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Keynesian economics - or demand-side economics believes that if people are employed, they will spend money and demand for products increases, and the economy improves. Keynesian economics believes that in times of high unemployment, the government should spend in order to maintain consumptive demand.

Keynesianism - believes that economic efficiency and equity are compatible. Social spending helps economic recovery, enhances productivity and keeps labour market flexible. Also called demand-side economics as it believes that if people are employed, they will spend money and demand for products increases, and the economy improves. Keynesian economics believes that in times of high unemployment, the government should spend in order to maintain consumptive demand.

Copyright © 2001 Steven Hick. All rights reserved.