Keynesian economics
Named after economist John Maynard Keynes, who believed the best way to ensure economic growth and stability is via government intervention in the economy.
Named after economist John Maynard Keynes, who believed the best way to ensure economic growth and stability is via government intervention in the economy.
When times are good, a government should raise taxes and curb public spending to ensure the public finances are robust. As soon as times get harder, tax cuts to help those still in work should be accompanied by public spending on infrastructure projects, such as schools, road maintenance maybe even an Olympic village. That keeps people in work even as job losses hit the private sector. If people are kept in jobs they will keep on spending and borrowing, which in turn supports firms and reduces the impact of a recession. So the theory goes.
Subscribe to MoneyWeek
Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE
Sign up to Money Morning
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Sign up for MoneyWeek's newsletters
Get the latest financial news, insights and expert analysis from our award-winning MoneyWeek team, to help you understand what really matters when it comes to your finances.
-
8 of the best houses for sale for around £1 million
This week: the best houses for sale for around £1 million – from a wing of a Grade II-listed Victorian manor house in Sunderland, to a brick-and-flint cottage in Cley next the Sea, Norfolk
By Natasha Langan Published
-
Starling Bank to scrap 3.25% interest rate from popular current account within days
Starling is to remove the generous 3.25% it pays on current accounts from next week – what does this mean for customers and should you move?
By Katie Williams Published