Milton Friedman
Who was Milton Friedman?
Nobel laureate: Nobel Prize in Economic Sciences (1976)
Biographical data adapted from Wikipedia’s article on Milton Friedman (CC BY-SA 4.0).
Biography
Milton Friedman, born on July 31, 1912, in Brooklyn, New York, became one of the most influential economists of the twentieth century. He went to Rahway High School before attending Rutgers University, Columbia University, and the University of Chicago, where he earned his Ph.D. in 1946. He also studied as a visiting scholar at the University of Cambridge. Throughout his career, Friedman challenged mainstream economic ideas, especially Keynesian theory, and developed new theories that changed modern economic thought.
Friedman's biggest contribution was monetarism, a theory that highlights how money supply affects economic activity and inflation. He introduced the permanent income hypothesis, which explained consumer spending behavior and became a key part of modern consumption theory. His work on the natural rate of unemployment predicted that trying to lower unemployment below a certain level would result in rising inflation, something observed as stagflation in the 1970s. These ideas earned him the Nobel Memorial Prize in Economic Sciences in 1976.
As a leading figure in the Chicago School of economics, Friedman mentored many students who later became notable economists, including Nobel laureates Gary Becker, Robert Fogel, and Robert Lucas Jr. His influence reached beyond academia with his writings and TV appearances, where he advocated for free-market capitalism, minimal government intervention, and individual economic freedom. He advised political leaders and influenced policy decisions globally.
Friedman married Rose Director in 1938, who became his lifelong partner and co-author on several works. Together, they promoted economic education and free-market principles to the public. His numerous awards included the National Medal of Science and Presidential Medal of Freedom in 1988, recognizing his contributions to both economics and society at large. Friedman died on November 16, 2006, in San Francisco, leaving behind a transformed field of economics and lasting influence on economic policy worldwide.
Before Fame
Growing up during the Great Depression, Friedman saw the economic struggles that would later influence his theoretical work. He initially aimed to become an actuary but was drawn to economics during his undergraduate studies at Rutgers University, where professors Arthur Burns and Homer Jones introduced him to thorough economic analysis.
The 1930s and 1940s were dominated by Keynesian economics, which promoted active government intervention to manage economic cycles. Friedman entered this environment as a graduate student, working on statistical and mathematical approaches to economic problems. His early career included work with the National Resources Planning Board and the Treasury Department during World War II, experiences that shaped his understanding of government economic policy and its limitations.
Key Achievements
- Developed the permanent income hypothesis explaining consumer spending behavior
- Created monetarist theory emphasizing money supply's role in economic stability
- Predicted stagflation through natural rate of unemployment theory
- Won Nobel Memorial Prize in Economic Sciences in 1976
- Mentored multiple future Nobel laureates including Gary Becker and Robert Lucas Jr.
Did You Know?
- 01.He was only 4 feet 11 inches tall and often stood on a box during lectures to see over the podium
- 02.His son David Friedman became a prominent anarcho-capitalist economist and legal scholar
- 03.He coined the phrase 'There is no such thing as a free lunch' in popular economics discourse
- 04.Friedman advocated for ending the military draft and replacing it with an all-volunteer army, which was implemented in 1973
- 05.He appeared on Phil Donahue's television show multiple times and hosted his own PBS series 'Free to Choose' in 1980
Family & Personal Life
Awards & Honors
| Award | Year | Details |
|---|---|---|
| Nobel Prize in Economic Sciences | 1976 | for his achievements in the fields of consumption analysis, monetary history and theory and for his demonstration of the complexity of stabilization policy |
| National Medal of Science | 1988 | — |
| Adam Smith Award | 1989 | — |
| John Bates Clark Medal | 1951 | — |
| Presidential Medal of Freedom | 1988 | — |
| Distinguished Fellow of the American Economic Association | — | — |
| Fellow of the Econometric Society | 1949 | — |
| Fellow of the American Statistical Association | — | — |
| honorary doctor of Harvard University | 1979 | — |
| Fellow of the Institute of Mathematical Statistics | 1943 | — |
| New Jersey Hall of Fame | 2019 | — |