The following course outline with its readings is pretty much self-explanatory, though I cannot help but notice that there is quite a bit of Milton Friedman to read in Milton Friedman’s money course. It reminds me of the remark by Samuelson:
One must not make the mistake attributed to Edward Gibbon when he wrote his Decline and Fall of the Roman Empire. Gibbon, it was said, sometimes confused himself and the Roman Empire.
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Milton Friedman
ECONOMICS 331—MONEY
Reading List—Winter Quarter, 1970
(Note: Readings marked with an asterisk (*) cover the essential substantive material.)
I. Introductory Material
*Milton Friedman, The Optimum Quantity of Money and Other Essays, (Aldine, 1968), Chap. 1.
*Milton Friedman, The Quantity Theory, International Encyclopaedia of the Social Sciences (reprints on reserve).
David Hume, “Of Money,” “Of Interest,” in Essays and Treatises.
H. G. Johnson, “Monetary Theory and Keynesian Economics,” reprinted in W. Smith and R. Teiger (eds.) Readings in Money, National Income, and Stabilization Policy.
D. H. Robertson, Money.
II. The Quantity Equation
*Irving Fisher, The Purchasing Power of Money (Macmillan, 1913), chaps. 1, 2, 3, 4, 8.
*J. M. Keynes, Tract on Monetary Reform (1924), chap. 2; chap. iii, sec. 1.
*Wesley C. Mitchell, Business Cycles, The Problem and Its Setting (New York, 1927), pp. 128-39.
*A. C. Pigou, “The Value of Money” in Lutz, F. A., and Mints, L. W. (eds.) Readings in Monetary Theory.
Alfred Marshall, Official Papers, “Evidence before the Indian Currency Committee (1889),” questions 11758-62 (pp. 267-69); “Evidence before the Gold and Silver Commission (1887-88).” questions 9629-86 (pp. 34-53); testimony to Royal Commission on The Depression of Trade and Industry (1886), answers to question 8(i), pp. 7-15.
Henry Thornton, An Enquiry into the Nature and Effect of the Paper Credit of Great Britain (1802), Library of Economics edition (Allen and Irwin, 1939), chaps. iii and xi.
Jacob Viner, Studies in the Theory of International Trade (Harpers, 1937), pp. 119-289.
III. The Demand for Money
*Phillip Cagan, “The Monetary Dynamics of Hyperinflation,” in Studies in the Quantity Theory of Money, esp. 11, 25-35 and 86-91.
*Milton Friedman, “The Quantity Theory of Money: A Restatement” in Studies in the Quantity Theory of Money, ed., M. Friedman.
*J. R. Hicks, “A Suggestion for Simplifying the Theory of Money,” Readings in Monetary Theory.
*H. G. Johnson, “Monetary Theory and Policy,” American Economic Review (June, 1962), Part II.
*J. M. Keynes, The General Theory of Employment, Interest and Money, chaps. 13 and 15.
Maurice Allais, “A Restatement of the Quantity Theory of Money,” American Economic Review (December, 1966), pp. 1123-57.
W. J. Baumol, “The Transactions Demand for Cash: An Inventory Theoretic Approach,” Quarterly Journal of Economics (November, 1952).
Karl Brunner and Allan H. Meltzer, “Predicting Velocity: Implications for Theory and Policy,” Journal of Finance (May, 1963), pp. 319-54.
Karl Brunner and Allan H. Meltzer, “Some Further Investigations of Demand and Supply Functions for Money,” Journal of Finance (May, 1964).
Gregory C. Chow, “On the Long-run and Short-run Demand for Money,” Journal of Political Economy (April, 1966), pp. 111-31.
John V. Deaver, “The Chilean Inflation and the Demand for Money,” unpublished Ph.D. dissertation (The University of Chicago, Department of Economics, Winter, 1961).
Edgar Feige, The Demand for Liquid Assets: A Temporal Cross-Section Analysis (Prentice-Hall, 1964).
Milton Friedman, “The Demand for Money: Some Theoretical and Empirical Results,” Journal of Political Economy (August, 1959), pp. 327-51.
H. G. Johnson, “Recent Developments in Monetary Theory,” Essays in Monetary Economics.
David Laidler, “Some Evidence on the Demand for Money,” Journal of Political Economy (February, 1966), pp. 55-68.
H. A. Latane, “Cash Balances and the Interest Rate—A Pragmatic Approach,” Review of Economics and Statistics (November, 1954) and (November, 1960).
Allan H. Meltzer, “The Demand for Money: The Evidence from the Time Series,” Journal of Political Economy (June, 1963).
Merton H. Miller and Daniel Orr, “A Model of the Demand for Money by Firms,” Quarterly Journal of Economics, LXXX (August, 1966), 413-35.
George R. Morrison, Liquidity Preferences of Commercial Banks (University of Chicago Press, 1966).
Joan Robinson, “The Rate of Interest,” Econometrica, Vol. 19 (1951), reprinted as chap 1 of The Rate of Interest and Other Essays.
James Tobin, “Liquidity Preference and Monetary Policy,” Review of Economics and Statistics, Vol. 19 (May, 1947), 130-31.
James Tobin, “Liquidity Preference as Behavior Toward Risk,” Review of Economic Studies (August, 1956), pp. 241-47.
James Tobin, “The Interest Elasticity of Transactions Demand for Cash,” Review of Economics and Statistics (August, 1956).
Clark Warburton, “Monetary Velocity and Monetary Policy,” and Tobin’s rejoinder, Review of Economic Statistics, XXX (November, 1948), 310-17.
IV. The Supply of Money (covered mostly in Econ. 330)
*Milton Friedman and Anna J. Schwartz, “Appendix B: Proximate Determinants of the Nominal Stock of Money,” from A Monetary History of the United States, 1867-1960.
*H. G. Johnson, “Monetary Theory and Policy,” sec. 3.
Phillip Cagan, Determinants and Effects of Changes in the Stock of Money, 1875-1960 (New York: National Bureau of Economic Research, 1968).
Phillip Cagan, “The Demand for Currency Relative to the Total Money Supply,” Journal of Political Economy (August, 1958).
William Dewald, “Free Reserves, Total Reserves, and Monetary Control,” Journal of Political Economy (April, 1963).
Milton Friedman, A Program for Monetary Stability, chap. ii.
A. G. Hart, “The ‘Chicago’ Plan of Banking Reform,” Readings in Monetary Theory.
A. J. Meigs, Free Reserves and the Money Supply (University of Chicago Press, 1962).
Lloyd W. Mints, A History of Banking Theory, pp. 9-12, 29-35, 217-22, 247-57, 265-87.
George Tolley, “Providing for Growth of the Money Supply,” Journal of Political Economy (Dec., 1957), pp. 465-85.
U.S. Board of Governors of the Federal Reserve, Federal Reserve Systems Purposes and Function.
Knut Wicksell, “The Influence of the Rate of Interest on Prices,” Economic Journal, 171 (June, 1907), 213-20
V. Liquidity and Financial Intermediaries
*Phillip Cagan, “Why Do We Use Money in Open Market Operations,” Journal of Political Economy (February, 1958).
*Roland N. McKean, “Liquidity and a National Balance Sheet,” Readings in Monetary Theory.
J. G. Gurley, “Liquidity and Financial Institutions in the Postwar Period,” Study Paper No. 14, Joint Economic Committee, January, 1960.
J. G. Gurley and E. S. Shaw, Money in a Theory of Finance.
H. Makower and J. Marschak, “Assets, Prices and Monetary Theory,” Readings in Price Theory.
Alvin Marty, “Gurley and Shaw on Money in a Theory of Finance,” Journal of Political Economy (February, 1961).
Edward Simmons, “The Relative Liquidity of Money and Other Things,” Readings in Monetary Theory.
VI. The Monetary Standard and International Monetary Arrangements
*”Conditions of International Monetary Equilibrium,” Session at 1962 meeting of American Economic Association, with papers by H. G. Johnson, Richard E. Caves, and Peter B. Kenen, and Discussion by J. Marcus Fleming, Harry C. Eastman, and J. Herbert Furth, American Economic Review (May, 1963), pp. 112-46.
*Milton Friedman, “Commodity Reserve Currency” and “The Case for Flexible Exchange Rates,” Essays in Positive Economics.
*Lloyd Mints, Monetary Policy for a Competitive Society, chaps. 4 and 5.
Frank W. Fetter, Development of British Monetary Orthodoxy, 1797-1875 (Harvard University Press, 1965).
Milton Friedman and Robert V. Roosa, The Balance of Payments: Free versus Fixed Exchange Rates, American Enterprise Institute for Public Policy Research, 1967.
H. G. Johnson, International Trade and Economic Growth, chaps. 6, 7.
H. G. Johnson, “The Case for Flexible Exchange Rates, 1969,” Review of Federal Reserve Bank of St. Louis, (June, 1969).
J. M. Keynes, Tract on Monetary Reform, chap. iii, secs. 2, 3, 4; chaps. iv and v (*especially chap. iii, sec. 2; chap. iv, sec. 2).
Egon Sohmen, Flexible Exchange Rates (University of Chicago Press, 1961).
VII. The Process of Adjustment: Inflation, Business Cycles
*Milton Friedman and Anna J. Schwartz, “Money and Business Cycles,” Supplement to Review of Economics and Statistics (February, 1963), containing proceedings of Conference on Monetary Economics. Also, comments by H. Minsky, A. Okun, and C. Warburton.
Phillip Cagan, “The Monetary Dynamics of Hyperinflation,” Studies in the Quantity Theory of Money.
Milton Friedman, Dollars and Deficits (Prentice-Hall, 1968), chaps. 1, 4, and 5.
Milton Friedman, “The Inflationary Gap,” in Essays in Positive Economics.
Milton Friedman, “The Monetary Studies of the National Bureau,” in The National Bureau Enters Its Forty-fifth Year, 44th Annual Report, National Bureau of Economic Research, June, 1964, pp. 7-25.
Milton Friedman and Anna J. Schwartz, A Monetary History of the United States, 1867-1960, esp. chapter 7.
Arnold C. Harberger, “The Dynamics of Inflation in Chile,” in C. Christ, et al., Measurement in Economics (Stanford University Press, 1964).
Eugene M. Lerner, “Inflation in the Confederacy, 1861-65,” Studies in the Quantity Theory of Money.
Clark Warburton, “The Misplaced Emphasis in Contemporary Business-Fluctuation Theory,” Readings in Monetary Theory.
Source: Hoover Institution Archives. Papers of Milton Friedman. Box 55, Folder 7.
Image Source: Milton Friedman (undated) from University of Chicago Photographic Archive, apf1-06231, Special Collections Research Center, University of Chicago Library.