The Impact of Milton Friedman on Modern Monetary Economics: Setting the Record Straight on Paul Krugman's "Who Was Milton Friedman?"

41 Pages Posted: 31 Oct 2007 Last revised: 8 Jul 2010

See all articles by Edward Nelson

Edward Nelson

Board of Governors of the Federal Reserve System

Anna J. Schwartz

City University of New York (CUNY); National Bureau of Economic Research (NBER) - NY Office

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Date Written: October 2007

Abstract

Paul Krugman's essay "Who Was Milton Friedman?" seriously mischaracterizes Friedman's economics and his legacy. In this paper we provide a rejoinder to Krugman on these issues. In the course of setting the record straight, we provide a self-contained guide to Milton Friedman's impact on modern monetary economics and on today's central banks. We also refute the conclusions that Krugman draws about monetary policy from the experiences of the United States in the 1930s and of Japan in the 1990s.

Suggested Citation

Nelson, Edward and Schwartz, Anna J., The Impact of Milton Friedman on Modern Monetary Economics: Setting the Record Straight on Paul Krugman's "Who Was Milton Friedman?" (October 2007). NBER Working Paper No. w13546. Available at SSRN: https://ssrn.com/abstract=1024963

Edward Nelson (Contact Author)

Board of Governors of the Federal Reserve System ( email )

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Anna J. Schwartz

City University of New York (CUNY) ( email )

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New York, NY 10010
United States

National Bureau of Economic Research (NBER) - NY Office

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New York, NY 10016-4309
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