Wednesday, August 3, 2011

Keynes V Hayek: Two Economic Giants Go Head To Head


John Maynard Keynes and Friedrich August Hayek were two prominent economists of the Great Depression era with sharply contrasting views. The arguments they had in the 1930s have been revived in the wake of the latest global financial crisis. The contemporary relevance of their ideas has even been debated in arap video. More than 1,000 people attended a BBC Radio 4 debate at the London School of Economics to hear supporters of the two economists argue their case. When discussing Hayek it is important to correct a misconception: Hayek's is not a "do nothing" theory. It does not deny that we should maintain spending when boom turns to bust. But it goes further. Unlike Keynes, Hayek believed that genuine recovery from a post-boom crash called not just for adequate spending, but for a return to sustainable production - production purged of boom-era distortions caused by easy money.

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