Keynes

John Maynard Keynes (1883–1946) was a British economist whose 1936 book The General Theory of Employment, Interest and Money fundamentally changed macroeconomics. He argued that aggregate demand — not supply — determines output and employment in the short run, and that market economies can settle into persistent unemployment equilibria without self-correcting. His solution was active government intervention: fiscal policy to boost demand when private spending falls short, and monetary policy to lower interest rates and stimulate investment. Keynes's work spawned Keynesian economics, though he would have rejected the IS-LM simplification that became its textbook face. The deeper Keynes — the one recovered by Axel Leijonhufvud — was a theorist of monetary disequilibrium and the structural failures of coordination in monetary economies, not merely a theorist of sticky wages and fine-tuning. Keynes's influence extends beyond economics into political philosophy, where his essay 'Economic Possibilities for Our Grandchildren' sketched a future of abundance and leisure, and into systems theory, where his concept of 'animal spirits' — irrational but systematic fluctuations in confidence — prefigures modern models of behavioral feedback and sentiment-driven dynamics.

Keynes was not a technician of demand management. He was a diagnostician of system failure, and the General Theory is a field guide to what happens when the corridor collapses.