Economics Dictionary of ArgumentsHome
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| Government policy: Government policy refers to a set of principles, guidelines, or actions established by a governing body to address specific issues or achieve desired outcomes within a society or economy, such as economic growth, social welfare, healthcare, education, or foreign relations. See also Government budget, Government debt, Politics, Society, Economy._____________Annotation: The above characterizations of concepts are neither definitions nor exhausting presentations of problems related to them. Instead, they are intended to give a short introduction to the contributions below. – Lexicon of Arguments. | |||
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Milton Friedman on Government Policy - Dictionary of Arguments
Landsburg I 41 Government policy/Friedman/Landsburg: 1) First, monetary policy should be focused on the long run, because it can do very little good in the short run. (It can, however, do great harm in the short run, as it did in the Great Depression, and that of course should be avoided.) 2) Second, there are also powerful limits to what monetary policy can do in the long run - in the long run it can't affect employment, and for similar reasons, it can't affect the production of goods and services. Therefore monetary policy should be geared to the one thing it can accomplish in the long run - a price level that grows gradually and predictably, so that people can form accurate expectations and make appropriate plans. >Price level, >Monetary policy. This circle of ideas - both the underlying story about the Phillips correlation and its implications for policy - has been immensely influential. >Phillips Curve. Today: Nowadays, monetary authorities around the world see Iow and predictable inflation as a primary goal, accept that monetary policy cannot affect output and employment in the long run, and see the management of expectations as a critical part of their jobs. >Expectations/Friedman, >Expectations/Economic theories. Economic theories: There's been a bit of evolution in how economists view unemployment. Pretty much everyone now agrees - and this is largely Friedman's doing - that there is a natural rate of unemployment, and that it's a fool's errand to aim for anything Iower. But nowadays there's a bit more concern with avoiding policies that might inadvertently push unemployment above its natural rate, and this too has had some effect on monetary practice. But the broad themes of monetary theory and monetary policy are instantly recognizable as those that Milton Friedman laid out in 1967, and as a world apart from everything that came before._____________Explanation of symbols: Roman numerals indicate the source, arabic numerals indicate the page number. The corresponding books are indicated on the right hand side. ((s)…): Comment by the sender of the contribution. Translations: Dictionary of Arguments The note [Concept/Author], [Author1]Vs[Author2] or [Author]Vs[term] resp. "problem:"/"solution:", "old:"/"new:" and "thesis:" is an addition from the Dictionary of Arguments. "Vs" indicates differences in content, not necessarily the chronological progression of a controversy. If a German edition is specified, the page numbers refer to this edition. |
Econ Fried I Milton Friedman The role of monetary policy 1968 Landsburg I Steven E. Landsburg The Essential Milton Friedman Vancouver: Fraser Institute 2019 |
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