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Unemployment and the Maturity of Capitalism

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  • Fix, Blair

Abstract

In my last post, I discussed the underwhelming relation between interest rates and unemployment. In this post, I’ll look at a better way to connect unemployment to interest income. It turns out that if you take US net interest and divide it by corporate profit, you get a ratio that closely tracks unemployment. It’s a measure that Jonathan Nitzan and Shimshon Bichler call the ‘maturity of capitalism’. If this language sounds odd, that’s because Nitzan and Bichler see capitalism differently than your average economists. So before we get to the data, let’s review some of their thinking.

Suggested Citation

  • Fix, Blair, 2023. "Unemployment and the Maturity of Capitalism," EconStor Preprints 270869, ZBW - Leibniz Information Centre for Economics.
    • Handle: RePEc:zbw:esprep:270869
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    More about this item

    Keywords

    income distribution; interest rate; maturity of capitalism; profit; sabotage; unemployment;
    All these keywords.

    JEL classification:

    • P00 - Political Economy and Comparative Economic Systems - - General - - - General
    • P1 - Political Economy and Comparative Economic Systems - - Capitalist Economies
    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
    • J6 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers
    • D3 - Microeconomics - - Distribution
    • E4 - Macroeconomics and Monetary Economics - - Money and Interest Rates

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