>>>>>>>>>>>>>>>>>>>>>>>>>>>>>> Aggregate expenditure includes investment expenditure, and in the Accounts, investment = saving; so raising aggregate expenditure OF A CERTAIN SORT, will raise saving; and, if investment is productive, it will raise aggregate expenditure in the long run (assuming no excess capacity in the economy). >>>>>>>>>>>>>>>>>>>>>>> Robin Neil apparently is willing to advise a third-world government that expanding aggregate demand will produce the saving that leads to a rise in living standards. I realize that this is an implication of the popular macroeconomics model that adorns our texts. Prior to Keynes this doctrine was considered heretical and untrue. I cannot believe that by encouraging consumption you create the type of habits and behavior patterns that lead to investment and economic development. Since Robin Neil finds these causal connections so obvious I an forced to admit that there are still economists like myself who think that to seriously recommend such a prescription to third-world governments is irresponsible. Am I correct that even devout Keynesians would not have the doctrine that applied (if it applies at all) to advanced capitalist economies applied to third-world countries? If so, why all the fuss about the World Bank and long term lending, etc? Is there any proof that third-world spending-oriented macroeconomic policies have promoted economic development? What proof can be offered? It seems to me that if economists cannot agree about the importance of saving over spending then what is point of looking for the meaning of "proofs" in econometrics, etc.? More basic matters first, please. L. Moss