Financial Management Appraisal of U.S. Administration Non-Keynesian Approach to Tackle Recession: Overemphasis on Employment of High Skilled-Cum-Aged Labour (Forming Minority) at the Expense of Majority Unskilled Labour Does Not Augur Well for Economic Recovery

Journal of Financial Management and Analysis Vol. 24 No.2 (Jul-Dec 2011)

Posted: 2 Apr 2012

See all articles by M. R. K. Swamy

M. R. K. Swamy

Om Sai Ram Centre for Financial Management Research

Date Written: March 30, 2012

Abstract

Inasmuch as the U.S. economy has been very slow in recovery from deep recession with unemployment hovering around 9 per cent due to the non-keynesian approach of the U.S. administration which has overemphasised on recruitment of high-skilled-cum-aged labour (forming the minority) at the expense of employment of low-skilled labour who form the majority of the population thus dwarfing the multiplier effect leading to sluggish effective demand and further slowing down of the U.S. economy. The strategy suggested in this study for fast recovery is to generate effective demand by creating employment for low-skilled-cum-less educated people who form the bulk of the population through establishment of medium-scale enterprises and to improve the quality of life by promoting large-scale affordable housing facilities for the majority poor (at the poverty level of annual income of US$ 22314 for a family of four persons) Americans for whom the marginal utility of one U.S. dollar is worth much more than to a millionaire for whom it is worth almost nothing.

Keywords: U.S. economy, Non-Keynesian approach, High-skilled labour, Majority poor, Unemployment

JEL Classification: E12, E24, J31, O14, O32, O51

Suggested Citation

Swamy, M. R. K., Financial Management Appraisal of U.S. Administration Non-Keynesian Approach to Tackle Recession: Overemphasis on Employment of High Skilled-Cum-Aged Labour (Forming Minority) at the Expense of Majority Unskilled Labour Does Not Augur Well for Economic Recovery (March 30, 2012). Journal of Financial Management and Analysis Vol. 24 No.2 (Jul-Dec 2011), Available at SSRN: https://ssrn.com/abstract=2032179

M. R. K. Swamy (Contact Author)

Om Sai Ram Centre for Financial Management Research ( email )

Mumbai
India

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