John Maynard Keynes was a famed economist who throughout his lifetime provided a great deal of contribution to the development of economics and intellect. During his lifetime Keynes developed a variety of policies and methods during drastic events such as World War I, the Great Depression, and World War II. It was his unrecognized contributions that demonstrated who he was as a man, as an economist, and as an empathetical political man who could rationalize through hard times. Keynes provided a great deal of aid and knowledge on how market structures worked, how we percieved the value of money, as well as how we percieved the stock market and how one should invest in order to pursue a higher profit and lessen the risk. In order to understand
…show more content…
Contrary to their popular belief, Keynes did not estimate that this would have positive outcomes on the entirety of the UK as the war had left Europe in a less off of a financial state that whan it was before. By returning to the gold standard the demand for exports would suddenly fall, the fall would then have to be counteracted through the deflation of prices yet the deflation of prices would lead to a loss of jobs throughout the area. Despite his warnings, the UK returned to the gold-standard and within the year, working classes began feelings its consequences, some were forced to take pay-cuts in order to facilitate the costs of producing a …show more content…
People began spending less as a whole in an attempt to save up what little money they had left, in hopes of waiting out what they believed to be a temporary economic downturn. This however proved to be a worsening solution for the economy, because of the lack of spending, unemployment began to rise within other communities. Keynes was a man who contradicted the common Say’s Law which stated that supply created demand, contradictory to this, Keynes believed that output was determined by demand as a result of his contrary beliefs, John Maynard Keynes was a man who changed the perspective of how the USA viewed economic downturns and the ways in which they solved them. Keynesian economics proved useful during the Great Depression as they encouraged government to get involved and ditch their old policies which followed a laissez faire approach as suggested by Adam Smith which states that markets work best when the government does not interfere. Under Keynesian policies, then government was meant to pump money into the economy by spending and encouraging other people to spend too. His economic policies cushioned the impact of what could have been more of a catastrophe, Keynes stated that if “Investment exceeds Saving, there will be inflation. If Saving exceeds Investment there will be recession. One implication of this is that, in the midst of an economic depression, the correct course of
Contrary to their popular belief, Keynes did not estimate that this would have positive outcomes on the entirety of the UK as the war had left Europe in a less off of a financial state that whan it was before. By returning to the gold standard the demand for exports would suddenly fall, the fall would then have to be counteracted through the deflation of prices yet the deflation of prices would lead to a loss of jobs throughout the area. Despite his warnings, the UK returned to the gold-standard and within the year, working classes began feelings its consequences, some were forced to take pay-cuts in order to facilitate the costs of producing a …show more content…
People began spending less as a whole in an attempt to save up what little money they had left, in hopes of waiting out what they believed to be a temporary economic downturn. This however proved to be a worsening solution for the economy, because of the lack of spending, unemployment began to rise within other communities. Keynes was a man who contradicted the common Say’s Law which stated that supply created demand, contradictory to this, Keynes believed that output was determined by demand as a result of his contrary beliefs, John Maynard Keynes was a man who changed the perspective of how the USA viewed economic downturns and the ways in which they solved them. Keynesian economics proved useful during the Great Depression as they encouraged government to get involved and ditch their old policies which followed a laissez faire approach as suggested by Adam Smith which states that markets work best when the government does not interfere. Under Keynesian policies, then government was meant to pump money into the economy by spending and encouraging other people to spend too. His economic policies cushioned the impact of what could have been more of a catastrophe, Keynes stated that if “Investment exceeds Saving, there will be inflation. If Saving exceeds Investment there will be recession. One implication of this is that, in the midst of an economic depression, the correct course of