Keynesian economics | Aggregate demand and aggregate supply | Macroeconomics | Khan Academy
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Keynesian economics | Aggregate demand and aggregate supply | Macroeconomics | Khan Academy


Voiceover: What I want to do in this video is start introducing and
we’ve already talked about him a little bit. So actually they’ve
already been introduced, but maybe flesh out a little
bit more Keynesian thinking. This right here is a picture
of John Maynard Keynes and I often mispronounce him as Keynes, because that’s how it’s spelled, but it’s John Maynard Keynes. He was an economist who did a lot of his most famous work
during the Great Depression, because in his view,
classical models did not seem to be of much use during
the Great Depression. To understand this a little bit better, let’s compare purely
classical aggregate supply aggregate demand models to maybe one that’s more Keynesian. Some of what we’ve talked about – Keynesian, I should say. I already did my first mispronunciation. One that’s a little bit more Keynesian. Keynesian right over here. In some of the conversations,
we’ve already begun to introduce a little bit
of Keynesian thinking, but in this video we’re going to try to show the difference between the two and it’s not to say that one
is right or one is wrong. In fact, Keynesian felt
that in the long run, the classical model actually made sense, but he also famously said, “In the long run we are all dead.” I also want to emphasize
that this isn’t a defense of Keynesian economics. There are some points
to what he has to say, but there are other schools of thought. Unfortunately, they
often get very dogmatic, but they also have some reasons to be wary of Keynesian economics
and we hope to go over some of that in future videos. In this one, we just want to understand what Keynesian economics is all about and how it really was
a fundamental departure from classical economics. In classical economics, I’m going to use aggregate demand and
aggregate supply in both. This is classical, this is
price, this right over here is real GDP and I’m going to do it for the Keynesian case, as well. This is price and this
right over here is real GDP. In both views of reality, or both models, you have a downward sloping
aggregate demand curve for all the reasons
that we’ve talked about in multiple videos. That’s aggregate demand right over there. We’ve already seen it,
the classical view is that in the long run, an
economy’s productivity, or productive capacity,
or its output shouldn’t be dependent on prices. We’ve seen the long run
aggregate supply curve something like this. This is the aggregate
supply in the long run, or sometimes you’ll have
long run aggregate supply. Sometimes it’ll be referred to that. Saying, look, all prices
are, they’re a way to signal what people want and demand
and things like that, but at the end of the
day, prices and money, they’re just facilitating transactions. You go to work and you
get paid and all that, but then you go and use
that money to go and buy other things that the economy produces, like food and shelter and transportation. All money is is a way of
facilitating the transactions, but the economy, in theory,
based on how many people it has, what kind of technology it has, what kind of factories it has, what kind of natural resources
it has, it’s just going to produce what it’s going to produce. If you were to just
change aggregate demand, if the government were to print money and aggregate demand were to – and just distribute it from helicopters, in this classical model,
you would just have aggregate demand shift to
the right, but you have this vertical long run
aggregate supply curve so the net effect is it
didn’t change the output in this classical model. All that happens is that the price goes from this equilibrium price
to this equilibrium price over here. You have the price would go up and you would just experience inflation with no increased output
and there’s multiple ways you could’ve shifted that
aggregate demand curve to the right. You could have a fiscal
policy where the government, maybe it holds its tax revenue constant, but it increases spending, or it goes the other way around. It does not decrease, it
doesn’t change its spending, but it lowers tax revenue. Either of those, it tries to
pump money into the economy and pushes that aggregate
demand curve to the right. In this purely classical
view, it says in the long run, that’s not going to be any good,
just will lead to inflation. The only way that you
can increase the output of economy is by making
it more productive. Maybe making some
investments in technology, make the economy more efficient, maybe your population grows. The only way is to really
shift this curve to the right on the supply side right over here. Keynes did not disagree with
that, but he sitting here in the middle of the
Great Depression, saying, “Look, all of a sudden
people are poor in the 1930s. “Factories did not get blown
up, people didn’t disappear. “In fact, there are
factories that want to run, but they are being shut
down, because no one “is demanding goods from them. “There are people who
want to work, but no one “is asking them to work. “They could work and produce
wealth that could then “be distributed to – “But no one’s demanding
for them to do it.” He suspected something weird was happening with aggregate demand,
especially in the short run. In a very pure, very,
very short run model, I know we have talked about a short run aggregate supply curve
that is upward sloping. Something that might
look something like that. That is actually starting to put some of the Keynesian ideas into practice. What I like to think of
is something in between, but if you think in the
very, very, very short term, Keynes would say prices are
going to be very sticky. Especially in the short
run, and I’ll call it the very short run, you have, especially if the economy’s
producing well below its capacity, like it seemed to be doing during the Great Depression,
prices are sticky. That makes intuitive sense. If the economy’s trying to get overheated, people are being overworked, you want them to work more, hey, I want overtime. You want factories to operate
faster, people are going to start – The utilization is high, people
are going to start charging more and more, but if I’m
unemployed and I’m desperate to work, I’m not going
to ask for a pay raise. If my factory is at 30%
utilization and someone wants to buy a little bit more, that’s
not the time that I’m going to say, “Hey, I’m going
to raise prices on you.” I’ll say, “Yeah, exact same price. “You want another 5% of
my factory to be utilized? “Sure, that sounds great.” In the very short run,
it has the opposite view of the aggregate supply curve
than the classical model. It says at any level of
GDP in the short run, prices won’t be affected. It won’t be affected. So in this model right over
here, this is aggregate supply I’ll call it, in the very short run. You can debate what short
run or very short run means, whether we’re talking
about days, weeks, months, or even a few years here,
but once you start looking at the world this way, then something interesting happens. In this model right over
here, the only way to increase GDP was on the supply side. In this model right over
here, the only way to increase GDP is on the demand
side, to actually either through monetary policy, print more money, or through fiscal policy, lower taxes while holding spending
constant or maybe do both, essentially deficit spending. Someway, without holding taxes constant, but the government’s
spending more, whatever. Shift the curve to the right
and that might be a way to increase the overall output. Keynes’ real realization was that, look, the classical economist
would tell you if you have a free and unfettered market,
the economy will just get to its natural, very efficient state. Keynes says, “Yes, that is sometimes true, “but that’s sometimes not true.” We’ll talk about different cases. By no means do I think the Keynesian model is the ideal and I don’t think even Keynes would have thought the Keynesian model describes everything. Depends on the circumstance. Keynes would say, “Look, let’s think “of a very simple idea.” You have person A, person
B, person C, and person D. Let’s say person A sells
to person B, person B sells to person C, person C sells to person D, and person D sells to person A. Let’s say that they’re
all selling two units of whatever good and
service that they offer. For whatever reason, let’s
say C, all of a sudden, just got a little bit
pessimistic, had a bad dream, woke up on the wrong
side of the bed and says, “You know what? “I’m not feeling so
good about the economy. “I’m going to hold off
from my purchase from B. Instead of two units, I’m
going to purchase one unit. Well, B says, “Well,
gee, my business is bad. “Now I’m only going to purchase one unit.” A does the same thing for the same reason, D does the same thing. Now it all came back to C and now C says, “Wow, I was right, that
dream was predictive.” It was a self-fulfilling prophecy. Now they’re going to operate in this state and there might not be any
natural way to get them bumped up to that state
where they’re all buying two units from each other
without maybe some outside, especially some government act or maybe all of a sudden saying, “Hey B, if C doesn’t want
to buy two, I’m going “to buy two temporarily.” There are dangers to this, huge dangers, and we’ll talk about
that in future videos, but then someone else,
let’s say the government, tries to shift the aggregate demand curve through fiscal policy and they say, “Hey, I’ll buy one from you, B.” Then B says, “Okay, now
I can buy two again,” and A can buy two again and
then D can buy two again and then C can buy two again. Then in an ideal world,
and this is the danger of the government, the
government would step back and say, “Okay, everything is fine again. “I don’t have to buy this.” As we know, it’s very
hard once the government starts spending money in
some way, to actually cut this spending right over here. This was the general
idea behind the Keynesian versus the classical. He says, “Look, there are circumstances, “like the Great Depression,
where the economy “is operating well below its potential “and in those circumstances,
you need to have “a stimulus on the demand
side, not just a supply side.” The correct answer, as with all things, is probably something in between. A probably more accurate
model is something like this. Let’s draw … This is price, this is
real GDP right over here and we’ll still draw our downward sloping aggregate demand curve and
the more accurate thing might look something like this. Let’s say that this is the absolute theoretical maximum output,
if everyone in the country isn’t sleeping, the
factories are just being run to the ground, that’s the
absolute theoretical output. Let’s say that this is its potential. Just a healthy state where the economy might be operating. The real medium run
supply curve or short run aggregate supply curve. This is aggregate supply
in the very long run. This is the long run aggregate supply. The best model would be
something that’s in between and might look something like this. Our aggregate supply curve
might look something like – I want to do it in a different color. Let me do it in magenta. It might look something like this. For whatever reason, maybe
someone has a bad dream or a bunch of people have a bad dream or something scary
happens, aggregate demand – The stock market crashes,
something happens, aggregate demand shifts over there. When we’re out here, now all of a sudden our output is well below
potential, we have a lot of excess capacity and now
the Keynesian ideas seem maybe they’ll make sense. Maybe there should be some outside stimulus happening. On the other side, if we’re
performing well at potential, then all of a sudden the
government wants to do Keynesian policies and
we’ll see in future videos, the government will always want to do Keynesian policies,
even if they’re not justified. It will push aggregate demand out here and then the net effect is, especially the more
vertical this is, the more this net effect will be true,
that you really just get more inflation and you
don’t really get a lot of increase in output. It really depends on the circumstance, but an aggregate supply
curve that starts flat at low levels of output
and then gets higher and higher slope and
becomes almost vertical in your high levels of
output, this is probably a better model that
takes into consideration both the classical and
the Keynesian ideas.

About James Carlton

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100 thoughts on “Keynesian economics | Aggregate demand and aggregate supply | Macroeconomics | Khan Academy

  1. I love how this video purports to demonstrate that there are no absolutes, but we should believe one side or the other once in a while…

  2. At 7:50 you make a huge assumption that 2 units circulating is the ideal number.  You need to revise this video to provide an example where 1 unit is being circulated until the state controlled central bank monopoly depresses interest rates below market and artificially stimulates projects and debt fueled consumption until 2 units are circulating, then when people wake up to the bubble (say in real estate/stock) and cut back to 1 unit, the statists compound the error by attempting to keep 2 units circulating at all cost.  I didn't read all the comments on the Austrian School, but that is where reality lives.  Keynesianism should only be taught to illustrate how absurd ideas are adopted because they fit an ideology of ever expanding central command and control government. 

  3. There is such an obvious yet easily missed fallacy in the example with person A,B,C and D. Where does the money which person B gets come from in the first place? It comes either from the printing press or from person F. In both cases all you are doing is transferring purchasing power from one group/person to another. There is no boost in the economy, on the contrary. When the printing press is running the money is transferred from the private sector to the public sector which is always less efficient in producing wealth.  

  4. When we figure out how to clone humans, can Salman Khan be the first one we clone? he can then teach at every high school and community college in the country, which would solve the problem of incapable teachers 

  5. Keynesian Economics = boosting economy in the short run by creating a ponzi scheme / asset bubbles

    Ponzies always feel good in the beginning, and now that the entire world is on the USD Reserve Currency based fiat monetary ponzi of 0% rates + QE, the entire ponzi is on the verge of imploding and the idiocy and pain of living in a world based on a centrally planned / central bank directed money printing rate manipulating ponzi are being felt.

    Ponzies are illegal…unless they are government mandated.

  6. This is a theory of trade based on the "Indians" outposts,
    the mafia of Chicago already proved Keynes wrong, they will issue so much fake debt around the World, that no amount of trade goods can bring properity… 

  7. Using GDP in an economic model will always produce irrelevant results.

    The problem is the all holy GDP measure is actually an extremely poor measure of how well an economy is doing. The measure of the health of economy should be centered around maximizing utility with productivity levels, or how much people have to work to get want they want, being a major factor. GDP has Consumption and Government Spending – both acts that destroy capital as main components. By "destroy capital" I mean there is a negative return when putting resources in these areas and putting capital in these areas is an unprofitable act.

    It is clear to see that Consumption is a capital destroying act by its very name. When you consume, the capital is gone and no longer exists. Now, some consumer goods actually last a long time, but its value diminishes and when considering something a consumer good it is already being conceded that it is unprofitable and that the choice in consumption results in less capital. Consumption does not benefit an economy, it actually hinders an economy. This is not to say that people shouldn't consume because that is the sole reason to work, save & invest, and produce, but the act of consumption actually depletes the available pool of scarce resources and lessens the ability to increase productivity.

    The fact that Government Spending is a component in GDP is almost comical. Government inherently makes nothing, it only gains its resources by taking it from those who produced those resources in the first place and redirects those resources into unprofitable ventures. So this is a double whammy. First, what should be celebrated and kept sacred – taking a certain amount of resources and aligns that resources in a certain way to create an end result of even more resources, or profit – is undermined by taking those newly created resources from profitable activities. You would think that if someone figures out a way to add resources to the economy that are now available for the world to consume, you would want them to do this more and more. But the government just sees these productivity activities as a cow to drink the productivity milk from. Without a profit incentive, the government ultimately aligns those newly ill gained resources in a way that results in an even lower supply of resources. 

    To sum it up, the health of an economy is the ability to produce, invest, and save – pure and simple – and it is not the ability to consume, spend, and borrow.

  8. In classical economics GDP doesn't really exist.  Or at very least it's considered only a theoretical number that could never be accurately determined.  And it certainly wouldn't include government spending as any sort of major component.

    GDP in real life, is an illusion.  It's a roughly made up number government offices fabricate.

  9. And this is why the great depression was so "great." His whole general theory book was completely and utterly debunked paragraph by paragraph.

  10. I really don't get Keynes idea.. someone please help me!

    What I am thinking is this: If the government gives money to A buy purchasing something, it must get the money to purchase somehow – Either by taxation or by printing it from the printing press. If the government finances the purchase through increased taxes, then it means that government must take from A, B, C, D in order to give them the money back (which would not boost demand). The other way the government can make the purchase is if they print money. But if they print new money, demand will not be boosted either.  From what I have learnt (kudos to Adam Smith), the value of money is the goods and services you can buy with it, money is just a medium of exchange. If more money is put in the system, the price on those goods and services goes up (quantity theory of money). If the purchasing power of the consumers weakens (inflation), then that definitely does not improve demand either. More money does not make more products, it means higher prices on existing products. Can somebody please explain how this works? Thanks!

  11. Keynesian does not consider the trouble that Gov intervention will create. The Great Depression started out as a normal temporary recession, BUT FDR's Socialist policies were taking money out of the private sector where jobs were created and wasted the money on make work projects that created no profit or wealth. It was Government intervention that creates problems, because for ever $1 the Gov takes 70% is wasted, Every $1 in the private sector is actually worth over $7 do to the multiplier effect.

  12. Anyone one wanna point out the his A.S line is actually incorrect. The supply line is not actually completely vertical. It is to an angle. Which would actually make a difference. .

  13. Whether or not his intentions were good or not doesn't matter. In the long run, I'm sure he was a great guy. However, his theories were simply wrong…

    Never in my life have I met a successful business owner nor had a University Professor (or Economics Professors) that of which were a fans of theories by Keynes.

  14. the example he gave with person a b c and d all selling each other stuff in a cycle is a false in no way do economys naturally operate this way its like saying chinese company sells walmart toys walmart sells people toys, and chinese company buys toys from consumers, in reality they make it in china ship it to walmart and sell it to the consumer and thats it there is no evidence to suggest "he just got up on the wrong side of the bed" and chose to make a bad investment…

  15. Actually Kenyse said public sector should do the opposite of the private. SO when in recessions government spends including cutting taxes.. AND in Booms/recovery, they Raise taxes and cut spending.. You should consider not pretending Classical economics is Neo-Classical. We are in a Neo-classical model or supply side economics which throws out actual data for ideology. No ideology can be applied for too long without economic instability. a pure classical model is by definition a system that includes both incentives for investment or capital mixed with incentives for labor. If both these forces could work in harmony you have pure capitalism, with small government, a consumption tax BUT also well paid workers that can afford to buy goods and services.. Capitalism is actually only a little over 100 years old so people have yet to understand that if you favor 1 over the other too much the system will collapse.

    This neo-classical model (only since 1980) says governments need to the same as private. So what happens? Austerity during recessions has failed everywhere it has been tried starting with Chilie. The reason is as the IMF have revealed. For every dollar a government cuts on spending, it cuts 7 dollars out of the economy. It is not a question of Keynes. It is a system issue. No ideology is right for every situation.

    Example: When Regan came in 1980. We had a large middle class, so what happened when he cut the tax rates… 80s excess. downside to this.. Wealth flows upward and stops coming down at some point. Now Capital was basically in control of the system, forget the politics for a second. How ever, doing this policy has lead to some econmic indicators that suggest it has been going on too long, particularly the rise of wealth inequality, the rise of personal debt to income, and wages for workers is stagnate.. Here is why this is bad. Simple not enough consumers.. Not enough well paid labor.. Businesses close, more jobs are lost, it becomes a domino effect. This is very crutial to fundementally understand.. This not only leads to depressions, but also rises in Fascism and communism.. Where fascist (perverted capitalist) insist Neo-classical can work if capital becomes authoritarian and Communism that says Labor (perverted Marxist) should become authoritarian so Labor can rule.
    Eventually this will lead to revolutions and war.. So you need to balance the system. We tried labor unions and that lead to huge fights between labor and capitol. So this equation needs to be adjusted where both can work together. Maybe like an NFL economy that basically says. Capitol gets 55% of the revenue and must reinvest in Labor 45%. This needs some work but eventually we will get to a system that allows prosperity for both, and uses the selfish interests of both to grow. This is what adam smith proposed. This is the essence of true entrepreneurship and labor.

  16. Lol where is the government getting this magical balancing dollar to redistribute? Oh yeah, by taking it from ABC and D through the only way it can; borrowing and taxing.

  17. After watching about 50 of your videos, I thoroughly believe you could beat watson on Jeopardy! Great videos 🙂

  18. The great blindspot in the analysis of market economies by Keynes is the central importance of land markets and the fact that the supply of land is inelastic. In the real world, the price mechanism does not clear the market for land. Quite naturally, owners of land will withhold land from use or sale in anticipation of ever-rising land prices. The only way to remove the potential for owners to profit from hoarding land or "investing" in land for purely speculative gain is to impose an annual tax on land equal to its potential rental value. Only then would land markets respond as does labor and capital goods.

  19. 2 minutes in, I need the explanation of why in the classical view LRAS is not dependent on prices!!! Can someone refer to me to the relevant video or explain

  20. The immediate problem I see with the A, B, C, and D analogy is that if C can afford not to buy 2 units from B, maybe C didn't really need them that much, which means that resources to produce that unit good were wasted. So a recession could be seen as a way for the economy to correct itself from bad production and misuse of resources. The reason this happens is mostly due to the facilitation of cheap money with artificially low interest rates.

  21. There are some aspects about this which are good but I can barely watch this video.
    1. Stop pretending you know everything about Keynes and his theory.
    2. You don't have to apologize about Keynesian theory.
    3. You have a prejudice against government spending the dangers of which are very well known but you keep making that point like it's something new.
    4. Sticky prices are better understood in terms of wages. If some aspect of prices are sticky (mostly wages but there are others) then price levels overall are sticky it's not just the price of a good (which intuitively can change a lot.)

  22. Hey, nice video. Something threw me off a little, though. At 3:10 you say that an increase in the total amount of money would move the AD-function to the right, but it should be that it moves the AD-function to the top, since the real GDP would not increase as it is cleared of any changes to the price-index. I hope I didn't mix something up there. :3

  23. Thank you Keynes for creating at least 90% of America's economic problems

  24. There is a fundamental flaw in the explanation of business cycles put forward by Keynes. He accepted the neo-classical discard of the classical treatment of nature (i.e., land) as a distinct factor of production. The apparent reason is that Keynes could not think of land beyond the treatment provided by Ricardo relating to agricultural land. Locations in cities are valued by the square foot, not by the acre where land is more distant to centers of population. Moreover, he failed to see that a high annual tax imposed on the rent of land would provide important incentives for owners of land to bring the land held to its highest, best use or sell to someone who would. Raising revenue from the taxation of land rent would have an important stabilizing impact on the production of goods and services. Taxes on wages, capital goods and commerce have the opposite effect; they impose significant deadweight losses on economic output.

  25. for the last diagram you drew, the y-axis is actually Price LEVEL, you will get points off for this on the IB Exam

  26. Comment section full of 14 year olds who like austrian economics because they can summarize it in a tweet. So much for nuance.

  27. A very concise explanation. Thanks for doing it man . Came with different conclusions than you but i guess thats whats its all about! Thanks for putting it out

  28. Keynes was wrong, in the long run we may be dead but our children must shoulder the burden of the debt we produce.

  29. the great depression was cause because of Keynesian economics. Free market corrections are never that long and never that severe, pity haven't had free market since before the civil war

  30. The neckbeard internet Austrian fanboys in the comments are hilarious.

    That's right liberteenagers: you're all economic experts because you've read a few articles at the Mises Institute. Give yourselves a pat on the head.

  31. I was struggling with the subject, since the book is difficult to understand. Luckily this video seems understandable.

  32. My Lectures to Simplify Economics.
    What is Keynesian Economics?
    http://intelligenteconomics.blogspot.com.tr/2017/11/what-is-keynesian-economy.html

  33. During the fall of 2018, Mason Gaffney, emeritus professor of economics at the University of California, was asked by the editors of The Chronicle of Higher Education to offer his perspectives on the current financial crisis, and how economic theory should be taught so that people would have a much better understanding of why it occurred. I think it is worthwhile to repeat the full text of his response:

    “Yes, the current financial crisis highlights how scholars need to recast the economic theory that they teach. The key concept that is missing today is LAND VALUE. Classical economics divided factors of production into three: land, labor, and capital. Beginning around 1920, scholars conflated land with capital. This left them totally unprepared to cope with or explain the crash of 1929. At this time “macroeconomics”, as we now call it, rose to the fore. For a time it eclipsed “micro-economics”, which had degenerated into the explanation of the allocation of resources among competing ends. Gradually, micro-economics came back to be integrated with macro, but in the process land value almost disappeared.

    “Scholars have “disappeared” land values in two main ways. One is to conflate them with values of manmade capital, overlooking or trivializing all differences. One obvious fault in this is that interest rates and land rents vary inversely.

    “The other way is simply to trivialize land values as a quantity. This is based on no respectable quantitative research whatever, and a systematic ignoring of research showing land values to be a major element of wealth.

    When it comes to the dynamics that lead to crises like that of 2008, land values move in cycles of high amplitude, much higher than the values of reproducible capital. When values are high and rising they lead to great excesses of urban sprawl. These excesses fructify vast new areas around growing cities, resulting in an overhang of “ripening” land that far exceeds possible demands, resulting in a crash.

    “As to teaching money and banking, few or no texts recognize that expanding banks, by taking land under and around speculative developments, in effect “monetize” those speculative land values. When the wave of land values ebbs, and debtors default, banks have to contract, as they are now. Yet economic theorists, and those statesmen whom they have trained, attend mainly to the froth on the waves, ignoring the basic wave of land value that drives the cycle.

    “Another and related fault in theory is to ignore the turnover of capital. In a boom of land values, capital goes into investments that pay out slowly. The basis of allocating loans is not marginal productivity, but collateral security, as perceived by bankers who do not distinguish land from capital. The loan turnover of banks slows down, because a bank, no matter how positive its balance sheet, cannot lend much faster than its debtors repay their loans. The result is to slow down new loans and seize up the system, as we see today.

    “Tax theory is now based on the fallacy that a progressive tax must also be one that suppresses and distorts incentives. This reflects economists ignoring the high concentration of the ownership of land, and the positive incentive effects of taxing land in lieu of work, enterprise, building, and income-creating investing.”

  34. well from the last model you just have given i suppose that was under the long-run circumstances, thus the price will shift greatly without obvious output increase, but what makes confused is that why people, in the long run, ignore the negative future, choose to cut their output instead of reduce the price to gain as much cash as possible, considering with lower productive capacity, the cost should fall as well? It will be great if i can hear an answer here.

  35. How he constantly repeats expressions and words in the very short run, in the very …short…run… make him sound like he's trying hard to sound professory and knowledgeable, and it's quite annoying on the very long run. On the very… long…… run.

  36. We're still dealing with the brutalities of the tyrannies and of the criminalities of the past two centuries from napoleon and the wild west to mussolini hitler probably lenin stalin and tse-tung/zedong and the organised crime/black-market capitalism of the 1950s 1960s 1970s 1980s 1990s and of the 2000s so only by liberating/emancipating/vindicating people/person's from the labor-force criminal-force military-force/external police-force and the police-force/internal military-force and maoism is the last unique variation/version upon marxist/marxian philosophy you had marxist/marxian socialism with marxist/marxian communism in mind you had marxist/marxian-leninist socialism with marxist/marxian communism in mind then you had marxist/marxian-leninist-stalinist socialism with marxist/marxian communism in mind and then you had marxist/marxian-leninist-stalinist-maoist socialism with marxist/marxian communism in mind so instead of regarding marxoid/keynesian social democratic liberal/libertarian capitalism as a spent force/exhausted movement we should revamp marxoid/keynesian social democratic liberal/libertarian capitalism and attract-and-appeal to the broader worker's union movement besides that includes keynesian economic liberal/libertarian capitalism

  37. There is no "sometimes" about the free market finding the best equilibrium. There's only a timeframe and most of the time people are too impatient (want instant gratification) to let it run its course in the best fashion possible and end up picking the scab prolonging how long it takes to heal! The problem with increasing aggregate demand especially through government spending of any kind is that you aren't going to get the proper productivity out of it you're going to boost productivity in areas of the economy that are inefficient or less useful that if you let the market determine which industries/products are in demand!

  38. Excellent video. I have a weaker grasp on economics than I'd like to admit. I've been doing some self-teaching, and your videos have been an excellent way to bolster that. Thank you for putting this out there!!

  39. But! With "Classical economics" as with Trickle down economics. All the wealth goes to the top 1% and is unacceptable! Keynesian economics worked just fine for the majority. What's wrong with keeping prices down and wages up by taxing higher on higher profits, what wrong with putting more money in everyones pockets to keep everyone happy and avoiding economic problems?

  40. Supply Side Economics, “Reagonomics,” “Voodoo Economics”, has failed the American people. It’s time for Bernie Sanders!
    Our modern day FDR!

  41. By all means, Let’s give HALF of our taxes to war! Destroy other economies, take their oil and tell the American people were fighting for our freedom, while our people are losing jobs, their houses and the children starve, our schools and educators suffer and veterans are sleeping out in the streets! All while, the rich get richer and big oil propagates with millions of OUR tax dollars “subsidies “ to fight against clean cheap energy!! FU

  42. Econ is now mathematics. There are actual equations that function for prices and max return depending on potential demand. It isn't a dartboard. MIT

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