What an amusement park can teach us about central banks

To Tivoli Gardens in the heart of Copenhagen, one of the world’s oldest amusement parks. It was founded 180 years ago, and its creator George Carstensen secured the land by petitioning King Christian VIII, arguing, “When the people are amusing themselves, they do not think about politics.”

 
In Tivoli, I don’t think about politics either. But during the wait to ride the Demon and the Star Flyer, I can’t help but think about economics. Specifically, I think about Robert Lucas’s charming speech, “What Economists Do”. It was delivered as a commencement address in 1988, seven years before the hugely influential macroeconomist was awarded the Nobel memorial prize.

I revisited the speech when news reached me of Robert Lucas’s recent death at the age of 85.

“We are basically storytellers,” wrote Lucas, “creators of make-believe economic systems.”

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