Milton Friedman is a rarity, an economist whose name is widely recognised
among the general public but who is also acknowledged within his discipline as
having made contributions to it of lasting importance. In the twentieth century,
only John Maynard Keynes has a claim - by no means undisputed - to a higher
rank than Friedman as a public figure and economic scientist. The reputations of
the two are, furthermore, deeply intertwined within the evolution of macroeconomics
- that branch of the subject that deals with the behaviour of the
economy as a whole. In the late 1930s, with the Great Depression still hanging
over the world’s market economies, Keynes was pivotal in the very creation of
macro-economics as a separate sub-discipline, and his work also helped to direct
it in a particular policy direction. Beginning in the 1950s, Friedman would play
a key part in bringing about a radical re-assessment of macro-economics’ central
scientific tenets, not least as they appertained to the explanation of the Great
Depression, and of their policy implications too. And yet, as I shall argue in due
course, Friedman and Keynes belong to the same intellectual tradition in
economics - that associated with Alfred Marshall. This tradition has lately fallen
into neglect, and ironically so, since this has come about, in some measure,
because of Friedman’s work.