What does Keynesian economics prioritize to stimulate the economy?

Keynesian economics focuses on the idea that during periods of economic downturn, aggregate demand is insufficient to maintain full employment and stimulate growth. To counteract this, Keynesian economists advocate for increased government expenditures and lower taxes as a means of boosting demand. By increasing government spending on public projects, infrastructure, and services, the government can create jobs and stimulate consumption. Lowering taxes gives individuals and businesses more disposable income, which they can spend, further driving up demand in the economy.

This approach is grounded in the belief that active government intervention can help manage economic cycles, particularly during recessions, when private sector spending may be weak. By prioritizing these measures, Keynesian economics aims to restore economic stability and promote growth.

In contrast, other options reflect different economic philosophies. Increased private investments and exports focus more on supply-side measures rather than addressing demand directly. Higher interest rates encourage saving rather than spending, which would not stimulate the economy effectively in a downturn. The reduction of government roles aligns more with laissez-faire or free-market economics, which contradicts the Keynesian emphasis on intervention during economic slumps.