Note of a meeting of the Bank's Panel of Academic Consultants.
The Bank's Panel of Academic Consultants met on 28 October to discuss the book Monetary Trends in the United States and the United Kingdom by Milton Friedman and Anna Schwartz. The Panel discussed only parts of the book relevant to the UK economy, about which the book makes strong claims; these were summarised by one participant as 'money causes prices, money does not cause output and nothing else causes prices or output'. In view of the importance for monetary policy of these claims, if true, the Bank felt they deserved full discussion by the Panel. For the meeting, the Bank invited two papers which discuss different aspects of the book. The first, by Professor Arthur Brown, considers how well the evidence in the book fits the UK historical experience. The second, by Professor David Hendry and Mr Neil Ericsson, examines the statistical procedures used by Friedman and Schwartz and the extent to which these enable the conclusions they drew to be substantiated. These papers, slightly revised in the light of the discussion, will shortly be issued as Panel Paper No 22. Copies will be available from the Bank at the address given on the reverse of the contents page of this Bulletin.
Monetary trends in the United Kingdom