Schools of Thought in Classical Liberalism, Part 2: Milton Friedman and the Chicago School

Summary: Dr. Nigel Ashford discusses the ideas of Milton Friedman, a Nobel Laureate and economist. Friedman is widely considered the founder of the Chicago School, an intellectual tradition that basis its theories on empirical and measurable evidence and theories. According to the Chicago School, in order to assess the merits of a law, you must measure the results of that law. Laws may be well-intended, but the Chicago School demands that we measure the consequences of laws, and not just intentions. The Chicago School admits that markets do fail sometimes. But, they also believe that governments fail as well. They contend that government failure is almost always greater than market failure. That's why the Chicago School believes the government should be significantly limited. What does the Chicago School say about the proper role of government? According to Friedman's thinking, which you can find in his popular books Capitalism and Freedom and Free to Choose, the government should have four realms of responsibility: Military and police Administration of justice Public goods (like defense) and negative externalities (like pollution) Protection of children and mentally handicapped