Unemployment, recession, inflation, workforce
Peasants, nomadic tribes members or servants can be very unproductive, extremely poor or reduced to idleness because its institutions exclude the land or property of animals or other riches; but unemployment in these societies is static condition resulting from existing institutions. We did not find periods of high and low unemployment in these societies (except if, perhaps, the good and bad harvests), but a more or less constant proportion of workers in the total population. Also in societies of command the workforce may be ill-allocated or under-used but in this case, unemployment presents with disabilities the planning mechanism, not as a result of malfunction of market mechanisms.
By way of contrast, the most important social task that a market system entrusts its "mechanisms" is to find acceptable work for the members of society. It is also a task that the market does not perform entirely satisfactorily. From time to time, as we know, severe depression shattered market systems, causing unemployment to rise to heights that not only inflicted great damage to people unable to find work, but threatened the very political and social stability of the system.
[...] By way of contrast, the most important social task that a market system entrusts its "mechanisms" is to find acceptable work for the members of society. It is also a task that the market does not perform entirely satisfactorily. From time to time, as we know, severe depression shattered market systems, causing unemployment to rise to heights that not only inflicted great damage to people unable to find work, but threatened the very political and social stability of the system. REFERENCES: Heilbroner, Robert L., The formation of the economic society, 5th Edition Ed Guanabara - . RJ ROSSETTI, José Paschoal, Introduction to economic. [...]
[...] In this regard, we will have to wait and see. What seems certain is that we need to go back to the controls and heavier taxes if the current course does not work. No one likes this difficult and intrusive role of government. But if inflation continues, despite our therapeutic efforts, the taste of necessary medicine will become much less unpalatable. UNEMPLOYMENT PROBLEM In our study of economics, we found ourselves more than once with the problem of unemployment. And no wonder the reason. [...]
[...] Unemployment, recession, inflation Does not impose controls because they are administratively cumbersome, difficult to implement and almost invariably circumvented in one way or another. It will not surprise anyone that efforts to control wages tend to be more successful than those in the control prices. This is because the Government has an ally to help you implement your wage regulations. Employers know what your employees do and have an interest in keeping wages within legal limits. Consumers, on the other hand, generally ignore the cost of the product and may not require the warehouses and shops to refrain from reschedule the articles. [...]
[...] The result of a recessive policy has been cut growth, but no inflation. Instead, we get the worst of both sides - more stagnation continued inflation, the modern disease of "stagflation". INFLATION AS WAY OF LIFE Does this mean that inflation has become a chronic fact of life, incurable except in unemployment that would be socially disastrous, or by imposing rigid and unpopular wage controls, prices and incomes? So it seems. All efforts to find a compromise, where a moderate dose of inflation could be combined with a moderate recession, failed. [...]
[...] Unfortunately, moderate recessions are difficult to control. A tight monetary policy and more austere government budgets, through which these recessions are planned, tend to have their impact unevenly. Large companies with strong cash reserves, can pass through the recession relatively unscathed, while small businesses unable to obtain bank credit, collapse on all sides. This quickly leads to a call for greater facilities for small business - a cry Congress can not hang. At the same time, an effort to cut government spending "wasteful" soon leads to the conclusion that it is not easy to change the institutional structures of the federal government, state and local. [...]
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