Advanced Search
MyIDEAS: Login

Private Sector "Employer of Last Resort"

Contents:

Author Info

  • Musgrave, Ralph S.

Abstract

Those advocating “government as employer of last resort schemes” (ELR) nearly always assume, first, that “ELR employers” should be specially set up to employ those out of work, i.e. that these projects or “employers” should be separate from existing public sector employers. A second almost universal assumption is that, as already intimated, the work involved should be public sector type work rather than private sector commercial type work. This paper puts an argument which demolishes or weakens both the above two assumptions. That is, it is argued, first, that ELR work should be with EXISTING employers. Second, it is argued that this work should be in BOTH public and private sectors, not just the public sector. I actually argued against the above two assumptions in a paper in 1991 (Musgrave (1991)) but for different reasons. The argument below complements these “1991” reasons, rather than renders them obsolete in any way. These 1991 reasons are set out below in abbreviated form, and begin after the heading “Marginal Employment Subsidy” below. The argument that is new in this paper centres around the other factors of production (OFP) that need to be employed alongside the relatively unskilled ELR employees (these factors of production are skilled labour, materials and equipment). If ELR involves little or no OFP, then output will be hopeless. On the other hand if ELR involves anywhere near the usual ratios of different factors of production, then the ELR scheme amounts to much the same thing as a normal employer. This suggests that ELR employees should be placed with existing public sector employers. Second, traditional ELR advocates normally claim that public sector ELR is not inflationary. This claim is based on the assumption that no OFP need be withdrawn from the private sector to make ELR work. Once this false assumption is rectified, it turns out there is no difference in the inflationary impact as between public and private sector ELR, thus there is no reason to confine ELR to the public sector.

Download Info

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
File URL: http://mpra.ub.uni-muenchen.de/18593/
File Function: original version
Download Restriction: no

File URL: http://mpra.ub.uni-muenchen.de/20110/
File Function: revised version
Download Restriction: no

File URL: http://mpra.ub.uni-muenchen.de/19094/
File Function: revised version
Download Restriction: no

Bibliographic Info

Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 18593.

as in new window
Length:
Date of creation: 13 Nov 2009
Date of revision:
Handle: RePEc:pra:mprapa:18593

Contact details of provider:
Postal: Schackstr. 4, D-80539 Munich, Germany
Phone: +49-(0)89-2180-2219
Fax: +49-(0)89-2180-3900
Web page: http://mpra.ub.uni-muenchen.de
More information through EDIRC

Related research

Keywords: Government as employer of last resort; workfare; private sector; marginal employment subsidy.;

Find related papers by JEL classification:

This paper has been announced in the following NEP Reports:

References

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
as in new window
  1. John F. Henry & L. Randall Wray, 1998. "Economic Time," Macroeconomics 9811004, EconWPA.
Full references (including those not matched with items on IDEAS)

Citations

Lists

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

Statistics

Access and download statistics

Corrections

When requesting a correction, please mention this item's handle: RePEc:pra:mprapa:18593. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Ekkehart Schlicht).

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.