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    What is the difference of the economic ideas of Keynes and those of Monetarism?

    Question #105355. Asked by synlar. (May 06 09 3:49 AM)


    dchidawg

    Monetarism: IS flattish:
    I highly r-sensitive.
    Slope represents marginal efficiency of capital.
    i.e. S-side influences on investment demand.

    Keynesianism: IS steep.
    r is only one among many determinants of I.
    Likely to be relatively minor.
    Decisions likely to be very LR.
    i.e. not dependent on SR factors like fluctuations in r.

    From slide #4 in the PPT found at:
    http://www.homepages.ucl.ac.uk/~uctpvhg/ECON7003/Slides/MBS%20Topic%207%20Mism%20090304c%20NO%20BLUES.ppt

    May 07 09, 3:04 PM


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