The macro-economics of repressed stagflation. Part 2: The crisis of 2009+ and a reduction of the working week
AbstractThe current macro-economic crisis can be diagnosed as repressed stagflation bursting into the open. The Obama Administration and EU stimulus packages prevent economic collapse but do not tackle stagflation itself yet. Without proper measures, a protracted period of high unemployment or high inflation and continued instability can be expected. Instead, macro-economic theory can come at ease with deflation as a temporary state that is logically implied by the notion of price stability. What is crucial is to keep people in jobs. With proper tax measures the NAIRU is shifted to the proper position. The current situation seems to require a (temporary) reduction of the working week, for some areas even from 5 to 4 days.
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Bibliographic InfoPaper provided by University Library of Munich, Germany in its series MPRA Paper with number 14180.
Date of creation: 20 Mar 2009
Date of revision:
financial crisis; economic crisis; stagflation; inflation; unemployment; Phillipscurve; taxes; working time reduction;
Find related papers by JEL classification:
- E0 - Macroeconomics and Monetary Economics - - General
- A1 - General Economics and Teaching - - General Economics
- P16 - Economic Systems - - Capitalist Systems - - - Political Economy of Capitalism
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