Keynes JohnMaynard

Keynes JohnMaynard

(1883-1946) English economist who, in the 1930s, transformed economic thinking and was influential in changing the way in which governments tackled high UNEMPLOYMENT at times of economic recession. Keynes’ seminal work was The General Theory of Employment, Interest and Money (1936). Before Keynes, most economists had assumed that economies would tend to achieve FULL EMPLOYMENT unaided as the outcome of Say's Law, the natural tendency of supply and demand to match. At a time of prolonged worldwide recession and high levels of unemployment, Keynes showed that this was not so, that recessions are not always self-correcting, and that falling wages and falling rates of interest would not always be sufficient to bring unused capital and unemployed workers back into use. Accordingly, Keynes argued that government intervention in the economy to influence the level of aggregate demand was necessary if economies were to function effectively. see also KEYNESIAN ECONOMICS.
Collins Dictionary of Sociology, 3rd ed. © HarperCollins Publishers 2000