Sample Solution

ggregate demand via activist equilibrium and economic interference policies by the government. Keynesian economics is viewed as a “demand-side” idea that concentrates on changes in the economy over the short term. (jahan, mahmud and papageorgiou, 2014)
To understand Keynes, it is important to note that unlike most economists nowadays, his key target was to get completely rid of unemployment: the “real problem, fundamental yet essentially simple is to provide employment for everyone.” His objective for unemployment is “the sort of level we are facing in wartime less than 1 per cent.” Keynes strongly denied that the fundamental cause of unemployment is wage and price rigidities (Higgs, 1995). He said that once full employment is reached then markets can work freely. He also claimed in his book “The General Theory of Employment, Interest and Money” that socialization of investment incorporating public-private partnership, might be needed to secure full employment (Keynes, 1936). He opposed to an economy which generated far less than it could, a problem which left millions of people unemployed in economies where work is not only social status, but source of revenue.
The significant impact of Keynesianism throughout the World War II is widely attributed to the obliteration of mass employment, which occasioned in an extreme influence and spread of Keynesianism connecting to the government’s duty of upholding full employment.( (Higgs, 1995) For example, in 1944, the UK government espoused a plan towards ensuring a “high and stable level of employment” as a part of its employment policy (Jstor.org, 2012). In the USA, the Employment Act of 1946 displayed the commitment of the Federal Government in embracing measures to accomplish “maximum employ