Life and influences:
I was born in 1912 in New York City. When I was 20, I first went to Rutgers University and earned my B.A. Then later in 1933, I went to the University of Chicago to earn my M.A. degree where i fir and went to the University of Columbia in 1946. During my time in Rutgers, I was greatly influenced by two economics professors, Homer Jones, and Arthur F. Burns and helped me to believe that modern economics can end the Great Depression. In my later years, I received Nobel Memorial Prize in Economic Sciences. People often refer to me as one of the most influential economist in the 20th century and the second most well-known economist.
Major publications and ideas
One of my key ideas is ''monetarism'' which is against the Keynes. I believe that the government should have less intervention to the economy during the times of recession and depression. The government should cut back the regulations and should just let the market on its own so the market price and the wages are determined by its demand and supply. As well as I believe that full employment is impossible to achieve nor it is desirably for the economy to achieve it.
To explain my idea in a simple way, when the Fed increases its money supply using fiscal policies, people have more money. But the physical assets such as housings and financial assets such as bonds and stocks remain constant. This will eventually lead the price of the assets to rise and higher price of bonds and stocks mean lower interest rates.
I would say that In the long run, increasing monetary growth increases the price but has little effect on the output but in the short run, increasing money supply increase both employment and the output.
I also do not agree with Keynes view of the trade-off between unemployment and the inflation rate which is illustrated by the Philips curve. This suggests that by increasing the demand for goods and services, the unemployment rate can be permanently reduced but the economy has to accept the higher inflation rate. My view is that, once people get used to the higher inflation rate, the unemployment rate would rise again. This can be explained by the inflation cycle- with high inflation rate, workers demand for higher wages, and the firms reduce the number of workers to reduce the cost of production. In order to keep the unemployment stable and low, a permanently accelerating inflation rate is required. Phillips curve is shown below.
Influence on field of economics
I have made some major contributions to the modern economics including inflation, unemployment, exchange rate policy and money. A Monetary History Of United States, which I wrote in 1963 explains the failure of Fed to to prevent the Great Depression and how they have incorrectly set money supply in the market.
I was born in 1912 in New York City. When I was 20, I first went to Rutgers University and earned my B.A. Then later in 1933, I went to the University of Chicago to earn my M.A. degree where i fir and went to the University of Columbia in 1946. During my time in Rutgers, I was greatly influenced by two economics professors, Homer Jones, and Arthur F. Burns and helped me to believe that modern economics can end the Great Depression. In my later years, I received Nobel Memorial Prize in Economic Sciences. People often refer to me as one of the most influential economist in the 20th century and the second most well-known economist.
Major publications and ideas
One of my key ideas is ''monetarism'' which is against the Keynes. I believe that the government should have less intervention to the economy during the times of recession and depression. The government should cut back the regulations and should just let the market on its own so the market price and the wages are determined by its demand and supply. As well as I believe that full employment is impossible to achieve nor it is desirably for the economy to achieve it.
To explain my idea in a simple way, when the Fed increases its money supply using fiscal policies, people have more money. But the physical assets such as housings and financial assets such as bonds and stocks remain constant. This will eventually lead the price of the assets to rise and higher price of bonds and stocks mean lower interest rates.
I would say that In the long run, increasing monetary growth increases the price but has little effect on the output but in the short run, increasing money supply increase both employment and the output.
I also do not agree with Keynes view of the trade-off between unemployment and the inflation rate which is illustrated by the Philips curve. This suggests that by increasing the demand for goods and services, the unemployment rate can be permanently reduced but the economy has to accept the higher inflation rate. My view is that, once people get used to the higher inflation rate, the unemployment rate would rise again. This can be explained by the inflation cycle- with high inflation rate, workers demand for higher wages, and the firms reduce the number of workers to reduce the cost of production. In order to keep the unemployment stable and low, a permanently accelerating inflation rate is required. Phillips curve is shown below.
Influence on field of economics
I have made some major contributions to the modern economics including inflation, unemployment, exchange rate policy and money. A Monetary History Of United States, which I wrote in 1963 explains the failure of Fed to to prevent the Great Depression and how they have incorrectly set money supply in the market.