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John Maynard Keynes and his followers argued that:
1. The classical model might explain economic performance in the long run, but the long run could take a long time. This highlights the idea that the economy may experience short-term fluctuations or crises that need to be addressed through government intervention to stabilize it and prevent long-term negative consequences.
2. The short run is important, contrary to the belief that it is unimportant. Keynesians emphasize the significance of short-run economic dynamics, such as changes in consumer spending, investment, and government policies, as they can have immediate impacts on economic conditions.
3. The economy should not necessarily be left to function with minimal government interference. Keynesian economics advocates for active government involvement in stabilizing the economy, especially during times of economic downturns or recessions, through fiscal policies like government spending and taxation.
4. The economy does not operate the same way in both the short run and long run. Keynesian economics recognizes that short-run economic behavior, like fluctuations in aggregate demand, can differ from long-run equilibrium conditions, where the economy tends towards full employment and potential output over time.
These points outline the key arguments and perspectives of John Maynard Keynes and his followers in challenging and expanding upon the traditional classical economic model.
