--- title: "Meaning & Key Takeaway of: Keynes tried to show that market…" description: "\"Keynes tried to show that market economies could settle in equilibrium states in which the labour market did not clear, and in which the level of unemp..." image: "https://sms4smile.com/quotes/i/8bc/paul-ormerod-27778_clear_keynes-tried-to-show-that-market-economi_372552.jpg" --- # Keynes tried to show that market economies could settle in… ![“Keynes tried to show that market economies could settle in equilibrium states in which the labour market did not clear, and in which the level of unemployment was high. He believed that this was due to a particular example of market failure, developed in his concept of effective demand.” quote by Paul Ormerod](https://sms4smile.com/quotes/i/8bc/paul-ormerod-27778_clear_keynes-tried-to-show-that-market-economi_372552.jpg) [Download](https://sms4smile.com/quotes/i/8bc/paul-ormerod-27778_clear_keynes-tried-to-show-that-market-economi_372552.jpg) [Open image](https://sms4smile.com/quotes/i/8bc/paul-ormerod-27778_clear_keynes-tried-to-show-that-market-economi_372552.jpg) > “Keynes tried to show that market economies could settle in equilibrium states in which the labour market did not clear, and in which the level of unemployment was high. He believed that this was due to a particular example of market failure, developed in his concept of effective demand.” [Paul Ormerod](https://sms4smile.com/quotes/author/paul-ormerod/) ## About This Quote This interpretation was drafted with AI assistance. It is one reading of the quote, not the author's own explanation. Keynes argued that economies can rest in a stable state where jobs remain unfilled because overall demand is insufficient. **In simple terms:** Unemployment can persist when demand is low. Key Takeaway Address demand gaps to reduce unemployment. Themes economics employment market failure equilibrium Mood analytical concerned Type theoretical explanatory When to use this quote - policy design - business cycle analysis - labor market reforms - government stimulus Key Concepts Effective demand aggregate demand macroeconomic theory Questions to Reflect On - What policies can boost effective demand? - How do skill gaps affect unemployment? A Different Perspective Keynes’ view may underplay structural factors like skill mismatches. ★ ★ ★ ★ ★ No ratings yet [Demand](https://sms4smile.com/quotes/about/demand/) [Economy](https://sms4smile.com/quotes/about/economy/) [Equilibrium](https://sms4smile.com/quotes/about/equilibrium/) [Failure](https://sms4smile.com/quotes/about/failure/) [Investing](https://sms4smile.com/quotes/about/investing/) [Labour](https://sms4smile.com/quotes/about/labour/) [Market economy](https://sms4smile.com/quotes/about/market-economy/) [Market failure](https://sms4smile.com/quotes/about/market-failure/) [Unemployment](https://sms4smile.com/quotes/about/unemployment/) ## Related quotes > [I believe in market economics. 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