keynesiano

Keynesian economics, known as keynesiano in Spanish, is a school of macroeconomic thought based on the work of John Maynard Keynes. It emphasizes aggregate demand as the main driver of economic activity in the short run and holds that economies can experience persistent unemployment without policy intervention. Prices and wages are treated as sticky, so markets do not automatically clear.

Keynesian theory argues that when private demand falls, public demand through fiscal policy can compensate. Policy tools include increased government spending, tax cuts, or transfers to households. Monetary policy also plays a role by influencing interest rates and investment, though its effectiveness may be limited in liquidity-trap situations. A central concept is the fiscal multiplier, which measures the impact of a change in spending on overall output.

Historically, Keynesian ideas were developed in The General Theory (1936) and became influential in mid-20th century policy, shaping stabilization programs and welfare-state policies. The IS-LM framework and later New Keynesian models formalized the approach, incorporating price and wage rigidities to explain short-run non-neutrality of policy. Open-economy variants extend analysis to exchange rates and capital flows.

Key criticisms have come from monetarists and other schools that emphasize rules-based stabilization and the dangers of fiscal deficits. Critics also question the effectiveness and timing of government interventions. In contemporary macroeconomics, Keynesian ideas persist during recessions or demand shocks, often supporting countercyclical fiscal stimulus and accommodative monetary policy, sometimes paired with structural reforms.