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Permanent On-The-Spot Job Creation—The Missing Keynes Plan for Full Employment and Economic Transformation

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  • Pavlina R. Tcherneva

Abstract

The paper rejects the conventional view that Keynes had an aggregate demand approach to full employment. Instead, it proposes that he advocated a very specific labor demand targeting approach that would be implemented both in recessions and expansions. Modern policies, which aim to “close the demand gap” between current and potential output are inconsistent with Keynes's work on theoretical and methodological grounds. There is considerable evidence to suggest that a permanent program for direct or (in his words) “on-the-spot” job creation is the missing Keynes Plan for full employment and economic transformation. The current crisis presents the social economist with a unique opportunity to set fiscal policy straight along the original Keynesian lines. The paper suggests what specific form such a policy might take.

Suggested Citation

  • Pavlina R. Tcherneva, 2012. "Permanent On-The-Spot Job Creation—The Missing Keynes Plan for Full Employment and Economic Transformation," Review of Social Economy, Taylor & Francis Journals, vol. 70(1), pages 57-80, September.
    • Handle: RePEc:taf:rsocec:v:70:y:2012:i:1:p:57-80
    DOI: 10.1080/00346764.2011.577348
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    References listed on IDEAS

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    1. L. Randall Wray, 1998. "Understanding Modern Money," Books, Edward Elgar Publishing, number 1668.
    2. Pavlina Tcherneva, 2012. "The Role of Fiscal Policy," International Journal of Political Economy, Taylor & Francis Journals, vol. 41(2), pages 5-25.
    3. repec:elg:eebook:14213 is not listed on IDEAS
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    Cited by:

    1. Pavlina R. Tcherneva, 2011. "Fiscal Policy: Why Aggregate Demand Management Fails and What to Do about It," Economics Working Paper Archive wp_650, Levy Economics Institute.

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