Representative of the school of Keynesian economics, what is Keynesian economics?

Keynesianism, or Keynesian economics, is an economic theory based on Keynes's general theory of employment, interest and money (Keynes, 1936), which advocates the adoption of expansionary economic policies by the state to promote economic growth by increasing demand.

Keynes's economic theory held that macroeconomic trends would constrain the specific behavior of individuals. "Political economy" or "economics" since the late 18th century has been based on the continuous development of production to increase economic output, while Keynes believed that the decline in aggregate demand for goods was the main cause of economic recession.

From this point of view, he argues that measures to maintain the balance of overall economic activity data can balance supply and demand at the macro level. As a result, Keynes's and other economic theories based on Keynes's theory are called macroeconomics to distinguish them from microeconomics, which focuses on the study of individual behavior.

Keynesianism (Keynesiani** or Keynesian Theory) was born in the thirties of the 20th century.

Scientific theories in the context of the Great Depression.

From 1929 to 1933, the world experienced an unprecedentedly severe economic crisis.

This great crisis has swept the countries of the world.

After a four-year-long crisis, the whole world has fallen into a long-term depression.

The Great Crisis and the ensuing special depression in Western countries became known as the "Great Depression of the 30s".

2. Scientific theories that are compatible with state interventionism.

Before the First World War, state interventionism began to emerge.

In the intervening years of the Great War, this state intervention developed rapidly and took on an extraordinary military character.

New economics opposes laissez-faire and advocates state interventionism; It points out the important role of the "visible hand" in ensuring the smooth operation of the economy, and does not simply emphasize the role of the "invisible hand" market mechanism.

3. Academic background.

Before the emergence and spread of Keynesian economics, the dominant economics was traditional economics represented by Marshall, Pigou (and others).

Veblen first used the term "neoclassical" to describe Marshallian economics in 1900.

Later, economics generally accepted the terms "neoclassical school" and "neoclassical economics" to refer to Marshall, Pigou and others and their economics.

Neoclassical economics dominates mainstream academia, both in theory and in terms of policy.

Keynes himself grew up under the influence of neoclassical economics.

Keynesian economics critiques the employment theory in neoclassical economics, inheriting the mercantilist theory of state intervention, Malthusian theory of insufficient effective demand, Mendeville's theory that high consumption promotes prosperity, and Hobson's theory that excessive savings lead to unemployment and economic depression.