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Accounts Quote by Kenneth Arrow

“I don't believe that unemployment is all voluntary, by anticipation of future wage movements or this sort of thing. I know you can modify the models by taking into account the indivisibilities, but I don't really think that people are voluntarily unemployed.” quote by Kenneth Arrow
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“I don't believe that unemployment is all voluntary, by anticipation of future wage movements or this sort of thing. I know you can modify the models by taking into account the indivisibilities, but I don't really think that people are voluntarily unemployed.”

Kenneth Arrow

About This Quote

Source Paper: “Unemployment and the Labor Market” (1970) discussing voluntary vs involuntary unemployment

Unemployment is rarely a free choice; structural factors and indivisibilities limit true voluntariness.

In simple terms: Jobs are often not chosen freely.

Key Takeaway

Recognize systemic barriers to work.

Themes

economics labor market voluntariness policy inequality

Mood

analytical concerned

Type

economic policy

When to use this quote

  • welfare design
  • job training programs
  • minimum wage debates

Key Concepts

search theory matching frictions policy design

Questions to Reflect On

  • What policies best reduce involuntary joblessness?
  • How do personal circumstances affect labor decisions?
A Different Perspective

Assumes rational agents ignore personal constraints.

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