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Head picture of Leslie with a speech bubble. A bit rude perhaps but maybe justified. Although i don’t know who or what a Keynesian is.
 
Made by an MLPOL Anon from the Drawthread on MLPOL.NET

safe2192845 artist:anonymous2001 oc957580 oc:leslie fair145 earth pony512543 pony1622997 /mlpol/413 drawthread2763 economics33 female1823540 fiscal policy1 happy45143 looking291 open mouth241561 reaction image10571 shut up108 smiling403965 speech bubble40579 text90968

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Thorned Rose Ninja
Preenhub - We all know what you were up to this evening~
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Keynesians espouse an expansionary fiscal policy which seeks to increase aggregate demand enough to reduce unemployment and improve price stability. In contrast, contractionary fiscal policy aims to reduce aggregate demand without worsening inflation.
 
To do this, expansionary fiscal policy (i.e. Keynesian) seeks to increase government spending, decrease net taxes, or some combination of the two. Contractionary fiscal policy (espoused by Hayek) seeks to decrease government purchases and/or increase net taxes. Either results in shifting the aggregate demand curve to the right or left, respectively.
 
The aggregate demand is the total demand for final goods and services in an economy at a certain time; the demand for a country’s gross domestic product (GDP). Both macroeconomic policies aim to get the economy back to its potential output; that is, the economy’s maximum sustainable output where there are no surprises about price level.
Background Pony #2B17
Keynesians, in a nutshell, are proponents of the notion that free market doesn’t necessarily lead to the economic optimum, and that its failings need to be solved through government intervention. As such, they’re partisans of a strong public sector and increased spendings to boost the economy.
 
They’re named after economist John Maynard Keynes, who was the inspiration for Roosevelt’s New Deal in the 30s.