Marx-Keynes on involuntary unemployment and alternative labour market indicators

Abstract

The paper revisits Marx and Keynes' notion of involuntary unemployment and discusses how to account for this phenomenon by developing a series of alternative labour market indicators. Both Marx and Keynes treated the 'reserve army of labour' or 'involuntary unemployment' phenomenon as a consequence of the long-run capital accumulation and as an inevitable outcome of the deficient decentralised capitalist market economy. The goal of this paper is to survey the latest developments in labour force statistics to see whether a series of alternative indicators of labour markets fare well with Marx and Keynes' analysis of involuntary unemployment. The survey in this paper shows that the labour (under-)utilisation framework that the International Labor Office (ILO) has proposed is one of the broadest measures of labour market performance, and that it allows us to examine the relative size and different type of the presence of the reserve army of labour and involuntary unemployment in our contemporary economies.