Abstract
Join us for our next Fiscal Policy for the Future seminar.
Debt has become a defining feature of the global economy, shaping everything from household behaviour to fiscal policy and central bank actions.
In this Treasury Guest Lecture, Professor Atif Mian will unpack the mechanisms behind the world's growing reliance on debt and explore the profound implications for economic stability, equity, and policymaking. Drawing on groundbreaking research, including the "Goldilocks Theory of Fiscal Deficits" and the dynamics of "Indebted Demand," our guest speaker will examine the challenges posed by high debt levels, persistently low interest rates, and the diminishing effectiveness of traditional stabilisation tools. He will also consider the role of unequal savings patterns and housing market dynamics in amplifying systemic vulnerabilities.
With high household debt and a structural deficit, New Zealand provides a striking illustration of the economic pressures highlighted in Professor Mian's work. Join this talk by one of the world's leading Macroeconomists for some valuable insights on how to navigate this complex environment.
About the presenter
Atif Mian is John H. Laporte, Jr. Class of 1967 Professor of Economics, Public Policy and Finance at Princeton University, and Director of the Julis-Rabinowitz Center for Public Policy and Finance at the Woodrow Wilson School. He holds a bachelor's degree in mathematics with Computer Science and Ph.D. in Economics from MIT. Prior to joining Princeton in 2012 he taught at the University of California, Berkeley and the University of Chicago Booth School of business.
Professor Mian's work studies the connections between finance and the macro economy. His latest book, House of Debt, with Amir Sufi builds upon powerful new data to describe how debt precipitated the Great Recession. The book explains why debt continues to threaten the global economy, and what needs to be done to fix the financial system.
Professor Mian's research has appeared in top academic journals, including the American Economic Review, Econometrica, Quarterly Journal of Economics, Journal of Finance, Review of Financial Studies and Journal of Financial Economics.
Material and video recording
A transcript and captions for this video will be available in due course.
Fiscal Policy for the Future seminar series
New ideas, innovative concepts, research evidence and expert advice are all crucial to stimulate and inform the Treasury's economic analysis and advice. Our current theme for guest lectures - Fiscal Policy for the Future - explores the role of stabilising, sustainable and effective fiscal policy. Speakers will provide insights into how fiscal policy can be designed to support government to meet its current and future objectives and obligations while adapting to changing circumstances and delivering value to the New Zealand public.
Fiscal policy has a stabilising role in helping to smooth the business cycle, while sustainability in fiscal policy is foundational for resilience to both shocks and longstanding challenges, such as climate change, technological advancements and demographic trends. Ensuring effective and value for money expenditure is important so that fiscal policy contributes to the living standards of New Zealanders, both now and in the future.