Keynesian vs Monetarist Economy
Economics for Hospitality,
Tourism and Leisure
Keynesians versus Monetarists
Faculty responsible: J. Heller
Ismail EL HASSANI
Humanity has known in its history long periods of growth with the Agrarian Revolution, the Industrial Revolution, the Oil era and now the Information’s one. From the last period of sustained growth is born the myth of continuous and eternal growth. However, the scarcity of natural resources and the awareness of the negative effects of economic activities suggest that humanity may live a long period of stagnation. In fact, it has already experienced long periods of recession. That is the reason why we should prepare ourselves to sustain growth rather than calling it as our ancestors called rain. In order to achieve this goal, we can follow different economic philosophies such as Keynesianism or Monetarist economies.
In this work, we will focus more on Keynesianism. Firstly, we will discover the history of this theory and then define it. In addition, we will analyse and describe all the components of this theory. Finally, we will be comparing the two approaches to demonstrate that Keynesianism is much more effective and brings more advantages than Monetarists.
John Maynard Keynes was born in England in 1883 until his death in April 1946. Keynes was certainly the greatest economist of the twentieth century (Clark, 2008). Even today he returns often in the foreground: the known subprime financial crisis in late 2009 led a great business newspaper to elect him "Man of the Year" (Diever, 2010). Keynes’ thinking was very different from the others, this is the main reason his thoughts were terribly combated by anti-Keynesian. However it is still standing until our day while periods of economic crisis have put his theory in the spotlight again (Diever, 2010).
Because it was not only an economist but also a philosopher, mathematician, man of letters, arts and culture, John Maynard Keynes was able to equal in the
Tourism and Leisure
Keynesians versus Monetarists
Faculty responsible: J. Heller
Ismail EL HASSANI
Humanity has known in its history long periods of growth with the Agrarian Revolution, the Industrial Revolution, the Oil era and now the Information’s one. From the last period of sustained growth is born the myth of continuous and eternal growth. However, the scarcity of natural resources and the awareness of the negative effects of economic activities suggest that humanity may live a long period of stagnation. In fact, it has already experienced long periods of recession. That is the reason why we should prepare ourselves to sustain growth rather than calling it as our ancestors called rain. In order to achieve this goal, we can follow different economic philosophies such as Keynesianism or Monetarist economies.
In this work, we will focus more on Keynesianism. Firstly, we will discover the history of this theory and then define it. In addition, we will analyse and describe all the components of this theory. Finally, we will be comparing the two approaches to demonstrate that Keynesianism is much more effective and brings more advantages than Monetarists.
John Maynard Keynes was born in England in 1883 until his death in April 1946. Keynes was certainly the greatest economist of the twentieth century (Clark, 2008). Even today he returns often in the foreground: the known subprime financial crisis in late 2009 led a great business newspaper to elect him "Man of the Year" (Diever, 2010). Keynes’ thinking was very different from the others, this is the main reason his thoughts were terribly combated by anti-Keynesian. However it is still standing until our day while periods of economic crisis have put his theory in the spotlight again (Diever, 2010).
Because it was not only an economist but also a philosopher, mathematician, man of letters, arts and culture, John Maynard Keynes was able to equal in the
References: : Gerald, M. (2009, 04 27). Les politiques économiques. Retrieved from http://www.skyminds.net/economie-et-sociologie/la-regulation-des-activites-sociales/les-politiques-economiques/ Clark, J. M. (2008, 12 09). John maynard keynes. Retrieved from http://www.newworldencyclopedia.org/entry/John_Maynard_Keynes DeNardo, G. (2008, 12 07). Mv=pt a classic equation and monetary policy. Retrieved from http://www.nolanchart.com/article5583-mvpt-a-classic-equation-and-monetary-policy.html Cowen, T. (2012, 07 30). Business cycles explained: Monetarist theory. Retrieved from http://learnliberty.org/videos/business-cycles-explained-monetarist-theory Pettinger , T. (2008, 12 30). Keynesianism vs monetarism. Retrieved from http://www.economicshelp.org/blog/1113/concepts/keynesianism-vs-monetarism/ Diever, M. (2010). Les principaux courants de pensée économique. Retrieved from http://www.oeconomia.net/private/cours/economiegenerale/CAPET/01.theorieseconomiques.pdf