Question

In a short paragraph, describe John Maynard Keynes's major economic philosophies and how his beliefs differed from economic theories that were popular during the early years of the Great Depression.

Answer 1

John Maynard Keynes proposed that increasing government expenditures and lowering taxes would stimulate demand and pull the economy out of a state of depression. His approach sought to generate demand by having the government intervene to "jump start" economic activity. This differed from all the "belt-tightening" and restrictive approaches that others advocated. President Roosevelt's New Deal program sought to put Keynesian economic theory into practice.