Retrospectives
"Cost-Push and Demand-Pull Inflation: Milton Friedman and the "Cruel Dilemma
Bibliographic Data
| ID | 4030252 |
|---|---|
| Authors | Johannes A Schwarzer (Johannes A. Schwarzer is a Lecturer in Economics, University of Hohenheim, Stuttgart, Germany. His email address is), Johannes Schwarzer (University of Hohenheim, corresponding author) |
| Year | 2018 |
| Volume | 32 |
| Issue | 1 |
| Pages | 195-210 |
| Publication date | 2018-02-01 |
| Peer Reviewed | Yes |
| Open Access | Yes |
| Type | ARTICLE |
| Venue | The Journal of Economic Perspectives (JOURNAL) |
| Journal identifiers | ISSN: 0895-3309 • E-ISSN: 1944-7965 |
| Publisher | American Economic Association (PUBLISHER • US) |
| DOI | 10.1257/jep.32.1.195 |
| OpenAlex | W2786327984 |
| Language | EN |
| Citations received | 3 |
| References cited | 17 |
This paper addresses two conflicting views in the 1950s and 1960s about the inflation-unemployment tradeoff as given by the Phillips curve. Many economists at this time emphasized the issue of a seemingly unavoidable inflationary pressure at or even below full employment. In contrast, Milton Friedman was convinced that full employment and price stability are not conflicting policy objectives. This dividing line between the two camps ultimately rested on fundamentally different views about the inflationary process: For economists of the 1950s and 1960s cost-push forces are responsible for the apparent conflict between price stability and full employment. On the other hand, Friedman, who regarded inflation to be an exclusively monetary phenomenon, rejected the notion of ongoing inflationary cost-push pressures at full employment. Besides his emphasis on the full adjustment of inflation expectations, this rejection of cost-push theories of inflation, which implied a decoupling of the two previously perceived incompatible policy objectives, was the other important element in Friedman's attack on the Phillips curve tradeoff in his 1967 presidential address to the American Economic Association
Economics · Full employment · Keynesian economics · Macroeconomics · Monetary policy · Phillips curve · Presidential system · Price of stability · Stagflation · Unemployment · Economic Theory and Institutions · Economic Theory and Policy · Law · Monetary Policy and Economic Impact
The Role of Monetary Policy
The Control of Inflation
Marshall and Friedman on Union Strength
The Theory of Union Wage Policy
Another View of Cost-Push and Demand-Pull Inflation
Money-Wage Dynamics and Labor-Market Equilibrium
Nobel Lecture
The Relation between Unemployment and the Rate of Change of Money Wage Rates in the United Kingdom, 1862-1957
The Relation Between Unemployment and the Rate of Change of Money Wage Rates in the United Kingdom, 1861–1957 1
Phillips Curves, Expectations of Inflation and Optimal Unemployment over Time
An Overhaul of Doctrine
Cost-Induced Inflation and the Quantity Theory of Money
| Unique citing works | 3 |
|---|---|
| Citations per year | 0,6 |
| Citation span | 2021 - 2025 (5) |
| Citation velocity | recent |
| Highly cited | No |
| Citation types | Neutral: 3 |