Acclaimed economists Akerlof and Shiller challenge the economic wisdom that got America into its current financial mess and put forward a bold new vision to transform and restore prosperity.

Preface vii Acknowledgments xiii Introduction 1 Part One: Animal Spirits Chapter One: Confidence and Its Multipliers 11 Chapter Two: Fairness 19 Chapter Three: Corruption and Bad Faith 26 Chapter Four: Money Illusion 41 Chapter Five: Stories 51 Part Two: Eight Questions and Their Answers Chapter Six: Why Do Economies Fall into Depression? 59 Chapter Seven: Why Do Central Bankers Have Power over the Economy (Insofar as They Do)? 74 Postscript to Chapter Seven: The Current Financial Crisis: What Is to Be Done? 86 Chapter Eight: Why Are There People Who Cannot Find a Job? 97 Chapter Nine: Why Is There a Trade-off between Inflation and Unemployment in the Long Run? 107 Chapter Ten: Why Is Saving for the Future So Arbitrary? 116 Chapter Eleven: Why Are Financial Prices and Corporate Investments So Volatile? 131 Chapter Twelve: Why Do Real Estate Markets Go through Cycles? 149 Chapter Thirteen: Why Is There Special Poverty among Minorities? 157 Chapter Fourteen: Conclusion 167 Notes 177 References 199 Index 219