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Tous droits r€serv€s D€partement des relations industrielles de l'Universit€Laval, 1955

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https://www.erudit.org/en/Document generated on 09/26/2023 1:16 p.m.Relations industriellesIndustrial RelationsSur la politique du plein emploiOn Full Employment PolicyFran...ois Perroux

Volume 10, Number 4, September 1955URI: https://id.erudit.org/iderudit/1022668arDOI: https://doi.org/10.7202/1022668arSee table of contentsPublisher(s)D€partement des relations industrielles de l'Universit€ LavalISSN0034-379X (print)1703-8138 (digital)Explore this journalCite this article

Perroux, F. (1955). Sur la politique du plein emploi.

Relations industrielles /

Industrial Relations

10 (4), 210†236. https://doi.org/10.7202/1022668ar

Article abstractIntroduction

1. The great depression ‡ and mass unemployment ‡ threatened political and industrial societies. In order to avoid a

repetition of such a threat, one idea dominates the economic thought of the late decades: the establishment of full

employment.

2. In order to reach this, two methods have been proposed, both inoperative.1.The classical, because it does not recognize that wages are the largest variable factor in the total expense.

2.The Keynesian, because the chronic tendency to over-save and under-invest is non-existant; that the marginalefficiency of capital cannot be fully appreciated and that it presupposes the absence of bottlenecks.

Full employment must be a compromise between the maximum use of labour and other resources.I‡ONE FIGURE AND MULTIPLE SYMPTOM METHODSTwo methods may be used to prove the rationality of that compromise:

1.The one-figure method: over a certain percentage of the available labour force, unemployment is consideredexcessive. This method has serious limitations.2.In order to avoid the deficiencies of the first method, Perroux proposes the multiple symptom method, i.e. an analysisof the tolerable lack of balance in expansion and growth in the following variables:

1.Global supply and demand of money.2.Saving and investment.3.Labour supply and demand.

According to him, full employment must be defined as a high level of correct employment, consistent with expansion

and growth without unbearable lack of balance.

II‡CRITICISM OF THE EFFECTIVE DEMAND POLICY

This criticism is made on a report of the U.N.O. (1949). The author sees two fundamental errors in the doctrine of the

report:

1.the use of one-figure method setting a figure beyond which a whole series of counter-measures is set in motion;2.a remanence of the General Theory "directed principally and wrongly towards the internal economy".Ill‡THE AIM AND MEANS OF THE POLICY RECOMMENDED1. The type of economy: a more or less planned economy due to:1.governmental controls through which the over-all flows are influenced and coordinated;2.decentralised individual and group initiatives.

Therefore, the policy recommended by Mr. Perroux, is in reference to an economy which is not automatically regulated

by the market and its prices.

The government instruments: the usual monetary and financial organizations: central bank, treasury.IV‡ACTUAL APPLICATIONSHere is specified the contents of the tolerable lack of balance in expansion and growth in three cases:1.The re-conversion and the freeing of exchanges;2.The eventual contraction which would be brought about by a slump in the United States;3.The planning of long-term growth on a world-wide scale.V‡FULL EMPLOYMENT AND ECONOMY' OF PROGRESSIVE FORMThe author concludes:

"We hope to have furnished some good reasons to the understanding of the unilateral and hasty character of the

doctrine of full employment under its ordinary and Keynesian forms."A society where full employment exists is not necessarily economically progressive. In order for it to be so, it isnecessary that:

1.the technical invention therein be changed into economic innovation;2.the economic innovation eliminate the enterprises of which the activity and procedure are absolete;3.the surplus of real production be spread out to benefit all social categories;and this in the shortest time and at the lowest cost to society.

Sur la politique du plein emploi

Françoi

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L'auteu

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