Journal of Business & Economic Policy

ISSN 2375-0766 (Print), 2375-0774 (Online) DOI: 10.30845/jbep

The Policy Budget in Financial Crisis
Bader I. Alabdulkarim

The Keynesian theory is used by governments to deal with financial crisis. This research shows the main concepts for this theory. The Keynesian theory recommends that government motivates the economy by increasing spending and decreasing the interest rate. The theory proposes that these two actions will increase the purchasing power for the public. As a result, the demand for products will increase, which thus motivates the private sector to hire more employees, leading to economic recovery.

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