Re: Full Employment is what?

[Bill Mitchell <ecwfm@xxxxxxxxxxxxxxxxxxxxxxx>]

Paul said:

> At least the Mosler ELR concept has as definition of full employment that
> has  some meaning -- but the problem is that thre government wage rate
> MUST be significantly lower than the private sector wage rate.  Thus there
> may be many workers who would be willing to work at the market wage rate
> but who could not find a job -- and still not be willing to work at the
> government wage rate?  Is that what we mean by full employment??


Warren's ELR is similar to my Job Guarantee model. In both, the JG wage
only has to be slightly lower than the
private sector wage not significantly lower to gain the inflation control.
It is loose full employment because the
level of demand associated with JG Full N is < level of demand associated
with a fully employed private economy.
The gain it makes has to be relative to the NAIRU mentality that controls
inflation with unemployment.

The question also has to be asked: can the private sector ever provide
enough jobs without inflation to fully account
for all the labour force? my answer is no and therefore the JG is the only
way to achieve both goals.

best wishes
bill




William F. Mitchell
Professor of Economics and Head of Department
Director, Centre of Full Employment and Equity
University of Newcastle
New South Wales, Australia
E-mail: ecwfm@xxxxxxxxxxxxxxxxxxxxxxx
Phone: +61-2-4921 5065
Fax:   +61-2-4921 6919
Mobile: 0419 422 410

WWW Home Page: http://e1.newcastle.edu.au/economics/bill/billeco.html