A Theory of the Consumption Function.

FRIEDMAN, Milton.

$20,000.00

Item Number: 116572

Princeton: Princeton University Press, 1957.

First edition of Friedman’s magnum opus. Octavo, original  cloth, graphs and charts throughout. Association copy, inscribed by the author to the British economist Lionel Robbins on the front free endpaper, “To Lionel, in place of a work of art Milton.” The recipient, Lionel Robbins, along with J.M. Keynes, was the leading British economist during the inter-war period at the London School of Economics, he “dominated the economics department for thirty years and built it up to its pre-eminent position in British economics” (ODNB). Milton Friedman was less shaped by Robbins’s thought and teachings than many of his British contemporaries, but all economic thought in the period was deeply affected by Robbins’s work. Friedman and Robbins were both founding members at the Mont Pelerin Society in 1947, and in his and Rose’s memoirs Milton praises Robbins’s “genius” in drafting the statement of aims that was acceptable to all members, save Maurice Allais (Two Lucky People, p. 161). Aside from their shared economics profession, the Friedman and Robbins couples were friends for many years – Rose recalls in the memoirs that “I had met Lionel Robbins, not yet a Lord, many years earlier [from 1953] when he was visiting Aaron [Rose’s brother] in Washington. Lionel and Iris visited us in Cambridge and we had many visits with them in London” (IBID., p. 249). Near fine in a near fine dust jacket. An exceptional association copy linking these two giants of twentieth century economics.

This economist's masterpiece of economic theory "reinterpreted that Keynesian concept of the consumption function by relating it to lifetime instead of current income. For its ingenious manipulation of data and its reconciliation of apparently conflicting evidence, this book must rank as one of the masterpiece of modern econometrics" (Blaug, 63). "Milton Friedman offered conservative answers to the great questions of economics, at the same time challenging economic thought since Keynes. In this book, Friedman disputes Keynes' idea that aggregate spending and income are directly linked (and therefore open to government influence). Rather, he writes, consumer spend independent of government policy, based on their expected long-term, or 'permanent' income. In all his writing, Friedman embraces a laissez-faire approach that celebrates individual freedom. He sees the ideal role for government as 'umpire', not 'parent' (NYPL Books of the Century 144).