessions to prevent unemployment from rising. If the demand for ~~labour~~labor falls, this lowers wages. But because wages have fallen, the probability of 'shirking' (workers not exerting effort) has risen. If employment levels are to be maintained, through a sufficient lowering of wages, workers will be less productive than before through the shirking effect. As a consequence, in the model, wages do not fall enough to maintain employment levels at the previous state, because firms want to avoid excessive shirking by their workers. So, unemployment must rise during recessions, because wages are kept 'too high'.

# Possible corollary: Wage sluggishness. Moving from one private cost of hiring (w∗) to another private cost of hiring (w∗∗) will require each firm to repeatedly re-optimize wages in response to shifting [[Unemployment|unemployment rate]]. Firms cannot cut wages until unemployment rises sufficiently (a coordination problem).

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{{blockquote|They'll say the IMF is arrogant. They'll say the IMF doesn't really listen to the developing countries it is supposed to help. They'll say the IMF is secretive and insulated from democratic accountability. They'll say the IMF's economic 'remedies' often make things worse{{snd}} turning slowdowns into recessions and recessions into depressions. And they'll have a point. I was chief economist at the World Bank from 1996 until last November, during the gravest global economic crisis in a half-century. I saw how the IMF, in tandem with the U.S. Treasury Department, responded. And I was appalled.}}

Stiglitz's protector-of-sorts at the World Bank, Wolfensohn, had privately ~~empathised~~empathized with Stiglitz's views, but was worried for his second term, which Summers had threatened to veto.{{Citation needed|date=October 2008}} Stanley Fischer, deputy managing director of the IMF, called a special staff meeting and informed the gathering that Wolfensohn had agreed to fire Stiglitz. Meanwhile, the bank's [[Foreign policy|External Affairs]] department told the press that Stiglitz had not been fired; his post had merely been abolished.<ref name=WADE>{{cite book | last = Wade | first = Robert | title = US hegemony and the World Bank: Stiglitz's firing and Kanbur's resignation | archive-url = https://web.archive.org/web/20080529110008/http://sociology.berkeley.edu/faculty/evans/evans_pdf/Wade.pdf | archive-date = 29 May 2008 | url = http://sociology.berkeley.edu/faculty/evans/evans_pdf/Wade.pdf | publisher = [[University of California, Berkeley|UC Berkeley]] }}</ref>

In a September 19, 2008 radio interview, with [[Aimee Allison]] and Philip Maldari on [[Pacifica Foundation|Pacifica Radio]]'s [[KPFA]] 94.1 FM in [[Berkeley, California|Berkeley]], United States, Stiglitz implied that President Clinton and his economic advisors would not have backed the [[North American Free Trade Agreement]] (NAFTA) had they been aware of stealth provisions, inserted by lobbyists, that they overlooked.

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The next day, during a BBC interview, Stiglitz stated that "there's no problem of Greece or Spain meeting their interest payments". He argued nonetheless, that it would be desirable and needed for all of Europe to make a clear statement of belief in social solidarity and that they "stand behind Greece". Confronted with the statement: "Greece's difficulty is that the magnitude of debt is far greater than the capacity of the economy to service", Stiglitz replied, "That's rather absurd".{{Citation needed|date=June 2015}}

In 2012, Stiglitz described the European austerity plans as a "suicide-pact".<ref name=Moore1>{{cite news|last=Moore|first=Malcolm|title=Stiglitz says European austerity plans are a 'suicide pact'|url=https://www.telegraph.co.uk/finance/financialcrisis/9019819/Stiglitz-says-European-austerity-plans-are-a-suicide-pact.html |archive-url=https://ghostarchive.org/archive/20220112/https://www.telegraph.co.uk/finance/financialcrisis/9019819/Stiglitz-says-European-austerity-plans-are-a-suicide-pact.html |archive-date=2022-01-12 |url-access=subscription |url-status=live|access-date=April 26, 2012|newspaper=Telegraph|date=Jan 17, 2012|location=London}}{{cbignore}}</ref> In 2015, he said that the ~~programme~~programmer of austerity in Greece had been "an enormous mistake", that the International Monetary Fund, [[European Central Bank]] and the [[European Commission]] had "criminal responsibility for causing a major recession".<ref name="Time_2015">{{cite magazine |last1=Shuster |first1=Simon |title=Joseph Stiglitz to Greece's Creditors: Abandon Austerity Or Face Global Fallout |url=https://time.com/3939621/stiglitz-greece |access-date=24 April 2023 |magazine=Time |date=29 June 2015}}</ref> He argued that Greek debt should be written off.<ref name="Time_2015"/>

===Scotland===

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===Support for anti-austerity movement in Spain===

On July 25, 2011, Stiglitz participated in the "I ~~Foro~~Forro Social del 15M" organized in [[Madrid]] (Spain) expressing his support for the [[anti-austerity movement in Spain]].<ref name="15M SPEECH">{{cite web|url=https://www.youtube.com/watch?v=z2iKj-1v2Cc| archive-url=https://web.archive.org/web/20111123222535/http://www.youtube.com/watch?v=z2iKj-1v2Cc| archive-date=2011-11-23 | url-status=dead|title=Joseph Stiglitz apoya el movimiento 15-M|website = [[YouTube]]|access-date=July 26, 2011}}</ref> During an informal speech, he made a brief review of some of the problems in Europe and in the United States, the serious unemployment rate and the situation in Greece. "This is an opportunity for economic contribution social measures", argued Stiglitz, who made a speech about the way authorities are handling the political exit to the crisis. He encouraged those present to respond to the ideas with good ideas. "This does not work, you have to change it", he said.

===Criticism of rating agencies===

Stiglitz has been critical of [[Big Three (credit rating agencies)|rating agencies]], describing them as the "key culprit" in the [[2007–2008 financial crisis]], noting "they were the party that performed the alchemy that converted the securities from F-rated to A-rated. The banks could not have done what they did without the complicity of the rating agencies."<ref name=Neate1>{{cite news|last=Neate|first=Rupert|title=Ratings agencies suffer 'conflict of interest', says former Moody's boss|url=https://www.theguardian.com/business/2011/aug/22/ratings-agencies-conflict-of-interest|access-date=April 21, 2012|newspaper=The Guardian|date=August 22, 2011|location=London}}</ref>

Stiglitz co-authored a paper with [[Peter Orszag]] in 2002 titled "Implications of the New Fannie Mae and Freddie Mac Risk-Based Capital Standard" where they stated "on the basis of historical experience, the risk to the government from a potential default on GSE debt is effectively zero." However, "the risk-based capital standard ... may fail to reflect the probability of another Great Depression-like scenario."<ref name=fanniemae>{{cite web|url=http://www.pierrelemieux.org/stiglitzrisk.pdf|title=Implications of the New Fannie Mae and Freddie Mac Risk-Based Capital Standard|publisher=[[Fannie Mae]]|access-date=February 10, 2010|url-status=dead|archive-url=https://web.archive.org/web/20091122094851/http://www.pierrelemieux.org/stiglitzrisk.pdf|archive-date=November 22, 2009}}</ref>

===Views on risks associated with government-sponsored enterprises===

In a 2002 paper coauthored with [[Jonathan Orszag]], and [[Peter R. Orszag]], Stiglitz asserted "the probability of default by the GSEs [Government-Sponsored Enterprises] is extremely small".<ref name=GSErisk>{{cite web|url=http://www.pierrelemieux.org/stiglitzrisk.pdf|title=Implications of the New Fannie Mae and Freddie Mac Risk-Based Capital Standard|publisher=[[Fannie Mae]]|access-date=February 10, 2010|url-status=dead|archive-url=https://web.archive.org/web/20091122094851/http://www.pierrelemieux.org/stiglitzrisk.pdf|archive-date=November 22, 2009}}</ref>

===Criticism of Trans-Pacific Partnership and Transatlantic Trade and Investment Partnership===

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Citing Keynesian theory, he explains that trade surpluses are harmful: "[[John Maynard Keynes]] pointed out that surpluses lead to weak global aggregate demand – countries running surpluses exert a "negative externality" on trading partners. Indeed, Keynes believed it was surplus countries, far more than those in deficit, that posed a threat to global prosperity; he went so far as to advocate a tax on surplus countries".<ref name=":0">{{cite web|url=https://www.theguardian.com/commentisfree/2010/may/05/reform-euro-or-bin-it-greece-germany|title=Reform the euro or bin it - Joseph Stiglitz|first=Joseph|last=Stiglitz|date=5 May 2010|website=The Guardian}}</ref> From the beginning of 1930, Keynes stopped believing in free trade, denounced the theory of [[comparative advantage]] (the basis of free trade) and adhered to protectionism.<ref name="J.M. Keynes, free trade and protectionism">{{Cite journal|url = https://www.erudit.org/fr/revues/ae/2010-v86-n1-ae3990/045556ar/|doi = 10.7202/045556ar|title = J.M. Keynes, le libre-échange et le protectionnisme|year = 2011|last1 = Maurin|first1 = Max|journal = L'Actualité Économique|volume = 86|pages = 109–129|doi-access = free|access-date = 14 May 2021|archive-date = 6 May 2021|archive-url = https://web.archive.org/web/20210506024936/https://www.erudit.org/fr/revues/ae/2010-v86-n1-ae3990/045556ar/|url-status = live}}</ref><ref name="National Self-Sufficiency">{{cite journal|url=http://www.mtholyoke.edu/acad/intrel/interwar/keynes.htm|author=John Maynard Keynes|title=National Self-Sufficiency|journal=The Yale Review |volume= 22 |number= 4 |date=June 1933 |pages=755–769|access-date=14 May 2021|archive-date=15 May 2011|archive-url=https://web.archive.org/web/20110515044928/http://www.mtholyoke.edu/acad/intrel/interwar/keynes.htm|url-status=live}}</ref>

Stiglitz writes: "Germany's surplus means that the rest of Europe is in deficit. And the fact that these countries import more than they export contributes to the weakness of their economies". He thinks that surplus countries are getting richer at the expense of deficit countries. He notes that the euro is the cause of this deficit and that as the trade deficit declines GDP would rise and unemployment would fall: "The euro system means that Germany's exchange rate cannot increase compared to other euro area members. If the exchange rate were to rise, Germany would have more difficulty exporting and its economic model, based on strong exports, would cease. At the same time, the rest of Europe would export more, GDP would rise, and unemployment would fall".<ref name=":0" />

He also thinks that the rest of the world should impose a carbon-adjustment tax (a protectionist measure) on American exports that do not comply with global standard.<ref>{{cite web|url=https://www.theguardian.com/business/2017/jun/02/paris-climate-deal-to-trumps-rogue-america|title=How to respond to Trump's America - Joseph Stiglitz|first=Joseph|last=Stiglitz|date=2 June 2017|website=The Guardian}}</ref>

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Stiglitz does not want the United States to stop free trade. According to him, if China limits globalization, it will not hurt them, but if the United States stops with the process of free trade, it will be harmful. About China, according to him, if China depends less on [[economic globalization]], it will not be negative for the country.<ref name=":1" /> He writes that the decline in exports from China to the U.S. may not "hurt them more than it hurt us" because "China's government has far more control over the country's economy than our government has over ours; and it is moving from export dependence to a model of growth driven by domestic demand." Regarding the United States, he writes the opposite and advice to apply the opposite of the Keynesian theory of trade deficits seen earlier:<ref name=":0" /> "Walking away from globalization may reduce our imports, but it will also reduce exports in tandem. And, almost surely, jobs will be destroyed faster than they will be created: there may even be fewer net manufacturing jobs". "[The] erection of barriers to trade and the movement of people and ideas more likely than not will be one in which the U.S. almost surely will lose."<ref name=":1" />

In early 2017, he wrote that "the American middle class is indeed the loser of [[globalization]]" (the diminution of international trade regulations as well as tariffs, taxes) and "China, with its large emerging middle class, is among the big beneficiaries of globalization". "Thanks to ~~globalisation~~globalization, in terms of purchasing-power parity, China actually has already become the largest economy in the world in September 2015".<ref name=":1" /> However, contrary to what he wrote earlier, he later argued in February 2017 that the fall in wages and the disappearance of well-paid jobs in the United States, are not due to free trade or ~~globalisation~~globalization, but rather are inevitable collateral damage to the march of economic progress and technological innovation: "The United States can only push for advanced manufacturing, which requires higher skill sets and employs fewer people. Rising inequality, meanwhile, will continue ...".<ref name=":2"/> In addition, on December 5, 2017, contrary to what he wrote earlier, he wrote that the drop in wages in the United States is due to the actions of multinational companies rather than the ~~globalisation~~globalization and the trade account imbalances between countries caused by free trade: "It was an agenda written by and for large multinational companies, at the expense of workers".<ref name=":4" />

In 2016, he said he believes that the economic situation of the United States is critical: "As the economists Anne Case and [[Angus Deaton]] showed in their study published in December 2015, life expectancy among middle-age white Americans is declining, as rates of suicides, drug use, and alcoholism increase. A year later, the National Center for Health Statistics reported that life expectancy for the country as a whole has declined for the first time in more than 20 years."<ref name=":2"/> ... With the incomes of the bottom 90% having stagnated for close to a third of a century (and declining for a significant proportion), the health data simply confirmed that things were not going well for swaths of the country".<ref name=":3" />

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''[[Whither Socialism?]]'' is based on Stiglitz's Wicksell Lectures, presented at the [[Stockholm School of Economics]] in 1990 and presents a summary of [[information economics]] and the theory of markets with imperfect information and imperfect competition, as well as being a critique of both free market and market socialist approaches (see Roemer critique, op. cit.). Stiglitz explains how the [[neoclassical economics|neoclassical]], or [[Walrasian model]] ("Walrasian economics" refers to the result of the process which has given birth to a formal representation of [[Adam Smith]]'s notion of the "invisible hand", along the lines put forward by [[Léon Walras]] and encapsulated in the general equilibrium model of [[Arrow–Debreu model|Arrow–Debreu]]), may have wrongly encouraged the belief that [[market socialism]] could work. Stiglitz proposes an alternative model, based on the [[information economics]] established by the Greenwald–Stiglitz theorems.

One of the reasons Stiglitz sees for the critical failing in the standard [[neoclassical economics|neoclassical model]], on which [[market socialism]] was built, is its failure to consider the problems that arise from lack of [[perfect information]] and from the costs of acquiring information. He also identifies problems arising from its assumptions concerning completeness.<ref name=ZAPIA>{{cite web|url=http://www.econ-pol.unisi.it/pubdocenti/HEI99.pdf |author=Zapia, Carlo |title=The economics of information, market socialism and Hayek's legacy |publisher=Dipartimento di Economia Politica, Università di Siena |access-date=October 29, 2013 |url-status=dead |archive-url=https://web.archive.org/web/20070614110711/http://www.econ-pol.unisi.it/pubdocenti/HEI99.pdf |archive-date=June 14, 2007 }}</ref>

===''Globalization and Its Discontents'' (2002)===

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===''Fair Trade for All'' (2005)===

In ''Fair Trade for All'', authors Stiglitz and [[Andrew Charlton (politician)|Andrew Charlton]] argue that it is important to make the trading world more development friendly.<ref>{{cite journal | last = Blandford | first = David | title = Review of ''Fair Trade for All'', by J.E. Stiglitz and Andrew Charlton | journal = American Journal of Agricultural Economics | volume = 90 | issue = 2| year = 2008 | pages=571–572| doi=10.1111/j.1467-8276.2008.01160_1.x}}</ref> The idea is put forth that the present regime of tariffs and agricultural subsidies is dominated by the interests of former colonial powers and needs to change. The removal of the bias toward the developed world will be beneficial to both developing and developed nations. The developing world is in need of assistance, and this can only be achieved when developed nations abandon mercantilist -based priorities and work towards a more liberal world trade regime.<ref>{{cite journal | last = Northcott | first = Michael S. | title = Review of ''Fair Trade For All'' by J.E. Stiglitz and Andrew Charlton | journal = Studies in World Christianity | volume = 12 | issue = 3| year = 2006 | pages = 282–284 | doi = 10.1353/swc.2006.0025| s2cid = 144250262 }}</ref>

===''Making Globalization Work'' (2006)===

''[[Making Globalization Work]]'' surveys the inequities of the global economy, and the mechanisms by which developed countries exert an excessive influence over developing nations. Dr. Stiglitz argues that through tariffs, subsidies, an over-complex patent system and pollution, the world is being both economically and politically ~~destabilised~~destabilized. Stiglitz argues that strong, transparent institutions are needed to address these problems. He shows how an examination of incomplete markets can make corrective government policies desirable.

Stiglitz is an exception to the general pro-~~globalisation~~globalization view of professional economists, according to economist [[Martin Wolf]].<ref name=preface>"Why Globalization Works" (Yale University Press 2004) {{ISBN|978-0-300-10252-9}}, p. 8. Also Wolf criticizes World Bank heavily (pp. xiii–xv).</ref> Stiglitz argues that economic opportunities are not widely enough available, that financial crises are too costly and too frequent, and that the rich countries have done too little to address these problems. ''Making Globalization Work''<ref>see {{YouTube|UzhD7KVs-R4|Stiglitz discuss his book}}</ref> has sold more than two million copies.

===''Stability with Growth'' (2006)===

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{{Main|Freefall: America, Free Markets, and the Sinking of the World Economy}}

In ''Freefall: America, Free Markets, and the Sinking of the World Economy'', Stiglitz discusses the causes of the 2008 recession/depression and goes on to propose reforms needed to avoid a repetition of a similar crisis, advocating government intervention and regulation in a number of areas. Among the ~~policy-makers~~policymakers he ~~criticises~~criticizes are George W. Bush, Larry Summers, and Barack Obama.<ref>{{cite news |first=Joel|last=Krupa |title=Guiding the Invisible Hand |url=http://www.oxonianreview.org/wp/guiding-the-invisible-hand/ |archive-url=https://web.archive.org/web/20110516145756/http://www.oxonianreview.org/wp/guiding-the-invisible-hand/ |url-status=usurped |archive-date=May 16, 2011 |date=June 7, 2010 |access-date=December 28, 2010}}</ref>

===''The Price of Inequality'' (2012)===

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===''People, Power and Profits: Progressive Capitalism for an Age of Discontent'' (2019)===

From the jacket: Stiglitz shows how a middle-class life can once again be attainable by all. An ~~authoritive~~authorities account of the predictable dangers of free market fundamentalism and the ~~foundatioins~~foundations of progressive capitalism, ''People, Power, and Profits'' shows us an America in crisis, but also lights a path through this challenging time.

~~{{Empty section|date=September 2023}}~~[[File:Joseph Stiglitz and Kamal Nath (3181943232).jpg|thumb|Joseph Stiglitz and Kamal Nath]]

===''Measuring What Counts: The Global Movement for Well-Being'' (2019)===

Stiglitz and his co-authors point out that the interrelated crises of environmental degradation and human suffering of our current age demonstrate that "something is fundamentally wrong with the way we assess economic performance and social progress." They argue that using GDP as the chief measure of our economic health does not provide an accurate assessment of the economy or the state of the world and the people living in it.<ref>{{cite web |last1=Queally |first1=Jon |title='Everything Is Not Fine': Nobel Economist Calls on Humanity to End Obsession With GDP |url=https://www.commondreams.org/news/2019/11/25/everything-not-fine-nobel-economist-calls-humanity-end-obsession-gdp |website=Common Dreams |access-date=10 December 2019 |date=25 November 2019}}</ref><ref>{{cite news |last1=Stiglitz |first1=Joseph |title=It's time to retire metrics like GDP. They don't measure everything that matters |url=https://www.theguardian.com/commentisfree/2019/nov/24/metrics-gdp-economic-performance-social-progress |access-date=10 December 2019 |work=The Guardian |date=24 November 2019 |format=Opinion}}</ref>

=== The Road to Freedom (2024) ===

In The Road to Freedom Stiglitz challenges the claim that neoliberalism is morally superior to its alternatives. The book's subtitle is Economics and the Good Society.

==Papers and conferences==

Stiglitz wrote a series of papers and held a series of conferences explaining how such information uncertainties may have influence on everything from unemployment to lending shortages. As the chairman of the Council of Economic Advisers during the first term of the Clinton Administration and former chief economist at the [[World Bank]], Stiglitz was able to put some of his views into action. For example, he was an outspoken critic of quickly opening up financial markets in developing countries. These markets rely on access to good financial data and sound bankruptcy laws, but he argued that many of these countries did not have the regulatory institutions needed to ensure that the markets would operate soundly.

In July 2020, Stiglitz alongside Hamid Rashid, the chief of Global Economic Monitoring at the UN Department of Economic and Social Affairs, published a report, pointing out that the [[quantitative easing]] policy implemented by the US after the [[~~2008 Financial Crisis|2008~~2007–2008 financial crisis]], had "basically exported a debt bubble to developing countries".<ref>{{Cite web |title=New CEPR Policy Insight - Averting Catastrophic Debt Crises in Developing Countries {{!}} Centre for Economic Policy Research |url=https://cepr.org/content/new-cepr-policy-insight-averting-catastrophic-debt-crises-developing-countries |access-date=2022-08-01 |website=cepr.org |archive-date=2022-05-27 |archive-url=https://web.archive.org/web/20220527044516/https://cepr.org/content/new-cepr-policy-insight-averting-catastrophic-debt-crises-developing-countries |url-status=dead }}</ref><ref>{{Cite web |title=Hamid Rashid {{!}} VOX, CEPR Policy Portal |url=https://voxeu.org/users/hamidrashid |access-date=2022-08-01 |website=voxeu.org}}</ref>

==Awards and honors==

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* {{cite book | last1 = Stiglitz | first1 = Joseph E. | title = People, Power and Profits: Progressive Capitalism for an Age of Discontent | publisher = Allen Lane | year = 2019 | isbn = 9780241399231 }}

* {{cite book |last1=Stiglitz |first1=Joseph |last2=Fitoussi |first2=Jean-Paul |last3=Durand |first3=Martine |title=Measuring What Counts; The Global Movement for Well-Being |date=19 November 2019 |publisher=The New Press |location=New York |isbn=978-1-62097-569-5 |edition=Paper |url=https://thenewpress.com/books/measuring-what-counts |access-date=10 December 2019}}

* {{cite book |last1=Stiglitz |first1=Joseph E. |title=The Road to Freedom: Economics and the Good Society |publisher=W. W. Norton & Company |year=2024 |isbn=9781324074373}}

===Book chapters===

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[[Category:Fellows of the British Academy]]

[[Category:Fellows of the Econometric Society]]

[[Category:Foreign ~~Members~~members of the Royal Society]]

[[Category:Foreign ~~Members~~members of the Russian Academy of Sciences]]

[[Category:Georgist economists]]

[[Category:Gerald Loeb Award winners for Columns, Commentary, and Editorials]]

[[Category:Information economists]]

[[Category:Intergovernmental Panel on Climate Change lead authors]]

[[Category:Jewish American non-fiction writers]]

[[Category:Jewish American economists]]

[[Category:Academic staff of Keio University]]

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[[Category:Chairs of the United States Council of Economic Advisers]]

[[Category:Members of the American Philosophical Society]]

[[Category:~~Fulbright~~Jews ~~alumni~~from Indiana]]