Keynesian critique reveals flaws in classical theory of unemployment.
The article discusses how Keynes expanded Pigou's Theory of Unemployment to criticize classical economic theories. Keynes focused on the importance of demand in determining employment levels, using a two-sector model to illustrate his points. By extending Pigou's model, Keynes showed that involuntary unemployment is caused by a lack of demand rather than labor supply. This critique highlights the significance of overall demand in the economy and challenges classical views on employment.