Alan Blinder on Raghuram Rajan in 2005

In the interest of keeping our eye on the ball in FinReg, let me present Alan Blinder stating that incentives in banks that are too big to fail simply must be totally and completely broken and misaligned:

I’d like to defend Raghu a little bit against the unremitting attack he is getting here for not being a sufficiently good Chicago economist and just emphasize the sentence in his paper which says, “There is typically less downside and more upside risk from generating investment...