22 July 2016
For decades most economists, except for a minuscule minority, have believed that it is impossible to explain large-scale unemployment except through the device of sticky wages.
Here we show that the failure of macroeconomics to explain involuntary unemployment lies in the assumptions of microeconomics. We prove that Keynes was indeed right in asserting that there is such a thing as involuntary unemployment and that it cannot be explained by rigid wages.
Read more at Why is there involuntary unemployment?
Category: Economics