Milton Friedman

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President Ronald Reagan and Nancy Reagan in The East Room Congratulating Milton Friedman Receiving The Presidential Medal of Freedom

Milton Friedman 1976

Milton Friedman (July 31, 1912 – November 16, 2006) was an American economist and statistician who made substantial contributions to the fields of macroeconomics, microeconomics, economic history, and statistics. Friedman was a strong advocate for free-market capitalism, and he is best known for his theoretical and empirical research in consumption analysis, monetary history and theory, and the complexity of stabilization policy. As one of the most influential economists of the 20th century, he received the Nobel Memorial Prize in Economic Sciences in 1976 for his achievements in the fields of consumption analysis, monetary history and theory, and for his demonstration of the complexity of stabilization policy.

Early Life and Education

Milton Friedman was born in Brooklyn, New York, to Jewish immigrants from Berehove, Ukraine. He earned his undergraduate degree from Rutgers University in 1932, where he specialized in mathematics and economics. Following this, Friedman obtained a master's degree from the University of Chicago in 1933, a place with which he would be long associated. He completed his Ph.D. at Columbia University in 1946, where his research focused on income from independent professional practice.

Career and Contributions

Friedman spent the majority of his academic career at the University of Chicago, where he led the Chicago School of Economics. His work at Chicago laid the groundwork for his theories on consumption analysis and the theory of the consumption function, which he published in his seminal book "A Theory of the Consumption Function" in 1957. This work challenged the Keynesian view of saving and consumption and introduced the Permanent Income Hypothesis, suggesting that a person's consumption at a point in time is determined not just by their current income but by their expected income over time.

In the field of monetary economics, Friedman, along with Anna Schwartz, co-authored "A Monetary History of the United States, 1867–1960", which argued that the Great Depression was exacerbated by the Federal Reserve's poor monetary policies. This work contributed to the decline of Keynesian economics and led to the rise of monetarism, a school of thought that emphasizes the role of governments in controlling the amount of money in circulation.

Friedman was also a vocal advocate for free markets and minimal government intervention. He argued that the government's role should be limited to creating a stable monetary environment. His political philosophy was encapsulated in his best-selling 1962 book, "Capitalism and Freedom", where he outlined his support for free-market principles like voluntary exchange, a competitive economic environment, and the importance of individual freedom.

Legacy

Milton Friedman's influence extends beyond academia into public policy and popular culture. He was a key figure in the movement that argued for the privatization of government services, deregulation of industries, and the reduction of government spending and taxation. His ideas have been credited with influencing economic policies in the United States and around the world, particularly during the late 20th century.

Friedman was also known for his public discourse on economics, including his participation in public debates, lectures, and his television series "Free to Choose", which sought to educate the public on his economic philosophies.

Death and Honors

Milton Friedman died on November 16, 2006, at the age of 94. Throughout his life, he received numerous awards and honors for his contributions to economics, including the Nobel Prize in Economics. His legacy is preserved through his extensive body of work and the ongoing influence of his ideas on economic policy and theory.