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why is this difficult to explain using the classical model?
how could the keynesian model explain it ?

2007-11-09 07:24:28 · 2 answers · asked by cmy 1 in Social Science Economics

2 answers

Classical economic assume the that markets find a equilibrium were supply equals demand including labor markets, so there can be no one who wants to work without a job, Keynes provided a mechanism that prevents this from happening.

2007-11-09 07:49:07 · answer #1 · answered by meg 7 · 0 0

The way the government reports unemployment is misleading.
It only shows people collecting benefits & seeking work.
Many have run out of benefits & given up seeking work.
Or they have settled for under-employment at minimum wage.

2007-11-09 07:29:14 · answer #2 · answered by Robert S 7 · 0 0

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