Rethinking the Monetarist Experience: Monetary Theory and Monetary Policy in the United States

Journal title HISTORY OF ECONOMIC THOUGHT AND POLICY
Author/s Benjamin K. Johannsen, Bradley W. Bateman
Publishing Year 2013 Issue 2013/1 Language English
Pages 19 P. 161-179 File size 105 KB
DOI 10.3280/SPE2013-001009
DOI is like a bar code for intellectual property: to have more infomation click here

Below, you can see the article first page

If you want to buy this article in PDF format, you can do it, following the instructions to buy download credits

Article preview

FrancoAngeli is member of Publishers International Linking Association, Inc (PILA), a not-for-profit association which run the CrossRef service enabling links to and from online scholarly content.

In the history of monetary theory and monetary policy, there can be little doubt that the 1980’s are seen as a watershed. Following a disastrous decade of inflation and recession in the 1970’s, the monetarist ideas of Milton Friedman are largely seen to have triumphed then over the older Keynesian demand management policies. The moment of monetarism’s ascendancy is probably seen most often as 1979 – the year that Margaret Thatcher was first elected as Prime Minister of Britain, having run for office on an explicit platform of monetarist ideas, as well as the year that Paul Volcker was named chair of the Federal Reserve’s Board of Governors in the United States. The purpose of this essay is to focus on what happened in the United States after Volcker’s appointment as chair of the Federal Reserve.

Keywords: Monetary policy, Volcker, USA, Federal Reserve, monetarism

Jel codes: A11, E58, B22

  1. Andersen L.C. and K.M. Carlson (1970). A Monetarist Model for Economic Stabilization, The Federal Reserve Bank of St. Louis Review, April: 7-25, also reprinted in The Federal Reserve Bank of St. Louis Review, October 1986: 45-66
  2. Andersen L.C. and J.R. Jordan. (1968a). The Monetary Base. Explanation and Analytical Use. The Federal Reserve Bank of St. Louis Review. August: 7-11
  3. Andersen L.C. and J.R. Jordan. (1968b). Monetary and Fiscal Actions: A Test of Their Relative Importance in Economic Stabilization. The Federal Reserve Bank of St. Louis Review. November: 11-24.
  4. Bateman B.W. (2006). Keynes and the Keynesians. The Cambridge Companion to Keynes. Eds. Roger E. Backhouse and Bradley W. Bateman. Cambridge, Cambridge University Press. DOI: 10.1017/CCOL0521840902.015
  5. Blinder A.S. (1998). Central Banking in Theory and Practice. MIT Press, Cambridge.
  6. Brunner K. (1968). The Role of Money and Monetary Policy. The Federal Reserve Bank of St. Louis Review, July: 9-24
  7. Brunner K. and A.H. Meltzer (1975). Friedman's Monetary Theory. In Gordon (ed.)(1975): 63-76.
  8. DeLong J.B. (2001). The Triumph of Monetarism. Journal of Economic Perspectives. 14, 1: 83-94. DOI: 10.1257/jep.14.1.83
  9. Feldstein M. (ed.)(1994). American Economic Policy in the 1980s, Chicago, University of Chicago Press. DOI: 10.7208/chicago/9780226241739.001.0001
  10. Friedman M. (1953). Essays in Positive Economics. Chicago and London, The University of Chicago Press.
  11. Friedman M. (1956). The Quantity Theory of Money. A Restatement. Studies in the Quantity Theory of Money. Chicago, University of Chicago Press.
  12. Friedman M. (1968). The Role of Monetary Policy. The American Economic Review. 58, 1 (Mar.): 1-17.
  13. Friedman M. (1975). Monetary Analysis, in Gordon (ed.)(1975): 1-62.
  14. Friedman M. (1984). Lessons from the 1979-1982 Monetary Policy Experiment. The American Economic Review. Vol. 74. No. 2. (May): 379-400.
  15. Friedman M. and A.J. Schwartz (1963). A Monetary History of the United States 1867-1960. A Study by the National Bureau of Economic Research, New York. Princeton, Princeton University Press.
  16. Gordon R.J. (ed.)(1975). Milton Friedman's Monetary Framework: A Debate With His Critics, Chicago, University of Chicago Press.
  17. Greenspan A. (1993a). Federal Open Market Committee Transcript. 2/2-3/1993: 39.
  18. Greenspan A. (1993b). Statements to Congress. Federal Reserve Bulletin, April.
  19. Hirsch A. and N. de Marchi (1990). Milton Friedman: Economics in Theory and Practice. Ann Arbor, University of Michigan Press.
  20. Jordan J.L. (1986). The Andersen-Jordan Approach after Nearly 20 Years. The Federal Reserve Bank of St. Louis Review, October: 5-8.
  21. Kilborn P.T. (1986). Monetarism Falls from Grace. The New York Times. 3 July. Section D: 1. London S. (2003). Milton Friedman. Financial Times. 7 June. FT Weekend Magazine. Lunch With the FT: 12.
  22. Mayer T. et al. (1978). The Structure of Monetarism. New York, Norton.
  23. Mussa M. (1994). US Monetary Policy in the 1980s, in Feldstein (ed.)(1994): 81-145.
  24. Roos L. (1982). Federal Open Market Committee Transcript. 10/5/1982.
  25. Thatcher M. (1993). The Downing Street Years. New York, Harper Collins.
  26. The Economist (1986). The Year Monetarism Dies? 4 January 1986: 11.
  27. The Economist (1991). Monetarism; Back From the Dead, 16 February 1991: 62.
  28. Thornton D.L. (1983). The FOMC in 1982: De-emphasizing M1. The Federal Reserve Bank of St. Louis Review. June/July.
  29. Thornton D.L. (2005a). A New Federal Funds Rate Target Series: September 27, 1982- December 31, 1993. Working Paper Series. Federal Reserve Bank of St. Louis.
  30. Thornton D.L. (2005b). When Did the FOMC Begin Targeting the Federal Funds Rate? What the Verbatim Transcripts Tell Us. Working Paper Series. Federal Reserve Bank of St. Louis.
  31. Volcker P.A. (1976). The Contributions and Limitations of 'Monetary' Analysis. Remarks before the American Economic Association and the American Finance Association, 16 September; Reprinted in Federal Reserve Bank of New York Monthly Review, October 1976: 251-252. Found in Lindsey D. E., A. Orphanides, and R. H. Rasche. The Reform of October 1979: How it Happened and Why. Finance and Economics Discussion Series. Divisions of Research & Statistics and Monetary Affairs. Federal Reserve Board, Washington, D.C. 2005-02: 62.
  32. Volcker P.A. (1978). The Rediscovery of the Business Cycle. 1978 Moskowitz Lecture. Reprinted in The Rediscovery of the Business Cycle. New York, Free Press.
  33. Volcker P.A. (1979a). Federal Open Market Committee Transcript. 8/14/1979: 21-22.
  34. Volcker P.A. (1979b). Federal Open Market Committee Transcript. 10/6/1979: 28.
  35. Volcker P.A. (1982a). Federal Open Market Committee Transcript. 6/30-7/1/1982.
  36. Volcker P.A. (1982b). Federal Open Market Committee Transcript. 10/5/1982.
  37. Volcker P.A. (1982c). Federal Open Market Committee Transcript. 12/20-21/1982.
  38. Volcker P.A. (1982d) Federal Open Market Committee Transcript. 5/18/1982.
  39. Volcker P.A. (1983). Federal Open Market Committee Transcript. 2/8-9/1983.
  40. Volcker P.A. (1990). The Triumph of Central Banking? The Per Jacobsson Lecture.
  41. Volcker P.A. (1994a). Monetary Policy, in Feldstein (ed.)(1994): 145-151.
  42. Volcker P.A. (1994b). Summary of Discussion, in Feldstein (ed.)(1994): 157-164.
  43. Volcker P.A. (2000). Interview. Commanding Heights. Public Broadcasting Service. 26 September. .
  44. Young H. (1989). One of Us: A Biography of Margaret Thatcher. London, MacMillan

  • Balance of Payment, Wage Indexation and Growth: the Role of CESPE in Italian Policy-Making in the 1970s Francesco Cattabrini, Fabio Masini, in HISTORY OF ECONOMIC THOUGHT AND POLICY 2/2017 pp.25
    DOI: 10.3280/SPE2017-002002

Benjamin K. Johannsen, Bradley W. Bateman, Rethinking the Monetarist Experience: Monetary Theory and Monetary Policy in the United States in "HISTORY OF ECONOMIC THOUGHT AND POLICY" 1/2013, pp 161-179, DOI: 10.3280/SPE2013-001009