Milton Friedman and the Road to Monetarism: A Review Essay

Thursday, March 31, 2022

Economics Working Paper 22107

Abstract: The objective of Ed Nelson’s two-volume book, Milton Friedman and Economic Debate in the United States, 1932-1972, is to provide an account of Friedman’s views in major monetary-policy debates during the period identified in the book’s title. Nelson tells the story of the development of Friedman’s monetary framework, from its Keynesian origins in the early-1940s, to its gradual absorption of monetary factors in the late-1940s, and, finally, to its monetarist character of the 1950s and after, through the windows of a selection debates that engaged Friedman. At the same time, Nelson places Friedman’s monetary contributions within the context of the modern macroeconomics literature. In this essay, I consider doctrinal issues related to Nelson’s account of the development of Friedman’s monetarist framework.

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