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A Crash Course on Crises

An incisive overview of the macroeconomics of financial crises—essential reading for students and policy experts alike.

With alarming frequency, modern economies go through macro-financial crashes that arise from the financial sector and spread to the broader economy, inflicting deep and prolonged recessions. A Crash Course on Crises brings together the latest cutting-edge economic research to identify the seeds of these crashes, reveal their triggers and consequences, and explain what policymakers can do about them.

Each of the book’s ten self-contained chapters introduces readers to a key economic force and provides case studies that illustrate how that force was dominant. Markus Brunnermeier and Ricardo Reis show how the run-up phase of a crisis often occurs in ways that are preventable but that may go unnoticed and discuss how debt contracts, banks, and a search for safety can act as triggers and amplifiers that drive the economy to crash. Brunnermeier and Reis then explain how monetary, fiscal, and exchange-rate policies can respond to crises and prevent them from becoming persistent.

With case studies ranging from Chile in the 1970s to the COVID-19 pandemic, A Crash Course on Crises synthesizes a vast literature into ten simple, accessible ideas and illuminates these concepts using novel diagrams and a clear analytical framework.

A Crash Course on Crises is also an ideal teaching companion for courses such as Intermediate Macroeconomics, Money and Banking, and similar.

Read the introduction

Praise for A Crash Course on Crises

“You learn most about the character of an economy when it is in crisis, and there have been many to learn from. This book provides a first comprehensive, intuitive, and insightful description of the many macro-financial crises of recent decades. The two leading macroeconomists of our times cut through the clutter and distill essential lessons for students and policymakers.”

— Gita Gopinath, First Deputy Managing Director, International Monetary Fund

“In this crash course, two top economists introduce students to what we know about financial crises, with a taste of economic theory and an abundance of fascinating case studies.”

— Greg Mankiw, Harvard University

“Written by two of the leading economic thinkers today, A Crash Course on Crises is an eminently readable introduction to modern thinking about the macroeconomic and financial underpinnings of economic crises. The book, targeted at the intelligent undergraduate, the curious policymaker, and the interested public citizen, unpacks complex ideas while explaining the causes of crises as well as the tools policymakers have used to recover from them. It will be very useful as accompanying reading in any macroeconomics or macro-finance course.”

— Raghuram Rajan, author of The Third Pillar

“A remarkably fresh take on teaching financial crises, drawing on examples from around the world to eloquently exposit even the most difficult concepts in a thoroughly engaging format.”

— Kenneth S. Rogoff, coauthor of This Time Is Different

About the Authors

Markus K. Brunnermeier is the Edwards S. Sanford Professor of Economics at Princeton University and the Director of Princeton’s Bendheim Center for Finance.

Originally from Landshut, Germany, Brunnermeier has been with Princeton since completing his Ph.D. at the London School of Economics. His research focuses on international financial markets and the macroeconomy with special emphasis on bubbles, liquidity, financial and monetary price stability, and digital money.

In 2020, Brunnermeier was elected as Vice President of the American Finance Association. He has been a member of several advisory groups, including the International Monetary Fund, the Federal Reserve Bank of New York, the European Systemic Risk Board, the Bundesbank, and the U.S. Congressional Budget Office. His books include The Resilient Society and The Euro and the Battle of Ideas. 


Ricardo Reis is the A. W. Phillips Professor of Economics at the London School of Economics. He also holds research positions at the Centre for Macroeconomics, the Centre for Economic Policy Research, and the CESIfo Group. Ricardo acts as an academic advisor to the Bank of England and the Federal Reserve Bank of Richmond, and sits on numerous advisory bodies. He is also editor of the Journal of Monetary Economics.

A graduate of the LSE Department of Economics, Ricardo was awarded his PhD in Economics by Harvard in 2004. Between 2004 and 2008 he was Assistant Professor of Economics and Public Affairs at Princeton. In 2008, he became one of the youngest full professors in the history of Columbia University, and was later appointed to the Eccles Chair in Financial Economics. He is a winner of the 2021 Yrjö Jahnsson Award.