Explain the keynesian theory of employment?

Question: Explain the keynesian theory of employment?

The Keynesian theory of employment, developed by economist John Maynard Keynes, posits that government intervention is necessary to maintain full employment in an economy. Keynes argued that during economic downturns, a lack of aggregate demand can lead to unemployment, as businesses reduce production and lay off workers. To combat this, Keynes proposed that the government should increase spending and investment, creating jobs and stimulating demand. This increase in government spending would lead to a multiplier effect, where increased demand would create more jobs, leading to further increases in demand and a cycle of economic growth.

Rjwala

Rjwala is your freely Ai Social Learning Platform. here our team solve your academic problems daily.