John H. Cochrane

Senior Fellow
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Biography: 

John H. Cochrane is a senior fellow at the Hoover Institution. He is also a research associate of the National Bureau of Economic Research and an adjunct scholar of the CATO Institute. 

Before joining Hoover, Cochrane was  a Professor of Finance at the University of Chicago’s Booth School of Business, and earlier at its Economics Department. Cochrane earned a bachelor’s degree in physics at MIT and his PhD in economics at the University of California at Berkeley. He was a junior staff economist on the Council of Economic Advisers (1982–83).

Cochrane’s recent publications include the book Asset Pricing and articles on dynamics in stock and bond markets, the volatility of exchange rates, the term structure of interest rates, the returns to venture capital, liquidity premiums in stock prices, the relation between stock prices and business cycles, and option pricing when investors can’t perfectly hedge. His monetary economics publications include articles on the relationship between deficits and inflation, the effects of monetary policy, and the fiscal theory of the price level. He has also written articles on macroeconomics, health insurance, time-series econometrics, financial regulation, and other topics. He was a coauthor of The Squam Lake Report. His Asset Pricing PhD class is available online via Coursera. 

Cochrane frequently contributes editorial opinion essays to the Wall Street Journal, Bloomberg.com, and other publications. He maintains the Grumpy Economist blog.

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Recent Commentary

Featured

A Progressive VAT

by John H. Cochrane via Grumpy Economist
Wednesday, April 26, 2017

A VAT (value added tax) with no other tax — no income, corporate, estate, etc. etc. etc. — is pretty much the economists’ ideal. But how do you make it progressive? A bright — or perhaps lunatic— idea occurred to me.

Analysis and Commentary

Long Run Lira?

by John H. Cochrane via Grumpy Economist
Tuesday, April 25, 2017

Luigi Zingales inaugurated a series of essays in Il Sole 24 Ore, an Italian newspaper, on whether Italy should stay in or get out of the Euro, and graciously asked me to contribute. My view, here in English, here in Italian.

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Make America Exceptional Again

by John H. Cochrane via Hoover Digest
Monday, April 24, 2017

The rule of law, the centerpiece of American exceptionalism, is under assault. How to halt the predations of the regulatory state. 

Analysis and Commentary

Inflating Our Troubles Away?

by John H. Cochrane via Grumpy Economist
Monday, April 24, 2017

These are comments I gave on "Inflating away the public debt? An empirical assessment" by Jens Hilscher, Alon Aviv, and Ricardo Reis at the Becker-Friedman Institute Government Debt: Constraints and Choices conference, April 22 2017, along with generic comments on the conference in general. This post contains mathjax equations.

Featured

Capital Cause And Effect

by John H. Cochrane via Grumpy Economist
Friday, April 14, 2017

Òscar Jordà, Björn Richter, Moritz Schularick, and Alan Taylor wrote a provocative What has bank capital ever done for us? at VoxEu, advertising the underlying paper Bank Capital Redux.

Featured

United

by John H. Cochrane via Grumpy Economist
Wednesday, April 12, 2017

Commentators seem to have noticed a lot of the economics of the United fiasco: Yes, don't stop auctions at $800. Yes, if you need employees at Louisville so badly, call up American and buy a first class ticket. Book a private jet. Or, heck, you're an airline. Bring up another plane. Don't drag people off planes to save a measly $500.

Featured

The Second Original Sin Of Healthcare Regulation

by John H. Cochrane via Grumpy Economist
Wednesday, April 5, 2017

Whenever I advance one or another view of how a relatively free health care and insurance market could work a lot better than the mess we have now, the obvious question comes up: Well, what about the homeless person with a heart attack? You won't let him die in the gutter will you?

Federal Reserve
Analysis and Commentary

Spikes

by John H. Cochrane via Grumpy Economist
Tuesday, April 4, 2017

Jon Hartley, writing in Forbes, offers a great graph of the overnight Federal Funds rate,This graph  mirrors nicely the graph I posted last week, from "Deviations from Covered Interest Rate Parity" by Wenxin Du, Alexander Tepper, and Adrien Verdelhan:What's going on with these...

Interest Rates
Analysis and Commentary

Floating Rates?

by John H. Cochrane via Grumpy Economist
Tuesday, April 4, 2017

I was interested to read in the Financial Times, "Iceland weighs plan to peg krona to another currency":Iceland’s finance minister has admitted it is untenable for the country to maintain its own freely floating currency....Benedikt Johannesson told the Financial Times that the Nordic island of...

Analysis and Commentary

Consumption Vs. GDP

by John H. Cochrane via Grumpy Economist
Sunday, April 2, 2017

Random Critical Analysis has a really interesting blog post from a while ago, on the difference between consumption and income as measures of well being. The level of data analysis and detail on that blog is really impressive.

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Current Online Courses

Asset Pricing, Part 1, via Coursera and the University of Chicago

This course is part one of a two-part introductory survey of graduate-level academic asset pricing. We will focus on building the intuition and deep understanding of how the theory works, how to use it, and how to connect it to empirical facts. This first part builds the basic theoretical and empirical tools around some classic facts. The second part delves more deeply into applications and empirical evaluation. Learn more. . .