Paul Krugman has recently been
critical of Friedman (and Phelps), the Phillips curve, and the
Natural Unemployment Rate (NUR) theory in the process of arguing that due to
the recent Great Recession, the accompanying financial crisis, and Bush-Obama-Fed
Great Stagnation, Freidman has vanished from the policy front.
Krugman makes this claim despite the fact there is an on-going vigorous debate
on rules versus discretion
with at least some attention to Friedman’s plucking model. While
maligning Freidman’s contributions, Krugman manages a slap at Austrians and
claims a renewed practical relevance for Keynes:
What I think is really interesting is the way Friedman
has virtually vanished from policy discourse. Keynes is very much back, even if
that fact drives some economists crazy; Hayek is back in some sense, even if
one has the suspicion that many self-proclaimed Austrians bring little to the
table but the notion that fiat money is the root of all evil — a deeply
anti-Friedmanian position. But Friedman is pretty much absent....To ReadMore....
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