With Ben Bernanke stepping down as Chairman of the Federal Reserve Board, President Obama has nominated Janet Yellen to hold the seat. She would be the first woman in the position. On November 14, she answered questions during the Senate Banking Committee hearing on her nomination. Yellen’s position offers a unique chance for good research paper topics, such as women in finance, Federal Reserve Board policy and supply-side economics versus Keynesian economics.
Economist Yellen rose through the ranks
Janet Louise Yellen, born 1946, earned a Ph.D. in economics from Yale University in 1971. After joining the faculty at the University of California, Berkeley in 1980, she ended her academic career as Professor Emerita at the university’s Haas School of Business. She served as an economist with the Federal Reserve Board of Governors, as President and CEO of the Federal Reserve Bank of San Francisco, as Chair of the White House Council of Economic Advisers under President Bill Clinton and then as Vice Chair of the Board of Governors of the Federal Reserve System.
Women encouraged by Yellen appointment
There have been women secretaries of state and national security advisors. Now for the first time, a woman will be chair of the Federal Reserve Board. More and more, women are gaining prominence in positions of political and business power. “Women who find their way to the top create a draw for the people who are coming behind,” said KeyCorp Chair and CEO Beth Mooney in “Inspired by Yellen, women in banking see ‘infinite’ possibilities” by Sarah Todd and Jeanine Showronski in American Banker, October 15, 2013.
“Janet Yellen isn’t going to change the course of monetary policy drastically… but there will be some priorities at the Fed that will reflect the fact that she is a woman and that will be progress, too,” said American Banker Editor-at-Large Barb Rehn in the same article. A good research paper topic may be to profile a few women in high positions in business and economics and report on how they reached the top, their business strategies and their predictions for the future of their industries.
Investors appear happy with Yellen’s economic policy
Yellen’s economic policy has been characterized by a desire to continue stimulus money to aid the economy, a decision that encourages investors, evidenced by their confidence in the stock market. “Yellen’s turn before the Senate Banking Committee was as notable for what she didn’t say as for what she did—namely, anything remotely to do with when the Fed would start scaling back its $85 billion-a-month bond purchase program,” reported Alain Sherter in “Taper caper: Why investors don’t fear Janet Yellen,” posted November 18, 2013 for CBS News’s Money Watch. This decision was tactical, and “For the Fed, tapering no longer poses the same threat to the economy that it did in mid-summer, when stocks recoiled at the bare mention of the word.”
Yellen is entering her position at a time when the economic condition is well into a solid recovery. Short-term interest rates and consumer interest rates are near zero, the stock market is rising at an acceptable rate, home prices are rising and bank lending is stable.
Keynesian economics versus free market
Another idea for good research paper topics is to discuss different economic policies and their benefits and disadvantages. Yellen, considered an acolyte of Ben Bernanke, advocates a Keynesian approach, which believes that the government should play a significant role in offering stimulus money and bailouts to encourage economic growth. Developed by the British economist John Maynard Keynes during the 1930s to deal with the Great Depression, Keynesian economics advocates government economic intervention policies to stimulate demand.
Opposed to this big government approach is supply-side economics, which advocates letting the free market take care of itself without government interference. Lower taxes and deregulation provide businesses with more money to grow and hire more workers.
In his opinion piece “A case against Janet Yellen for Fed chairman,” posted October 9, 2013 on Forbes, Hunter Lewis remarked about the years since the 2008 economic downturn: “Every dollar of new borrowing encouraged by giveaway interest rates was more than offset by a reduction in spending by savers. When savers receive little or no return on savings, they cannot either spend or invest what they do not receive…. The severely repressed interest rates they have favored represent price controls … and price controls never work.”
For your business or economics term paper, consider writing about economic policy and whether you believe we should continue with government stimulus to spur economic growth or to let the free market, supply-side economics and consumer behavior allow the market to correct itself.
Do you agree or disagree with Janet Yellen’s economic policies?
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