Sample Solution

employment for everyone.” His objective for unemployment is “the sort of level we are facing in wartime less than 1 per cent.” Keynes strongly denied that the fundamental cause of unemployment is wage and price rigidities (Higgs, 1995). He said that once full employment is reached then markets can work freely. He also claimed in his book “The General Theory of Employment, Interest and Money” that socialization of investment incorporating public-private partnership, might be needed to secure full employment (Keynes, 1936). He opposed to an economy which generated far less than it could, a problem which left millions of people unemployed in economies where work is not only social status, but source of revenue.
The significant impact of Keynesianism throughout the World War II is widely attributed to the obliteration of mass employment, which occasioned in an extreme influence and spread of Keynesianism connecting to the government’s duty of upholding full employment.( (Higgs, 1995) For example, in 1944, the UK government espoused a plan towards ensuring a “high and stable level of employment” as a part of its employment policy (Jstor.org, 2012). In the USA, the Employment Act of 1946 displayed the commitment of the Federal Government in embracing measures to accomplish “maximum employment, production and purchasing power”. The dedications by both the UK and the USA were of ultimate importance concerning the spread and influence of Keynesianism, even though they were lacking the ways of reaching the stated aims of maximum employment (Jstor.org, 2012)
When looking at the case of the United Kingdom, Keynes had an opinion that the target 3 per cent of average employment was tremendously optimistic and said that there was no possible harm in putting it into practice. It is obvious that the post-war success enjoyed by the United Kingdom and the United State can be credited to the stabilization policy of Keynesianism. James Tobin, the most well-