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Adam Smith vs. John Keynes

  • Word Count: 589
  • Approx Pages: 2

How can John Maynard Keynes version of capitalism be compared to

Adam Smith's? Both are considered to be the molders and theorizers of the

economic era. They are both very different in thinking, one complex the

other basic, in there specific time history.

John Maynard Keynes has had much of the worlds economic theories

based on his beliefs in his most important work The General Theory of

Employment, Interest, and Money. During the Great Depression, Keynes, to

secure a stable economy, promoted the use of government intervention.

However, the idea was said to be deranged be President Roosevelt, he was

against spending tax payers money to allow the nation to get into a national

deficit. Another theory of Keynes was that the inflation and unemployment

were necessary to keep the economy balanced. It can be understood by the

fact that too much inflation expresses signs of low unemployment for the

nation. Even so, if the unemployment rate is too high then the inflation

percentage will pull down the economy to a low percentage too. Because of

President Roosevelt decline to use the theory of Keynes until it was too

late, his theory was not really confirmed. In spite of that, while his theory

was being applied the economy slowly, but surely started to rise. At last,

when World War II came along it caused a mass production which boosted

the economy from slipping down any future, and allowed companies to rise

up from bankruptcy.

Adam Smith was one of the earliest of our economists that Robert L.

Heibroner talks about. Its seems to me like he was the person that presented

capitalism to the English government. Smith was alive during the time that

Britain had a hold on the American colonies. It was Smith that directed the

King and Queen, and recommended The Crown's abuse of the colonies

would help the homeland and be successful and g...

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