2008–2009 Keynesian Resurgence

2008–2009 Keynesian Resurgence

In 2008 and 2009, there was a worldwide resurgence of interest in Keynesian economics among prominent economists and policy makers. This included discussions and implementation of economic policies in accordance with the recommendations made by John Maynard Keynes in response to the Great Depression— most especially fiscal stimulus and expansionary monetary policy.

From the end of the Great Depression until the early 1970s, Keynesian economics provided the main inspiration for economic policy makers in Western industrialized countries. The influence of Keynes's theories waned in the 1970s, due to stagflation and critiques from Milton Friedman, Robert Lucas, Jr., Friedrich Hayek and other economists who were less optimistic about the ability of interventionist government policy to positively regulate the economy. From the early 1980s to 2008, the normative consensus among economists was that attempts at fiscal stimulus would be ineffective even in a recession, and such policies were only occasionally employed by the governments of advanced nations.

In 2008, a rapid shift of opinion took place among many prominent economists in favour of Keynesian stimulus, and, from October onward, policy makers began announcing major stimulus packages, in hopes of heading off the possibility of a global depression. By early 2009 there was widespread acceptance among the world's economic policy makers about the need for fiscal stimulus. Yet by late 2009 the consensus among economists began to break down, and in 2010 with a depression averted but unemployment in many countries still high, policy makers generally decided against further fiscal stimulus. With the end of the brief consensus for Keynesian policies, but with the neoliberal policies that characterised the Washington Consensus era still viewed by many as discredited, several commentators have predicted that the Macroeconomic domain will see a return to ideological struggles.

Read more about 2008–2009 Keynesian Resurgence:  On The 2008–2009 Keynesian Resurgence, In Academia, Criticisms, Aftermath: 2010 and Later, See Also

Other related articles:

Greg Mankiw - Controversy and Criticism - 2008–2009 Keynesian Resurgence
... "If you were going to turn to only one economist to understand the problems facing the economy, there is little doubt that the economist would be John Maynard Keynes ... Although Keynes died more than a half-century ago, his diagnosis of recessions and depressions remains the foundation of modern macroeconomics ...
2008–2009 Keynesian Resurgence - See Also
... Fear the Boom and Bust 2007–2012 global economic crisis Neo-Keynesian economics. ...

Famous quotes containing the word resurgence:

    If the devil were to offer me a resurgence of what is commonly called virility, I’d decline. “Just keep my liver and lungs in good working order,” I’d reply, “so I can go on drinking and smoking!”
    Luis Buñuel (1900–1983)