Is the “Chicago School” to Blame in the Economic Crisis?

Michael Mussa, a former student and professor at the University of Chicago, assesses the influence—for good and for ill—of economics as espoused at the University of Chicago.

Recorded October 14, 2009. © Peterson Institute for International Economics.

Steve Weisman: This is Steve Weisman at the Peterson Institute for International Economics. Michael Mussa is our guest today to talk about whether the University of Chicago School of Economics shares any of the blame for the recent global financial crisis and downturn. I’ll explain why I’m asking him that in a second. Michael, thank you for agreeing to have this somewhat unusual conversation.

Michael Mussa: Well, it’s a pleasure to be here. It is unusual, but we shall see.

Steve Weisman: In addition to his many other achievements, notably as a senior fellow here, but also as the chief economist at the IMF and a member of President Reagan’s Council of Economic Advisers, Dr. Mussa taught and studied at the University of Chicago for something like more than 15 years.

Michael Mussa: Between studying and teaching—about 20 years actually.

Steve Weisman: The University of Chicago magazine has a cover story: “Is the Chicago School Thinking to Blame?” That is, to blame for the crisis. What is meant by that question?

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