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Job Guarantee Program and the Kaleckian Dilemma: Lessons from the Rehn-Meidner Plan

Author

Listed:
  • Caio Vilella
  • Eduardo F. Bastian

Abstract

Minsky (1965) has presented the Job Guarantee program as a recommendation in the war against unemployment and poverty. Kalecki (1943), on the other hand, argued that the full employment situation could be technically feasible but politically hard to implement due to the class struggle, resulting in what we will refer to as the "kaleckian dilemma." Based on this contradiction, this paper aims to extract lessons from the Rehn-Meidner Swedish plan, which successfully combined low unemployment rates and creeping inflation for over three decades, as a means to study the chances of a Job Guarantee overcoming the kaleckian dilemma. From these lessons, this piece highlights the importance of a tripartite council bargaining board at the national level to settle the Job Guarantee’s wage level. In addition, we highly recommended other desirable features, such as international capital control and taxation on extraordinary profits, to raise the chances of the program successfully dealing with the kaleckian dilemma, just as Rehn-Meidner did. Originally issued as EDI Working Paper No. 10, November 2023.

Suggested Citation

  • Caio Vilella & Eduardo F. Bastian, 2024. "Job Guarantee Program and the Kaleckian Dilemma: Lessons from the Rehn-Meidner Plan," Economics Working Paper Archive wp_1066, Levy Economics Institute.
    • Handle: RePEc:lev:wrkpap:wp_1066
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    References listed on IDEAS

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    Keywords

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    JEL classification:

    • E11 - Macroeconomics and Monetary Economics - - General Aggregative Models - - - Marxian; Sraffian; Kaleckian
    • E31 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Price Level; Inflation; Deflation
    • H53 - Public Economics - - National Government Expenditures and Related Policies - - - Government Expenditures and Welfare Programs
    • I30 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - General

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