Routledge Dictionary of Economics, Second Edition
1 The state of being part of a LABOUR FORCE, wanting to work, but without a job.
2 A DISEQUILIBRIUM phenomenon arising from inflexible prices.
Unemployment can take many forms—VOLUNTARY, INVOLUNTARY, FRICTIONAL, STRUCTURAL. It has been measured both as a STOCK and as a FLOW, using as statistical sources registers of persons declaring themselves to be unemployed and household surveys. In CLASSICAL ECONOMICS, unemployment is viewed as a temporary phenomenon until price flexibility restores an economy to full employment.
KEYNES challenged the classical view and later economists have been sceptical about the clearing of markets.
See also: natural rate of unemployment
References
Layard, R. (1986) How to Beat Unemployment, Oxford: Oxford University Press.
Minford, P. (1983) Unemployment: Cause and Cure, Oxford: Basil Blackwell.
Sinclair, P. (1987) Unemployment: Economic Theory and Evidence, Oxford: Basil Blackwell.
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