What is the difference between monetarism and keynessianism?
Monetary policy is a government policy concerning money and credit conditions, especially the rate of growth in the money supply and the level of interest rates. It utilizes the countercyclical monetary policy which is a policy of the central bank (Federal Reserve USA ::: Chairman of the Federal Reserve Dr. Ben S. Bernake—formally Alan Greenspan) designed to stabilize economic activity, usually by increasing the rate of growth of the money supply during recessions and decreasing the rate of growht of the money supply in infationary periods. Keynessianism is derived from the theories of John Maynard Keynes, advocating government spending and taxation to taintain full employment and stable economy. Current Chairman of the Fed, Dr. Ben S. Bernake is a Keynessianest. All Keynesian analysis fouses on the aggregate demand for goods and services. It assumes that aggregate supply is sufficient to accommodate increased demand without raising prices. Any increases in aggregate demand at full e