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Unemployment: The Silent Epidemic

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  • Pavlina R. Tcherneva

Abstract

This paper examines two key aspects of unemployment--its propagation mechanism and socioeconomic costs. It identifies a key feature of this macroeconomic phenomenon: it behaves like a disease. A detailed assessment of the transmission mechanism and the existing pecuniary and nonpecuniary costs of unemployment suggests a fundamental shift in the policy responses to tackling joblessness. To stem the contagion effect and its outsized social and economic impact, fiscal policy can be designed around two criteria for successful disease intervention--preparedness and prevention. The paper examines how a job guarantee proposal uniquely meets those two requirements. It is a policy response whose merits include much more than its macroeconomic stabilization features, as discussed in the literature. It is, in a sense, a method of inoculation against the vile effects of unemployment. The paper discusses several preventative features of the program.

Suggested Citation

  • Pavlina R. Tcherneva, 2017. "Unemployment: The Silent Epidemic," Economics Working Paper Archive wp_895, Levy Economics Institute.
    • Handle: RePEc:lev:wrkpap:wp_895
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    File URL: http://www.levyinstitute.org/pubs/wp_895.pdf
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    References listed on IDEAS

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    1. Raphael, Steven & Winter-Ember, Rudolf, 2001. "Identifying the Effect of Unemployment on Crime," Journal of Law and Economics, University of Chicago Press, vol. 44(1), pages 259-283, April.
    2. Christian Breuer & Horst Rottmann, 2014. "Do Labor Market Institutions Influence Suicide Mortality? An International Panel Data Analysis," CESifo Working Paper Series 4875, CESifo.
    3. Kunze, Lars & Suppa, Nicolai, 2017. "Bowling alone or bowling at all? The effect of unemployment on social participation," Journal of Economic Behavior & Organization, Elsevier, vol. 133(C), pages 213-235.
    4. Katharine G. Abraham & John Haltiwanger & Kristin Sandusky & James R. Spletzer, 2019. "The Consequences of Long-Term Unemployment: Evidence from Linked Survey and Administrative Data," ILR Review, Cornell University, ILR School, vol. 72(2), pages 266-299, March.
    5. Reichert, Arndt & Tauchmann, Harald, 2011. "The Causal Impact of Fear of Unemployment on Psychological Health," Ruhr Economic Papers 266, RWI - Leibniz-Institut für Wirtschaftsforschung, Ruhr-University Bochum, TU Dortmund University, University of Duisburg-Essen.
    6. Denis Fougère & Francis Kramarz & Julien Pouget, 2009. "Youth Unemployment and Crime in France," Journal of the European Economic Association, MIT Press, vol. 7(5), pages 909-938, September.
    7. Lindo, Jason M., 2011. "Parental job loss and infant health," Journal of Health Economics, Elsevier, vol. 30(5), pages 869-879.
    8. Pavlina R. Tcherneva, 2007. "Chartalism and the Tax-Driven Approach to Money," Chapters, in: Philip Arestis & Malcolm Sawyer (ed.),A Handbook of Alternative Monetary Economics, chapter 5, Edward Elgar Publishing.
    9. Linn, M.W. & Sandifer, R. & Stein, S., 1985. "Effects of unemployment on mental and physical health," American Journal of Public Health, American Public Health Association, vol. 75(5), pages 502-506.
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    Citations

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    Cited by:

    1. 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.
    2. John Komlos, 2019. "The Real U.S. Unemployment Rate Is Twice the Official Rate, and the Phillips Curve," CESifo Working Paper Series 7859, CESifo.
    3. Esteban Cruz-Hidalgo & Dirk H. Ehnts & Pavlina R. Tcherneva, 2019. "Completing the Euro: The Euro Treasury and the Job Guarantee," Revista de Economía Crítica, Asociación de Economía Crítica, vol. 27, pages 100-111.

    More about this item

    Keywords

    Unemployment; Epidemic; Mortality; Morbidity; Health; Scarring Effects; Crime; Family; Job Guarantee; Labor Market Dynamics; Involuntary Job Loss; Prevention;

    JEL classification:

    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
    • E62 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Fiscal Policy
    • H1 - Public Economics - - Structure and Scope of Government
    • H4 - Public Economics - - Publicly Provided Goods
    • I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health
    • I3 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty
    • J08 - Labor and Demographic Economics - - General - - - Labor Economics Policies
    • J6 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers

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