John Maynard Keynes

I really want to add a subtitle: when a name became a theory. In fact, few people can afford this comment, especially when the entitled theory is frequently and decisively quoted or mentioned. Nevertheless, John Maynard Keynes is honorably one of them. So after introducing the father of microeconomics, we step today for father of macroeconomics.

Unlike Adam Smith, hero in my last blog, John was cultivated in a better earth. His father was an economics lecturer in Cambridge whereas his mother is author and a social reformist. His family is almost all brilliant in any criterion. From Eton to Cambridge, his education was as smooth as most successful men. Thanks to his talent that was shown in his early time, he was luckily admitted by Alfred Marshall whose shoulder provided him with an unbelievable high stage. Fame on head, he was appointed to the Royal Commission on Indian Currency and Finance. This period of experience helped him a lot in his accumulation of practical work.

He worked for the British finance department during the World War I, though his constructive advices in the post-war reparations were not adopted. From this point we can have a reasonable conceive that if the history is rewritten at that time, would we have avoided another disaster in 1940s? Mr. Keynes was so unhappy with the final decision that he quitted.

His golden time came with the arrival of the great depression of the world economic situation, most severe in the U.S... The story was like that: from October 1929, an endless nightmare started to swallow Uncle Sam. Within only a few weeks, some 250 billion dollars vanished together with the unemployment raised sky-high. The European banks were in the queue of breaking down and so were their counter part over Atlantic. It was at that time that people came to search for another solution instead of relying on the "invisible hand" to solve this fatal trouble. Therefore, Keynes and his theory were lit up as fundamental theory support of governmental intervenes.

Here it is highly necessary that we laid out some of his main thoughts. Keynes was often called as the father of macroeconomics since that derived mostly from his famous magnum opus "The General Theory of Employment, Interest, and Money". We can mainly and roughly conclude his idea by another controlling hand from the government which would use fiscal and monetary measures to aim to mitigate the adverse effects of economic phenomena.

Something interesting about him: first, he is a not only a great man in the world of economics but also in the real world: we rarely have an economist as tall as 198cm! Another is that there were a lot of objections towards him accusing him to turn this society of capitalism into communist one. Actually if without him, the latter would have dominated the world quite possibly.