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Full Employment as a Possible Objective for EU Policy I. A Perspective From the Point of View of The Monetary Circuit

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  • Massimo Cingolani

    () (European Investment Bank)

Abstract

In two recent contributions Alain Parguez and Jean-Gabriel Bliek argued in favour of assigning a full employment objective to European economic policies and their coordination (Bliek and Parguez (2007) and Parguez (2007b)). Their argument is based on the approach of the monetary circuit, whose treatment of full employment is the object of this article. The approach is presented here as emblematic of out of equilibrium models, i.e. models where the equilibrium conditions of pure competition are not fulfilled. A forthcoming contribution will show how the description of economic reality suggested by the circuit can help interpreting recent macroeconomic developments in the US, Canada, Japan and the EU and will discuss some empirical studies confirming its relevance for policy analysis.

Suggested Citation

  • Massimo Cingolani, 2008. "Full Employment as a Possible Objective for EU Policy I. A Perspective From the Point of View of The Monetary Circuit," Panoeconomicus, Savez ekonomista Vojvodine, Novi Sad, Serbia, vol. 55(1), pages 89-114, March.
  • Handle: RePEc:voj:journl:v:55:y:2008:i:1:p:89-114
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    References listed on IDEAS

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    1. Jean-Paul Fitoussi & Francesco Saraceno, 2004. "The Brussels-Frankfurt-Washington Consensus. Old and New Tradeoffs in Economics," Documents de Travail de l'OFCE 2004-02, Observatoire Francais des Conjonctures Economiques (OFCE).
    2. Roger Guesnerie, 2005. "Assessing Rational Expectations 2: "Eductive" Stability in Economics," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262072580, January.
    3. Parguez, A. & Seccareccia, M., 1999. "A Credit Theory of Money: The Monetary Circuit Approach," Working Papers 9902e, University of Ottawa, Department of Economics.
    4. Alessandro Roncaglia & Mario Tonveronachi, 1985. "Pre-Keynesian roots of the neoclassical synthesis," Cahiers d'Économie Politique, Programme National Persée, vol. 10(1), pages 51-65.
    5. Olivier Giovannoni & Alain Parguez, 2007. "What Drives Profits? An Income-spending Model," Chapters,in: Money, Distribution and Economic Policy, chapter 5 Edward Elgar Publishing.
    6. de la Croix,David & Michel,Philippe, 2002. "A Theory of Economic Growth," Cambridge Books, Cambridge University Press, number 9780521001151, May.
    7. Paul Davidson, 2005. "Responses to Lavoie, King, and Dow on what Post Keynesianism is and who is a Post Keynesian," Journal of Post Keynesian Economics, Taylor & Francis Journals, vol. 27(3), pages 393-408.
    8. Seccareccia, M. & Sharpe, A., 1991. "Canada's Competitiveness: Beyond the Budget Deficit," Working Papers 9111e, University of Ottawa, Department of Economics.
    9. Lavoie, Marc, 1999. "The Credit-Led Supply of Deposits and the Demand for Money: Kaldor's Reflux Mechanism as Previously Endorsed by Joan Robinson," Cambridge Journal of Economics, Oxford University Press, vol. 23(1), pages 103-113, January.
    10. Seccareccia,M., 1991. "Post Keynesian Fundism and Monetary Circulation," Working Papers 9113e, University of Ottawa, Department of Economics.
    11. Roger Guesnerie, 2001. "Assessing Rational Expectations: Sunspot Multiplicity and Economic Fluctuations," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262072076, January.
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    More about this item

    Keywords

    Unemployment; Capacity Utilisation; Circuit; Disequilibrium; Investment; Savings; Price Equation;

    JEL classification:

    • D5 - Microeconomics - - General Equilibrium and Disequilibrium
    • E12 - Macroeconomics and Monetary Economics - - General Aggregative Models - - - Keynes; Keynesian; Post-Keynesian
    • H5 - Public Economics - - National Government Expenditures and Related Policies
    • H6 - Public Economics - - National Budget, Deficit, and Debt
    • E4 - Macroeconomics and Monetary Economics - - Money and Interest Rates

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