What was the greatest wealth-creating film of all time? Titanic might be a popular guess, but the answer, according to Columbia University’s Nobel laureate economist Robert Mundell, is Taxi Driver.
The 1976 classic, directed by Martin Scorsese with Robert De Niro as the bitterly alienated protagonist, gave the world De Niro’s catchphrase “You talking to me?,” and also introduced a young Jodie Foster. But what does it have to do with the world economy?
John Hinckley, the deranged would-be assassin who attempted to kill Ronald Reagan in 1981, claimed that he was inspired by it. He said that his action was an attempt to impress Foster. (The movie features a scene in which a mohawked De Niro attempts to assassinate a politician.)
According to Mundell, the wave of sympathy for President Reagan that was engendered by the assassination attempt deterred Democrats in Congress from voting against his proposed tax cuts. Due to this accident of history, the US administered a big fiscal stimulus at the same time that Paul Volcker at the Federal Reserve was administering tight money. This, for Professor Mundell, was vital in creating the era of prosperity that followed.
“Taxi Driver is the most important movie ever made from the standpoint of creating GDP,” Mundell told delegates. “It’s the movie that made the Reagan revolution possible. That movie was indirectly responsible for adding between $5 trillion and $15 trillion of output to the US economy.”
So says a May 15, 2008 report in the Financial Times.
(Thanks to investigator Torsten Schmidt for bringing this to our attention.)