Krugman on Unemployment

Via Brad deLong is Paul Krugman’s introduction to the General Theory.  Point Three in Krugman’s stripped down version is:

3. Government policies to increase demand, by contrast, can reduce unemployment quickly.

Well, that would certainly explain why unemployment recovered so quickly during the Great Depression.  Or perhaps, despite the fact that "all it took to get the economy going again was a surprisingly narrow, technical fix,"  we just weren’t trying hard enough.  See also Tyler’s comments.


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