Monetarism; PQ=MV

Was born in 1912 to Jewish immigrants. Went to Rutgers University to get his BA and later went to Univ. Chicago and got his MA. Later went to Columbia to get his PhD. In 1976, he was awarded the Nobel prize for economics, for his achievements in the field of consumption analysis, monetary history and theory and for his demonstration of complexity of stabilization of policy. Did not like the idea of the draft. Died November 16 th, 2006.

Friedman was influential in helping to revive the monetarist school of economic thought. Views based on the belief that inflation depends on the amount of money the government prints. Most Macroeconomists except Mr. Friedman’s most famous proposition that inflation is always a monetary phenomenon. Was key influential in Macroeconomics, especially in attacking the Keynesians on their view of the IS-LM analysis. In this attack, Friedman wanted Keynesians not to ignore money matters in their analysis.

Monetarism is a macroeconomic school of thought that emphasizes (1) long-run monetary neutrality, (2) short-run monetary nonneutrality, (3) the distinction between real and nominal interest rates, and (4) the role of monetary aggregates in policy analysis. “The government solution to a problem is usually as bad as the problem.”

Milton Friedman is a monetarist, which means an economist who holds the strong belief that the economy's performance is determined almost entirely by changes in the money system.