Classical Vs Keynesian
I think that the Keynesian philosophy has a lot more valid aspects. At first I was wondering why Adam Smith would be known as the "father of modern economics", since he lived in the 1700's. I figured that Keynes, who lived during the 1900's, would have been more modern. After doing research, I saw that Keynes had a lot of the same views as Smith, and that Keynes wouldn't have probably came up with his own philosophy without the help of Smith's. I don't feel that either philosophy was wrong. Smith's Classical philosophy went along with his time period pretty much. If he could have seen the future I think he would have felt slightly different about certain things. Keynes philosophy goes along with modern day economics. These are some of things I learned about th
The consumption function, a Keynesian principle, is when disposable income rises, household spending rises, but at a slower rate. This is why household savings also grow as income rises. ------------------------------------------------------------------------ Keynes thought that the more specific reason for the Great Depression was a large drop in private investment due to pessimistic expectations. John Maynard Keynes challenged the theories of classical economists in the great depression of the 1930s Keynes believed the general cause of the Great Depression in the 1930s was a collapse in aggregate demand. According to Keynesian economics, inflexible wages and prices cause real GDP and employment to fall when aggregate demand decreases. Classical ec
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Approximate Pages = 2 (250 words per page double spaced)
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