SCHOOL OF ECONOMIC THOUGHT
SCHOOL OF ECONOMIC THOUGHT
The school of economic thought can be described as variety of attempts made by economists who present their economic thoughts about the economy and what can be done to fix it during times of inflation or depression. There are many school of thoughts and it is very hard to chose which one is the best for the American economy as all the economists have different opinions. The main schools are classical ,neo classical, Keynesians and supply siders.
According to me ,Keynesian economics named after John Maynard keynes would be perfect for the current economy of this country . His theory was based on circular flow of money , it refers that if spending increases , earnings increases too. For example, one person's spending increases it goes towards another person's earnings, and when that person
spends his or her earnings, it supports another person's earnings. That would keep the normal economy running at a regular pace .The one adverse effect is that , incase if the economy hits great depression people would tend to save money and not spend it and that would stop the circular flow of the money thus bringing economy to standstill. According to the test I took , my opinion doesn’t exactly matches any particular of school of thoughts, it is kind of mix of all of them and that is balanced freedom .The Classical economics focuses on the markets to move towards equilibrium . The Keynesian theory wants people to spend more money and by decreasing tax ,it helps economy boost to the top. Economist disagree at each others theory because they all have different point of view. All these theory are totally on opposite sides and that doesn’t mean that they are wrong or invalid , all economist have different theory for the economy , some are great for stable economy and some are great for the depression and inflation time .They are all helpful in their own ways.
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The school of economic thought can be described as variety of attempts made by economists who present their economic thoughts about the economy and what can be done to fix it during times of inflation or depression. There are many school of thoughts and it is very hard to chose which one is the best for the American economy as all the economists have different opinions. The main schools are classical ,neo classical, Keynesians and supply siders.
According to me ,Keynesian economics named after John Maynard keynes would be perfect for the current economy of this country . His theory was based on circular flow of money , it refers that if spending increases , earnings increases too. For example, one person's spending increases it goes towards another person's earnings, and when that person
spends his or her earnings, it supports another person's earnings. That would keep the normal economy running at a regular pace .The one adverse effect is that , incase if the economy hits great depression people would tend to save money and not spend it and that would stop the circular flow of the money thus bringing economy to standstill. According to the test I took , my opinion doesn’t exactly matches any particular of school of thoughts, it is kind of mix of all of them and that is balanced freedom .The Classical economics focuses on the markets to move towards equilibrium . The Keynesian theory wants people to spend more money and by decreasing tax ,it helps economy boost to the top. Economist disagree at each others theory because they all have different point of view. All these theory are totally on opposite sides and that doesn’t mean that they are wrong or invalid , all economist have different theory for the economy , some are great for stable economy and some are great for the depression and inflation time .They are all helpful in their own ways.
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