| dc.description.abstract |
Milton Friedman is usually regarded as an instrumentalist on the basis of his infamous
claim that economic theories are to be judged by their predictions and not by the
realism of their assumptions. This interpretation sits oddly with Friedman's empirical
work - e.g., Friedman and Schwartz''s monetary history - and his explicit rejection
of theories of the business cycle that, while based on accurate correlations, nevertheless
do not make economic sense. In this paper, I try to reconcile Friedman's methodological
writings with his practices as an empirical economist by, first, taking his roots
in Alfred Marshall seriously and, second, by taking the methodological implications
of his empirical work seriously. Friedman dislikes the word "cause". Nevertheless,
appearances to the contrary notwithstanding, Friedman is best understood as a causal
realist - that is, one who understands the object of scientific inquiry as the discovery
through empirical investigation of the true causal mechanisms underlying observable
phenomena.
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