[9] She graduated Phi Beta Kappa from Barnard College[10] at 18 and gained her master's degree in economics from Columbia University in 1935, at 19.

Her first published paper was in the Review of Economics and Statistics (1940), in which she, along with Arthur Gayer and Isaiah Finkelstein, wrote British Share Prices, 1811–1850.

Though she held teaching positions for only a short part of her career, she developed younger scholars by her willingness to work with them and to share her approach (a scrupulous examination of the past) to understand history better and to draw lessons for the present.

In collaboration with Arthur Gayer and Walt Whitman Rostow, she produced the monumental Growth and Fluctuations in the British Economy, 1790–1850: An Historical, Statistical, and Theoretical Study of Britain's Economic Development.

Gayer had died before the book's first appearance, but two other authors wrote a new introduction, which reviewed literature on the subject that had published since the original publication date.

In particular, Schwartz indicated that she had, in the light of recent theoretical and empirical research, revised her view of the importance of monetary policy and her interpretation of interest rate movements.

Prompted by Arthur F. Burns, then at Columbia University and the National Bureau who would subsequently be Chairman of the U.S. Federal Reserve System, she and Milton Friedman teamed up to examine the role of money in the business cycle.

Some editions include an appendix[14] in which the authors got an endorsement from an unlikely source at an event in their honor when Ben Bernanke made this statement: "Let me end my talk by abusing slightly my status as an official representative of the Federal Reserve.

Drawing on evidence from over two centuries, she demonstrated that business failures do not have major consequences for the economy if their effects are prevented from spreading through the financial system.

In an interview with Barrons in 2008, Schwartz said interventions such as injecting liquidity into markets and reacting to the credit crisis with ad hoc programs were not the answer.

Some years ago, the Department of Banking and Finance at City University, London, England, started a research project on the monetary history of the United Kingdom.

She continued commenting on economic affairs until the financial crisis of the first decade of the 21st century, and criticized the government's response to it, such as Ben Bernanke's support for bailouts and persistently-low interest rates.