The Macroeconomics of Unemployment - 1126 Words

The Macroeconomics of Unemployment In any economy, no matter whether it is controlled by the government or by free markets, people need to work in order to support it. The government does not generate tax revenue by magic. There have to be people in that economy earning an income to ensure that the government continues to collect taxes. In a free market economy, the same applies because there are some services which only an organized government can supply (such as protection from extra-national threats), but there also those which the people get for themselves because of the working of the markets. In any scenario, unemployment is, at the very least, a drag on the economy, and it can be much worse. This paper examines how the unemployment rate in the United States is underreported, and how that fact effects the sluggishness of the present economy. Unemployment is currently measured in the United States by counting those who do not have a job, have actively looked for work in the prio r four weeks, and are currently available for work (Leonhardt). This means that a great deal of people are not counted as unemployed because they are discouraged and have not looked for work in the past four weeks. Or, the person was injured in some way and they are not currently available for work. This does not mean that the people in either of these groups do not actually wish to find work, but it does mean that they are not counted because of an archaic system that has been used byShow MoreRelatedUnemployment in Macroeconomics1804 Words   |  8 PagesMacroeconomics Coursework assignment word count: 1802 Marco Lau What are the main means by which unemployment can be controlled? Unemployment, the state of being unemployed, especially involuntarily can cause big problems in our modern world. But how does one measure such an enormous prospect? When measuring unemployment it is first necessary to measure the working population, as not every person is able to work. Looking at the elderly and young children asRead MoreMacroeconomic Unemployment1312 Words   |  6 PagesThe State of the US economy on 07 –15 –14 This essay is based on the Federal Reserve Open Market (FOMC) statement released on 07 –15 –14. The release describes the state of the economy in terms of the following macroeconomic indicators: a progression towards maximum employment, increased price stability, and rebounding growth of real gross domestic product. The essay presents a discussion of the Federal Reserve’s mandate and the state of the US economy as of the month of the press release and theRead MoreMacroeconomics : The Unemployment Rate1948 Words   |  8 PagesMacroeconomics: The Unemployment Rate The more Americans employed means we as a nation are experiencing economic growth. However, if there is a high unemployment rate this interprets that more Americans are struggling in our economy. There are several types and reason for high unemployment. Though America’s unemployment rate was 5.6%, as of December 2014, every state’s unemployment rate varies for different reasons. America’s unemployment rate has a direct negative impact on our entire nation’s economyRead MoreMacroeconomics Essay-Unemployment1131 Words   |  5 PagesCompare and contrast alternative views on the nature and possible causes of unemployment and evaluate the effectiveness of demand and supply management policies to combat it This essay will compare and contrast alternative views on the nature and possible causes of unemployment. It will then go on to evaluate the effectiveness of demand and supply management policies that try and combat unemployment. 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This essay focuses on discussing the role of government policy on reducing unemployment andRead MoreNew Classical Macroeconomics Arose From The Monetarism And Rational Expectation School Essay922 Words   |  4 PagesIntroduction New Classical Macroeconomics arose from the Monetarism and Rational Expectation School in the 1970s and follows the tradition of classical economics. If the market mechanism is allowed to play its role spontaneously, which could solve the unemployment, recession and a series of macroeconomic issues. Keynesian economists believe that changes in the money supply will lead to changes in effective demand that will changes in the total economy. 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Keynes offered a clarification for the fallout from the Great Depression, when goods remained unsold and workers unemployed, a feat that left classical economists stumped. Keynes theory explained why markets may not clear. This theory evolved throughout the 20th century, diverting into several macroeconomic schools of thought