Roman Frydman

Chair, Program on Imperfect Knowledge Economics at The Institute for New Economic Thinking, Inc.

Roman Frydman

Roman Frydman

Chair, Program on Imperfect Knowledge Economics at The Institute for New Economic Thinking, Inc.

Biography

Roman Frydman is Professor of Economics at New York University, Chair of the INET Program on Knightian Uncertainty Economics, and Founding Editor of Project Syndicate. Frydman’s lifelong research has focused on the implications of Knightian uncertainty for macroeconomics, finance theory, and policymaking. His early work examined the widespread belief that the Rational Expectations Hypothesis (REH) – which since the 1970s has become the core premise of behavioral and imperfect-information approaches as well – provides the appropriate standard for modeling forecasting behavior. In contrast, Frydman argued, in a 1982 article in the American Economic Review that REH models do not provide an adequate representation of rational decision-making in real-world markets.

In the 1990s, Frydman became involved in the post-communist transformation in Eastern Europe and the former Soviet Union. He was one of the proponents of mass privatization – a novel approach to distribute equitably state-owned assets to citizens who lacked the resources to acquire them. His joint research with Andrzej Rapaczynski and others examined the political economy of the post-communist transformation and involved extensive empirical studies in ten countries. The results were presented in numerous articles and eight books (published by Oxford University Press jointly with Central University Press). This research laid the groundwork for the creation of Project Syndicate, which initially provided surveys of transition issues and commentaries to newspapers in fledgling democracies, but has since grown into the world’s largest provider of original commentaries on vital issues, which are published in more than 500 quality news outlets in over 150 countries.

Over the last two decades, Frydman has returned to his research on macroeconomics and finance theory. Building on his 1982 AER article, he and Michael Goldberg showed that the epistemological and empirical difficulties of existing macroeconomic and finance models stem from their assumption that Knightian uncertainty is irrelevant for understanding outcomes. They presented the results of this research, which they called Imperfect Knowledge Economics (IKE) in a number of articles and two books published by Princeton University Press, Imperfect Knowledge Economics and Beyond Mechanical Markets.

The arguments advanced by IKE’s critique have played an important role in developing an approach that would enable economists and policymakers to build models that recognize that they face Knightian uncertainty. After a multiyear effort, Roman Frydman, Søren Johansen, Anders Rahbek, and Morten Tabor have completed the development of such an approach, called the Knightian Uncertainty Hypothesis (KUH). By recognizing that economists and policymakers face Knightian uncertainty, KUE models show how both fundamental and psychological considerations drive rational behavior and market outcomes. Thus, KUH synthesizes the insights contributed by the major advances in macroeconomic and finance theory – REH and behavioral finance – since the 1970s. INET’s Research Program on KUE aims to develop this approach as an alternative to the prevailing paradigm in macroeconomics and finance theory.

Overview
RelSci Relationships

1343

Number of Boards

2

Relationships
RelSci Relationships are individuals Roman Frydman likely has professional access to. A relationship does not necessarily indicate a personal connection.

Co-Founder at The Institute for New Economic Thinking, Inc.

Relationship likelihood: Strong

Research Director at The Institute for New Economic Thinking, Inc.

Relationship likelihood: Strong

President at The Institute for New Economic Thinking, Inc.

Relationship likelihood: Strong

Former Professional at Boston University

Relationship likelihood: Strong

Co-Founder at ReadyNation, Inc.

Relationship likelihood: Strong

Director, Julis Rabinowitz Center for Public Policy & Finance at Princeton University

Relationship likelihood: Strong

Thomas W. Lamont University Professor at Harvard University

Relationship likelihood: Strong

Co-Founder at The Millennium Promise Alliance, Inc.

Relationship likelihood: Strong

Weekly Columnist at El Diario/la Prensa

Relationship likelihood: Strong

Research Associate at National Bureau of Economic Research, Inc.

Relationship likelihood: Strong

In The News
Institutional Investor (America's Edition)
April 11, 2014
Financial Bubbles, Toils and Troubles
Paths to Roman Frydman
Potential Connections via
Relationship Science
You
Roman Frydman
Chair, Program on Imperfect Knowledge Economics at The Institute for New Economic Thinking, Inc.
Career History
Chair, Program on Imperfect Knowledge Economics
Current

The Institute for New Economic Thinking was created to broaden and accelerate the development of new economic thinking that can lead to solutions for the great challenges of the 21st century. The havoc wrought by our recent global financial crisis has vividly demonstrated the deficiencies in our outdated current economic theories, and shown the need for new economic thinking – right now. The Institute is supporting this fundamental shift in economic thinking through research funding, community building, and spreading the word about the need for change. We already are a global community of thousands of new economic thinkers, ranging from Nobel Prize winning economists to teachers and students who have emerged out from the shadows of prevailing economic thought, attracted by the promise of a free and open economic discourse.

Professor of Economics
Current

Founded in 1831, New York University is now one of the largest private universities in the United States. Of the more than 3,000 colleges and universities in America, New York University is one of only 60 member institutions of the distinguished Association of American Universities. From a student body of 158 during NYU's very first semester, enrollment has grown to more than 40,000 students attending 18 schools and colleges at five major centers in Manhattan and in sites in Africa, Asia, Europe, and South America. Today, students come from every state in the union and from 133 foreign countries. The faculty, which initially consisted of fourteen professors and lecturers (among them artist and inventor Samuel F. B. Morse), now totals over 3,100 full-time members whose research and teaching encompasses the humanities, the sciences, and the social sciences; the law; medicine; business; education; the fine arts, studio art, and the performing and cinematic arts; music; social work; public administration; the ancient world; and continuing and professional studies. With more than 2,500 courses offered, the University awards more than 25 different degrees. Although overall the University is large, the individuals schools and colleges are small- to moderate-sized units—each with its own traditions, programs, and faculty – and there are many communities to be found within the NYU community based on interests, activities, and shared experiences. The center of NYU is its Washington Square campus in the heart of Greenwich Village. One of the city's most creative and energetic communities, the Village is a historic neighborhood that has attracted generations of writers, musicians, artists, and intellectuals. NYU, in keeping with its founder’s vision, is “in and of the city”: the University – which has no walls and no gates – is deeply intertwined with New York City, drawing inspiration from its vitality. In addition to its Manhattan locations, the University is also formally affiliated the Polytechnic Institute of NYU in Brooklyn, the second oldest school of engineering and technology in the country, and has research facilities, notably the Nelson Institute of Environmental Medicine, in Sterling Forest, near Tuxedo, New York. And NYU has established itself as the first global network university, with a comprehensive liberal arts campus in Abu Dhabi – the first to be operated abroad by a major U.S. research university – and other sites for study and research in Accra, Ghana; Berlin, Germany; Buenos Aires, Argentina; Florence, Italy; London, England; Madrid, Spain; Paris, France; Prague, the Czech Republic; Shanghai, China; and Tel Aviv, Israel, among other locations.

Boards & Committees
Member, Advisory Board
Current

The Institute for New Economic Thinking was created to broaden and accelerate the development of new economic thinking that can lead to solutions for the great challenges of the 21st century. The havoc wrought by our recent global financial crisis has vividly demonstrated the deficiencies in our outdated current economic theories, and shown the need for new economic thinking – right now. The Institute is supporting this fundamental shift in economic thinking through research funding, community building, and spreading the word about the need for change. We already are a global community of thousands of new economic thinkers, ranging from Nobel Prize winning economists to teachers and students who have emerged out from the shadows of prevailing economic thought, attracted by the promise of a free and open economic discourse.

Secretary
Current

FOSTER THE DEVELOPMENT OF ECONOMICS EDUCATION IN RUSSIA AND ADVANCING ACADEMIC COOPERATION BETWEEN AMERICAN AND RUSSIAN INSTITUTIONS AND TO COOPERATE WITH OTHER CHARITABLE ORGANIZATIONS WHETHER LOCAL, NATIONAL, OR INTERNATIONAL IN FURTHERANCE OF THE ORGANIZATION'S PURPOSE.

This web site is not endorsed by, directly affiliated with, maintained, authorized, or sponsored by Roman Frydman. The use of any trade name or trademark is for identification and reference purposes only and does not imply any association with the trademark holder. The Presence of Roman Frydman's profile does not indicate a business or promotional relationship of any kind between RelSci and Roman Frydman.