Re: Communicating with Randy Wray.

[Doug Henwood <dhenwood@xxxxxxxxx>]

Is this an exercise in irony?

Doug

Doug Henwood [dhenwood@xxxxxxxxx]
Left Business Observer
212-874-4020 (voice)
212-874-3137 (fax)


On Tue, 4 Oct 1994, Paul Davidson wrote:

> FROM:  Paul Davidson
> "      Economics Department
> "      523 Stokely Management Center  (615) 974-4221
> BTW, there is another reason I forgot to mention why unemployment is not
> a public policy problem.  When, for example, the MEASURED unemployment rate
> is say 6.2%, since the same workers are not included in this 6.2% for a whole
> years (the average duration of unemployment is approximately 13 weeks), therefo
> re there is no unemployment public policy problem. The unemployment pool is
> constantly turning over so that, on average, measured unemployed
> workers find jobs (its only a search problem due to incomplete information)
> within a few months. Of course those "malingerers" who prefer leisure and
> unemployment benefits instead of working will be cut off the social net
>  after 26 weeks--- and are likely to reveal a pemanent preference for
> leisure, what bleeding-heart liberals call "discouraged workers -).
>
> Unemployment is not a policy problem because what we measure as unemployed
> is not truly involuntary unemployed; it tends to be a mix of frictionally
> unemployed agents searching for a "better" position (just like Randy's consumer
> buys better products) or malingerers. There will always be some unemployed
> malingerers and "better" job searchers among us--  what good  economists,
> i.e., those that have hard-heads and brains to match while "bad" economists
> have soft-hearts and brains to match-) using a "tough-minded economics for
> a just society" label the
> natural (measured) rate of unemployed or sometimes NAIRUs. To adopt public
> policies to reduce the unemployment among the natural rate of unemployed
> via expansionary demand management will  merely cause
> inflation -- oops! I mean will cause people to buy more and higher quality
> products from Bloomingdales rather than WALMARTS.
>
> Have a good day!____Paul Davidson
> ))))_ fax # (615) 974-1686
>