Listener: 23 May, 1981.
Keywords: History of Ideas, Methodology & Philosophy;Macroeconomics & Money;
I once asked Dr W.B. Sutch how much Keynes had influenced the thinking of the first Labour Government. John Maynard Keynes’s book The General Theory of Employment and Money has been the most influential piece or economics writing this century in terms or its impact on both economic theory and economic policy. It explained how a government could practice deficit financing to increase employment.
Sutch, who was a government adviser in the 1930s, replied that Keynes had little influence. Rather, the government observed that housing materials were not being used, house builders were unemployed, and families desired houses, so that the Government ensured there was the finance to bring the builders and materials together to construct the houses that were needed.
