Stanford University

Economic Affairs

Show Me the Money: Central Bank Museums and Public Trust in Monetary Governance

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Soraya Johnson
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McGill University Professor of Political Science Juliet Johnson unpacked how central banks use their own museums to support the ‘stability narrative’ and promote confidence in financial institutions. She discussed her research in a recent REDS seminar co-sponsored by CDDRL and The Europe Center.

Central banks may be unique among government bureaucracies because of their investment in their own museums. Central banks focus on public outreach because monetary systems depend on collective belief in the value of money, as it is one of the most essential social contracts upon which modern society is built.

Museums can be effective instruments for improving faith in money and financial institutions. Visitors are unusually receptive to learning from museums because museums are often viewed as neutral, trusted guides. The number of central bank museums has increased significantly over the last two decades, and some get many visitors yearly. The Museum Bank Indonesia has an impressive 10,781 Google reviews and a 4.7-star rating.

The nearly 60 central bank museums that focus on economic education (in addition to numismatics and/or art) promote what Johnson calls the stability narrative, which is that central banks can maintain the value and security of money, represent the nation, and have become progressively more effective over time.

Through interactive exhibits and games, these museums aim to teach visitors that the central bank is needed to fight the evils of inflation. For example, the Bank of Finland museum has a display that features a green inflation monster to convey this sentiment. They use the exhibits to emphasize how people can be personally affected by inflation and, in many cases, to explain why maintaining a 2% inflation rate is ideal for protecting the value of money.

Central banks convey a sense of security to visitors through exhibits about detecting counterfeit money, regulating banks, and displaying their wealth, such as with gold bars. They tie their work to national pride through art displays about national heroes depicted on currency and by relating their work to prominent historical events. Through visual timelines, they convey how central bankers have learned from past mistakes and solved problems, making them more equipped to continue ensuring the stability of our financial system.

The rise of central bank museums exhibits the importance of improving public confidence in money and the financial institutions that control it, legitimizing an essential aspect of our society. 

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Juliet Johnson presented her research in a REDS Seminar, co-hosted by CDDRL and TEC, on February 27, 2025.
Juliet Johnson presented her research in a REDS Seminar, co-hosted by CDDRL and TEC, on February 27, 2025.
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Juliet Johnson, Professor of Political Science at McGill University, explores how central banks build public trust through museums.

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The political economy of antipoverty policies in Latin America

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Poverty relief policies based on Conditional Cash Transfer (CCT) programs are perhaps the most fundamental institutional social policy innovation at the turn of the twentieth century. It was in Latin America where they were initially created. This chapter explores the political economy of the adoption of CCT antipoverty interventions, why they have improved targeting in favor of the poor, how they have become increasingly popular among politicians and policy makers, and whether structuring these programs has shifted policy discretion away from political clientelism, in favor of becoming true entitlements. One major implication of the rise of CCTs is that citizens in Latin America can now judge the competence and performance of politicians in terms of their success or failure in reducing poverty.

This is a draft (longer version) of the forthcoming article prepared for the Oxford Handbook of Social Policies in the Global South (2025). Edited by: Armando Barrientos, Matthew Carnes, Huck-Ju Kwon, Herbert Obinger, Leila Patel and Carina Schmitt. Oxford University Press.

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Working Papers
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Alberto Díaz-Cayeros

Beyond the Pitch Deck: Truths About VC

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In-person: Stanford Graduate School Business - C105 (655 Knight Way, Stanford)

Online: Via Zoom

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Better financial contracts can unlock business growth in Kenya

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Supply chains can be surprisingly complex. In many low- and middle-income settings, large companies often rely on networks of small, independent distributors who travel by foot to sell consumer goods to otherwise hard-to-reach customers (Kruijff et al. 2024). These ‘micro-distributors’ operate at the far edge of the supply chain, with no formal employment contracts, thin profit margins, and high levels of economic risk.

In a field experiment in Kenya, we partnered with one of the world’s largest food manufacturers (pseudonymously “FoodCo”) to evaluate whether investment-appropriate financing contracts could help their independent distributors improve their business performance. We found that tailoring repayment terms to better share risk and rewards—compared to a standard, rigid debt contract—significantly boosted distributors’ profits. Crucially, these more flexible contracts took advantage of detailed administrative data on monthly performance. These findings underscore the promise of improved observability enabled by digitisation: with richer data, financial contracts can be designed to incorporate greater risk-sharing (Fischer 2013, Meki 2024), potentially opening new opportunities for mutually beneficial investments.

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Flexible financing for ‘last-mile’ distributors boosted profits across a food supply chain in Kenya.

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VoxDev
Authors
Marcel Fafchamps

Financial market exposure increases generalized trust

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How can we build trust, especially in polarized societies? We propose that exposure to broad financial markets—where individuals place their assets in the hands of large groups of unfamiliar agents who nonetheless have the incentive and ability to promote their interests—can contribute to generalized trust. In a randomized controlled trial, we encourage Israelis to hold or trade stocks for up to seven weeks. We find that participation in financial markets increases the probability of expressing generalized trust by about 6 percentage points, equivalent to a quarter of the control group mean. The effects seem to be driven by political partisans along the left–right spectrum in Israel, and are robust to negative price changes. Thus, trust is not only a cause but can also be an effect of participation in financial markets.

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Journal of Public Economics
Authors
Saumitra Jha
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February 2025, 105303

Global Capitalism, Trust and Accountability Conference

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The Program on Capitalism and Democracy
presents a two-day conference
Co-sponsored by the Stanford Graduate School of Business (GSB) and the Center on Democracy, Development and the Rule of Law (CDDRL)

Global Capitalism, Trust, and Accountability conference

Are democratic governments equipped and willing to hold global capital accountable, and does their failure to do so affect citizens’ trust?

Global capitalism has reshaped trade, economic priorities, and financial flows — and, in doing so, has also transformed societies and politics. However, the transnational nature of global capital has presented an intellectual and policy challenge as corporate activities and corruption adapt to the global environment. While activists, journalists, and scholars have investigated and publicized these issues, much work remains to develop coherent analytical understandings of these problems.  

Democratic governments often struggle to establish and enforce proper rules for corporate malfeasance and corruption. Domestic regulations present jurisdictional challenges, and corporate law, which enables corporations, has yet to be effective in preventing them and their leaders from dodging accountability in global markets. The world of global capital is opaque, designed explicitly to hide assets or evade the reach of governments. The financialization of the global economy has expanded the power not only of banks but also of professional services that facilitate ties between wealthy individuals, political leaders, and tax havens or shelters.

This conference brings together scholars across the disciplines of law, business, social sciences, and history, as well as practitioners and journalists, to explore the challenge of creating trust and accountability in a system dominated by global capitalism. In convening together, we aim to advance research, education, and policy on these critical issues.

Organizers

Anat Admati (George G.C. Parker Professor of Finance and Economics, GSB, and Faculty Director of the Capitalism and Democracy Program at CDDRL) and Didi Kuo (Center Fellow, CDDRL)

Anat R. Admati Anat Admati

Anat R. Admati

Didi Kuo Didi Kuo

Didi Kuo

FRIDAY, APRIL 4

 

1:30 - 1:45 — Introduction and Opening Remarks
 

Peter DeMarzo, Philip H. Knight Professor and Dean of the Graduate School of Business (Interim)
Kathryn Stoner, Mosbacher Director, Center on Democracy, Development and the Rule of Law
Didi Kuo, Center Fellow, Freeman Spogli Institute for International Studies
Anat Admati, George G.C. Parker Professor of Finance and Economics, Stanford Graduate School of Business

1:45 - 3:15 pm Session 1 — Why Trustworthy Governments are Essential
 

For markets and capitalism to continue producing broad-based prosperity, governments must maintain the institutions that underpin the market economy, ensuring that property and human rights are protected, that people have fair access to society’s resources and that contracts and laws are enforced effectively. This panel examines the forces that can help make institutions trustworthy or in turn cause trust to erode, framing key issues that the rest of the conference explores.

MODERATOR
Curtis Milhaupt, Stanford Law School

PANELISTS
Vic Khanna, University of Michigan Law School
Naomi Lamoreaux, Economics and History, Yale University
Alexander Cooley, Political Science, Barnard College

DISCUSSANT
Rick Messick, Global Anticorruption Blog

3:15 - 3:45 — Break

 

3:45 - 5:15 pm — Session 2: Opacity and Illicit Flows


The globalization of financial flows, and the opacity of the global economic system and of many governments, have increased opportunities for wealthy individuals, kleptocrats and terrorists to evade law enforcement. How can we conceptualize and measure these problems and the harm they cause? What is the role of anonymous and multinational corporations, secrecy jurisdictions, transnational actors, and cryptocurrencies in shaping these opportunities, and how might these problems be addressed?

MODERATOR
Victoria Baranetsky, The Center for Investigative Reporting

PANELISTS
Dan Nielson, Government, University of Texas at Austin 
Gary Kalman, Transparency International US
Brooke Harrington, Sociology, Dartmouth College

DISCUSSANT
Mark Weidemaier, University of North Carolina School of  Law

5:30 - 6:15 pm — Keynote: Investigating “the Brazen”


Tom Wright, Co-Founder of Project Brazen; co-author of the bestseller, Billion Dollar Whale: The Man Who Fooled Wall Street, Hollywood, and the World; Former Wall Street Journal Asia Economics Editor

MODERATOR
Anat Admati, Stanford Graduate School of Business

6:30 — Reception and Dinner
 


SATURDAY, APRIL 5
 

8:00 - 8:30 am — Breakfast
 

8:30 - 9:15 am — Keynote: Is Cryptocurrency a Racket?


Judge Jed Rakoff, Senior Judge of the United States District Court for the Southern District of New York

MODERATOR
Rohit Chopra, Former CFPB Director and FTC Commissioner

9:15 - 10:45 am — Session 3: The Law and Politics of Fighting Corruption


Can democratic governments and global institutions. through laws and international agreements, address corruption in its many forms within and across jurisdictions? What are the political forces that interfere with such efforts? This panel examines the mechanisms and tools that are available to policymakers, media and the public, to fight corruption in the private sector and in government, and the political and institutional challenges.

MODERATOR
Luigi Zingales, University of Chicago Booth School of Business

PANELISTS
Kevin Davis, New York University School of Law
Gerhard Schick, Finanzwende, Germany
John Githongo, Kenya

DISCUSSANT
Vikrant Vig, Stanford Graduate School of Business

10:45 - 11:15 am — Break
 

11:15 am -12:45 pm — Session 4: Greed, Norms, Culture, and Trust


Norms and culture, both in corporations, in government bodies, and in society at large, play a significant role in promoting trust and preventing misconduct. Global capitalism and democratic institutions reflect norms, but they also reshape them. This panel investigates the societal and democratic norms shaping transparency, whistleblowing, ways to hold power to account, and ultimately trust in institutions.

MODERATOR
Didi Kuo, Freeman Spogli Institute for International Studies, Stanford University

PANELISTS
Jonathan Katz, The Brookings Institution
Peter Solmssen, Former Siemens AG
Miriam Baer, Brooklyn Law School

DISCUSSANT
Paola Sapienza, Hoover Institution, Stanford University

12:45 - 1:45 pm Lunch
 

1:45 - 3:15 pm — Session 5: Corporate Misconduct and the Law


What are the tools for deterring corporate misconduct, and are these tools being used effectively? This panel of experts on white-collar crime will explain why laws and enforcement mechanisms may fail to deter corporate misconduct and why corporate leaders are rarely appropriately held accountable. What is the interplay of institutions, politics, and power that undermines the rule of law in the corporate context?

MODERATOR
Anat Admati, Stanford Graduate School of Business

PANELISTS
Ellen S. Podgor, Stetson University College of Law
Elizabeth Pollman, University of Pennsylvania Carey Law School
Fabio De Pasquale, Public Prosecutor's Office, Milan, Italy

DISCUSSANT
Jennifer Taub, Wayne State University Law School

3:15 -3:45 pm — Break
 

3:45 -5:15 pm — Session 6 (Round Table): What Academics, Activists, and the Media Can Do


This roundtable will enable all participants to brainstorm how academics, activists, and journalists can work together to accomplish shared goals around global capitalism and accountability. How are each sector's resources, voices, and contributions best deployed? How might individuals and organizations align their work and objectives? And most importantly, how might we create a more trustworthy and fair economic system for the 21st century?

MODERATOR
Bethany McLean, Vanity Fair

5:15 - 5:30 pm — Closing Remarks
 

5:30 pm — Closing Reception

In-person: By invitation only.

Virtual: Open to the public

Conferences
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Demand for Commitment in Credit and Saving Contracts: A Field Experiment

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We conduct a field experiment in which we offer credit and saving contracts to the same pool of Pakistani microfinance clients. Additional treatments test ex-ante demand for soft commitment (in the form of reminders, either to respondents or to their families), hard commitment (in the form of a penalty for missing an installment), and flexibility (an option to postpone an installment) to save or pay loan installments on time. We find substantial demand for fixed repayment contracts in both the credit and savings domains in ways that imply that respondents value the commitment required. While we find little or no average demand for additional contractual features, we nonetheless observe that different combinations of contractual add-ons are preferred depending on the respondent’s level of financial discipline. Respondents with high financial discipline prefer flexibility in credit contracts when combined with reminders to self, while those with low discipline value penalties in savings contracts only when paired with reminders. Our results imply that, for the average microfinance client, demand for commitment is met through the regular payment schedule built into standard microcredit or commitment savings contracts. However, combining penalties or flexibility with reminders may appeal to certain subsets of clients.

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The Economic Journal
Authors
Marcel Fafchamps
Number
Issue 664

Katherine Casey

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Professor of Political Economy, Stanford GSB
Faculty Director, Stanford King Center on Global Development
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Katherine Casey is Professor of Political Economy at the Stanford Graduate School of Business and the Faculty Director of the King Center on Global Development. Her research explores the interactions between economic and political forces in developing countries, with particular interest in the role of information in enhancing political accountability and the influence of foreign aid on economic development. Her work has appeared in the American Economic Review, Journal of Political Economy, and Quarterly Journal of Economics, among others. 

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Israel Insights Webinar with Azar Gat — What Is The Problem With “The Palestinian Problem”?

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Cover image for Gil Troy event

Despite the great progress made in Arab-Israeli rapprochement over the past several decades, the Israeli-Palestinian conflict appears as intractable today as it has ever been. Why has this conflict proved so difficult to resolve? Why have all attempts at a final peace settlement between Israelis and Palestinians failed since the launch of the Oslo Peace Process in the early 1990's? And what can be learned from this history of failure about the prospects of resolving the Israeli-Palestinian conflict? Join Amichai Magen in conversation with Azar Gat.

Read the essay here.

ABOUT THE SPEAKER

Professor Azar Gat is the Ezer Weitzman Chair of National Security and Head of the International and Executive MA Programs in Security and Diplomacy in the School of Political Science, Government and International Affairs at Tel Aviv University. He is also Academic Advisor to the Executive Director of the Institute for National Security Studies (INSS) in Tel-Aviv. Professor Gat is the author of 12 books - on democracy, nationalism, ideology, war and military history - which have been translated into numerous languages.

Virtual Event Only.

Amichai Magen
Amichai Magen

Virtual Only Event.

Azar Gat
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Democracy Dilemma: Business Leadership in an Era of Rising Autocracies

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Bill Browder event

In an era of rising autocracy, Bill Browder, the bestselling author of Red Notice and Freezing Order, brings his unparalleled expertise to the forefront. Join the Program on Capitalism and Democracy for a discussion on how business leaders can safeguard democratic principles while navigating increasingly challenging political landscapes. 

Browder's firsthand experiences combating corruption in Russia and beyond offer valuable lessons for today's global business environment. His story exemplifies how business leaders can leverage their influence to shape policy, champion justice, and uphold democratic ideals—even when confronted with grave personal and professional risks.

This event is co-sponsored by the Corporations and Society Initiative (CASI) at the Graduate School of Business and the Program on Capitalism and Democracy at the Center on Democracy, Development and the Rule of Law (CDDRL).

ABOUT THE SPEAKER

Sir William (Bill) Browder KCMG was once the largest foreign portfolio investor in Russia until being declared “a threat to national security” in 2005 for exposing corruption in Russian state-owned companies.

In 2008, Bill’s lawyer, Sergei Magnitsky, uncovered a massive fraud committed by Russian government officials stealing US $230 million of state taxes and was subsequently arrested, imprisoned without trial, and systematically tortured.

Sergei Magnitsky died in prison on November 16, 2009. Ever since, Sir William has led the Global Magnitsky Campaign for governments around the world to impose targeted visa bans and asset freezes on human rights abusers and highly corrupt officials, introducing the passage of the Sergei Magnitsky Accountability Act in 2012, & the Global Magnitsky Human Rights Accountability Act 2016. Which has since been adopted by 11 countries, including the U.S., UK, Canada, and New Zealand.

For his exceptional service to the UK abroad and internationally, in recognition of his significant and sustained contribution to human rights and anti-corruption, he was appointed by King Charles in the 2024 Birthday Honours List a Knight Commander of the Order of St Michael and St George (KCMG).

Rachel Hersh, MBA '25

In-person: GSB Knight Management Center, C102 (657 Jane Stanford Way, Stanford)
Online: Via Zoom

Bill Browder
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