Keynesian Policy Today: More Employment and More Human Capital

Cosimo Perrotta

Chapter Chapter 7 in Human Capital, 2023, pp 119-139 from Springer

Abstract: Abstract Keynes stated that the periodical crises of the early nineteenth century and the crisis that started in 1929 were both due to scarce demand, as a result of technological unemployment. He also argued that the neoclassical misinterpretation of the 1930s crisis derived from Ricardo. Both Ricardo and his contemporaries, in contrast with Malthus, denied that there was any persisting lack of demand. Thus Keynes criticised “classical economists” and projected to overcome the crisis by boosting demand through a policy of employment. Keynes’ approach proved highly effective during the welfare state. However, a full employment policy required long-run structural transformations that governments and big enterprises did not implement. Thus, technological unemployment and insufficiency of demand reappeared and have persisted up to now. Today, we need new Keynesian policies which complete the old ones.

Keywords: Periodical crises; Underconsumption; Insufficient demand; Technological unemployment (search for similar items in EconPapers)
Date: 2023
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Persistent link: https://EconPapers.repec.org/RePEc:spr:sprchp:978-3-031-34494-7_7

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DOI: 10.1007/978-3-031-34494-7_7

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