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Written Assignment Unit 2: Classical Economics vs Keynesian Economics
University of the People
BUS 1104 Macroeconomics
Galin Todorov, Instructor
June 27, 2020

Written Assignment Unit 2: Classical Economics vs Keynesian Economics
Introduction
The Classical versus Keynesian debate is an argument over how a free market economy would
bounce back during a recession and return to a state of full employment. Classical
economics asserts that economies are self-correcting and function best with minimal government
intervention ( Definition of classical economics | Higher rock education. (n.d.)). Keynesian
Economics : A school of thought that is characterized by a belief in active government
intervention in an economy and the use of monetary policy to promote growth and stability
( Introducing aggregate demand and aggregate supply | Boundless economics. (n.d.)).
Similarities between Classical and Keynesian Economics
There are a few similarities between classical and Keynesian economics. Both believe in the idea
of a free market economy where people/businesses make decisions that allow them to maximize