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RESEARCH PRODUCT

Non-voluntary unemployment in circuit analyses

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Studying unemployment is generally done in terms of market. In this type of analysis is not, however, easy to show compulsory redundancy. Furthermore, it's nowadays difficult to deny the existence of this kind of underemployment. According to the Keynesian theory it seems interesting to consider the analysis in terms of circulation. In this respect three outlines are in confrontation. If we accredit the idea of the building up of capital, compulsory redundancy could be explained by a deficit in the flow. Unfortunately, from a macroeconomic point of view this explanation cannot be accepted; if a product is not bought spontaneously, the sale of the product is implemented by force. The analysis based on the "circulatory" conception of the economic circulation (when rejecting the idea of building up capital) states that the development of unemployment is the result of the insolvency of certain firms. Unfortunately, in reality, this explanation can no longer be accepted because the payment of salaries doesn't make the firms get into debt with the banks, but trough the banks they get into debt with the income holders. In order to arrive at a satisfactory explanation of compulsory redundancy it's necessary to consider another conception of economic circulation: it's then possible to show that the development of underemployment results from the expense of an "induced" profit on the service production market