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Beveridge's analysis of unemployment in 1909: the reserve of labour

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  • Jocelyn Poirel

Abstract

The aim of this paper is to provide a rational reconstruction of Beveridge's theory of unemployment published in 1909. First and foremost, it shows that his theory of unemployment is coherent - what Beveridge refers to as 'the reserve of labour' represents 'unemployment' as a whole; unemployment is due to the imperfection of the labour market and associated friction and the organisation of the labour market is necessary. Second, it suggests that as early as 1909, a negative relationship already existed between unemployment and job vacancies and that the segmentation of the labour market and imperfect information are key factors of friction. The first part of the paper provides a reconstruction of Beveridge's theory of the reserve of labour (1909) including causes and factors of unemployment and unemployment policies. The second part shows that certain founding principles of the 'Beveridge curve' (Beveridge 1944 [1953]) were already to be found in his 1909 book and that links can be established between Beveridge (1909), Phelps (1970) and Pissarides (2000).

Suggested Citation

  • Jocelyn Poirel, 2014. "Beveridge's analysis of unemployment in 1909: the reserve of labour," The European Journal of the History of Economic Thought, Taylor & Francis Journals, vol. 21(3), pages 448-466, June.
    • Handle: RePEc:taf:eujhet:v:21:y:2014:i:3:p:448-466
    DOI: 10.1080/09672567.2012.683026
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    1. Bernard Corry & Alan Budd & Walter Eltis & Jose Harris & Terry Peach & George Peden, 1996. "Unemployment and the Economists," Books, Edward Elgar Publishing, number 959.
    2. Christopher A. Pissarides, 2000. "Equilibrium Unemployment Theory, 2nd Edition," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262161877, April.
    3. Laidler,David, 1999. "Fabricating the Keynesian Revolution," Cambridge Books, Cambridge University Press, number 9780521641739.
    4. Anna Batyra & Michel De Vroey, 2012. "From One To Many Islands: The Emergence Of Search And Matching Models," Bulletin of Economic Research, Wiley Blackwell, vol. 64(3), pages 393-414, July.
    5. Marx, Karl, 1867. "Capital: A Critique of Political Economy (I): The Process of Capitalist Production," History of Economic Thought Books, McMaster University Archive for the History of Economic Thought, volume 1, number marx1867.
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