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What about lack of aggregate demand?
His work on the importance of aggregate demand anticipated later work by Keynes.
Orders from China is one component of aggregate demand, to be sure.
Following are excerpts: For some time now, the growth of aggregate demand has exceeded the expansion of production potential.
But, this rise in long-term unemployment is readily explained by the prolonged collapse of aggregate demand.
"are driven by traditional Keynesian economic relationships that emphasize the influence of aggregate demand on output in the short term".
Recent data suggest that the expansion of aggregate demand may be moderating toward a pace closer to the rate of growth of the economy's potential to produce.
Recent data have indicated that the expansion of aggregate demand is moderating toward a pace closer to the rate of growth of the economy's potential to produce.
It is pretty obvious that there is a serious shortage of aggregate demand, which is depressing prices and generating a threat of deflation.
As the initial stimulus steadily took effect, it would gradually draw in the private sector's cash surplus as the level of aggregate demand began to rise.
The big mystery isn't why austerity has failed to work as advertised: anybody familiar with the concept of "aggregate demand" could explain that one.
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