Professor Goodfriend’s insights were often applied directly to policy. He served as a visiting scholar at various global monetary authorities, including the Bank of Japan and the European Central Bank. From 1984 to 1985, he served as a senior staff economist for President Ronald Reagan’s Council of Economic Advisers.
“He really excelled at bridging the divide between rigorous academic economics and policy-setting,” said Jeffrey Lacker, a former president of the Richmond Fed who worked with Professor Goodfriend when both were on the staff there.
His research also helped to fundamentally shift the way academics understood central banking, Professor Gertler said. While macroeconomists had long focused on money supply, for instance, Professor Goodfriend pointed out that interest rates were central to economic policy during Paul Volcker’s tenure as chairman of the Fed.
“He was an original thinker,” Professor Gertler said.
Professor Goodfriend also made a case that central bank secrecy could have both benefits and drawbacks, and he did extensive research into negative interest rates.
In the wake of the 2007-9 recession, he took a position that was fairly out of the consensus in warning that the Fed might be courting high inflation with its post-financial crisis monetary policies. He told House lawmakers in 2017 that the Fed’s inflation targeting approach should be made more credible.
While he was sometimes critical of the Fed’s approach, Professor Goodfriend was ultimately loyal to the institution and its mission, Professor Gertler said. He was a member of the Shadow Open Market Committee, an independent group of influential academics who evaluated the policy choices and actions of the Fed’s policy-setting committee.
“He has always been someone who wants to follow the idea he has — even if it’s controversial,” his wife, Marsha Stroh Goodfriend, said. The two met while working at the Richmond Fed 41 years ago, and dated for nearly four decades before marrying in 2017, she said.