Keynesian


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Keynesian

A scholar or other person who believes that government intervention is necessary to ensure an active and vibrant economy. According to this theory, government should stimulate demand for goods and services in order to encourage economic growth. It thus recommends tax cuts and increased government spending during recessions to reinvigorate growth; likewise, Keynesians recommend tax increases and spending cuts during economic expansion in order to combat inflation. Many economists believe that Keynesian economic theory is more efficient than supply-side economics, though critics point to the theory's inability to explain stagflation in the United States during the 1970s.
References in periodicals archive ?
In short, hard-core Austrians argued that integrating Austrian economics into the Keynesian model would be like mixing oil and water, or squaring a circle.
In addition to partial debt relief, sound Keynesian economics would suggest some increased social spending and public infrastructure projects to create employment.
The consequence of these cuts, however, has been exactly what the Keynesians predicted: With both private and public spending drying up, the economies of these nations tanked.
1998) Post Keynesian Price Theory, Cambridge: Cambridge University Press.
A second criticism of the Keynesian multiplier stems from Austrian criticisms of empirical studies in general.
The exploitation of the inflation-unemployment tradeoff soon became the central tenet of Keynesian economics.
It should come as no surprise that neoclassical, Keynesian, and Marxian economists all promote their respective theories as the most consistent with reality while dismissing alternative theories as inadequate.
Perhaps its mains shortcoming is the lack of critical analysis of the Keynesian active policies of the post--World War II policies.
For decades the battle was between the Keynesians and the Monetarists, adherents of Milton Friedman's system of thinking.
It is paradoxical that people accept, without any rigorous analysis, the idea that whenever there is an economic crisis, governments must apply Keynesian solutions--namely, increase aggregate demand, especially consumption and public expenditures.
The Keynesian explanation is that we're still recovering from the financial panic, though it's worth recalling that in January 2010 the Fed predicted that growth in 2012 would be 3.