Question

Which best summarizes the philosophical difference between economists John Maynard Keynes and Adam Smith? Keynes said government was the key to solving economic issues, while Smith believed government should take a hands-off approach. Smith said government was the key to solving economic issues, while Keynes believed government should take a hands-off approach. Smith believed in an "invisible hand" with which government pushes the economy, while Keynes did not agree with this idea. Keynes believed in an "invisible hand" with which consumers push the economy, while Smith did not agree with this idea.

Answer 1

Answer:

Keynes said government was the key to solving economic issues, while Smith believed government should take a hands-off approach

Explanation:

John Maynard Keynes, a British economist said government was the key to solving economic issues because government is the one that can increase spending and reduce taxes when there is recession in order for them to create jobs and also boost the buying power of consumer. He argued that uncertainty can cause businesses to stop acting and government is the only one that can step in.

Adam smith believed government should take a hands-off approach because government need to enforce contracts that will encourage new ideas and they need to hands off and the free market mechanism should operate on it's own without government intervention. He argued that the role of government should be limited.