The problem of unemployment

To a planner, the problem of unemployment looks very solvable.

There is a sum total of social labour necessary in a given year to produce the conventional bundle of goods and services to be consumed by the population in that year.

So divide the total labour applicable by the number of adults in the workforce, and you will have the per-head-of-work-force annual labour necessary.

But it does not work that way in real life.

Why does it not work that way in real life?

In University of Bombay I read a book on the Soviet gold industry. This was a book written by an American mining engineer who was instrumental in setting up the industry. Apparently, Stalin had read stories of the Californian Gold rushes with avidity, and was taken up with the thought of the civilizing effects of a major discovery of gold. He pushed the nomadic populations of the Russian steppes out of their traditional way of life into becoming work forces for gold mining in Russia. I can’t remember the names of the fields, and don’t know where they are geographically today. But the point I’m trying to make here is that the employment problem was in a way solved by fiat.

The signals the markets send out are more subtle, and there is no central database of jobs available and a matching service to the best of my knowledge. The internet perhaps aspires to this ideal.

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One Response to “The problem of unemployment”

  1. Amit Says:

    Perhaps its a matter of being in a place where the signals are stronger. Linked-in is abuzz with VPs and corporates seeking ideal candidates.
    Its the place to get noticed by a big other and perhaps meet the stalin of your dreams.

    The fields you are referring to I think are the mines in siberian cities.
    I also thought you might find this to be a relevant article from 1968 – Time magazine:

    http://www.time.com/time/magazine/article/0,9171,871075,00.html

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