ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -For example, Keynesian economists would advocate deficit spending on labor-intensive infrastructure projects to stimulate employment and stabilize wages during economic downturns. They would raise taxes to cool the economy and prevent inflation when there is abundant demand-side growth.

Detailed explanation-2: -Keynesian economics is a theory that says the government should increase demand to boost growth. 1 Keynesians believe that consumer demand is the primary driving force in an economy. As a result, the theory supports the expansionary fiscal policy.

Detailed explanation-3: -It was developed by British economist John Maynard Keynes during the 1930s in an attempt to understand the Great Depression. The central belief of Keynesian economics is that government intervention can stabilize the economy.

Detailed explanation-4: -Key points Keynesian economics is based on two main ideas. First, aggregate demand is more likely than aggregate supply to be the primary cause of a short-run economic event like a recession. Second, wages and prices can be sticky, and so, in an economic downturn, unemployment can result.

Detailed explanation-5: -According to Keynesian economic theory, the government should increase demand in order to boost growth. Keynesians hold the belief that the primary driving force in an economy is consumer demand.