Keynesian Economics

Definition

Keynesian Economics is an economic theory stating that government spending should increase during business slumps and be curbed during booms. It was developed by economist John Maynard Keynes during the 1930s as a response to the Great Depression.

Related terms

Fiscal Policy: This refers to how governments adjust taxes, spending, and borrowing levels to influence national economies.

Recession: A period of temporary economic decline during which trade and industrial activity are reduced.

Stimulus Package: Governmental measures specifically intended to stimulate a struggling economy through spending programs or tax incentives.