Friedman's work was based at Chicago University. His economic theories emphasised the link between the money supply and the rate of inflation. If the government prints more money to fund its projects, then inflation inevitably goes up
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Friedman's theories formed the basis of the economic policies of Margaret Thatcher in Britain, and Ronald Reagan in the US. But Friedman's own study criticized the Thatcher administration for making only "limited" progress in tackling the growth of public spending
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Friedman's theories were hailed by right-wing politicians in the Eighties, when many western economies went through a boom period. But even at the height of Friedman's influence, some critics felt his faith in market forces went too far
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The boom years on the stock exchanges ended dramatically in October 1987 when shares collapsed in unprecedented falls. The Dow Jones industrial average in New York fell by 22.9 per cent, nearly twice the fall that triggered the Great Crash of 1929
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The collapse of the stock markets took the gloss off Friedman's monetarist gospel, but the man himself still acted as a guru to many politicians. He warned that increasing money supply as a means to stimulate the economy would produce a worrying rise in inflation
