Niall Ferguson

The Crisis and How to Deal with It

Pub Date: 
Thu, 06/11/2009

Paul Krugman: I think there are two big structural changes that we'd want to see. One is we need to reduce the role of the financial sector in the economy. We went from an economy in which about 4 percent of GDP came from the financial sector to an economy in which 8 percent of GDP come from the financial sector, and in which at its peak 41 percent of profits were being earned by the financial sector. And there is no reason to believe that anything productive happened as a result of all of that.

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