Great aim of economic thought

Sunday, May 15, 2011

In the years immediately after the Second World War the great aim of economic thought and policy was to achieve and maintain a state of Full Employment. The mood was much affected by memories of the Great Depression of the pre-war decade and by the promotion of Keynesian ideas. More recently, the emphasis of economic policy has turned onto the control of a threatening runaway inflation, a control which has been exercised at the expense of the recurrence of mass unemployment and of an increasing inequality between the incomes of the rich and the poor. Now once again Full Employment is seriously considered as a primary aim of policy. Can it be regained without serious inflation and increasing inequality?