Question

Based on what you know about Keynes and Keynesian economics—consider the views and arguments advanced by Milton Friedman, Karl Brunner and Allan Meltzer (taking the three as a group or “school of thought”), would you consider them Keynesian? Support your answer with specifics.

Answer 1

Main arguements presented by John Maynard Keynes supporting his passage titled " The end of Laissez-faire".

The economy involves many variables and complex interactions and hence, cannot be simplified into a self-adjusting mechanism.
A case-by-case approach is necessary deciding whether to allow market forces to self-adjust or intervention by means of government action.
An individual acting in pure self-interest may not always be successful. In other words, it is not a given that the individual has a complete understanding of the movements in the economy.
Changes in economic conditions are subject to a variety of factors and simplification by application of 'state of nature' theory does not fully take into considerations adverse reactions such as the costs of competition, tendency of wealth to be distributed where it is not appreciated the most.
He quotes, Marshall and seems to agree with the idea that laissez faire ideas with a utopian flavour and a penchant for self-adjustment or "natural" reactions are irresponsible and do not sum up the actual interactions and consequences of events.
Society's
Arguements Keynes tried to counter:-

Self-adjusting mechanism is not necessarily or always the best solution to problems.
Individuals possess a natural liberty with respect to their economic decisions.
The world is not an organism that always balances individual and social interest.
Question(2). Yes, some of his statements are backed by assertions. A major portion passage consists of arguements, quotations and comparisons. It is nonetheless a very compelling thought.

Question (3). His arguements would appeal to the ones who are inclined to the position that every action has an equal and opposite reaction, and that the term action here refers to the mindful, reasonable and calculated position that an entity would have to take in comparison to a sense of irresponsible and mindless nature that surrounds human inaction in a totally free market system. So, we could say that his arguements were well founded as he did not take an extreme position by totally rejecting natural interactions, nor did he support a complete government intervention . In fact, he advocated specific methods for specific cases. (case-by-case approach)

Question (4). Keynesian theory focuses on corrections being made to the economy in the short run so as to influence its course. While classical view suggests no long term improvements can be acheived by corrections and that the economy should be allowed to take its natural course. It is a matter of perception and in-depth analysis (of qualitative vs quantitative). It could be said that ,classical theories involve philosophical and metaphyical considerations while Keynesian theory is focussed on immediate action. To answer our question, following Keynes' theory, the economy would follow a path of action and reaction and immediate tangible results which could provide further clues as to how to move further.