He Keng believes that the fundamental way to control economic stagflation is to strengthen supply management, including: First, increase support for emerging industries that can accommodate more jobs. The second is to strengthen technical training. Third, deepen the reform of fiscal, taxation and wage system, optimize the combination of production factors (land and manpower), and use the reform of wage system, taxation and financial system to guide the flow of funds and talents to areas and industries that need development.

Regarding the policy mix during the Twelfth Five-Year Plan period, He Keng emphasized that a prudent fiscal policy and a flexible monetary policy should be adopted.

He believes that the essence of fiscal policy is to promote social equity, and its role in promoting economic growth is limited. Stimulating economic growth mainly depends on monetary policy, improving the construction of social security system, improving the social security of low-income groups and migrant workers, and embodying labor equality.