Hey there! Sign in to join this conversationNew here? Join for free
    • Thread Starter
    Offline

    0
    ReputationRep:
    I have been reading about Keynesian and classical economics and one of the topics that came up was the idea of a 'general glut' whether there is overall overproduction within an economy- i.e. more is produced by suppliers than is consumed. This was presented as the basis of Keynes' beliefs about a recession, and how the stimulating of demand is necessary to return the economy to full employment. I thought that I understood Keynesian economics and the idea that a lack of demand can cause the output of an economy to be below its productive potential, but surely there can be low aggregate demand, without there being excess supply- can't supply and demand both be at a level below the economy's productive potential, rather than there having to be overproduction?
 
 
 
  • See more of what you like on The Student Room

    You can personalise what you see on TSR. Tell us a little about yourself to get started.

  • Will you be richer or poorer than your parents?
  • See more of what you like on The Student Room

    You can personalise what you see on TSR. Tell us a little about yourself to get started.

  • The Student Room, Get Revising and Marked by Teachers are trading names of The Student Room Group Ltd.

    Register Number: 04666380 (England and Wales), VAT No. 806 8067 22 Registered Office: International House, Queens Road, Brighton, BN1 3XE

    Quick reply
    Reputation gems: You get these gems as you gain rep from other members for making good contributions and giving helpful advice.