Many Keynesians argue that in order to stimulate the economy you must increase consumption. There methods of doing so result in a decrease in investment. They argue that without an increase in consumption, investment will naturally not take place because people will not demand goods. One of the bigg…

Remember that “demand” is not simply an impulse to want something. To create demand for a good, you must first have the resources to trade for that good. A homeless person without any money whatsoever may crave for apple products or food, but if they do not have the money to buy them, they do not …

Alright I’m back. So, I looked at some of the links which were very helpful. Basically, what I was looking for was how exactly production would be stimulated in a recession. I learned that during recession demand is lowered and in result wages come down (from less demand for labor), prices come down…

Continuing what I said earlier about dumbing it down…Hoppe takes it even farther… [Economist Hans Hermann-Hoppe rips Paul Krugman on Money Printing 01-10-13]

Here’s my input: The question: How is it that the economy can return to normal spending patterns when there isn’t adequate demand for the consumer goods produced in the first place. There are some awkward aspects of investment here, but this is the essence of the question. The responses: The pr…

Neo, There are other problems with govt interventions besides regime uncertainty. All the govt can do is redistribute, openly [taxes] or deviously [inflation]. Neither of these things increases production in the economy as a whole. Did you not read my article that quotes Keynesian research that p…

Hmm. Where have I heard that before . I was indeed building upon something you had noted in this thread. My contribution was elaborating the flaw in the chicken and egg argument.

Dave, While I think that just saying it is as simple as redistribution is somewhat simplifying the issue, I generally agree. I was simply saying that a criticism of Keynesianism should be more extensive than just regime uncertainty which was a large part of what has occurred on this thread. The ul…

Was that not obvious? I thought it was made pretty clear what I (and probably Professor Hoppe) would just love to have you school us ignorant boobs on.

Neo, Forgive me if this reply is repititious. The hour is late, the fingers type freely. Say’s law is important because accepting it means denying all of Keynesianism in all its flavors. Because one of the corrolaries of the law, to quote Say, is: The same principle leads to the conclusion, that…

Investment vs. Consumption

Economics Economics Questions

John_James January 31, 2013, 2:24pm 14

Oh this ought to be good.

Hmm. Where have I heard that before.

Krugman tries to answer Hoppe

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Investment vs. Consumption

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