Chicago - TheChicagoSchool ECON205W Summer2006 Prof.Cunningham 1 ,chair194661.NobelPrize,1979 .NobelPrizein1976 VonHayek(195062.NobelPrize,1974

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    1 The Chicago School ECON 205W Summer 2006 Prof. Cunningham
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2 Historical Background Theodore Schultz arrives 1943, chair 1946-61. Nobel Prize, 1979. Milton Friedman arrives 1946. Nobel Prize in 1976. Von Hayek (1950-62). Nobel Prize, 1974. George Stigler arrives 1958. Nobel Prize, 1982. Ronald Coast arrives 1964. Nobel, 1991. Gary Becker earned PhD at Chicago, returns to faculty in 1970.  Nobel Prize, 1992. Robert Lucas earned his degrees at Chicago, returned in 1974 as  professor. Nobel Prize, 1995.
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3 Background (2) Old School vs. New School Tenets: 1. Optimizing behavior 2. Monopoly and monopsony effects are not significant.  Observed prices and wages are good approximations of  long-run competitive prices and wage equilibria. 3. Old school—policy, empiricism, Marshallian. New School—theory, math, Walrasian, REH. 4. Rejection of Keynesian Economics and fiscalism. 5. Limited role for government. Contributions that have lasted?
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4 Milton Friedman  (1912-  ) Milton Friedman mid-1950s, University of Chicago neoclassical price theorist Establish career on PIH and the underpinnings of Marshall’s basic supply and demand model Influenced by Frank Knight while a student at Chicago. Joined faculty there in 1948. Money and Banking Workshop at Chicago. Friedman is a self-proclaimed quantity theorist and classical liberal. According to Friedman, “Inflation is everywhere and at all times a monetary phenomenon.” (To the Keynesians, inflation is the result of excess demand for goods and services, and hence arises out of conditions in the real sector.) Karl Brunner coins the phrase “Monetarism”; Brunner and Alan Meltzer construct the microfoundations of Monetarism, creating a second “camp.”
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This note was uploaded on 11/02/2011 for the course ECON 7125 taught by Professor Smith during the Spring '11 term at James Madison University.

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Chicago - TheChicagoSchool ECON205W Summer2006 Prof.Cunningham 1 ,chair194661.NobelPrize,1979 .NobelPrizein1976 VonHayek(195062.NobelPrize,1974

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