Lew Rockwell reports:
As the "heir" of Frank Knight, Friedman wielded a lot of power in the department, though he was not yet well known outside of it.How great to have had historian Ronald Hamowy as a distinguished visiting faculty member at Mises University last week. We did a fascinating and moving podcast about his teacher F.A. Hayek, and his close friends Murray Rothbard and Burt Blumert.
In his graduate seminar, reports David Gordn, Ronald confirmed that it was indeed Milton Friedman who blocked Hayek from the Chicago economics faculty. As a result of the Miltonian blackball, Hayek had to take an unpaid position at the university, and eventually returned to Austria. His American salary was paid by the heroic Volcker Fund, but there was no pension and certainly no tenure.
Hayek, though, has the last laugh on this one. Hayek's great work was too powerful for the University of Chicago to ignore. Milton Friedman may have attempted to block Hayek's affiliation with the economics department at the University, but he failed. The University of Chicago in its Gleacher Center to this day prominently displays the photos of Nobel Prize winners in Economics that taught at the University. Displayed, with those who taught in the economics department at U of C, is Hayek, no doubt to the eternal annoyance of Friedman.