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(Full) Employment Policy: Theory and Practice

Author

Listed:
  • Dimitri B. Papadimitriou

    (The Jerome Levy Economics Institute)

Abstract
Although the U.S. unemployment rate in 1998 was at its lowest level since the late 1960s, the nation's employment problem is still far from solved. Although many economists assume that unemployment tends toward a natural rate below which it cannot go without creating inflation, this paper asks whether the current employment policies will be able to deal with the challenges of the next downturn. To evaluate these questions, the author examines the relative merits of three proposed strategies to improve the employment situation - a reduced workweek, employment subsidies, and a public service job opportunity program - to see if they will meet the challenges of upholding an individual's basic right to job while not stimulating inflation. He finds that a shorter workweek and wage subsidies both have failed to meet one or both of these challenges, but that a public service job opportunity program, such as the "employer of last resort policy," would satisfy both the full employment and noninflationary criteria.

Suggested Citation

  • Dimitri B. Papadimitriou, 1999. "(Full) Employment Policy: Theory and Practice," Macroeconomics 9901003, University Library of Munich, Germany.
    • Handle: RePEc:wpa:wuwpma:9901003
    Note: Type of Document - Acrobat Pdf Files; prepared on IBM PC; to print on PostScript; pages: 27; figures: included
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    File URL: https://econwpa.ub.uni-muenchen.de/econ-wp/mac/papers/9901/9901003.pdf
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    References listed on IDEAS

    as
    1. Layard, Richard & Nickell, Stephen & Jackman, Richard, 2005. "Unemployment: Macroeconomic Performance and the Labour Market," OUP Catalogue, Oxford University Press, number 9780199279173.
    2. repec:bla:econom:v:56:y:1989:i:224:p:473-86 is not listed on IDEAS
    3. L. Randall Wray, 1997. "Government as Employer of Last Resort: Full Employment without Inflation," Economics Working Paper Archive wp_213, Levy Economics Institute.
    4. Mathew Forstater, 1997. "Selective Use of Discretionary Public Employment and Economic Flexibility," Economics Working Paper Archive wp_218, Levy Economics Institute.
    5. Amartya Sen, 1997. "Inequality, Unemployment and Contemporary Europe," STICERD - Development Economics Papers - From 2008 this series has been superseded by Economic Organisation and Public Policy Discussion Papers 07, Suntory and Toyota International Centres for Economics and Related Disciplines, LSE.
    6. Garfinkel, Irwin, 1973. "A Skeptical Note on "The Optimality" of Wage Subsidy Programs," American Economic Review, American Economic Association, vol. 63(3), pages 447-453, June.
    7. Barry Bluestone & Stephen Rose, "undated". "The Unmeasured Labor Force, The Growth in Work Hours," Economics Public Policy Brief Archive ppb_39, Levy Economics Institute.
    8. Calmfors, Lars, 1985. "Work sharing, employment and wages," European Economic Review, Elsevier, vol. 27(3), pages 293-309.
    Full references (including those not matched with items on IDEAS)

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    Cited by:

    1. Georgios Argitis & Stella Michopoulou, 2011. "Are Full Employment and Social Cohesion Possible Under Financialization?," Forum for Social Economics, Springer;The Association for Social Economics, vol. 40(2), pages 139-155, July.
    2. Chiara Piovani & Nursel Aydiner-Avsar, 2015. "The 2008/09 Economic Crisis: The Impact on Psychological Well-Being in the USA," Forum for Social Economics, Taylor & Francis Journals, vol. 44(1), pages 18-45, April.
    3. Rania Antonopoulos, 2007. "The Right to a Job, the Right Types of Projects: Employment Guarantee Policies from a Gender Perspective," Economics Working Paper Archive wp_516, Levy Economics Institute.
    4. Zdravka, Todorova, 2009. "Employer of Last Resort Policy and Feminist Economics: Social Provisioning and Socialization of Investment," MPRA Paper 16240, University Library of Munich, Germany.
    5. Marc-Andre Pigeon & L. Randall Wray, "undated". "Down and Out in the United States, An Inside Look at the Out of the Labor Force Population," Economics Public Policy Brief Archive ppb_54, Levy Economics Institute.
    6. Rania Antonopoulos & Sofia Adam & Kijong Kim & Thomas Masterson & Dimitri B. Papadimitriou, 2014. "After Austerity: Measuring the Impact of a Job Guarantee Policy for Greece," Economics Public Policy Brief Archive ppb_138, Levy Economics Institute.

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    JEL classification:

    • E - Macroeconomics and Monetary Economics

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