Restoring full employment: the job guarantee

In this paper we outline a path to full employment and inflation control based on the Job Guarantee (JG) proposal by Mitchell (1998) and develop some new analysis of this option. We also contrast it with the wage-cutting approach proposed by the so-called Five Economists (for example, Dawkins, 1999). The context of the paper is clear. If the misery index (sum of the unemployment rate and inflation) is computed for most OECD countries, then it is higher than it was in 1960, when full employment was systematically achieved, and unemployment now makes a higher contribution (Mitchell, 1996). The data reflects the shifting emphasis of economic policy over the last 40 years. The "NAIRU era" since the 1970s has since been associated with deficient demand and persistent unemployment. The orie indisputable fact is that the Australian economy (like most) has failed to generate enough employment to match the number of available workers.