Log In

John Brian Taylor

economist , educator

Mary and Robert Raymond Professor of Economics at Stanford University, and the George P. Shultz Senior Fellow in Economics at Stanford University's Hoover Institution;

famous for Taylor rule

Background

TAYLOR, John Brian was born in 1946 in Yonkers, New York, United States of America.

Education

Bachelor of Arts Princeton University, 1968. Doctor of Philosophy Stanford University, 1973.

Career

John Brian Taylor is the Mary and Robert Raymond Professor of Economics at Stanford University, and the George P. Shultz Senior Fellow in Economics at Stanford University's Hoover Institution. He taught at Columbia University from 1973–1980 and the Woodrow Wilson School and Economics Department of Princeton University from 1980–1984 before returning to Stanford. He has received several teaching prizes and teaches Stanford's introductory economics course as well as Ph.D. courses in monetary economics. In research published in 1979 and 1980 he developed a model of price and wage setting—called the staggered contract model—which served as an underpinning of a new class of empirical models with rational expectations and sticky prices—sometimes called new Keynesian models. In a 1993 paper he proposed the Taylor rule, intended as a recommendation about how nominal interest rates should be determined, which then became a rough summary of how central banks actually do set them. He has been active in public policy, serving as the Under Secretary of the Treasury for International Affairs during the first term of the George W. Bush Administration. His book Global Financial Warriors chronicles this period. He was a member of the President's Council of Economic Advisors during the George H. W. Bush Administration and Senior Economist at the Council of Economic Advisors during the Ford and Carter Administrations.

In 2012 he was included in the 50 Most Influential list of Bloomberg Markets Magazine. Thomson Reuters lists Taylor among the 'citation laureates' who are likely future winners of the Nobel Prize in Economics.

Achievements

  • Member, Advisory Review Panel for Economics, National Science Foundation, 1979-81

  • Member, Advisory Committee, Carnegie-Rochester Conference Series on Public Policy, 1979-89, 1992-2001

  • Research Associate, National Bureau of Economic Research, 1981-

  • Member, Brookings Panel on Economic Activity, 1982-83

  • Member, Economics Oversight Committee, National Science Foundation, 1983

  • Member, Graduate Record Examinations Committee, ETS, 1984-86

  • Member, Committee on Economic Stability and Growth and Subcommittee on Monetary Research, Social Science Research Council, 1986-89

  • Member, Federal Economic Statistics Advisory Committee, 2000-2001

  • Voluntary National Content Standards in Economics

    Member, Revisions Committee, 2008-2011

    Member, Review Committee, 1997

  • Member, Board of Trustees, Foundation for Teaching Economics, 1997-2001

  • American Economic Association

    Vice-President, 2000-2001

    Executive Committee, 1992-95

    Co-Editor for Macroeconomics and International Economics, American Economic

    Review, 1985-88

    Chair, American Economic Review Editor Search Committee, 2000

    Member, Committee on Role of Advocacy, 2007- 2009

    Member, Committee on Economic Education, 1997-2001

    Member, Budget Committee, 1993-95

    Member, Honors and Awards Committee, 1989-93

  • Managing Editor, International Journal of Central Banking, 2005-2008

  • Member, Pew Task Force on Financial Reforms, 2009-2010

Works

  • book

    • Rational Expectations Analysis (edited with Mathew Canzoneri), special issue of the Journal of Economic Dynamics and Control, North Holland, Amsterdam, 1980

    • Macroeconomics: Theory, Performance and Policy (with Robert E. Hall), W.W. Norton, New York, 1986,

    • Macroeconomic Policy in a World Economy: From Econometric Design to Practical Operation, W.W. Norton, New York, 1993; on-line Edition, 1999.

    • Economics, Houghton-Mifflin, Boston, 1995

    • Inflation, Unemployment and Monetary Policy, (with Robert Solow), Massachusetts Institute of Technology Press, 1998, paperback edition, 1999, Translated into Italian, RCS Libri, Etas Division, Milan 1998; translated into Japanese, Prentice Hall, Japan o

    • Monetary Policy Rules (editor), University of Chicago Press, 1999, paperback edition, 2001

    • Handbook of Macroeconomics (edited with Michael Woodford), North Holland, Elsevier, 1999

    • Policies in International Finance, 2001-2005, A Real Time Record in Speeches and Testimony, On-line collection of speeches and papers, May 2005

    • Global Financial Warriors: The Untold Story of International Finance in the Post 9/11 World, WW Norton, 2007, paperback edition, 2008. Translated into Japanese, 2008

    • Getting Off Track: How Government Actions and Interventions Caused, Prolonged, and Worsened the Financial Crisis, Hoover Institution Press, Stanford, 2009, Translated into Italian, Spanish, Polish and Japanese

    • The Road Ahead for the Fed, with John Ciorciari (Eds.), Hoover Institution Press, Stanford, California, 2009

    • Ending Government Bailouts As We Know Them, with Kenneth Scott and George Shultz (Eds.), Hoover Institution Press, Stanford, California, 2010

    • Towards an Exit Strategy: Discretion or Rules? Translated into Italian. E-book. Torino, IBL Libri, 2012

    • First Principles: Five Keys to Restoring America’s Prosperity, WW Norton, 2012

    • Government Policies and the Delayed Economic Recovery, with Lee Ohanian and Ian Wright (Eds.), Hoover Institution Press, Stanford, California, 2012.

    • Bankruptcy Not Bailout: A Special Chapter 14, with Kenneth E. Scott (Eds.), Hoover Institution Press, Stanford, California, 2012.

Views

Research interest in macroeconomic questions began with an investigation of the impact of countercyclical policies on longterm growth, in an undergraduate thesis at Princeton. I then turned to theoretical econometric and optimal control issues relating to macro-policy. The effect of different policy rules on the information about how policy works was studied in my Stanford Doctor of Philosophy thesis and in several papers, some joint with T. W. Anderson.

I began to study the role of expectations in macro-policy soon after moving to Columbia where I benefitted greatly from collaborations with E. S. Phelps. My first concern was with how people would come to learn enough during transition periods to form expectations ration

ally. I also investigated the problem of non-uniqueness due to the self-fulfilling properties of rational expectations.

Previous research in macroeconomics with rational expectations had assumed perfectly flexible prices, which I viewed as unrealistic, and therefore Phelps and I developed a sticky price model with rational expectations. Monetary policy has a role in this framework, but one which is different quantitatively than earlier sticky price models. I became interested in developing empirical models that could be used for policy when expectations are consistent, and estimated a small model that satisfied the rational expectations requirements.

A policy was characterised as a choice of a rule that trades off output fluctuations against inflation fluctuations. In developing the aggregate supply side, I found that staggered overlapping contracts for wages played an important role, and therefore began a systematic investigation of staggered wage setting, using data for the United States. More recently I have been working on the international aspects of macro-policy using the framework developed in my earlier studies.

Connections

colleague:
Milton Friedman
Milton Friedman - colleague of John Taylor

Collegue:
John Maynard Keynes

Collegue:
Paul Volcker