Full Employment: Can It Be a Key Policy Objective for Europe?

Contrary to some recent critiques, the General Theory of the Monetary Circuit approach must be regarded as the most general model of modern economies. On one side, it relies entirely on the anchor of last resort of the modern economy, money, without theoretically stringent assumptions preimposing a...

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Bibliographic Details
Published in:International journal of political economy 2007-10, Vol.36 (3), p.24-46
Main Authors: Parguez, Alain, Bliek, Jean-Gabriel
Format: Article
Language:English
Subjects:
Economic models
Economic policy
Economic theory
Economics
Employment
European Union
Federal budget deficit
Full employment
Full employment policies
Gross domestic product
Labor policy
Money
Personal debt
Political economy
Public debt
Public investments
Studies
Trade deficits
Unemployment
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Summary:Contrary to some recent critiques, the General Theory of the Monetary Circuit approach must be regarded as the most general model of modern economies. On one side, it relies entirely on the anchor of last resort of the modern economy, money, without theoretically stringent assumptions preimposing a solution. On the other side, it explicitly aims at a general policy framework by addressing the question of how to establish full employment as the ultimate condition for stable growth. This article analyzes the dynamics of money creation, which allows economic agents to overcome financial constraints on expenditures. It then shows how this general model leads to a genuine full employment policy for the European Union.
ISSN:0891-1916
1558-0970
DOI:10.2753/IJP0891-1916360302