MONEY AND POVERTY

Money and Poverty



Money and Poverty

Introduction

The early nineteenth century brought a major epistemological break. The economy thought soon became involved in a scientific approach. The British economist John Maynard Keynes argued in 1936 that there were many reasons why the self-correcting mechanisms during a recession might not work in practice (Tymoigne & Lee p. 287). A work of Keynes that led to an understanding of poverty dynamics associated with the use and administration of money was his work “Social Consequences of Changes in the Value of Money.” For most of the first three decades after World War II, Keynesian orthodoxy reigned. In his work 'Position on Poverty,' Galbraith's has several concerns in reassessment of the economic situation of Americans in the the post-World War scenario. He stresses on revising the relationship between consumption, production and advertising; focusing on poverty and economic inequalities; and factors like inflation, unemployment and consumer debt (Galbraith, p. 29). This essay compares and contrasts the theories and concepts of these two economists.

Discussion

In 1923 Keynes published "A Treatise on Monetary Reform", which analyzes the causes and consequences of changes in the value of money, while paying attention to such important points as the impact of inflation on income distribution, the role of expectations, the relationship between expectations of price changes and interest rates, etc . on proper monetary policy, according to Keynes, should be based on the priority of maintaining the stability of domestic prices, rather than to aim to maintain an overvalued exchange rate, as it did in that period the British government. Keynes criticized the current policy, in his pamphlet "The economic consequences of Mr. Churchill ".

In the second half of the 1920s, Keynes devoted himself to "Treatise on Money", where he continued to explore issues related to exchange rates and gold standard. ...