Introduction

The Great Depression of the 1930s was one of the most dramatic economic events of the last century. It shook economists’ belief in the existence of self-adjusting forces and prompted Keynes to write his masterwork, The General Theory of Employment, Interest and Money (1936). His aim in this book was to justify the possibility that the economy might be stuck in a state of underemployment, which he qualified as involuntary unemployment and which, he claimed, could be remedied only through state interventions.