KARTHIK SASTRY

KARTHIK SASTRY is assistant professor of economics and public affairs at Princeton University.

Karthik Sastry on Animal Spirits and the Economy

KARTHIK SASTRY March 12, 2025

While we like to think our financial decisions are based on logic, the truth is, they are largely driven by emotion. So when John Maynard Keynes looked for methods to measure economic fluctuations, animal spirits were a key ingredient. Karthik Sastry is a macroeconomist and assistant professor at Princeton University. In this podcast, he says personal instincts and primal urges are known to cause cycles of boom and bust, and one way to gauge those emotions is through economic narratives.

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IMF Podcasts are the views of the International Monetary Fund (IMF) staff and external officials on pressing economic and policy issues of the day. The IMF, based in Washington D.C., is an organization of 191 countries, working to foster global monetary cooperation and financial stability around the world. The views expressed are those of the author(s) and do not necessarily represent the views of the IMF and its Executive Board.