This document summarizes the life and work of John Maynard Keynes, a British economist known as the father of macroeconomics. It outlines that Keynes helped lead economies out of the Great Depression by advocating for interventionist policies like increased government spending. He challenged established neoclassical economic theories by introducing new concepts like consumption and the multiplier effect. Keynes argued the government should ensure full employment and regulate markets. His theories formed the basis of Keynesian economics and influenced economic policy for decades following World War II.

1. “Ideas shape the course of history”

2. Biography
 Britisheconomist
 Born on June 1883
 Wrote “The General Theory of
Employment, Interest and
Money” during WWII
 He’s known as the Father
of Macroeconomics

3. Major Achievements
 Helped in the economy’s recovery during
the Great Depression
 Influenced the general economic boom by
Western Nations between 1945-1975
 Formed the basis of Keynesian economics
 Introduced the Macroecomics theory
◦ He believed that government spending
could pull an economy out of recession

4. The Great Depression
o Period of high rates
of unemployment
o He advocated interventionist
economic policy
o Urged government to:
o use financial and monetary measures to
reduce the adverse effects of business
cycles, economic recessions, and
depressions
o Spend on public works like programs to
promote employment

5. He outlined the limitations of
Microeconomics* theory. Due to
unemployment and poverty, the demand
for good and services dropped. Many
workers were unwilling to accept lower
wages
*Studies the individual parts of economy, the household
and the firms, make decisions to allocate limited
resources. How good or services are bought and sold.

6.  High unemployment rate greatly influenced the
development of macroeconomics
 Challenged the established neoclassical economics
 Introduced important concepts such as:
o Consumption
o Multiplier
o Marginal efficiency of capital
o Liquidity preference
END OF
 Government's responsibility is to NEOCLASSICAL
◦ Reach and maintain full employment THEORIES!
◦ Regulate markets and free trade such as Laissez-faire

7. Keynesian Economics Impact
 Aid in the formation of the 20th Century’s
economy
 Consequences of the Great Depression were
lessened
 Government took an active role in the
country's economy (Departure from
neoclassical theories)

8. Why did the Keynesian theory
didn't work?
 Government spend too
much money on post-WWII
events. Examples: Vietnam war, sending the first man to the moon
◦ The Keynesian solution stopped working
◦ Unemployment became worst
◦ It created Inflation
◦ In conclusion Keynesian theories work best on
economics catastrophes

9. Keynesian Economics Nowadays
 New stimulus Bill package
◦ President Obama’s
plan to save the U.S.
economy with a massive
round of government
spending was based
on Keynes' ideas

10. Bibliography
 Ryan, James John Maynard Keynes John Maynard Keynes; 2005, p1-2, 2p
 Columbia Electronic Encyclopedia, 6th Edition; 10/1/2009, p1-1, 1p. See Keynes’s Collected Writings
(30 vol.,
1971–80) Biography by R. Skidelsky (3 vol., 1986–2001); G. Fletcher, the Keynesian Revolution and Its Critics
(1987);
P. Clarke, The Keynesian Revolution in the Making, 1924–1936
(1989).
 NPR story: Davidson, Adam and Blumberg, Alex report was produced in collaboration with Chicago Public Radio's
This American Life, Obama Gives Keynes His First Real-World Test, 2009
 Keynes, John M., The General Theory of Investment, Interest and Money 1936
 Lawler, JosephThe American Spectator, We’re All Keynesian Again, 2009