John Maynard Keynes

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John Maynard Keynes : biography

5 June 1883 – 21 April 1946

Keynes’s optimism was also cultural, in two senses – he was of the last generation raised by an empire still at the height of its power, in its own eyes and by much of the world (at least outwardly) seen as preeminent in both power and benevolence. Keynes was also of the last generation who felt entitled to govern by culture, rather than by expertise. According to Skidelsky, the sense of cultural unity current in Britain from the 19th century to the end of World War I provided a framework with which the well-educated could set various spheres of knowledge in relation to each other and to life, enabling them to confidently draw from different fields when addressing practical problems.

Publications

  • 1913 Indian Currency and Finance
  • 1914 Ludwig von Mises’s Theorie des Geldes (EJ)
  • 1915 The Economics of War in Germany (EJ)
  • 1919 The Economic Consequences of the Peace
  • 1921 A Treatise on Probability
  • 1922 The Inflation of Currency as a Method of Taxation (MGCRE)
  • 1922 Revision of the Treaty
  • 1923 A Tract on Monetary Reform
  • 1925 Am I a Liberal? (N&A)
  • 1926 The End of Laissez-Faire
  • 1926 Laissez-Faire and Communism
  • 1930 A Treatise on Money
  • 1930 Economic Possibilities for our Grandchildren
  • 1931 The End of the Gold Standard (Sunday Express)
  • 1931 Essays in Persuasion
  • 1933 An Open Letter to President Roosevelt (New York Times)
  • 1936 The General Theory of Employment, Interest and Money
  • 1940 How to Pay for the War: A radical plan for the Chancellor of the Exchequer

Legacy

Prime Minister [[Clement Attlee with King George VI after his 1945 election victory.]]

The Keynesian ascendancy 1939–1979

From the end of the Great Depression to the mid-1970s, Keynes provided the main inspiration for economic policy makers in Europe, America and much of the rest of the world.

While economists and policy makers had become increasingly won over to Keynes's way of thinking in the mid and late 1930s, it was only after the outbreak of World War II that governments started to borrow money for spending on a scale sufficient to eliminate unemployment. According to economist John Kenneth Galbraith (then a US government official charged with controlling inflation), in the rebound of the economy from wartime spending, "one could not have had a better demonstration of the Keynesian ideas." 

The Keynesian Revolution was associated with the rise of modern liberalism in the West during the post-war period.Barry Stewart Clark, Political economy: a comparative approach. p. 101. "Modern liberalism was the dominant ideology in Western nations from the end of World War II until the early 1970s. Its appeal stemmed from not only the success of Keynesian economics in maintaining prosperity during that period, but also from the postwar revulsion towards any pure form of ideology." Keynesian ideas became so popular that some scholars point to Keynes as representing the ideals of modern liberalism, as Adam Smith represented the ideals of classical liberalism.Alan Wolfe, The Future of Liberalism. p. 13. "If Adam Smith is the quintessential classical liberal, the twentieth-century British economist John Maynard Keynes, whose ideas paved the way for massive public works projects and countercyclical economic policies meant to soften the ups and downs of the business cycle, best represents the modern version." After the war Winston Churchill attempted to check the rise of Keynesian policy-making in the United Kingdom, and used rhetoric critical of the mixed economy in his 1945 election campaign. Despite his popularity as a war hero Churchill suffered a landslide defeat to Clement Attlee whose government’s economic policy continued to be influenced by Keynes’s ideas.

Neo-Keynesian economics