Irving Fisher is one of the few names that left a mark in the field of economics. Fisher was born on February 27, 1867 and died on April 29, 1947. Fisher, who has a life of 80 years, is among the neoclassical economists. Irving Fisher’s equation and Fisher’s theorem are famous. Let’s take a closer look at Who is Irving Fisher, what is Irving Fisher theory, what are Irving Fisher contributions to the economy. You can browse here for information about Milton Friedman.
Who is Irving Fisher? What is the Irving Fisher Theory?
Fisher gave his first purely theoretical doctoral dissertation “The Buying Power of Money” at Yale University at the age of 25. Irving Fisher contributed greatly to the mathematization of “Marginal Utility Theory”. Marginal Utility Theory (Grenznutzentheorie) was founded by Carl Menger and Ikon Walras. Fisher also presented a mathematical explanation of the price theory based on this theory. Price theory describes how and at what height a price is formed in the market. The market value equation still provides the basis for many studies.
In Fisher’s equation, Irving Fisher described the role of interest rate in a complex economy. According to this equation, the difference between nominal and real interest rates indicates the expected inflation rate.
Irving Fisher Purchasing Power of Money
In his scientific studies, Irving Fisher emphasized the “value of money” issue, which he thought was the center of business cycles (market movements). According to Fisher’s observations, the value of money is measured by frequently fluctuating purchasing power. Fisher, who thinks that the difference between the nominal value of money, namely the nominal value of money and the real value of money, cannot be distinguished by the consumer, states that they do not understand the purchasing power of money.
Irving Fisher published his work “The Purcasing Power Of Money” in 1911. Fisher states in this study that the increase in the amount of money will affect the prices and cause the economic balance to deteriorate. Fisher thinks that the resulting overpayments will cause the price increase and therefore a decrease in purchasing power. In his equation for the market value of money, Irving Fisher explained these connections with a simple mathematical formula.
For details: https://en.wikipedia.org/wiki/Irving_Fisher