Christina Romer, Distinguished Fellow 2023

Christina Romer is the Class of 1957-Garff B. Wilson Professor of Economics. She joined the Berkeley faculty in 1988 and was promoted to full professor in 1993. Professor Romer is co-director of the Program in Monetary Economics at the National Bureau of Economic Research and is a member of the NBER Business Cycle Dating Committee. She served as chair of the Council of Economic under President Obama.  She is a fellow of the American Academy of Arts and Sciences and recipient of the Distinguished Teaching Award at the University of California, Berkeley. She has received a John Simon Guggenheim Memorial Foundation Fellowship, the National Science Foundation Presidential Young Investigator Award, and an Alfred P. Sloan Research Fellowship. She has served as vice president and a member of the executive committee of the American Economic Association. Prior to her appointment at Berkeley, she was an assistant professor of economics and public affairs at Princeton University from 1985-1988. She received her Ph.D. from M.I.T. in 1985.

Romer's early work focused on a comparison of macroeconomic volatility before and after World War II.  She showed that much of what had appeared to be a decrease in volatility was due to better economic data collection, although recessions have become less frequent over time.

She has also researched the causes of the Great Depression in the United States and how the US recovered from the depression. Her work showed that the Great Depression occurred more severely in the US than in Europe and had somewhat different causes. She showed that New Deal fiscal policy measures, though innovative, were insufficient, and dwarfed by Hoover's tax increase two years earlier.  However, accidental monetary policy played a large role in the US recovery from depression. This monetary policy came first from the devaluation of the dollar in terms of gold in 1933–1934, and later from the flight of European capital to the relatively stable US as war in Europe became more likely.

She has done extensive work on fiscal and monetary policy from the Great Depression to the present, using notes from the meetings of the Federal Open Market Committee  (FOMC) and the materials prepared by Fed staff to study how the Federal Reserve makes its decisions. Her work suggests that some of the credit for the relatively stable economic growth in the 1950s lies with Federal Reserve policy, and that the members of the FOMC could at times have made better decisions by relying more closely on forecasts made by the Fed professional staff.

Her recent work with David Romer has focused on the impact of tax policy on government and general economic growth. This work looks at US tax changes from 1945 to 2007, excluding changes made to fight recessions or offset the cost of new government spending. They find that such "exogenous" tax increases, made for example to reduce inherited budget deficits, reduce economic growth. Romer and Romer find "no support for the hypothesis that tax cuts restrain government spending; indeed [they find that] tax cuts may increase spending… the main effect of tax cuts on the government budget is to induce subsequent legislated tax increases.”

In summary, her work has led to improvements in our understanding of the role of fiscal and monetary policy in contributing to economic prosperity in the 20th century.