PAPM 1000 Chapter Notes - Chapter 21 and 22: Marginalism, Aggregate Demand, Effective Demand

• School: Carleton University
• Department: Public Affairs and Policy Management
• Course: PAPM 1000
• Professor: Marc Andre Gagnon

Document Summary

Major aspects of the keynesian school: keynesian economics, borrowed heavily from the marginalists, neoclassical economists, and especially. Alfred marshall in such areas as: marginal propensities to consume, save and invest, the (cid:862)su(cid:271)je(cid:272)ti(cid:448)e ps(cid:455)(cid:272)hologi(cid:272)al app(cid:396)oa(cid:272)h(cid:863, diminishing returns to capital and labor, uppl(cid:455) a(cid:374)d de(cid:373)a(cid:374)d ope(cid:396)ati(cid:374)g like the (cid:862)pai(cid:396) of s(cid:272)isso(cid:396)s(cid:863) of ma(cid:396)shall. As well as links to marx, the webbs and other socialists: keynesian ideas became particularly prominent with the onset of the great. I(cid:373)ila(cid:396) to the (cid:862)(cid:373)a(cid:396)ket gluts(cid:863) of malthus: leading to unsold goods, layoffs, higher unemployment, recessions and at the worst a global depression. It fluctuates with changes in the expectations of business people and investors regarding future profits from their intended investments. It decreases through time with increased investment in any given type of investment. Expected profits decline because of competition from companies making similar investments. Personal savings could increase greatly in the longer term for a number of reasons, many legitimate reasons why.