Thomas J. Sargent Quotes

8 Sourced Quotes

What policymakers (and econometricians) should recognize, then, is that societies face a meaningful set of choices about alternative economic policy regimes.

Thomas J. Sargent
My recollection is that Bob Lucas and Ed Prescott were initially very enthusiastic about rational expectations econometrics. After all, it simply involved imposing on ourselves the same high standards we had criticized the Keynesians for failing to live up to. But after about five years of doing likelihood ratio tests on rational expectations models, I recall Bob Lucas and Ed Prescott both telling me that those tests were rejecting too many good models.

Thomas J. Sargent
For policy, the central fact is that Keynesian policy recommendations have no sounder basis, in a scientific sense, than recommendations of non-Keynesian economists or, for that matter, non-economists.

Thomas J. Sargent
It is paradoxical that an administration that came to office rejecting the whole apparatus of Keynesian economics finds itself presiding over a stream of what threaten to be permanent deficits.

Thomas J. Sargent
My published work is just a record of my learning. I'm sharing it with people so they won't make the same mistakes that I did. It's been a painful and slow process. My work is like a journey, a journey of discovery.

Thomas J. Sargent
Cagan's adaptive mechanism for explaining expectations of inflation has sometimes been criticized as an ad hoc formulation that is inconsistent with the hypothesis that expectations are rational. In this paper, we have showed that conditions exist under which adaptive expectations are fully rational.

Thomas J. Sargent
Q: Professor Sargent, can you tell me what CD rates will be in two years?
Sargent: No.

Thomas J. Sargent
An alternative rational expectations view denies that there is any inherent momentum in the present process of inflation. This view maintains that firms and workers have now come to expect high rates of inflation in the future and that they strike inflationary bargains in light of these expectations.

Thomas J. Sargent