Question

What is the view of Dr. Ashok Mathur on Keynesian multiplier of underdeveloped country?

What is the view of Dr. Ashok Mathur on Keynesian multiplier of underdeveloped country?

Homework Answers

Answer #1

Countries like US and UK which are developed see large access to open involuntary unemployment and access prpductive capacity and thus showed high elasticity of supply of output as proportional to change in demand which caused investment multiplier to show magnified effects on real GDP growth.

However as per Dr. Ashok mathur the baove criteria of depression is missing in underdeveloped countries and there is low elasticity of supply of output rendering multiplier effect as inefficient.

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