ABSTRACT
Milton Friedman was one of the most influential economists of all time – and his ideas had a huge impact on the economic policies of governments across the world.
A key theorist of capitalism and its relationship to democratic freedoms, Friedman remains one of the most cited authorities in both academic economics and government economic policy. His work remains striking not just for its brilliant grasp of economic laws and realities, but also for its consistent application of high-level evaluation and reasoning skills to produce arguments that can convince experts and laypeople alike.
Friedman’s 1968 essay ‘The Role of Monetary Policy’ is a key example of how Friedman’s critical thinking skills helped to cement his influence and reputation. The paper addressed the question of how a government’s monetary policy affects the economy – from employment levels to inflation and so on. At its heart lies an evaluation and critique of the most widely accepted conception of monetary policy at the time – the ‘Phillips Curve’ – which argued that increased inflation leads naturally to increased employment. Systematically noting the flaws and weaknesses of the Phillips Curve theory, Friedman showed why this is not, in fact, the case. He then drew up a systematic alternative argument for what governmental monetary policy could and should aim to do.
Though economists now consider Friedman’s ideas to have considerable limitations, ‘The Role of Monetary Policy’ remains a masterclass in evaluating and countering faulty arguments.
TABLE OF CONTENTS
section 1|21 pages
Influences
module 1|5 pages
The Author and the Historical Context
module 2|5 pages
Academic Context
module 3|5 pages
The Problem
module 4|5 pages
The Author’s Contribution
section 2|20 pages
Ideas
module 5|5 pages
Main Ideas
module 6|5 pages
Secondary Ideas
module 7|4 pages
Achievement
module 8|5 pages
Place in the Author’s Work
section 3|19 pages
Impact
module 9|5 pages
The First Responses
module 10|4 pages
The Evolving Debate
module 11|4 pages
Impact and Influence Today
module 12|5 pages
Where Next?