On New Year’s Day, 1936, John Maynard Keynes wrote a letter to his friend, dramatist George Bernard Shaw.

The book he was working on, he said, would “largely revolutionize… in the course of the next ten years—the way the world thinks about economic problems”.

Keynes' famous self-confidence was justified. The General Theory of Employment, Interest and Money would change the landscape of economics and shape the post-war world economy.

Depending on your point of view, Keynes was the savior of capitalism, or the man who allowed for the great post-war expansion of government.

Although many economists hoped that Keynes’ influence had waned in the 1990s and 2000s, the financial crises of 2008 and 2020 changed that. Keynesian ideas came back with a vengeance.

In both cases, it was arguably only heavy intervention by governments that averted another Great Depression.

The philosopher Isaiah Berlin described Keynes, an English economist whose friends included many artists and poets, as “certainly the cleverest man I have met in my life”. But who was he, what were his ideas, and what was the paradigm he sought to upend?

In 1935, the world was still trying to claw itself out of the Great Depression, it seemed obvious to Keynes that economics had failed utterly in being able to fix real-world problems.

As a young economist he had fully accepted the economic paradigm of his day. This ‘classical’ economics was a term coined by Karl Marx to describe the intellectual basis of free market capitalism.

Classical theory seemed to explain the workings of the modern economic world, but it had slowly dawned on Keynes that it did not. At the heart of his thinking was the problem of demand.