Edward C. Prescott quotes

Edward C. Prescott was an American economist renowned for his work on macroeconomics and business cycles. His research, especially the development of real business cycle theory, had a profound impact on economic policy and theory. He was awarded the Nobel Prize in Economic Sciences for his contributions to dynamic macroeconomics. Here are 20 of his quotes:

In the Great Depression, employment was not low because investment was low. Employment and investment were low because labor market institutions and industrial policies changed in a way that lowered normal employment.

Edward C. Prescott

Economists create their own worlds. We're like little gods with our artificial economics, wanting to see what happens.

Edward C. Prescott

Sometimes pessimism or optimism gets popular, and it's contagious.

Edward C. Prescott

Random distributions are not good things, because people are risk-averse, and this risk adversely affects their welfare. If you get too much price uncertainty, all kinds of long-term, mutually beneficial contracts can't be entered into.

Edward C. Prescott

If productivity grows, the economy does well.

Edward C. Prescott

The purpose for a tax system is to collect needed revenue at the least cost to the people.

Edward C. Prescott

After World War II, there were a lot of pension funds in Europe that were fully funded, but they were pressured to hold a lot of government debt. There was a lot of inflation, and the value of all those assets fell. Those pension funds couldn't honor their promises to the people.

Edward C. Prescott

The money is nice, but I am not in this game for the money.

Edward C. Prescott

Economic integration is the path to riches and peace.

Edward C. Prescott

Multinational companies use their technological know-how in their foreign subsidiaries, so reciprocal multinational relationships are key - they lead to a vested interest in both countries to remaining open.

Edward C. Prescott

Despite the impression created by some economic pundits, the U.S. economy is not a delicate little machine that needs to be fine-tuned with exact precision by benevolent policymakers to keep from breaking down.

Edward C. Prescott

It is an established scientific fact that monetary policy has had virtually no effect on output and employment in the U.S. since the formation of the Fed.

Edward C. Prescott

There is an old maxim which states that good judgment comes from experience, and experience comes from poor judgment. I think something similar can be said of government policy, to wit: Good policy comes from experience, and experience comes from poor policy.

Edward C. Prescott

The Chinese are saving like mad, but they are not getting a very good return on their savings.

Edward C. Prescott

At some point, the spectacular growth in China has to stop.

Edward C. Prescott

In the Great Depression, employment and investment were low because labor market institutions and industrial polices changed.

Edward C. Prescott

A lot of technological capital has to be absorbed person-to-person, and that happens more quickly if countries are economically integrated.

Edward C. Prescott

In the category of economic superpowers, more is better than less - the more technology those leaders develop, the more we all benefit.

Edward C. Prescott