Economics, Chicago School of

The Chicago School of Economics refers to that group of economists associated with the University of Chicago and most closely identified with the work of Milton Friedman [Page 136]and George Stigler. Frank Knight and his protégé, Henry Simons, are commonly credited with having established this school of thought in the 1930s and 1940s. The Chicago School's approach to economics, as it developed under Friedman and Stigler in the 1960s and 1970s, rests squarely on the conclusions reached earlier by the English classical economists that the rational allocation of economic resources required free and unhindered markets and that capitalism alone was consistent with political and social freedom. This conclusion stood in sharp contrast to the prevailing neo-Keynesian orthodoxy at midcentury, which regarded government intervention in the ...