Aggregate Consumption in the Economics of John Maynard Keynes

Stavros A. Drakopoulos ()
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Stavros A. Drakopoulos: National and Kapodistrian University, Department of History and Philosophy of Science

Chapter Chapter 3 in The Consumption Function in Economics, 2026, pp 25-37 from Springer

Abstract: Abstract This chapter starts with Keynes’ criticism of utility theory that was the standard model of decision making of his contemporary orthodoxy. It proceeds with a presentation of the key components of Keynes’ approach to aggregate consumption, including his recognition of the psychological and sociological aspects of consumption decisions. The chapter will also focus on the notions of the dependence of consumption expenditure on the level of income, the absolute income hypothesis, and the multiplier. It also discusses the standard Keynesian analysis of aggregate consumption and its significance for the level of total output and employment. Finally, the economic policy implications of Keynesian consumption function will also be briefly presented.

Keywords: Keynes’ criticism of utility theory; Keynes’ consumption function; The absolute income hypothesis; Keynesian consumption function (search for similar items in EconPapers)
Date: 2026
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Persistent link: https://EconPapers.repec.org/RePEc:spr:sprchp:978-3-032-15958-8_3

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DOI: 10.1007/978-3-032-15958-8_3

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