CFSP Hosts Workshop Bringing Micro and Macro Together

September 26, 2011

In August, CFSP sponsored the second meeting of its ongoing workshop, “Savings and Financial Underpinnings of Macro Models,” in historic Bretton Woods, NH, which was the site of the inaugural assembly of what is now the International Monetary Fund and the World Bank. 

Led by CFSP Faculty Director Robert M. Townsend, CFSP members Francisco Buera and Christopher Udry, and CFSP Fellow Kenichi Ueda, the workshop convened economists and policymakers from 15 universities and monetary organizations around the globe.

The central goal of the workshop is to make progress in building better and more relevant economic models with realistic financial underpinnings so that the impact of savings and related financial innovations can be more fully understood through these models. The workshop brings together development economists and researchers who are working on quantitative macroeconomic models and who have relevant expertise in a variety of sub-fields.

“This meeting is about the explicit integration of micropinnings in macro models,” noted Townsend in his opening remarks. “The theme is how do we think about macro from the perspective of micro and vice versa, and how do we get them together? This is going to lead to discussions about method and where we are struggling in the field to reach that unified vision.”

The conference featured lectures by Townsend and Udry as well as discussion of four papers by academics and policymakers:

At the conference’s conclusion, the participants noted the significance of the meeting. Many appreciated that it provided a rare occasion for diverse researchers and policymakers to share lessons and to identify the next frontier of work in developing countries.

“The world has changed,” observed presenter Alex Monge-Naranjo. “When (the original IMF organizers) met in Bretton Woods, it was to get the world in order, and with that they meant post-war Europe and the United States. There was a clear disregard for developing countries. We came here today to do just the opposite.”

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Photo of workshop participants taken on the lawn of the Bretton Woods resort.