Yahoo Answers is shutting down on May 4th, 2021 (Eastern Time) and beginning April 20th, 2021 (Eastern Time) the Yahoo Answers website will be in read-only mode. There will be no changes to other Yahoo properties or services, or your Yahoo account. You can find more information about the Yahoo Answers shutdown and how to download your data on this help page.

FlameCow asked in Social ScienceEconomics · 8 years ago

Can cyclical unemployment ever be zero?

If so, then does unemployment have to be 0%?

2 Answers

Relevance
  • 8 years ago
    Favorite Answer

    First you have to determine potential output from PPF and for that you mist know productivity, labor employed and capital used. Historical data could be available for K and L but to relate to A is difficult as there is no standard measure. Well, you can assume/know cumulative effect of automation and trained labor and better infrastructure like transport, banking, laws etc. and then can assert value of A.

    Know what I am arriving at ? All these numbers we read are fake.

    When government says they cannot reduce %U below 5% that being NAIRU , accept that.

    Those theorists in universities ,after all, are fed by companies who always want some unemployment.

  • Anonymous
    8 years ago

    Yes, when business cycle is on the peak. But unemployment will not be zero, because seasonal, structural and frictional unemployment is still there.

Still have questions? Get your answers by asking now.