9:59:59.000,9:59:59.000 - [Christina] The most important thing[br]that I try to pass on 9:59:59.000,9:59:59.000 is the sense that economics[br]is an empirical field, 9:59:59.000,9:59:59.000 then if you get[br]new empirical evidence, 9:59:59.000,9:59:59.000 you're going to have[br]to change the way 9:59:59.000,9:59:59.000 you think about the economy. 9:59:59.000,9:59:59.000 I think being open to that 9:59:59.000,9:59:59.000 is the most important thing[br]for a young economist to know. 9:59:59.000,9:59:59.000 Economists -- not a group 9:59:59.000,9:59:59.000 with a lot of Marys,[br]Natashas or Juanitas, 9:59:59.000,9:59:59.000 and that's caused[br]a lot of controversy. 9:59:59.000,9:59:59.000 However, what's often overlooked[br]are the actual female economists 9:59:59.000,9:59:59.000 who are pushing economics forward 9:59:59.000,9:59:59.000 by addressing real-world issues. 9:59:59.000,9:59:59.000 Welcome to Women in Economics. 9:59:59.000,9:59:59.000 ♪ [music] ♪ 9:59:59.000,9:59:59.000 I grew up in a family 9:59:59.000,9:59:59.000 where public policy[br]was discussed a lot. 9:59:59.000,9:59:59.000 I was planning to be a lawyer, 9:59:59.000,9:59:59.000 so I was going to major[br]in Government. 9:59:59.000,9:59:59.000 And as part of the Government[br]major at my college, 9:59:59.000,9:59:59.000 you had to take[br]a year of Economics. 9:59:59.000,9:59:59.000 I was about three weeks in,[br]and I was hooked, 9:59:59.000,9:59:59.000 like the government major's gone,[br]the lawyer's gone, 9:59:59.000,9:59:59.000 I was in an Economist. 9:59:59.000,9:59:59.000 Christina Romer[br]is a macro economic historian. 9:59:59.000,9:59:59.000 She takes the tools[br]of modern economics, 9:59:59.000,9:59:59.000 statistics, and data 9:59:59.000,9:59:59.000 and applies them[br]to historical questions. 9:59:59.000,9:59:59.000 - [Narrator] Christy's researcher[br]agenda throughout her career 9:59:59.000,9:59:59.000 has focused[br]on a course set of topics 9:59:59.000,9:59:59.000 about economic fluctuations[br]and business cycles. 9:59:59.000,9:59:59.000 She's been asking and answering 9:59:59.000,9:59:59.000 fascinating questions[br]about our economy, 9:59:59.000,9:59:59.000 starting with her dissertation[br]as a graduate student at MIT. 9:59:59.000,9:59:59.000 There, she changed[br]her understanding 9:59:59.000,9:59:59.000 of how the economy[br]has grown over time. 9:59:59.000,9:59:59.000 I think the questions[br]that came to me 9:59:59.000,9:59:59.000 were about monetary policy[br]and business cycles 9:59:59.000,9:59:59.000 and the Great Depression. 9:59:59.000,9:59:59.000 - [Narrator] It was widely believed 9:59:59.000,9:59:59.000 that government policies led to[br]less fluctuations and unemployment 9:59:59.000,9:59:59.000 after World War II. 9:59:59.000,9:59:59.000 However, the data before[br]World War II was unreliable. 9:59:59.000,9:59:59.000 - [Nancy] But Christy came up[br]with the ingenious insight 9:59:59.000,9:59:59.000 that while you couldn't clean up[br]the historical data, 9:59:59.000,9:59:59.000 you could fuzzy up[br]the more modern data, 9:59:59.000,9:59:59.000 and that's exactly what she did. 9:59:59.000,9:59:59.000 And when she did it, lo and behold, 9:59:59.000,9:59:59.000 all these differences[br]basically collapsed. 9:59:59.000,9:59:59.000 - [Narrator] Amazingly,[br]if she applied 9:59:59.000,9:59:59.000 the old techniques to the new data, 9:59:59.000,9:59:59.000 the pose WOrld War II economy 9:59:59.000,9:59:59.000 looked just as volatile[br]as the pre-World War economy. 9:59:59.000,9:59:59.000 This contradicted the consensus 9:59:59.000,9:59:59.000 on the role of government[br]stabilization policies. 9:59:59.000,9:59:59.000 Her research rattled[br]the economic community. 9:59:59.000,9:59:59.000 It made a splash. 9:59:59.000,9:59:59.000 I remember one of the prominent[br]economist MIT, 9:59:59.000,9:59:59.000 his first reaction was, 9:59:59.000,9:59:59.000 "Well, I'd be very upset[br]about this if I believed it. 9:59:59.000,9:59:59.000 So I'm not going to believe it." 9:59:59.000,9:59:59.000 Throughout her academic career, 9:59:59.000,9:59:59.000 Christine continued to challenge 9:59:59.000,9:59:59.000 her understanding[br]of the Great Depression. 9:59:59.000,9:59:59.000 As just one example,[br]most economists believed 9:59:59.000,9:59:59.000 the Great Depression ended 9:59:59.000,9:59:59.000 because of higher[br]government spending 9:59:59.000,9:59:59.000 and investment in public works. 9:59:59.000,9:59:59.000 She showed that the impact[br]of those policies 9:59:59.000,9:59:59.000 were relatively small compared to 9:59:59.000,9:59:59.000 the monetary policy[br]changes taking place. 9:59:59.000,9:59:59.000 - [ ] Starting as soon as Roosevelt[br]took the US off the gold standard 9:59:59.000,9:59:59.000 when he took office in 1933, 9:59:59.000,9:59:59.000 over the next decade, 9:59:59.000,9:59:59.000 there's just an enormous increase[br]in money supply. 9:59:59.000,9:59:59.000 What he showed was that 9:59:59.000,9:59:59.000 that is what caused[br]the very rapid growth that we had. 9:59:59.000,9:59:59.000 - [Narrator] Christina's research[br]has often focused on the effect 9:59:59.000,9:59:59.000 economic events have[br]on people's everyday lives. 9:59:59.000,9:59:59.000 - [ ] It's tough to manage to have[br]new ideas on the same thing 9:59:59.000,9:59:59.000 again and again and again. 9:59:59.000,9:59:59.000 One of the remarkable things 9:59:59.000,9:59:59.000 about Christy and David's[br]research program 9:59:59.000,9:59:59.000 is that they have done that[br]very successfully. 9:59:59.000,9:59:59.000 - [Narrator] Over 35 years, 9:59:59.000,9:59:59.000 Christina has done[br]meticulous research, 9:59:59.000,9:59:59.000 frequently, with her collaborator[br]and husband, David Romer. 9:59:59.000,9:59:59.000 - [David] We'll have her paper,[br]and I think it's almost done. 9:59:59.000,9:59:59.000 We've worked really hard on it, 9:59:59.000,9:59:59.000 and each do one last read. 9:59:59.000,9:59:59.000 She says, "You know,[br]I think there's a logical tension 9:59:59.000,9:59:59.000 between where we end up[br]in Section 4b 9:59:59.000,9:59:59.000 and how we set out[br]what we're going to do in Section 2a. 9:59:59.000,9:59:59.000 And I'm thinking, "Oh,[br]no one's going to notice." 9:59:59.000,9:59:59.000 And we spend weeks more[br]on the paper because she's right. 9:59:59.000,9:59:59.000 And the paper gets much better. 9:59:59.000,9:59:59.000 - [ ] One of the remarkable[br]things about her work 9:59:59.000,9:59:59.000 is the coherence that spans[br]literally her graduate school days 9:59:59.000,9:59:59.000 and her work on her dissertation, 9:59:59.000,9:59:59.000 and connects up to some[br]of her most recent work 9:59:59.000,9:59:59.000 on thinking about[br]ways of identifying 9:59:59.000,9:59:59.000 turning points in the economy. 9:59:59.000,9:59:59.000 - [Narrator] Christina's work[br]would be put to the test 9:59:59.000,9:59:59.000 during the devasting crash of 2008, 9:59:59.000,9:59:59.000 when the US economy[br]was in free fall. 9:59:59.000,9:59:59.000 - [Christina] We often[br]describe the economy 9:59:59.000,9:59:59.000 as at the edge of a cliff. 9:59:59.000,9:59:59.000 Well, the truth is, we're not only[br]at the edge of a cliff, 9:59:59.000,9:59:59.000 we were headed down. 9:59:59.000,9:59:59.000 Financial markets were plunging, 9:59:59.000,9:59:59.000 and the risk of contagion[br]from the US to the global economy 9:59:59.000,9:59:59.000 was v ery real. 9:59:59.000,9:59:59.000 - [ ] Even people who'd see a lot 9:59:59.000,9:59:59.000 were really worried[br]about what was happening. 9:59:59.000,9:59:59.000 Just as the nation was turning[br]to President-elect Obama 9:59:59.000,9:59:59.000 to confront the economic crisis, 9:59:59.000,9:59:59.000 a mysterious email[br]showed up in Christina'a inbox 9:59:59.000,9:59:59.000 with the subject line:[br]"Obama Transition." 9:59:59.000,9:59:59.000 - [ ] And I will take a little bit of credit here 9:59:59.000,9:59:59.000 because Christina was just about to delete it, 9:59:59.000,9:59:59.000 and I said, "Why don't you at least google fitst." 9:59:59.000,9:59:59.000 And she discovered that he was the head of the economic side of the transition. 9:59:59.000,9:59:59.000 The Obama administration wanted to meet with Christina as soon as possible. 9:59:59.000,9:59:59.000 - [ ] On the next day, she was on a plane to Chicago to meet with the President-elect. 9:59:59.000,9:59:59.000 - [Narrator] Christina was asked to chair the Council of Economic Advisers. 9:59:59.000,9:59:59.000 The council wa sset up to bring academics into the policy-making process 9:59:59.000,9:59:59.000 and make recommendations to the President. 9:59:59.000,9:59:59.000 - [Christina] I was taking to Rahm Emanuel, and I said, 9:59:59.000,9:59:59.000 "So tell me again, how did I get this job?" 9:59:59.000,9:59:59.000 And he said, "You were an expert on the Great Depression, 9:59:59.000,9:59:59.000 and we thought we might need one." 9:59:59.000,9:59:59.000 - [Janet] She's tried to understand what caused the Depression, 9:59:59.000,9:59:59.000 what ended the Depression, 9:59:59.000,9:59:59.000 what role monitoring and fiscal policy oculd play 9:59:59.000,9:59:59.000 and no one could be better positioned to know what the right strategy woulf be. 9:59:59.000,9:59:59.000 - [CHristina] We were talking to bankers, 9:59:59.000,9:59:59.000 we were talking to employers, 9:59:59.000,9:59:59.000 we were talking to the people that where collecting the statistics. 9:59:59.000,9:59:59.000 - [Marrator] Christina'a research revealed 9:59:59.000,9:59:59.000 that the economy was even more of a perilous position 9:59:59.000,9:59:59.000 than previously thgoutt. 9:59:59.000,9:59:59.000 SHe got on the phone with Obama to give him the bad news. 9:59:59.000,9:59:59.000 - [Christina] Saying, you going, this is terrible. 9:59:59.000,9:59:59.000 We've lost three-quarters of a million jobs. 9:59:59.000,9:59:59.000 I'm just going on like this, and finally he stops me 9:59:59.000,9:59:59.000 and he said, "Christy, it's not your fault... yet." 9:59:59.000,9:59:59.000 - [ ] The challenge that CHristy and her team members on the Economic Advisory Team confronted 9:59:59.000,9:59:59.000 was how large a stimulus the US economy needed 9:59:59.000,9:59:59.000 in order to right the ship 9:59:59.000,9:59:59.000 and trying to calibrate that depended critically on the estimates 9:59:59.000,9:59:59.000 of how much bang for the buck you get 9:59:59.000,9:59:59.000 when you use fiscal policy as a tool 9:59:59.000,9:59:59.000 and try to then inflate the economy. 9:59:59.000,9:59:59.000 - [Marrator} CHristina helped design a fiscal package 9:59:59.000,9:59:59.000 that she thought was necessary to get the economy moving. 9:59:59.000,9:59:59.000 - [Gabriel] The American Recovery and Reinvestment Act 9:59:59.000,9:59:59.000 is a piece of legislation that was signed in February of 2009, 9:59:59.000,9:59:59.000 and it was a combination of direct government spending, 9:59:59.000,9:59:59.000 so think of repairing highways, 9:59:59.000,9:59:59.000 transfers to State governments, 9:59:59.000,9:59:59.000 transfers to individuals and tax cuts. 9:59:59.000,9:59:59.000 And the rationale for it was for the time when households were spending less 9:59:59.000,9:59:59.000 and busniesses were spending less -- 9:59:59.000,9:59:59.000 that's a time when it's appropriate for government to spend a little more 9:59:59.000,9:59:59.000 to fill in that gap. 9:59:59.000,9:59:59.000 The recessions leave long scars, 9:59:59.000,9:59:59.000 and people who lose their jobs during recession 9:59:59.000,9:59:59.000 and they're unemployed for a while -- 9:59:59.000,9:59:59.000 even ten years later, often are earning less 9:59:59.000,9:59:59.000 than they were before the recession occurred. 9:59:59.000,9:59:59.000 So by making the case, 9:59:59.000,9:59:59.000 both in acaedemic research, and then as a policymaker, 9:59:59.000,9:59:59.000 the government could do more to mitigate recessions 9:59:59.000,9:59:59.000 that really has an impact probably hundreds of thousands of people 9:59:59.000,9:59:59.000 kept their jobs during the Great Recession 9:59:59.000,9:59:59.000 because hse had become an expert on the behavior of the economy, 9:59:59.000,9:59:59.000 on the effects of fiscal policy. 9:59:59.000,9:59:59.000 - [ ] And she was realy passionate about the role that she played 9:59:59.000,9:59:59.000 after the financial crisis and the Great Recession