Title: Full employment and ecological sustainability: comparing the NAIRU, Basic Income, and Job Guarantee approaches

Authors: Philip Lawn

Addresses: School of Business Economics, Flinders University, GPO Box 2100, Adelaide, SA 5001, Australia

Abstract: One of the central themes of this joint conference – A Future that Works: Economics, Employment, and the Environment – is how to achieve full employment and ecological sustainability. This paper assesses three alternative macroeconomic policy approaches in terms of how well they resolve these two policy objectives. The three approaches assessed are: the NAIRU (non-accelerating inflation rate of unemployment) approach to macroeconomic policy setting; the Basic Income approach (guaranteed income for all); the Job Guarantee approach (employer of last resort). It is argued that: the NAIRU approach fails on both fronts; the Basic Income approach has the potential to improve distributional equity – though not as effectively as the Job Guarantee – but does not ensure full employment or ecological sustainability; the Job Guarantee is the best means of achieving full employment but, in order to bring about ecological sustainability, needs to be supplemented by the imposition of natural resource throughput constraints.

Keywords: full employment; ecological sustainability; macroeconomic policy; sustainable development; natural resource throughput constraints; job guarantee; basic income; NAIRU; ecological economics.

DOI: 10.1504/IJEWE.2005.007491

International Journal of Environment, Workplace and Employment, 2005 Vol.1 No.3/4, pp.336 - 353

Published online: 27 Jul 2005 *

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