• The context: the Great Depression — mass unemployment persisting; Say's Law failing before the world's eyes.
• The doctrine: output and employment determined by aggregate demand; saving and investment decisions separate; the paradox of thrift (ECO-I 1.3); underemployment equilibrium possible — the economy can settle below capacity with no automatic cure; liquidity preference (interest a monetary phenomenon; the liquidity trap's possibility);
• Policy conclusion: fiscal activism — deficit spending in slumps (the multiplier), counter- cyclical management; the post-war macro consensus and the Bretton Woods architecture's intellectual father (Unit 3.4).