Who is credited with creating modern macroeconomics?

Study for the Texas PACT Business and Finance 776 Test. Practice with flashcards and multiple-choice questions. Boost your confidence and knowledge to excel in your exam!

John Maynard Keynes is credited with creating modern macroeconomics due to his revolutionary ideas introduced during the Great Depression in the 1930s. His work emphasized the role of aggregate demand in influencing economic activity and proposed that government intervention is necessary to help stabilize economies during downturns. Keynes challenged the classical economic views that dominated before his time, which emphasized self-regulating markets. His landmark book, "The General Theory of Employment, Interest, and Money," laid the foundation for Keynesian economics, promoting the idea that active fiscal policy could be utilized to manage economic cycles. This understanding of economic fluctuations and government roles in managing economy change the course of economic thought and policy, fundamentally shaping modern macroeconomic theory.

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