The Economist Milton Friedman: Biography, Ideas, Life, and Sayings


Milton Friedman is an American economist who won the Nobel Prize in 1976 for his research on consumption, monetary history and the complexities of stabilization policies. Together with George Stigler, he was the intellectual leader of the second generation of the Chicago school. His students include such distinguished economists as Gary Bakker, Robert Vogel, Ronald Coase, Robert Lucas Jr. The main ideas of Friedman concern monetary policy, taxation, privatization, deregulation of state policy, especially in the 1980s. Monetarism also influenced the decisions of the US Federal System during the global financial crisis.


Brief Biography of Milton Friedman: The Early Years

The future scientist was born in Brooklyn, one of the poorest districts of New York. His parents were expats from Hungary. The city from which they emigrated is now located on the territory of Ukraine (the city of Beregovo in the Transcarpathian region). Friedman's parents were selling textiles. Shortly after the baby was born, the family moved to the city of Roway, in New Jersey. As a child, Friedman got into an accident, the scar on his upper lip remained with him for life. He graduated from school in 1928 and enrolled at Rutgers University. The young man specialized in mathematics and economics. Initially, he intended to become a secretary. However, while studying, he met two scientists, Arthur Burns and Homer Jones, who convinced him that the economy could help bring the world out of the Great Depression.

After graduation, he was offered two scholarships: in mathematics in Brown and in economics in Chicago. Friedman chose the latter and received a Master of Arts degree in 1933. His views were influenced by Jacob Wiener, Frank Knight and Henry Simons. There he met his future wife Rose. Then he studied statistics under the guidance of the famous economist Harold Hotelling and worked as an assistant to Henry Schultz. At the University of Chicago, Friedman met his two best friends, George Stigler and Allen Wallis.


Community Service

After graduation, Friedman did not manage to find a teacher at first. Therefore, he decided to go to Washington with his friend Allen Wallis, where Roosevelt had just begun to implement his “new course”. Later, Friedman concluded that all government interventions are "ineffective drugs for the wrong disease." In 1935, he worked at the National Resources Committee, where he first began to think about the interpretation of the consumption function. Then Friedman got a job at the National Bureau of Economic Research. He worked as an assistant to Simon Kuznets.

In 1940, Friedman was appointed a professor at the University of Wisconsin, but returned to government service because of anti-Semitism. He has worked on the federal government's military tax policy as an adviser. On duty, advocated Keynesian state intervention in the economy.


Career and achievements

Milton Friedman was an adviser to the US president for the Republican party, Ronald Reagan, and the British conservative prime minister, Margaret Thatcher. His political philosophy extolled the virtues of the free market with minimal government intervention. Once Friedman noted that he considers his main achievement to be the elimination of conscription to the army in the USA. During his life he wrote many monographs, books, articles in scientific journals and newspapers, was a guest of television programs, read lectures at various universities. His works were popular not only in the USA and Great Britain, but also in the countries of the socialist camp. Magazine "The Economist" called him the most influential economist of the second half of the 20th century, and possibly the entire century. Although some polls give palm to John Maynard Keynes.


Economic views

Milton Friedman is best known for attracting attention to the money supply. Monetarism is a set of views associated with quantitative theory. His traces can be found as early as the 16th century. Together with Anna Schwartz, Friedman wrote a book called The Monetary History of the United States of America, 1867-1960 (1963). Several regression analyzes confirmed the primacy of the money supply before investing and government spending. Natural unemployment is inevitable, so it does not make sense to fight it. The government does not need to direct the economy through fiscal policy.

Developments in the field of statistics

A consistent analysis developed by Milton Friedman. He came up with the main ideas while serving in the military research department in Colombia. Then the consistent statistical analysis turned into a standard evaluation method. Like many other discoveries of Friedman, today it seems unusually simple. But this is an indicator of genius, who managed to penetrate into the very essence of phenomena. Today, consistent statistical analysis is a key tool for modern economists.


Milton Friedman: capitalism and freedom

The concept of monetarism began with a refutation of Keynesian theory. Later, Milton Friedman would call many of her positions naive. In the 1950s, he made his own interpretation of the function of consumption. Capitalism and freedom are two concepts that Milton Friedman reintroduced into scientific circulation. Monetarism uses the "Keynesian language and methodological apparatus", but denies the initial assumptions of the theory of state regulation of the economy. Friedman does not believe in the possibility of a full load of production capacity. In his understanding, there is always a natural level of unemployment, which is pointless to fight. The economist argued that in the long run, the Phillips curve looks like a vertical straight line, and predicted the possibility of such a phenomenon as stagflation. Therefore, the only effective state policy is to gradually increase the money supply.

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