2010/02/12

employer of last resort

February 12th 2010 Posted to Uncategorized

I’ve been reading about these “job guarantee” or “employer of last resort” theories, and they seem interesting. Basically the government provides employment at delta below the legal minimum wage for those who are unemployed, thereby absorbing excess labor into the public sector. The advantages are clear: it is certainly better than welfare and it doesn’t compete with the private sector.

Why is this? Let’s reason about it in a crude way.
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