The Impact of Milton Friedman on Modern Monetary Economics: Setting the Record Straight on Paul Krugman's "Who Was Milton Friedman?"
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.
We are indebted to David Laidler and Lawrence White for helpful correspondence on the subject matter of this paper. Justin Hauke and Faith Weller provided research assistance. The views expressed in this paper are those of the authors, and do not necessarily reflect official positions of the Federal Reserve Bank of St. Louis, the Federal Reserve System, the Board of Governors, or the National Bureau of Economic Research.
Nelson, Edward & Schwartz, Anna J., 2008. "The impact of Milton Friedman on modern monetary economics: Setting the record straight on Paul Krugman's "Who was Milton Friedman?"," Journal of Monetary Economics, Elsevier, vol. 55(4), pages 835-856, May. citation courtesy of