Price Flexibility and Full Employment : Losing the Plot?

Tools

Grieve, Roy (2004) Price Flexibility and Full Employment : Losing the Plot? Discussion paper. University of Strathclyde, Glasgow.

[thumbnail of Grieve-2004-Price-flexibility-and-full-employment-losing-the-plot]
Preview
 Text. Filename: Grieve_2004_Price_flexibility_and_full_employment_losing_the_plot.pdf
Final Published Version
Download (215kB)| Preview

Abstract

This paper, from a historical perspective, questions the thesis (again in fashion) that price flexibility ensures full employment. The point is made that explanation of unemployment in terms of wage/price stickiness typified pre-Keynesian accounts, but not Keynes’s theory of involuntary unemployment. Under uncertainty, no set of prices consistent with full employment may actually exist: if so, price flexibility is not the critical factor. Finally, with respect to current use of the “AD/AS model”, we note that the strong arguments against attribution of necessarily beneficient effects to price and wage flexibility, which ought to be well-known, seem now to be forgotten.

  • Item type:Monograph(Discussion paper)
    ID code:67730
    Dates:
    Date
    Event
    14 June 2004
    Published
    Notes:Published as a paper within the Discussion Papers in Economics, No. 04-07 (2004)
    Subjects:Social Sciences > Economic Theory
    Department:Strathclyde Business School > Economics
    Depositing user: Pure Administrator
    Date deposited:07 May 2019 15:28
    Last modified:27 Jan 2025 02:26
    URI:https://strathprints.strath.ac.uk/id/eprint/67730
CORE (COnnecting REpositories)