An interview with Milton Friedman in 1996 ‐ presents his reflections on some of the important issues surrounding the evolution of, and currrent debates within, modern…
An interview with Milton Friedman in 1996 ‐ presents his reflections on some of the important issues surrounding the evolution of, and currrent debates within, modern macroeconomics. A world‐renowned economist and prolific author since the 1930s, Milton Friedman has had a considerable impact on macroeconomic theory and policy making. Associated mostly with monetarism and the efficacy of free markets, his work has ranged over a broader area ‐ microeconomics, methodology, consumption function, applied statistics, international economics, monetary theory, history and policy, business cycles and inflation. In the interview discusses Keynes’s General Theory, monetarism, new classical macroeconomics, methodology, economic policy, European union and the monetarist counter‐revolution.
The purpose of this paper is to explore the interaction between the economic and political imperatives of new monetarism. The breakdown of the global derivatives markets…
The purpose of this paper is to explore the interaction between the economic and political imperatives of new monetarism. The breakdown of the global derivatives markets, which came into the spotlight during the 2008/2009 global debt crisis, brought up the issue of trust. The matter at hand is the loss of trust in investors' ability to make informed decisions, but trust in the self‐regulating capacity of open markets has also been seriously shaken.
Relying on Roche and McKee's analysis of the global financial crisis, the author emphasizes that new monetarism is not a new paradigm, but rather a result of economic circumstances. Although the growth of financial asset prices was indeed partly a result of the liberalization of financial markets, the decisive factor is to be found in the creation of new financial instruments. On the one hand, derivatives have drastically increased the “investment power” or “purchasing power” of money. However, on the other hand, derivatives are a form of under‐appreciated liquidity that creates bubble assets.
Over the last two decades, the value of global financial assets has grown much faster than the real economy in its background, which means that in the era of new monetarism, financial markets set the tone of the real economy. Consequently, in the eyes of investors, the crucial term becomes “liquidity”, rather than “real economy”. As disinflation multiplied the value of financial assets, central banks progressively lost control of money. Players in financial markets that had increasing trust in cheap money started to introduce new forms of money, which allowed them to create liquidity, independently of the central bank. It has been shown that the quantity and cost of money available for investment can be frozen up to a point where it threatens the global financial system.
Networks for promoting social responsibility of the corporate sector, which more and more tightly cover our small planet, wish to make transparent the connections between corporate leaders, politicians and organizations to which they are connected. Their members conduct research with the aim of making the invisible power of money visible.
New financial democracy in the post‐modern era presupposes financially literate citizens, which without a doubt presents a challenge for education systems, which will evidently have to incorporate a new, crucial form of literacy, in addition to linguistic, mathematical and computer literacy – financial literacy.
This paper is a review essay of Leeson, R. (Ed.), Keynes, Chicago and Friedman (2 volumes), Pickering and Chatto, London, 2003. These volumes contain a comprehensive collection of previously published papers, and also some interesting new materials, relating to the controversy about the accuracy of Milton Friedman's depiction of the “oral tradition” in monetary economics at the University of Chicago in the 1930s and 1940s. As such, the work is a notable addition to the scholarly literature. The broader issue raised by this collection is the precise relationship between Friedman's “monetarism” and the so‐called “Keynesian economics” of the neoclassical synthesis, and specifically, whether there was any real difference between them.
Since the late 1970s, the study of the role, structure and functions of personnel management in the United Kingdom has been greatly facilitated by surveys emerging from a…
Since the late 1970s, the study of the role, structure and functions of personnel management in the United Kingdom has been greatly facilitated by surveys emerging from a number of large‐scale surveys. A major interest in interpreting the data from these surveys has been to evaluate the impact of recession, and, latterly, recovery on the power, structure and roles of personnel departments and personnel specialists in recent years. The survey data are used comparatively to evaluate the empirical plausibility of the different scenarios which have arisen, and to account for the results that emerge.
Ideology as a mixture of consciously or unconsciously accepted ideas and beliefs provides the underlying support or rationalisation for fundamental features of thought and…
Ideology as a mixture of consciously or unconsciously accepted ideas and beliefs provides the underlying support or rationalisation for fundamental features of thought and action in a society. A vigorously promoted contending ideology may at any given time also influence developments. Value judgments, which are likewise not based on the logical rules of observation and verification, may for present purposes be taken as concerned with less comprehensive or less fundamental matters than ideology.
Received histories present national accounts as universal, purely economic measures based mostly on theoretical foundations. This paper argues that this is an…
Received histories present national accounts as universal, purely economic measures based mostly on theoretical foundations. This paper argues that this is an anachronistic approach to the long and uneven development of these estimates and builds on geopolitical economy to examine national income estimates as quantifications of state power. First, it reveals national income accounts to be historically and geographically contingent rather than universal, suggesting contestation instead of any hegemony or dominance of one central ideology. Second, the economic power and motivations of nation-states, rather than economic theory, are at the core of the design of national income estimates, which are used to promote states’ position in international competition as well as advocate for particular national economic policies. The history of national accounting closely tracks the rise of the nation-state, the unique phase of British hegemony, the two World Wars, the east-west competition of the Cold War, and the north-south competition of the recent two decades. To this day, revisions to national accounting systems reflect the shifting balance of power and incessant international competition.
This paper focuses on the differences between the Austrian School's (Au) and the Monetarist's (Mt) position on Monetary theory. It will be shown that Au have a complete micro outlook that is not in the quantity theory tradition. Au reject central banking and coordinated monetary policy in favor of a system of free banking in which there is no government money. To Au, central banking, with its monopoly of government issued currency, not only allows commercial banks to expand credit beyond prudent limits, but also is responsible for the artificial lowering of market interest rates, followed by abnormally high investment demand, causing more volatile business cycles. In contrast, Mt do have a macro outlook that is in the quantity theory tradition. They believe in central banking, but want to limit discretionary monetary policy by using a growth rule. They focus on the aggregate price level and believe in the long run neutrality of money.
This paper seeks to focus on the challenge posed by financial globalization before the traditional Westphalian model of monetary sovereignty, claiming that financial…
This paper seeks to focus on the challenge posed by financial globalization before the traditional Westphalian model of monetary sovereignty, claiming that financial globalization of the world's markets leads to new forms of geopolitical rivalry among contemporary governments.
The paper sets the analytical framework for the study of a tripartite foundation of monetary sovereignty in money manager capitalism, consisting of currency associated with the instruments of its manipulation, which are the two largest independent macroeconomic players: the central bank and the state. This raises the issues of dual sovereignty in economy and the ways in which these entities use their sovereign powers on local and global levels.
Current growing interdependence of financial networks increases the number of choices in monetary issues and forces governments to make ever faster adjustments to the machinery of complex monetary instruments which not only facilitate transactions among very different and distant economies, but also obscure the transparency of decision making. The need to ensure, through the central bank's legislation, an independent status of central bankers with respect to politicians, implies that their work be effectively monitored by the public and the respective parliament.
The independence of central banks, which comprises goal independence, instrument independence and personal independence of the decision‐making body of a central bank, increases the accountability of central bankers and raises the issue of sanctions for their misbehavior.
Financial globalization has definitely raised the issue of redistribution of the authority of governments and non‐state agents. A clear hierarchy between currencies at the global level has dual consequences: first, it amplifies the unequal relationship between the leaders and the followers in global monetary circulation; second, global market forces ignore political borders and present a serious challenge for the monetary sovereignty of contemporary governments. Equally, the question of re‐formulation of the concept of a sovereign state is raised.