ng of equality or fairness of the distribution of income Keynes was quite clear. Keynes was critical of the inequalities in income and wealth but argued that some inequality is necessary to provide incentive to entrepreneurs to undertake investment. Keynes was of the mindset that there are valuable human activities, which require the motive of moneymaking and the environment of private wealth-ownership for their full development to fruition.The most important aspect of Keynes work in respect to this paper was his expositions and ideas upon the role of government in the economy. Keynes rejected the Adam Smith/classical economics belief, which held out the promise of material progress in a laissez-faire environment. Laissez-faire is a French term meaning "hands off" that De Tocqueville used when describing the American governmental paradigm concerning economics and markets. Keynes was convinced that market-based economies do not produce full employment automatically. He argued that there would be unemployment and depression from time to time in the absence of corrective government policies. In his view, government action was essential to stabilize an unstable economy. It was necessary for the government to intervene, to 'fine-tune' the economy by running demand-management polices; these were to counter current trends in the trade cycle - to speed up economic activity when there is too little, to slow it down when there is an excess. From these general ideas flowed a powerful and comprehensive view of economic behaviorthe basis of contemporary macroeconomics. Because consumers were limited in the amounts that they could spend by the size of their incomes, they could not be the source of the extreme ups and downs of the business cycle. It followed that the most dynamic forces were business investors and governments. It was Keynes idea that in a recession or depression, the proper thing to do was either to enlarge private investment or ...
