- [Christina] The most important thing that I try to pass on
is the sense that economics is an empirical field,
then if you get new empirical evidence,
you're going to have to change the way
you think about the economy.
I think being open to that
is the most important thing for a young economist to know.
Economists -- not a group
with a lot of Marys, Natashas or Juanitas,
and that's caused a lot of controversy.
However, what's often overlooked are the actual female economists
who are pushing economics forward
by addressing real-world issues.
Welcome to Women in Economics.
♪ [music] ♪
I grew up in a family
where public policy was discussed a lot.
I was planning to be a lawyer,
so I was going to major in Government.
And as part of the Government major at my college,
you had to take a year of Economics.
I was about three weeks in, and I was hooked,
like the government major's gone, the lawyer's gone,
I was in an Economist.
Christina Romer is a macro economic historian.
She takes the tools of modern economics,
statistics, and data
and applies them to historical questions.
- [Narrator] Christy's researcher agenda throughout her career
has focused on a course set of topics
about economic fluctuations and business cycles.
She's been asking and answering
fascinating questions about our economy,
starting with her dissertation as a graduate student at MIT.
There, she changed her understanding
of how the economy has grown over time.
I think the questions that came to me
were about monetary policy and business cycles
and the Great Depression.
- [Narrator] It was widely believed
that government policies led to less fluctuations and unemployment
after World War II.
However, the data before World War II was unreliable.
- [Nancy] But Christy came up with the ingenious insight
that while you couldn't clean up the historical data,
you could fuzzy up the more modern data,
and that's exactly what she did.
And when she did it, lo and behold,
all these differences basically collapsed.
- [Narrator] Amazingly, if she applied
the old techniques to the new data,
the pose WOrld War II economy
looked just as volatile as the pre-World War economy.
This contradicted the consensus
on the role of government stabilization policies.
Her research rattled the economic community.
It made a splash.
I remember one of the prominent economist MIT,
his first reaction was,
"Well, I'd be very upset about this if I believed it.
So I'm not going to believe it."
Throughout her academic career,
Christine continued to challenge
her understanding of the Great Depression.
As just one example, most economists believed
the Great Depression ended
because of higher government spending
and investment in public works.
She showed that the impact of those policies
were relatively small compared to
the monetary policy changes taking place.
- [ ] Starting as soon as Roosevelt took the US off the gold standard
when he took office in 1933,
over the next decade,
there's just an enormous increase in money supply.
What he showed was that
that is what caused the very rapid growth that we had.
- [Narrator] Christina's research has often focused on the effect
economic events have on people's everyday lives.
- [ ] It's tough to manage to have new ideas on the same thing
again and again and again.
One of the remarkable things
about Christy and David's research program
is that they have done that very successfully.
- [Narrator] Over 35 years,
Christina has done meticulous research,
frequently, with her collaborator and husband, David Romer.
- [David] We'll have her paper, and I think it's almost done.
We've worked really hard on it,
and each do one last read.
She says, "You know, I think there's a logical tension
between where we end up in Section 4b
and how we set out what we're going to do in Section 2a.
And I'm thinking, "Oh, no one's going to notice."
And we spend weeks more on the paper because she's right.
And the paper gets much better.
- [ ] One of the remarkable things about her work
is the coherence that spans literally her graduate school days
and her work on her dissertation,
and connects up to some of her most recent work
on thinking about ways of identifying
turning points in the economy.
- [Narrator] Christina's work would be put to the test
during the devasting crash of 2008,
when the US economy was in free fall.
- [Christina] We often describe the economy
as at the edge of a cliff.
Well, the truth is, we're not only at the edge of a cliff,
we were headed down.
Financial markets were plunging,
and the risk of contagion from the US to the global economy
was v ery real.
- [ ] Even people who'd see a lot
were really worried about what was happening.
Just as the nation was turning to President-elect Obama
to confront the economic crisis,
a mysterious email showed up in Christina'a inbox
with the subject line: "Obama Transition."