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Full Employment: Are We There Yet?

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  • Flavia Dantas
  • L. Randall Wray

Abstract

Flavia Dantas and L. Randall Wray argue that the emerging conventional wisdom--that the US economy has reached full employment--is flawed. The unemployment rate is not providing an accurate picture of the health of the labor market, and the common narrative attributing shrinking labor force engagement to aging demographics is overstated. Instead, falling prime-age participation rates are the symptom of a structural inadequacy of aggregate demand--a problem of insufficient job creation and stagnant incomes that conventional public policy remedies have been unable to address. The solution to our long-running secular stagnation requires targeted, direct job creation for those at the bottom of the income scale.

Suggested Citation

  • Flavia Dantas & L. Randall Wray, 2017. "Full Employment: Are We There Yet?," Economics Public Policy Brief Archive ppb_142, Levy Economics Institute.
    • Handle: RePEc:lev:levppb:ppb_142
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    References listed on IDEAS

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    Cited by:

    1. Yeva Nersisyan & L. Randall Wray, 2019. "How to Pay for the Green New Deal," Economics Working Paper Archive wp_931, Levy Economics Institute.
    2. Michalis Nikiforos & Gennaro Zezza, 2017. "The Trump Effect: Is This Time Different?," Economics Strategic Analysis Archive sa_apr_17, Levy Economics Institute.
    3. Edward Lane & L. Randall Wray, 2020. "Is It Time to Eliminate Federal Corporate Income Taxes?," Economics Working Paper Archive wp_979, Levy Economics Institute.
    4. Landwehr, Jannik J., 2020. "The case for a job guarantee policy in Germany: A political-economic analysis of the potential benefits and obstacles," IPE Working Papers 150/2020, Berlin School of Economics and Law, Institute for International Political Economy (IPE).
    5. Pavlina R. Tcherneva, 2017. "Unemployment: The Silent Epidemic," Economics Working Paper Archive wp_895, Levy Economics Institute.
    6. Tanweer Akram, 2019. "Prospects and Risks for the Global Economy in 2019," CPD Working Paper 130, Centre for Policy Dialogue (CPD).
    7. L. Randall Wray, 2018. "Does the United States Face Another Minsky Moment?," Economics Policy Note Archive 18-1, Levy Economics Institute.
    8. Michalis Nikiforos & Gennaro Zezza, 2018. "'America First,' Fiscal Policy, and Financial Stability," Economics Strategic Analysis Archive sa_apr_18, Levy Economics Institute.
    9. L. Randall Wray & Stephanie A. Kelton & Pavlina R. Tcherneva & Scott Fullwiler & Flavia Dantas, 2018. "Guaranteed Jobs through a Public Service Employment Program," Economics Policy Note Archive 18-2, Levy Economics Institute.

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