Tuesday 630
Mostly summarized from Gregory Mankiw’s Principles of Economics, 5th Ed. PART 9 The Real Economy in the Long Run Chapter 28 of 36 Unemployment Section 2 of 21 … Losing a job can be a person’s most traumatic economic event. People rely on job earnings to maintain their standard of living and they get a feeling of personal accomplishment from work. Job loss creates lower current living standard, anxiety about the future, and reduced self-esteem. Politicians often speak about how their proposed policies will create jobs and higher wages. ... We have previously seen some of the determinants of level and growth of a country's living standard. A country that saves and invests a high fraction of its income has more rapid capital stock and GDP growth than a country that saves and invests less. One determinant of a country's standard of living is its rate of unemployment over time. People who want to work but cannot find a job are not contributing to the economy's output of goods ...