<Li> Business and economics portal </Li> <Tr> <Td> <Ul> <Li> </Li> <Li> </Li> <Li> </Li> </Ul> </Td> </Tr> <Ul> <Li> </Li> <Li> </Li> <Li> </Li> </Ul> <P> Monetarism is a school of thought in monetary economics that emphasizes the role of governments in controlling the amount of money in circulation . Monetarist theory asserts that variations in the money supply have major influences on national output in the short run and on price levels over longer periods . Monetarists assert that the objectives of monetary policy are best met by targeting the growth rate of the money supply rather than by engaging in discretionary monetary policy . </P>

The federal reserve adopted a monetarist approach when it