Thursday, November 16, 2006

RIP Milton Friedman

Milton Friedman, the Nobel-prize winning economist who helped shape and define free-market economic theory, died Thursday at the age of 94 in San Francisco. The cause was heart failure, according to Reuters.

Friedman, who won the Nobel prize in 1976, helped interpret and popularize modern free-market economics that came to dominate much of U.S. public policy in the second half of the 20th century.

Free-market economic theories, which included tight fiscal discipline and deregulation of markets, grew influential in the United States after Ronald Reagan became president in the United States.

Friedman was regarded as the leader of the Chicago School of monetary economics and the leading proponent of free-market theory.

The Chicago School regarded the quantity of money as an instrument of government policy, capable of influencing inflation and business cycles, according to his biography at the Hoover Institution where Friedman served as a research fellow.

Friedman's ideas, which were embraced by President Reagan and U.K. Prime Minister Margaret Thatcher in the 1980s, were considered controversial because of the deep cuts in government spending and the restricted role the government was to play in buffering citizens from economic forces.

The changes brought about by Friedman's economic work represented a departure from the Keyensian economic philosophy, which included generous provisions for the unemployed and wage and price controls.

Overseas, Friedman's work helped shape policies used in Chile and Argentina in the 1970s. His influence raised eyebrows among critics because of the repressive political situations in both countries in that period.

Friedman received his B.A. from Rutgers University in 1932, an M.A. from the University of Chicago the next year. In 1946 he received his Ph.D. from Columbia University.

Friedman was born in Brooklyn, NY in 1912 to immigrant parents from a province of what was then the Austria-Hungary Empire.

Source: CNN

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