Books by Robert J. Shiller

The question, then, is which prediction markets might prove most useful. Nobel Laureate economist Robert J. Shiller has promoted the idea of prediction markets in GDP, but most people face major risks at a more local, less aggregated level. One of the risks I face, for example, concerns the revenue of the university where I teach. This year enrollments rose slightly even though U.S. GDP fell sharply. So a GDP-based hedge probably is not very useful to me.

New out from Princeton University Press is Robert J. Shiller, Narrative Economics: How Stories Go Viral & Drive Major Economic Events .

One intriguing side of Shiller is his advocacy of derivatives and prediction markets to help individuals better hedge risk.  On that see Shiller’s book Finance and the Good Society .  Shiller for instance would like to see explicit futures or forward markets in gdp, and individuals could hedge with those markets to bet against bad business prospects.  One also can imagine laborers insuring their future income by transacting in indicators of economic health.  Shiller has raised the idea of using ...