Keynesian economics

Buttonwood (2017) alerts about the grave consequences the rising wealth inequality within and between countries may have worldwide if the economics profession and the policymaker do not manage to address this problem properly. He notes that manmade ways that have brought down this problem whenever it emerged in the past was mass warfare, genuine revolution, and state collapse. Based on a dynamic wealth accumulation model, Pikkety and Saez (2014) suggest that wealth inequality starts rising when…

takes action to influence the economy. Economic policy refers to the actions that governments take in the economic field, economic policy hopes to accomplish a constant flow of supply and demand as well as incoming money. The economy has many working factors such as; supply-side economics, demand-side economics, and monetary policy. Supply-Side economics emphasizes the thought of strong economy policies that remove impediments to supply. Supply-Side economics originated from President Ronald…

Without political freedom, there really wasn’t any economic system (and therefore no freedom), and technology was completely stagnant the entire time. In accordance with Friedman’s theory, England sustained itself for hundreds of years, but never grew. As it slowly shifted toward capitalism and democracy, change in the form of technological innovation was immediately evident, culminating in the Industrial Revolution in the 1700’s. Later, the economic freedom in America motivated citizens to…

Introduction: The study of macro economics entails the behaviour of modern economy as a complete system. The following paper centers specifically on the money theory postulated by Keynes. We focus on the flaws in the classical money theory and then move on to explain the Keynes money model, then work on the criticisms on it. Since it is believed in the 1960's 70's and even now that "Never trust any theory of money older than thirty years" The Classical Theory: The fundamental principle of…

In the 1970s, the Supply Side Economics was developed as an alternative to the famous Keynesian economic policy (Feldstein 35). The Supply Side Economics promoted reduction in government regulations and tax rates in the argument that it would lead to economic growth. The policy claimed that producers would be able to supply low-priced goods to consumers who in turn had a high disposable income to spend on the goods and services in the market (Feldstein 38-39). Reaganomics was not different from…

The 32nd President of the United State, Franklin Delano Roosevelt was a good example of strong leader who guide the nation to accomplish the common good without overuse the exploitation of government intervention. FDR introduced the New Deal which helped to ease the Great Depression and to laid the foundation for an American welfare system. During his administration, he launched different programs to help the unemployed and needy. He established the Public Works Administration “PWA” to lower the…

Von Hayek The confrontation between John Maynard Keynes and his partner, Friedrich August von Hayek, are one of the most famous in the history of contemporary economic thought (Keynes Hayek). This feud started during the Great Depression of the 1930’s due to the causes and remedies of business cycle downturns in market economics (Keynes Hayek). John Maynard Keynes was a believer in the quantity theory of money (monetarism), and his writing topics were essentially built on the principles…

Problems measuring real unemployment Unemployment is an essential issue studied in macroeconomics. The unemployment level gives a signal as to the oval state of “how well off” or “how bad “of the current state of economy. Although the statistics are heavily relied upon by governments and state officials in order to make decisions, however there are a shortcomings in measuring its true reflection or the” real unemployment” level. Unemployment is defined by economists as a person who is actively…

As banking system showed that we need greater regulation, the same verdict can be given to other important economic sectors. But here the problem of right regulation is again a great problem. The old word that economist like to say that it is not enough to have the desire to do well but having the knowledge of doing this seems a heavy burden. As economy is still staggering over the years, there are still policy problems on how to contact it. We all knew from our basic study of macroeconomics…

Devaluation cause inflation, Economic growth is one of the most important and popular causes of the devaluation. From the first ages the economy started growing bigger and bigger till now a days, you may ask yourself how? I can tell you, its because of the devaluation that causes inflation.It may seem a little bit confusing, and you also may ask yourself who is dominating this growth ? what statistics and rules they are using? The government or the leader of the country started putting these…