is a
JapaneseThe are the predominant ethnic group of Japan. Worldwide, approximately 130 million people are of Japanese descent; of these, approximately 127 million are residents of Japan. People of Japanese ancestry who live in other countries are referred to as...
economistAn economist is an expert in the social science of economics. The individual may also study, develop, and apply theories and concepts from economics and write about economic policy...
and
professorThe meaning of the word professor varies. In some English-speaking countries, it refers to a senior academic who holds a departmental chair, especially as head of the department, or a personal chair awarded specifically to that individual...
at
Princeton UniversityPrinceton University a private university located in Princeton, New Jersey, United States. The school is one of the eight universities of the Ivy League and is considered one of the Colonial Colleges....
especially known for proposing several models that provide deeper
microeconomic foundationsIn economics, the term microfoundations refers to the microeconomic analysis of the behavior of individual agents such as households or firms that underpins a macroeconomic theory....
for
macroeconomicsMacroeconomics is a branch of economics that deals with the performance, structure, and behavior of a national or regional economy as a whole. Along with microeconomics, macroeconomics is one of the two most general fields in economics. It is the study of the behavior and decision-making of entire...
, some of which play a prominent role in New Keynesian macroeconomics.
After receiving his doctorate in economics from
Harvard UniversityHarvard University is a private university located in Cambridge, Massachusetts and a member of the Ivy League. Founded in 1636 by the colonial Massachusetts legislature, Harvard is the oldest institution of higher learning in the United States and currently comprises ten separate academic units...
in 1985, Kiyotaki held faculty positions at the
Univ. of Wisconsin–MadisonThe University of Wisconsin–Madison is a public research university located in Madison, Wisconsin, United States. Founded in 1848, UW–Madison is the flagship campus of the University of Wisconsin System. It became a land-grant institution in 1866...
, the
Univ. of MinnesotaThe University of Minnesota, Twin Cities is a public research university located in Minneapolis and St. Paul, Minnesota, United States...
, and the
London School of EconomicsThe London School of Economics and Political Science, commonly referred to as the London School of Economics or LSE, is a specialist constituent college of the University of London in London, England....
before moving to Princeton.
He is a fellow of the
Econometric SocietyThe Econometric Society, an International Society for the Advancement of Economic Theory in its Relation with Statistics and Mathematics was founded on December 29, 1930 at the Stalton Hotel in Cleveland, Ohio....
, was awarded the 1997
Nakahara PrizeThe Nakahara Prize is an annual award given by the Japanese Economic Association to Japanese economists under the age of 45 whose work has gained international recognition. The prize was created in 1995, and named after its sponsor Nobuyuki Nakahara...
of the Japan Economics Association and the 1999
Yrjö Jahnsson AwardThe Yrjö Jahnsson Award is a biennial award given by the Finnish Yrjö Jahnsson Foundation and the European Economic Association to European economists under the age of 45 "who have made a contribution in theoretical and applied research that is significant to the study of economics in Europe." ...
of the
European Economic AssociationThe European Economic Association is a professional academic body which links European economists. It was founded in the mid-1980s. Its first annual congress was in 1986 in Vienna, Austria. Its first President was Jacques Drèze....
, the latter together with
John MooreJohn Hardman Moore is a British economic theorist and professor at the University of Edinburgh and the London School of Economics . He is currently the director of the Scottish Institute for Research in Economics ....
.
In 1987, together with
Olivier BlanchardOlivier Jean Blanchard is currently the chief economist at the International Monetary Fund, a post he has held since September 1, 2008. He is also the Class of 1941 Professor of Economics at MIT, though he is currently on leave.Blanchard earned his Ph.D. in Economics in 1977 at MIT...
, Kiyotaki demonstrated the importance of
monopolistic competitionMonopolistic competition is a common market structure where many competing producers sell products that are differentiated from one another . Many markets are monopolistically competitive, common examples include the markets for restaurants, cereal, clothing, shoes and service industries in large...
for the
aggregate demand multiplierIn economics, the multiplier effect or spending multiplier is the idea that an initial amount of spending leads to increased consumption spending and so results in an increase in national income greater than the initial amount of spending...
.
is a
JapaneseThe are the predominant ethnic group of Japan. Worldwide, approximately 130 million people are of Japanese descent; of these, approximately 127 million are residents of Japan. People of Japanese ancestry who live in other countries are referred to as...
economistAn economist is an expert in the social science of economics. The individual may also study, develop, and apply theories and concepts from economics and write about economic policy...
and
professorThe meaning of the word professor varies. In some English-speaking countries, it refers to a senior academic who holds a departmental chair, especially as head of the department, or a personal chair awarded specifically to that individual...
at
Princeton UniversityPrinceton University a private university located in Princeton, New Jersey, United States. The school is one of the eight universities of the Ivy League and is considered one of the Colonial Colleges....
especially known for proposing several models that provide deeper
microeconomic foundationsIn economics, the term microfoundations refers to the microeconomic analysis of the behavior of individual agents such as households or firms that underpins a macroeconomic theory....
for
macroeconomicsMacroeconomics is a branch of economics that deals with the performance, structure, and behavior of a national or regional economy as a whole. Along with microeconomics, macroeconomics is one of the two most general fields in economics. It is the study of the behavior and decision-making of entire...
, some of which play a prominent role in New Keynesian macroeconomics.
Career
After receiving his doctorate in economics from
Harvard UniversityHarvard University is a private university located in Cambridge, Massachusetts and a member of the Ivy League. Founded in 1636 by the colonial Massachusetts legislature, Harvard is the oldest institution of higher learning in the United States and currently comprises ten separate academic units...
in 1985, Kiyotaki held faculty positions at the
Univ. of Wisconsin–MadisonThe University of Wisconsin–Madison is a public research university located in Madison, Wisconsin, United States. Founded in 1848, UW–Madison is the flagship campus of the University of Wisconsin System. It became a land-grant institution in 1866...
, the
Univ. of MinnesotaThe University of Minnesota, Twin Cities is a public research university located in Minneapolis and St. Paul, Minnesota, United States...
, and the
London School of EconomicsThe London School of Economics and Political Science, commonly referred to as the London School of Economics or LSE, is a specialist constituent college of the University of London in London, England....
before moving to Princeton.
He is a fellow of the
Econometric SocietyThe Econometric Society, an International Society for the Advancement of Economic Theory in its Relation with Statistics and Mathematics was founded on December 29, 1930 at the Stalton Hotel in Cleveland, Ohio....
, was awarded the 1997
Nakahara PrizeThe Nakahara Prize is an annual award given by the Japanese Economic Association to Japanese economists under the age of 45 whose work has gained international recognition. The prize was created in 1995, and named after its sponsor Nobuyuki Nakahara...
of the Japan Economics Association and the 1999
Yrjö Jahnsson AwardThe Yrjö Jahnsson Award is a biennial award given by the Finnish Yrjö Jahnsson Foundation and the European Economic Association to European economists under the age of 45 "who have made a contribution in theoretical and applied research that is significant to the study of economics in Europe." ...
of the
European Economic AssociationThe European Economic Association is a professional academic body which links European economists. It was founded in the mid-1980s. Its first annual congress was in 1986 in Vienna, Austria. Its first President was Jacques Drèze....
, the latter together with
John MooreJohn Hardman Moore is a British economic theorist and professor at the University of Edinburgh and the London School of Economics . He is currently the director of the Scottish Institute for Research in Economics ....
.
Contributions
In 1987, together with
Olivier BlanchardOlivier Jean Blanchard is currently the chief economist at the International Monetary Fund, a post he has held since September 1, 2008. He is also the Class of 1941 Professor of Economics at MIT, though he is currently on leave.Blanchard earned his Ph.D. in Economics in 1977 at MIT...
, Kiyotaki demonstrated the importance of
monopolistic competitionMonopolistic competition is a common market structure where many competing producers sell products that are differentiated from one another . Many markets are monopolistically competitive, common examples include the markets for restaurants, cereal, clothing, shoes and service industries in large...
for the
aggregate demand multiplierIn economics, the multiplier effect or spending multiplier is the idea that an initial amount of spending leads to increased consumption spending and so results in an increase in national income greater than the initial amount of spending...
. Most
New KeynesianNew Keynesian economics is a school of contemporary macroeconomics that strives to provide microeconomic foundations for Keynesian economics. It developed partly as a response to criticisms of Keynesian macroeconomics by adherents of New Classical macroeconomics.Two main assumptions define the New...
macroeconomic models now assume monopolistic competition for the reasons outlined by Blanchard and Kiyotaki.
Later, Kiyotaki worked with
Randall WrightRandall D. Wright is a Canadian academic macroeconomist who advanced the fields of monetary economics and labor economics by playing a major role in the development of matching theory.- Biography :...
to construct a model of the role of money, showing how money increased economic efficiency by permitting trade of many different types of goods which might not be traded under a system of
barterBartering is a medium in which goods or services are directly exchanged for other goods and/or services without a common unit of exchange . It can be bilateral or multilateral, and usually exists parallel to monetary systems in most developed countries, though to a very limited extent...
. This model, which formalized
William Stanley JevonsWilliam Stanley Jevons was an English economist and logician. His book The Theory of Political Economy expounded upon the "final" utility theory of value...
' insight about the double coincidence of wants as a barrier to economic activity under barter, has come to be known as the Kiyotaki-Wright model.
In 1997, with
John MooreJohn Hardman Moore is a British economic theorist and professor at the University of Edinburgh and the London School of Economics . He is currently the director of the Scottish Institute for Research in Economics ....
, Kiyotaki constructed a model to show how small shocks to the economy might be amplified into large output fluctuations through the interaction between real estate prices and restrictions on the availability of credit. This model is now known as the
Kiyotaki-Moore modelThe Kiyotaki-Moore model of credit cycles is an economic model developed by Nobuhiro Kiyotaki and John Moore that shows how small shocks to the economy might be amplified into large output fluctuations by credit restrictions....
.
External links