To each according to his contribution. Do state interventions always have a negative impact on the labor market? (eBook, PDF)
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Seminar paper from the year 2014 in the subject Economics - Job market economics, grade: 2,0, , language: English, abstract: In common theory labor is often treated like a normal commodity. This point of view is represented by neo-classical economists. Resulting in their general statement that markets - including the labor market - are driven only by supply and demand thus regulating themselves. Hence there is no space for any external interventions which due to the neo-classical opinion always have a negative effect. This provoking statement leads to the question whether this scenario can be ...
Seminar paper from the year 2014 in the subject Economics - Job market economics, grade: 2,0, , language: English, abstract: In common theory labor is often treated like a normal commodity. This point of view is represented by neo-classical economists. Resulting in their general statement that markets - including the labor market - are driven only by supply and demand thus regulating themselves. Hence there is no space for any external interventions which due to the neo-classical opinion always have a negative effect. This provoking statement leads to the question whether this scenario can be observed in real world. Based on the book "Debunking Economics" by Steve Keen the following research paper wants to provide a differentiated view concerning labor and how it can be treated in the economy. The first part of the dissemination paper reviews the neo-classical perspectives on the labor market followed by a reproduction of Keen's critical review concerning the neo-classical theory and his own elaboration of the labor market. The principle part concentrates on the treatment of labor force in the labor market and the possible outcome of several policies such as introducing or altering minimum wages, unemployment insurance (UI) and trade unions. Regarding to the research question whether an impact of the government has positive or negative impact on the labor market, the aim is to establish a link between labor market regulations, economic policies and theory. In this context the analysis shows what theory suggests and which outcomes can be observed by implementing regulations derived from theory. Finally the paper sums up the most important results and points out unanswered aspects which could be further discussed and analyzed to evaluate the impacts of external interventions on the labor market more precisely.
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