Loic Sauce, Professor, ISTEC, Paris, France. Prof. Sauce is a brilliant researcher from ISTEC, France who is author of numerous papers in prestigious journal on the topics of finance and financial markets. The title of his speech will be "Irrational financial instability and rational herding". The 2008 crisis rekindled the never-ending debate on the intrinsic (in)-stability of a complex monetary economy. The inability of the usual tools of economists to modelize uncertainty and the recurrence of irrational systematic behavior such as herding and bubbles is now obvious. The aim of the speech is to present and confront the two unconventional economic theories of Hyman Minsky (post-Keynesian) and Roger Koppl (Austrian school of economics) on these usual topics of market instability, business cycles and rationality. Both authors focus on the role of expectations, financial innovations, and institutions to explain the occurrence of business cycles and financial instability. Prof. Sauce will show that their opposed policy recommendations may be explained by the opposed causality relationship they build between expectations and institutions.
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