FORMATIVE ACTIVITY $26$: POLITICAL COSTS

Political costs: A major criticism of Keynesianism is that it $$invariably leads to the growth of the state, and higher inefficient, corrupt spending. To $$pump prime$$ the economy, the government ends up spending money on projects that create vested interests and after the recession, prove impossible to cut back.

$$Therefore$,$ Keynesianism has a tendency to increase the size of the state, which some see as a major drawback.$$

$($Pettinger$,2013)$ US$242910$

SO$3$ AC$1$

$[$Total: $10]$

$1.$ What is your response to Pettinger$$s assertions?

$(3)$

$2.$ What examples are there of the South African government $$pump priming$$ the economy?

$(5)$

$3.$ What effect has this had?

$(2)$