The 2008 crisis discredited efficient-market economists in public policy debate

Evidence

A major reason Keynesianism now became the policy du jour was that governing neoliberal ideas denied that such a crisis was possible in the first place. So when it happened, it was bound to open up room for ideas that said such events were inevitable if you let markets regulate themselves, which is the Keynesian point. It was hard to publicly defend the logic of self-correcting markets when they were so obviously not self-correcting. Indeed, such traditional standard bearers for the neoclassical cause as Eugene Fama, Edward Prescott, and Robert Barro who had previously enjoyed public prominence found themselves confined to the opinion pages of the Wall Street Journal. — Mark Blyth, Austerity, 158

Categorization

• XREF: The political power of economic ideas theme ties to Blyth’s chapter 2 and to the broader austerity intellectual history. — connects to: The 2008 crisis invalidated the preceding thirty years of financial orthodoxy — Mark Blyth, Austerity: The History of a Dangerous…, 133; Markets gained legitimacy as experts lost it after 2008 — Aris Komporozos-Athanasiou, Speculative Communities: Living with…, 113; Establishment economists defended Greenspan despite the 2008 crisis — Philip Mirowski, Never Let a Serious Crisis Go to Waste, 2035 (+9 more)