John Maynard Keynes

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John Maynard Keynes was born in 1883 in Cambridge, United Kingdom.

Both his parents John Neville Keynes and Florence Ada Keynes were very active
people. The father is a man of remarkable intellectual qualities who, in combination
with his puritanical morality, achieved solid results for his time. In his opinion
knowledge should not only be created and mastered, it should bring benefits to
people.

During his studies at Ethan, John Keynes demonstrated remarkable skills

in Mathematics and Theatrical arts. After joining the Royal College of Cambridge,
he made numerous contacts with his peers, who later became authorities in various
fields of science and art. Keynes also became a member of the so-called Cambridge
Apostles. It is an intellectual society, composed of chosen students, who discuss
three main topics during their meetings - philosophy, aesthetics and themselves. In
these discussions Keynes managed to develop a highly polemical culture that
helped him become an acknowledged authority and to remain forever in the history
of economic theory.

The state as an active participant in the system of economic relations.

That, in one sentence, was the new Keynes was leaning on. This is not about
restricting or eliminating opportunities for free economic initiative. The mocking
attitude Keynes has to Marx and the Marxism is another opportunity for a better
understanding of the Keynesianism.

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 Keynes' key concepts are demand, supply, market, i.e. the concepts of the
classical economics. He was not an author of a new economic model, he was
simply proposing a reform of the classical economy, thinking that the state could be
economically active. According to Keynes, it is obvious that the state is an entity,
which may be developed, meaning that it can become more beneficial to citizens
and businesses. Just as the state performs sanctions against the citizens and
businesses when they have contravened the law, so should it help them when they
need it.

According to Keynes, if incomes go up, people will buy more goods and
services, and if incomes fall, they will buy less. Higher costs for goods and services
lead to an increase in the overall well-being, while cost reductions cause overall
impoverishment. Keynes exalted consumption and according to him, people need
to spend more on all goods and services in order for the economy to develop.

When an individual limits his costs, it affects negatively all the

individuals involved, because their income decreases. Each of these individuals
limits his costs due to reduced income, and so this process continues endlessly.
This is the so-called multiplier, which is a key feature of the Keynesianism.

In order to have a stable full-employment economy and to equalize sales

with production, people need to consume enough and investments must be
adequate. If that doesn't happen, production will exceed sales and employers will
start being discharged. Conditions for entering a recession will be created.
However, if the government makes expenditures to compensate for the difference
between manufactured and sold goods and services, then these costs will multiply
and the recession will be overcome.

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 For Keynes, the state can and must be the guarantor of the free business
initiative. Keynes's theory is the search for a point of intersection between the
interests of the individuals, businesses and the state. Undoubtedly, he was
convinced that this point existed and consistently sought for it. By his rich artistry
he provoked a different understanding of the role of the state and changed
fundamentally the practice of the governments.

Famous quotes:

 The market can stay irrational longer than you can stay solvent.
 Words ought to be a little wild for they are the assault of thought
on the unthinking.
 It is better to be roughly right than precisely wrong.

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Sources:
https://en.wikipedia.org/wiki/John_Maynard_Keynes
https://www.britannica.com/biography/John-Maynard-Keynes
https://www.investopedia.com/articles/economics/09/john-
maynard-keynes-keynesian.asp