What do Keynesian economists believe about government spending?
Answer (1)
They believe it has a Multiplier Effect. That means one peso spent by the government can generate /more than .one peso in the economy For example, if the government builds a new public hospital in Samar, it hires workers, who then spend their wages on food, transport, and other needs. The suppliers also earn, and local businesses benefit. This chain reaction boosts economic activity far beyond the initial government investment.
