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A parallel that springs to mind is the deleterious impact that Western aid and development agencies have often had in Africa, at least in the past when they favored big-dollar projects. This gap between what employees of Goldman and its Wall Street peers (including hedge funds, private equity firms, etc.) How artificially high?
The conviction spread that, thanks in part to financial innovation, the world's developed economies had become more resilient even as financial markets became more volatile. You can find lots of scholars at top economics departments who study why bubbles and crashes happen, and how psychology and genetics shape individual decisionmaking.
Real business cycle theory continued to prosper, developing an increasing stranglehold over the professional journals. Behavioral finance stayed on the margins. It doesn't offer much hope, though, for clear guidelines to macroeconomic decisionmaking. And nothing happened.
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