Friday, February 12, 2010

Leijonhufvud's Modest Proposal

Axel Leijonhufvud (AL), UCLA economics professor's "Modest Proposal" is to better align bank managers' risks and rewards and limit the public damage they can do at VoxEU, 23 January 2010, link: I believe it's too modest. AL should have had banks' senior managers getting bailouts commit suicide, eat their children as Swift suggested the Irish do in his Modest Proposal, 1729, or at the least surrender all their assets. My proposal which I feel would be more difficult to game is on 7 July 2008:

1 comment:

Anonymous said...

I vote for AL's proposal.

Although your 2008 advice to Mr. Pandit was very good too.

Bankers must eat more of their own cooking.