Multiplier of Keynesian Economics

Richard Ferdinand Kahn was born on August 10, 1905, in Hampstead, London, England. He studied at the University of Cambridge, where he became one of John Maynard Keynes’s most prominent students. Kahn was deeply influenced by Keynesian thought and went on to become a key member of the Cambridge School of Economics. He later became a professor at Cambridge, where he contributed to the development and expansion of Keynesian economics.

Kahn’s most famous contribution to economic theory was the concept of the multiplier, which he introduced in his seminal 1931 paper, “The Relation of Home Investment to Unemployment.” This idea, which demonstrated how an initial increase in spending leads to a larger overall increase in national income, became a fundamental element of Keynesian economics. Keynes himself later expanded upon Kahn’s multiplier principle in “The General Theory of Employment, Interest, and Money” (1936), cementing its role in macroeconomic policy discussions.

In addition to his work on the multiplier effect, Kahn was an advocate for government intervention in the economy to combat unemployment and economic downturns. He supported public spending programs to stimulate demand and argued that policies aimed at maintaining high levels of employment were essential for economic stability.

Beyond his theoretical contributions, Kahn played a crucial role in shaping economic policy in the United Kingdom, particularly during and after World War II. He advised the British government on economic planning and contributed to postwar reconstruction efforts.

Richard Kahn remained an influential economist throughout his career, serving as a fellow of King’s College, Cambridge, and mentoring numerous students who went on to make significant contributions to economics. He passed away on June 6, 1989, leaving behind a legacy as one of the foremost architects of Keynesian macroeconomic thought.