Milton Friedman was an American economist, statistician, and author who taught at the University of Chicago for more than three decades. He was a recipient of the Nobel Prize and is known for his research on consumption analysis, monetary history and theory, and the complexity of stabilization policy. However, he didn’t start off that successful.
Milton Friedman was born July 31, 1912 to Sarah Ethel and Jeno Friedman. He was the last out of four children. When he was a year old his family picked up and moved to Rahway, N.J. where his mother ran a small dry goods shop while his father just went after a bunch of unsuccessful job ventures. Yet the family was still able to get by and have good times. As time went on, Milton graduated from Rahway High School right after his father passed. His remaining family made sure that Milton continued on with school and attended the University of Chicago and Columbia for economics.
Friedman came up with his on hypothesis and theories. Acouple of the most well known ones are the permanent income hypothesis and the quantity theory of money. His permanent money theory was his formulation of risk aversion and risk proclivity. He believed in the evolution theory when in comes to the theory of the firm. The resolution of the puzzle was that spending and savings decisions depended on people's views of their long-term (“permanent”) income; but they were much less inclined to adjust to transitory income variations in either direction. Meanwhile, the quantity theory of money was just stating that there was a close link between inflation and money supply. Inflation is controlled by the amount of money poured in to the economy.
Of course, Friedman was faced with criticism. During a financial crisis, several economists; like James Galbraith and Joseph Stiflitz, blamed Friedman’s free market philosophy for the economic turmoil. A Paul Krugman praised Friedman as a “great economist and a great man” after Friedman’s death, but also, went on...