Classical economists and Keynes shared the belief that increased saving would necessarily stimulate an equal amount of increased investment spending.

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Classical economists believed in the idea of Say's Law, which held that supply creates its own demand, meaning that all production creates an equal amount of demand. Therefore, they believed that increased saving would necessarily lead to increased investment spending, which would create jobs and stimulate economic growth. Keynes, on the other hand, rejected Say's Law and instead argued that in a depressed economy, increased saving could actually lead to decreased consumption and investment spending, creating a vicious cycle of economic stagnation. Thus, Keynes did not share the classical view that increased saving would necessarily stimulate increased investment spending.

Classical Economists and Keynes Shared the Belief That Increased Saving