Chicago School of Economics

The Chicago school of economics is known in the History of modern economic thought as a highly influential school of thought and methodology favoring free-market economics practiced at and disseminated from the University of Chicago after 1950. The leaders included George Stigler, Milton Friedman and numerous other Nobel proze winners.

The school closely follows neoclassical price theory (as developed by Alfred Marshall) and libertarianism. It rejected Keynesianism in favor of Friedman's monetarism, and (after 1980) later in favor of rational expectations as developed by Robert Lucas. It rejects most government regulation of business in favor of laissez-faire. In terms of methodology the stress is on "positive economics"--that is, empirically based studies using statistics, with less stress on theory and more on data. The school is noted for its very wide range of topics, from regulation to marriage, slavery and demography, that it studies.

The term "Chicago School" was coined in the 1950s to refer to economists teaching in the Economics Department at the University of Chicago, and closely related academic areas at the University such as the Graduate School of Business] and the Law School. Scholars met together in frequent, highly intense discussions that helped set a group outlook on economic issues, based on price theory.

Not all economists within the the Department of Economics at the University of Chicago shared the beliefs in the "Chicago school". The department has produced more Nobel Prize winners and John Bates Clark medalists in economics than any other university. Fewer than half of the professors in the economics department were considered part of the school of thought. Friedrich Hayek, a Nobel prize winner who taught at Chicago, had similar ideas but was not part of the intense discussion groups that comprised the "school."

See also

• Gary S. Becker
• Ronald Coase
• Robert Fogel
• Milton Friedman
• James Heckman
• Frank Knight
• Robert E. Lucas
• Kevin M. Murphy
• Richard Posner
• Sherwin Rosen
• Theodore Schultz
• Julian Simon
• Henry Calvert Simons
• Thomas Sowell
• George Stigler
• History of modern economic thought
• The Fourth Great Awakening and the Future of Egalitarianism (book by Robert William Fogel)

References

• Alan O Ebenstein, Friedrich Hayek: A Biography (2001)
• Milton Friedman and Rose Friedman, Two Lucky People: Memoirs ISBN 0-226-26414-9 (1998)
• J. Daniel Hammond and Claire H. Hammond, ed., Making Chicago Price Theory: Friedman-Stigler Correspondence, 1945-1957. Routledge (2006). 165 pp. ISBN 0-415-70078-7.
• Kasper, Sherryl. The Revival of Laissez-Faire in American Macroeconomic Theory: A Case Study of Its Pioneers (2002). Covers Knight, Simon, Hayek, Friedman and Lucas.
• H. Laurence Miller, Jr. "On the 'Chicago School of Economics'", The Journal of Political Economy, Vol. 70, No. 1 (Feb., 1962), pp. 64-69 online in JSTOR
• Nelson, Robert H. Economics As Religion: From Samuelson to Chicago and Beyond (2001)
• Reder, Melvin W. "Chicago Economics: Permanence and Change" Journal of Economic Literature (1982) 20(1): 1-38. ISSN 0022-0515 Fulltext in Jstor.
• Stigler, George J. ed. Chicago Studies in Political Economy (1988)
• Stigler, George J. Memoirs of an Unregulated Economist (1988)
• Wahid, Abu N. M. ed; Frontiers of Economics: Nobel Laureates of the Twentieth Century. Greenwood Press. (2002)

External links

• The University of Chicago Department of Economics