Monetarists and the Politics of Monetary Policy

Abstract

Monetarist economists appear to have achieved a high level of success in having their policy ideas put into practice. The monetarists are analyzed here as a political group. They are characterized as a loosely organized group offering distinct policy prescriptions, closely aligned with neoliberal political forces. The supply of monetarists is discussed in terms of their relative numbers and shared socialization experiences. The demand for monetarist analysis stems from needs for policy prescriptions, from self-interest, and from need for ideological reassurance. This article concludes with the argument that monetarists' success depends on their ability to convince policymakers outside the Federal Reserve to adopt a monetarist line.