Joseph Stiglitz Quotations

One needs to find innovative ways to transfer and absorb risks better within Asia, better ways of managing Asian financial markets.

China's growth has been export-based, but it may be difficult for it to sustain the pace of export growth.

China has been selling a lot of goods to the West, particularly to the US, but at the same time it has been providing the money to provide the goods.

He was the best articulator of a set of ideas. But they happen to be wrong ideas.

Greenspan's irresponsible support of that tax cut was critical to its passage.

My research in this period centered around growth, technical change, and income distribution, both how growth affected the distribution of income and how the distribution of income affected growth.

The question is whether some of the fears of last year will be realized this year. There is strong reason to worry.

The question is whether it'll be a stable country, will it be a country in which a diversity of views, open transparency, women's rights are recognized. The likelihood of that remains very low.

You can increase the price from 25 to 40 dollars, and people can absorb it. If the price rises above 60 dollars, they become unhappy. They start to adjust, they move to smaller cars, drive a little bit less.

Elderly people remember when they could go to the movie for a nickel or a quarter,

So the theory asks, how can shareholders ascertain what the firm's real prospects are when they have less information, ... It's a pervasive aspect of modern economies.

Anybody looking at these models would say they can't provide a good description of the modern world.

An example might be, when the owner of the firm knows more than the shareholders.

Asia has become the source of finance, the source of savings. It now has the human capital to manage that well. Why doesn't it take the advantage of that opportunity to try and create financial markets that work better for the people of Asia.

I told the commission that offering the two versions of Windows without a price difference was not a level playing field.

The US economy has lots of vulnerabilities in debts and deficits.

I, like many members of my generation, was concerned with segregation and the repeated violation of civil rights.

I recognized that information was, in many respects, like a public good, and it was this insight that made it clear to me that it was unlikely that the private market would provide efficient resource allocations whenever information was endogenous.

But while I loved all of these courses, there was an irresistible attraction of economics.

I don't think if we had been able to make that choice rationally, we would have said that's what we want to do. We would have said: "Can't we save the banks and solve our health care problems?" The answer is yes. You could have.

The important lesson of the deficit is - and the national debt - is we have to be careful about how we're spending money.

Temporary nationalization of the banks that are in very bad shape would mean basically that the government is the temporary owner. I always believe that the government should focus on its comparative advantages, and banking is not one of them. It should, therefore, if it nationalizes banks, sell them back to the private sector.

Wall Street banks have used the same tactic that Bush used in the war on terror - fear - and they've basically said that if you don't do what we tell you, the sky will fall. If you don't do what we tell you, it will be the end of capitalism as we know it. The failure of Lehman Brothers lent some credence to those fears.

The life prospects of an American are more dependent on the income and education of his parents than in any of the other advanced industrial countries.

The issue is: $1 trillion or $2 trillion is a lot of money. If our objective is to have stability in the Middle East, secure oil, or extend democracy, you can do a lot of democracy buying for this sum. To put it in context: The whole world spends $50 billion a year on foreign aid.

Most people think the Iraq war has increased the probability of an attack. However, it's difficult to put this aspect into financial terms.

For instance, one of the costs of the war is that soldiers today get very seriously injured but stay alive, and we can keep them alive but at an enormous price.

The Bush administration has been doing everything it can to hide the huge number of returning veterans who are severely wounded - - 17,000 so far including roughly 20 percent with serious brain and head injuries. Even the estimate of $500 billion ignores the lifetime disability and healthcare costs that taxpayers will have to spend for years to come.

Similarly, payments for a dead soldier amount to only $500,000, which is far less than standard estimates of the lifetime economic cost of a death. This statistical value of a life in the US amounts to circa $6.5 million.

There is a growing consensus that the European systems have worked better than the American: They have been able to deliver better health care to more people at lower cost.

I think that for the developing world there are many versions of capitalism, and countries have to choose one that's appropriate.

Unfettered market American-style capitalism doesn't work. Developing countries can't afford that kind of luxury. They just can't afford it. Period. If there's a mistake, they can't afford to put out $2 trillion.

We could have saved Wall Street without putting our future in jeopardy. I predicted that there would be all-around consequences - in the long run as well as in the short run. People are now saying we can't afford health care reform because we spent all the money on the banks. So, in effect, we're saying that it's better that we give rich bankers a couple of trillion than giving ordinary Americans access to health care.

The fact that the government had to put up hundreds of billions of dollars to Citibank in guarantees was a public declaration that Citibank was a mess. Making Citibank go through financial restructuring would not have conveyed any more different information. So it's very hard to see why it would have had that kind of a panic if it were done well.

I think what they've been doing is largely almost in firefighting mode without a good conceptual framework - either at the micro or the macro level. Micro, you would ask: "What kind of financial or banking system do we want?" Macro, you would say: "What are the underlying problems in the structure of our economy?"

When I said "the pocket of the banks," it is not necessarily a mercenary relationship. It is a mindset.

They [political leaders ] thought the only problem was the banking system, and if they fixed the banking system, all would be fine. But the banking system and the mortgage problem were symptomatic of some deeper problems, and evidently they still haven't recognized those deeper problems.

For that to happen, growth has to be very strong. To get back to normalcy, we will have to have extended growth of more than 3 percent. That's not in the cards.

If the President asked you to help, I don't think anybody could refuse, unless one felt that one couldn't be effective.

One has to always ask the question: Where can one be most effective in helping shape policies? It is always difficult when you're inside because you're very constrained.

Poverty is what we call the extremes at the bottom.

World War II was really unusual, because America was in the Great Depression before. So the war did help the US economy to get securely out of this decline. This time, the war [in Iraq] is bad for the economy in both the short and long run. We could have spent trillions in research or education instead. This would have led to future productivity increases.

We are helping the people that [George W.]Bush says are evil. Teheran couldn't be happier about the high oil prices resulting from the Iraq war.

The military is focusing only on the short run costs. If they don't provide appropriate body armor, they save some money today, but the healthcare cost is going to be the future for some other president down the line. I view that as both fiscally and morally irresponsible.

You saw on your TV what happened in New Orleans after Hurricane Katrina. The Reserves or National Guard are usually the people we use for those national emergencies. They weren't here, they were over in Iraq, and so we were less protected.

The recovery of the banks is what happens when you reduce competition, lend money to them at zero interest rates, allow them to gamble. That particular style of restoration actually inhibits the economic recovery.

There will come a moment when the most urgent threats posed by the credit crisis have eased and the larger task before us will be to chart a direction for the economic steps ahead. This will be a dangerous moment. Behind the debates over future policy is a debate over history-a debate over the causes of our current situation. The battle for the past will determine the battle for the present. So it's crucial to get the history straight.

I've always been sceptical about the notion that the market is a person you can engage in an argument with, and that that person is an intelligent, rational, well-intentioned person: it is fantasy. We know that ... the market is subject to irrational optimism and pessimism, and is vindictive ... You're dealing with a crazy man ... Having got what he wants he will still kill you.

The extra curricular activity in which I was most engaged - debating - helped shape my interests in public policy.

Amherst was pivotal in my broad intellectual development; MIT in my development as a professional economist.

I went to public schools, and while Gary was, like most American cities, racially segregated, it was at least socially integrated - a cross section of children from families of all walks of life.

There must have been something in the air of Gary that led one into economics: the first Nobel Prize winner, Paul Samuelson, was also from Gary, as were several other distinguished economists.

Amherst is a liberal arts college, committed to providing students with a broad education.

I went to Amherst because my brother had gone there before me, and he went there because his guidance counselor thought that we would do better there than at a large university like Harvard.

The notion that every well educated person would have a mastery of at least the basic elements of the humanities, sciences, and social sciences is a far cry from the specialized education that most students today receive, particularly in the research universities.

GDP tells you nothing about sustainability

Much of my work in this period was concerned with exploring the logic of economic models, but also with attempting to reconcile the models with every day observation.

In debate, one randomly was assigned to one side or the other. This had at least one virtue - it made one see that there was more than one side to these complex issues.

Economists often like startling theorems, results which seem to run counter to conventional wisdom.

The reason that the invisible hand often seems invisible is that it is often not there.

My teachers helped guide and motivate me; but the responsibility of learning was left with me, an approach to learning which was later reinforced by my experiences at Amherst.

Certainly, the poverty, the discrimination, the episodic unemployment could not but strike an inquiring youngster: why did these exist, and what could we do about them.

I grew up in a family in which political issues were often discussed, and debated intensely.

I knew that discrimination existed, even though there were many individuals who were not prejudiced.

If stability and efficiency required that there existed markets that extended infinitely far into the future - and these markets clearly did not exist - what assurance do we have of the stability and efficiency of the capitalist system?

In developing countries, lack of infrastructure is a far more serious barrier to trade than tariffs.

Even if Bush could be forgiven for taking America, and much of the rest of the world, to war on false pretenses, and for misrepresenting the cost of the venture, there is no excuse for how he chose to finance it. His was the first war in history paid for entirely on credit. As America went into battle, with deficits already soaring from his 2001 tax cut, Bush decided to plunge ahead with yet another round of tax relief for the wealthy.

No one would look just at a firm's revenues to assess how well it was doing. Far more relevant is the balance sheet, which shows assets and liability. That is also true for a country.

You can't overestimate what happens when you encourage regulators to believe that the goal of regulation is not to regulate.

The only surprise about the economic crisis of 2008 was that it came as a surprise to so many.

I understand why political leaders in the beginning want to be cheerleaders to generate optimism. But to admit that they didn't understand the depths of the problem afterwards, I found a little bit surprising.

Health care is very different from other sectors of the economy in several respects, one of which is the fact that the risk can be very high beyond people's ability. That leads to insurance.

Not everybody is qualified to go to Stanford, but everybody should have access to the best qualify for which they are eligible.

Active learning is always involved with interaction between teachers and students and Socratic methods and that's gonna continue.

If you're injured in an automobile accident, and you sue the driver, you get much more for your injury than if you're fighting for your country. There's a double standard here.

But individuals and firms spend an enormous amount of resources acquiring information, which affects their beliefs; and actions of others too affect their beliefs.

Trickle-down economics is a myth. Enriching corporations - as the TPP would - will not necessarily help those in the middle, let alone those at the bottom.

The budgetary cost to the UK of the wars in Iraq and Afghanistan through 2010 will total more than £18 billion. If we include the social costs the total impact will exceed £20 billion.

It's actually a tribute to the quality of economics teaching that they have persuaded so many generations of students to believe in so much that seems so counter to what the world is like. Many of the things that I'm going to describe make so much more common sense than these notions that seem counter to what ones eyes see every day.

As I noted in my Nobel lecture, an early insight in my work on the economics of information concerned the problem of appropriability - the difficulty that those who pay for information have in getting returns.

They [free market policies] were never based on solid empirical and theoretical foundations, and even as many of these policies were being pushed, academic economists were explaining the limitations of markets for instance, whenever information is imperfect, which is to say always.

The protesters have called into question whether there is a real democracy. Real democracy is more than the right to vote once every two or four years. The choices have to be meaningful. But increasingly, and especially in the US, it seems that the political system is more akin to "one dollar one vote" than to "one person one vote". Rather than correcting the market failures, the political system was reinforcing them.

Climate change is a reality.

The only people benefiting in Iraq war are George Bush's Jr. friends in the oil industry. He has done the American economy and the global economy an enormous disfavor, but his Texan friends couldn't be happier.

What most Americans mean when they say "the end of the recession" is, "When will it be back to normal? When can we get jobs? When will the employment rate be back to 4 percent or 5 percent?"

Most poor people earn more than minimum wage when they are working; their problem is not low wages. The problem comes when they are not working.

The striking thing about America is - it's historically, extraordinary unusual,I don't of any other instance - is that productivity of workers and wages have not moved in tandem.

Any society has to delegate the responsibility to maintain a certain kind of order. Enforcing regulations, making sure people stop at stoplights. We can't function as a society without rules and regulations, and the enforcement mechanism of those rules and regulations.

What you measure affects what you do. If you don't measure the right thing, you don't do the right thing.

I think in part the reason is that seeing an economy that is, in many ways, quite different from the one grows up in, helps crystallize issues: in one's own environment, one takes too much for granted, without asking why things are the way they are.

The problem is a lot of what is called economics is not economics. It is more ideology or religion.

I trace the inequality to a particular set of decisions that we took when we lowered the tax rate from 91% down to very low levels at the top, where we stripped away regulations. So the result of that was not a more dynamic economy, but a more unequal society. We tried the experiment of trickle-down. A third of a century later, we can say fairly definitively that it was a failure.

Drug companies spend more on advertising and marketing than on research, more on research on lifestyle drugs than on life saving drugs, and almost nothing on diseases that affect developing countries only. This is not surprising. Poor people cannot afford drugs, and drug companies make investments that yield the highest returns.

Governments can enhance growth by increasing inclusiveness. A country's most valuable resource is its people. So it is essential to ensure that everyone can live up to their potential, which requires educational opportunities for all.

American inequality didn't just happen. It was created.

It is trust, more than money, that makes the world go round.

International lending banks need to focus on areas where private investment doesn't go, such as infrastructure projects, education and poverty relief.

The top 1 percent have the best houses, the best educations, the best doctors, and the best lifestyles, but there is one thing that money doesn't seem to have bought: an understanding that their fate is bound up with how the other 99 percent live. Throughout history, this is something that the top 1 percent eventually do learn. Too late.

Macroeconomic policy can never be devoid of politics: it involves fundamental trade-offs and affects different groups differently.

Development is about transforming the lives of people, not just transforming economies.