He completed his undergraduate education at Harvard University (BA, summa cum laude, 1961), where he was affiliated with Adams House, and then attended Nuffield College, Oxford (B.Litt., 1963; M.A., 1964; D.Phil., 1967).

[13] Pioneering much of the research on the working mechanism and sustainability of public pension systems, he advanced the current understanding of the effects of social insurance.

He and Horioka found that in the long run, capital tends to stay in its home country — that is to say, a nation's savings is used to fund its investment opportunities.

"[citation needed] In 1997, writing about the upcoming European monetary union and the euro, Feldstein warned that the "adverse economic effects of a single currency on unemployment and inflation would outweigh any gains from facilitating trade and capital flows" and that, while "conceived of as a way of reducing the risk of another intra-European war", it was "more likely to have the opposite effect" and "lead to increased conflicts within Europe and between Europe and the United States.

The New York Times wrote an editorial advocating that Bush choose either Feldstein or Ben Bernanke due to their credentials, and the week of the nomination The Economist predicted that the two men had the greatest probability of selection out of the field of candidates.

Subsequently, AIG suffered a serious financial collapse that played a central role in the worldwide economic crisis of 2007–2008 and the ensuing global recession.

[20] As a member of the board of AIG Financial Products, Feldstein was one of those who had oversight of the division of the international insurer that contributed to the company's crisis in September 2008.

[26] In 2017, Feldstein joined a small group of "Republican elder statesmen" proposing that conservatives embrace carbon taxes, with all revenue rebated with lump-sum dividends, as a policy to deal with global climate change.

After correcting these issues, Leimer and Lesnoy found a much weaker relationship between Social Security and personal savings than Feldstein had originally suggested.

[34] Feldstein, an enthusiastic supporter of a single market for goods and services in the EU, argued that this goal does not require a monetary union.

[35] Furthermore, the creation of a single currency in the EU would increase political tensions in the union, as not all countries share the anti-inflationary stance of the German policy makers.

[37] During the sovereign debt crisis, Feldstein argued in favor of a "eurozone holiday" solution whereby the countries most affected by the crisis (such as Greece) would temporarily leave the eurozone, revert to their national currencies, devalue and re-enter at a lower exchange rate a few years later, a policy that would ensure a boost in international competitiveness solid enough to offset the economic recession.

Feldstein may have made one of his greatest impacts by the concentration of his students in top echelons of government and academia, such as Larry Summers, former Harvard president and U.S. Treasury secretary; David Ellwood, dean of Harvard Kennedy School; and James Poterba, MIT professor and member of Bush's tax reform advisory panel.

Lawrence Lindsey, formerly Bush's top economic adviser, wrote his doctoral thesis under Feldstein, as did Harvey S. Rosen, the previous chairman of the president's Council of Economic Advisers, Douglas Elmendorf, the former Director of the Congressional Budget Office, José Piñera, Chile's Secretary of Labor and Social Security during its pension privatization in 1980–1981, Jeffrey Sachs, Director of the Earth Institute at Columbia University, and Glenn Hubbard, Bush's first chairman of the council and now dean of the Columbia Business School.