Answer to Question #75540 in Macroeconomics for Mathew

Question

My area is a place where we only farm yam and other cash crops like cassava, rice and sugar cane, how can keynes model use to solve the economic challenges in the area to rise the economic growth

Answer 1

Keynesian economists generally argue that, as aggregate demand is volatile and unstable, a market economy will often experience inefficient macroeconomic outcomes in the form of economic recessions (when demand is low) and inflation (when demand is high). These can be mitigated by economic policy responses, in particular, monetary policy actions by the central bank and fiscal policy actions by the government, which can help stabilize output over the business cycle. Keynesian economists generally advocate a managed market economy – predominantly private sector, but with an active role for government intervention during recessions and depressions.
Source:
https://en.m.wikipedia.org/wiki/Keynesian_economics