Swedish economist Knut Wicksell was influential in the development of monetary theory, which concerned itself with overall price levels and interest rates in an economy. His work foreshadowed the most important modification of classical concepts of the free economy, exemplified in the work of John Maynard Keynes. In his General Theory of Employment, Interest, and Money (1936), Keynes opened up a whole new range of investigation into business cycles. A principal result of Keynes's teaching has been reflected in governmental attempts to control the business cycle by putting money directly into the economy; the "pump-priming" technique, often accompanied by an unbalanced budget, is now a part of most capitalist economic systems.
Sections in this article:
The Columbia Electronic Encyclopedia, 6th ed. Copyright © 2012, Columbia University Press. All rights reserved.
More on economics Keynes from Infoplease:
See more Encyclopedia articles on: Economics: Terms and Concepts