Chicago school of economics-about Chicago school of economics:
Chicago school of economics is the economics of a flexible discussion group, the members of the United States, Department of Economics, University of Chicago, composed of teachers and students, the school is to defend the core values of neo-classic economics, economics, believe that the market mechanism with the laissez-faire, opposed any form of intervention against the socialist planned economy with Keynesian.
Chicago School of Economics schools of the Western bourgeoisie. Its members are mainly taught at the University of Chicago, believe in neo-liberal economic philosophy, emphasizing the role of market mechanism regulating a number of economists, there are also individual never taught in school, but because of their academic point of view and policy orientation is considered members of the school. The school's main representative in the 1930s before and after J · Viner (1892 ~ 1970), Frank H · Knight (1885 ~ 1972), (1899 ~ 1946) and others; World War II after F. von Hayek, George Stigler (1911 ~), M · Friedman et al.
Chicago school of economics - basic information
Chicago school of economics is the economics of a flexible discussion group, the members of the United States, Department of Economics, University of Chicago, composed of teachers and students, the school is to defend the core values of neo-classic economics, economics, believe that the market mechanism with the laissez-faire, opposed any form of intervention against the socialist planned economy with Keynesian. The twentieth century, because since 1950 the Chicago School approach using econometric Keynesian theory of illusory attempt to prove the fame. All of a sudden, the school became resistant to Keynesian economists outpost. But the debate continued for a very long time, and both sides think they won a victory in this controversy.
Member of the Chicago school of economics firmly support the new classical economics theory of value economic analysis, policy recommendations in its frequency is the "free market" based on liberal ideology, but take the usual mathematical formalism against the abuse and is willing to give up the rigorous precision general equilibrium theory of logical reasoning and tend to be more results-oriented (result-oriented) partial equilibrium analysis of the methodology. In recent years, "the Chicago school of economics" and "economic imperialism (economicimperialism)" linked together, so-called "economic imperialism" refers to the application of economic reasoning methods into other areas traditionally considered the SAR, such as political science, law, history and sociology.
Chicago School of view are:
1, the extreme emphasis on individual freedom against arbitrary and all "authority"; in the state must intervene in the case of the economy, stressing that "the rule of law" against the "rule of man." For example, Simmons on the reform of the United States in the 1930s the idea of monetary and financial system, including commercial banks must deposit the absorption of 100% of the cash reserves to keep this proposal; Hayek always maintained that the gold standard is the ideal monetary realistic system, oppose any expansion of currency in circulation artificially policy measures; and Friedman's "single rule" of monetary policy. Despite the historical conditions in which these ideas vary, vary greatly according to the theory, the essence of the common idea to establish a monetary system in the system, a country's currency credit to the legal form of a liquid depends on the provisions of the "rules" rather than depending on discretionary monetary authorities adopted a policy measures (such as the actual economic situation and to adjust the discount rate at any time, change the commercial bank's statutory reserve ratio, and the central bank's open market trading of government securities activities , etc.).
2, with special emphasis on perfectly competitive market mechanism in the regulation of the capitalist economy of the major features, strongly advocated state intervention in economic life should be reduced to the essential minimum. For example, Knight and Simmons are great emphasis on the free competition of private enterprise in economic life to be played. Hayek argued that capitalism is not only free competition to achieve the optimal allocation of production resources, ie to achieve maximum economic efficiency, but also to save the freedom of the individual against arbitrary interference by policy makers. He not only economic plan and the individual freedom of choice completely against each other, even claiming that any form of economic plan is "the road to serfdom." However, due to changes in historical conditions, but also because each unique value judgments, the main representative of the Chicago School in the World War II before and after the policy has shown a very different proposition.
3, in the developed capitalist countries, economic freedom, economic efficiency and equal distribution of the three policy goals, he often eliminate this long to attend to, can not have both the. For example, to reduce unemployment, must bear a certain degree of inflation, to stabilize prices, it must allow more workers to the long term unemployed. Another example is the increase in government transfer payments and to protect social welfare spending, will help slow down the capitalist free competition brought about the unequal distribution of income and class conflict, but this must impose high progressive income tax, under certain conditions, prevent the accumulation of capital and labor productivity. The dilemma for such problems, the Chicago school of free and pay more attention to efficiency, relatively little attention to the issue of income distribution.
Chicago school of economics - theoretical characteristics
Chicago school of economicsAccording to the Chicago school of its policies in order to arrive at the theoretical point of view, generally has the following features or some of the assumptions or implicit premise is as follows:
① stressed that economics should be an empirical science, so many members of the Chicago school of economics known as the positivist.
② theoretical analysis focuses on the capitalist economy long-run equilibrium, ignoring short-term effects of economic policy. Members of the Chicago School generally believed that the market mechanism into full play the role of the premise, there is full employment capitalism inevitable trend.
③ In the theoretical analysis is often neglected under the conditions of free competition, social welfare and private interests, private costs and social costs will be the difference between, or that this difference or economic freedom and economic efficiency is negligible compared to, which makes them do not attach importance to the capitalist state in the regulation of resource allocation and income distribution important role.
Members of the Chicago School generally bourgeois 19th century with special emphasis on micro-economics in the economic analysis of the effectiveness and usefulness of the practical application of the so-called "Chicago tradition" of this feature, more prominently in the scientific work Stigler in. Stigler life in the market price theory and dynamic structure of the research, he learned and apply self-A. Smith to A. Marshall's traditional micro-economics of the basic theoretical framework (in a purely competitive or purely monopolistic context, were investigated in order to obtain maximum utility consumers and producers to earn maximum profits for the optimal behavior in the production and distribution of regularity), combination of different sectors of the statistical analysis of survey data to examine the reality of a purely competitive market economic problems (known as the Applied Microeconomics), thus affirming the traditional basis of the basic theory, they must be made to the traditional theory essential to effectively complement and development. Stigler through the introduction of "incomplete information" this factor, the capitalist market in a number of phenomena, such as price rigidity, queuing and resources are not fully utilized, the same kinds of goods in addition to the external transport costs in different regions have different selling prices, and an industrial sector coexist with why the big difference in the size of many companies, etc., made by strict logical reasoning, and experience in materials used to test theoretical explanation, and since the 1970s, the macroeconomic theory of unemployment and inflation provides a microscopic theory. Stigler that "incomplete information" and "non-perfectly competitive market," leading to inefficient allocation of resources is inherent in the essential characteristics of the market economy, and therefore can not be resolved through state intervention.
