Keynesian Revolution

Okay little one, have you ever heard grown-ups talking about how to save money and spend it wisely? Well, a long time ago, there was a man named John Maynard Keynes who had some really interesting ideas on how countries could save and spend money.

Before Keynes, most people thought that if a country saved a lot of money, it would be rich and prosperous. But Keynes thought that saving too much money could actually be bad for the economy. He believed that when people saved a lot of money, they didn't spend it, and when people didn't spend money, businesses didn't make money and people lost their jobs. This was a big problem because then people wouldn't have money to spend, and the economy would get even worse!

So, Keynes suggested that sometimes, the government needed to spend money to help the economy. This is called "government spending". He thought that when the government spent money, businesses would have more customers and would make more money, which would help the economy grow. He also believed that the government could help people who were out of work by creating jobs for them. This would give people money to spend, and again help the economy grow.

Keynes ideas became known as the "Keynesian revolution" and they changed the way people thought about money and the economy. Nowadays, many countries around the world use Keynesian ideas to help their economies grow and make sure that people have jobs and money to spend.