The State of Macro

32 Pages Posted: 20 Aug 2008 Last revised: 26 Aug 2008

See all articles by Olivier J. Blanchard

Olivier J. Blanchard

National Bureau of Economic Research (NBER); Peterson Institute for International Economics

Multiple version iconThere are 4 versions of this paper

Date Written: August 12, 2008


For a long while after the explosion of macroeconomics in the 1970s, the field looked like a battle field. Over time however, largely because facts do not go away, a largely shared vision both of fluctuations and of methodology has emerged. Not everything is fine. Like all revolutions, this one has come with the destruction of some knowledge, and suffers from extremism and herding. None of this is deadly however. The state of macro is good.

The first section sets the stage with a brief review of the past. The second argues that there has been broad convergence in vision, and the third reviews the specifics. The fourth focuses on convergence in methodology. The last looks at current challenges.

Keywords: Macroeconomics, shocks, propagation mechanisms, fluctuations

JEL Classification: E20, E30, E40

Suggested Citation

Blanchard, Olivier J. and Blanchard, Olivier J., The State of Macro (August 12, 2008). MIT Department of Economics Working Paper No. 08-12, Available at SSRN: or

Olivier J. Blanchard (Contact Author)

Peterson Institute for International Economics ( email )

1750 Massachusetts Avenue, NW
Washington, DC 20036
United States

National Bureau of Economic Research (NBER) ( email )

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

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