About Unemployment
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The unemployment rate is a measure of the prevalence of unemployment and it is calculated according to the number of unemployed persons. During periods of recession, an economy usually experiences a relatively high unemployment rate. According to International Labor Organization report, more than 200 million people globally or 6% of the world's workforce were without a job in 2012.
There remains considerable theoretical debate regarding the causes, consequences and solutions for unemployment. Classical Economics, New Classical Economics, and the Austrian School of Economics. These theories argue against interventions imposed on the labor market from the outside, such as unionization, bureaucratic work rules, minimum wage laws, taxes, and other regulations.
Keynesian economics emphasizes the cyclical nature of unemployment and recom- mendations. This theory focuses on recurrent shocks that suddenly reduce aggregate demand for goods and services and reduce demand for workers. Keynesian models recommend government interventions to increase demand for workers; These can include financial stimuli, publicly funded job creation, and expansionist monetary policies. Its namesake, economist John Maynard Keynes, believed that the root cause of unemployment is the desire of investors to receive more money rather than produce more products, which is not possible without public bodies producing new money.
High and persistent unemployment, in which economic inequality increases. Unemployment can harm growth not only because it is a waste of resources, but also because it generates redistributive pressures and subsequent distortions, drives people to poverty, constrains liquidity limiting labor mobility, and erodes self-esteem promoting social dislocation, unrest and conflict. 2013 Economics Nobel prize winner Robert J. Shiller in the United States and elsewhere is the most important problem.
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