Key events in Milton Friedman's life.
Friedman was extremely influential in shaping monetary policy theory, although he recanted on using money supply targeting in 2003.
"The use of money as a target has not been a success. I'm not sure I would as of today push it as hard as I once did."
Milton Friedman (July 31, 1912 - November 15, 2006) was an American economist, known for his work on macroeconomics, microeconomics, economic history, statistics, and for his advocacy of laissez-faire capitalism. In Capitalism and Freedom (1962) he minimized the role of government in a free market in order to create political and social freedom. In 1976, he won the Nobel Prize for his achievements in the fields of consumption analysis, monetary history and theory and for his demonstration of the complexity of stabilization policy. His television series Free to Choose aired on PBS in early 1980. It became a book, co-authored with his wife, Rose Friedman. The book was widely read, as were his columns for Newsweek magazine.From the Financial Times economics columnist Samuel Britton provides a very long and very thoughtful obituary:
In statistics, he devised the Friedman test, a non-parametric analogue to the two-way analysis of variance.
Milton Friedman died on November 15, 2006 according to an official at the Cato Institute in Washington.
Both his admirers and his detractors have pointed out that his world view was essentially simple: a passionate belief in personal freedom combined with a conviction that free markets were the best way of co-ordinating the activities of dispersed individuals to their mutual enrichment. Where he shone was in his ability to derive interesting and unexpected consequences from simple ideas. As I knew from my postbag, part of his appeal lay in his willingness to come out with home truths which had occurred to many other people who had not dared to utter them. Friedman would then go on, however, to defend these maxims against the massed forces of economic correctness; and in the course of those defences he, almost unintentionally, added to knowledge.
Those who wanted to write him off as a right-wing Republican were disabused by the variety of radical causes he championed. I was not impressed in my own student years by the claims to a belief in personal freedom of the pro-market British economists whom I first encountered. It was not until I came across Friedman, and learned that he had spent more time in lobbying against the US "draft" than on any other policy issue, that I began to take seriously the wider philosophic protestations of the pro-market economists.
Friedman's iconoclasm endured. He regarded the anti-drugs laws as virtually a government subsidy for organised crime. Even in the financial sphere, he espoused causes such as indexed contracts and taxes as a way of mitigating the harm done by inflation which did not endear him to natural conservatives.
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Outside monetary affairs Friedman remained a mainstream economist. As he himself wrote in Capitalism and Freedom (a book published in 1962 which meant went much deeper than Free to Choose) he could offer no hard and fast line for the limits of government intervention. But he believed that an objective study of the facts, case by case, combined with an underlying belief in personal choice, would usually swing the argument in favour of private provision in the market place. His friend, Sir Alan Walters, has expressed regret, however, that he did not in his last decades devote more effort to scholarly work outside the monetary field.
Friedman himself attributed the spread of both free markets and monetarist ideas to belated recognition of the consequences of soaring government spending and high inflation in the 1970s. But so far as the reaction was coherent and rational, much of the credit must go to him. The very success of free market policies has, of course, led to fresh problems; and what would one not give for a reborn 30-year-old Milton Friedman to comment upon and analyse these new challenges?