Can anyone describe this?
how Classical Economists views and Keynesians’ views conflict each other
regarding Say’s Law, flexibility of wages and prices, existence of self-regulation and the requirement of
government intervention. Make sure you talk about what happens if there is a recessionary gap and an
inflationary gap under both views.
- OiyLv 61 month ago
There are three things. First, the demand and supply in the labor market cannot find the equilibrium, especially in the short run. Wages and prices are sticky. Second, there is a different demand for money, like for transaction and speculation. Third, Say's law is not true. The supply does not always create its own demand. There are marginal propensity to consume and to save..