5-minute guide to John Maynard Keynes

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John Maynard Keynes with his wife Lydia The ideas of British economist John Maynard Keynes have had a huge impact on modern economic policy around the world.

Widely considered as the most influential economist of the 20th century, he was also one of the founders of modern macroeconomics. Here, we explain who he was, what he believed and how he has shaped modern economic thought.


Who he was
John Maynard Keynes was born in Cambridge in 1883. He went on to study at King's College, Cambridge, finishing his maths degree in 1905.

He then worked both as a lecturer and a civil servant, before going to work for the Treasury and then returning once more to Cambridge to teach.

During his life, Keynes was also a patron of the arts, a part of the Bloomsbury Group of intellectuals, a writer and a philosopher.

He married the Russian ballet dancer Lydia Lopokova in 1925 and was made a lord - Baron Keynes of Tilton - in 1942, then died four years later at the age of 62.

What he believed
Keynes spearheaded a revolution in economic thinking in the 1930s, after investigating the growing problem of unemployment in the UK.

Having looked into the issue, he decided that full employment required government spending to create jobs (by investing in public works).

In other words, that governments should use fiscal and monetary measures - or spend money they did not have - to mitigate the adverse effects of recessions and depressions and moderate "boom and bust" cycles of economic activity.

Previous economic thought had held that free markets could automatically provide full employment, as long as workers were flexible in their wage demands.

How he changed the world
Keynes died in 1946, but his ideas lived on - with almost all capitalist governments adopting the policies of Keynesian economics during the 1950s and 1960s.

His influence became less marked in the 1970s due to both the economic problems of that period and new economists coming forward with conflicting ideas.

However, the global financial crisis in 2007 prompted a resurgence in Keynesian thought, which has affected the political response in countries including the UK and the US.