John Maynard Keynes was born in Cambridge in 1883. In his early years as an economist, he was a strong believer in the quantity theory of money, due to the influence of Alfred Marshall and Arthur Pigou. However, his ideological view of economics took a dramatic turn as he witnessed the long-term unemployment in Britain. It was at this point that he considered other economic parameters, and wrote his famous, "The General Theory of Employment, Interest and Money". In this book, Keynes introduced the consumption function, (which shows aggregate demand as the sum of consumption, investment and government spending), and the idea that full employment is possible only with the help of government spending.
According to Keynes, once full employment was reached through fiscal measures, the market mechanism would operate freely.
Works by John Maynard Keynes:
Click on the icon to return to the
list of economists.
Click on Léon Walras to
return to the Walrasiad.
