Suggests that while saving is beneficial

Reference no: EM133710929

Question: The paradox of thrift, proposed by John Maynard Keynes, suggests that while saving is beneficial for individuals if everyone increases their savings simultaneously, it can decrease aggregate demand. This reduction in demand can result in lower overall economic growth, making everyone poorer instead of richer. This paradox is considered real by many economists, particularly during recessions, as increased savings can stifle consumption and economic recovery. Saving is generally good for individuals, providing financial security, but excessive saving across the economy can be detrimental. reply to this discussion post

Reference no: EM133710929

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