Understanding Why Jokowi is so Upset on Low Government Spending
First of all, this is such a heavy topic to write, especially from the non economist like me. But just to heads up, please bear on me, since this article is just to implement what I learned just now from Economic course 6013. So, any comments or challenge are welcome, and will be good learning for me. Ok, lets start from Keynesian theory that mentioned that during the crisis, in order to make economy keep running, Government should spending more instead of holding budget. The reason is, during the crisis, not only income reduced but also the confidence level will fall. When people doubt with the economy they tend to do more saving instead of spending. Thus, its kind of double effect, not only groups of people lost their job (thus lower income) but also the other groups which have the money won't spend it. So during this condition, it should be government who lead the spending so that able to give multiplier effect to the economy. That is why no wonder in th...