Assumption without representation: the unacknowledged abstraction from communities and social goods

We have not clearly acknowledged the abstraction from unpriceable “social goods” (derived from communities) which, different from private and public goods, simply disappear if it is attempted to market them. Separability from markets and economics has not been argued, much less established. Acknowledging communities would reinforce rather than undermine them, and thus facilitate the production of social goods. But it would also help economics by facilitating our understanding of – and response to – financial crises as well as environmental destruction and many social problems, and by reducing the alienation from economics often felt by students and the public

Wage Theory, New Deal Labor Policy, and the Great Depression: Were Government and Unions to Blame?

A growing number of economists blame the length and severity of the Great Depression on factors that rigidified wage rates, raised production costs, and interfered with the market allocation of labor. The target of their critique is President Franklin Roosevelt’s New Deal labor program, which they portray as creating a series of large negative supply shocks through encouragement of unions, minimum wages, unemployment insurance, and other anticompetitive industrial relations practices. The author uses a combination of institutional and Keynesian theory to present the other side of the story. Drawing principally from the works of J. R. Commons and J. M. Keynes, he develops both a spending and productivity rationale for stable wages during the Great Depression and demonstrates that the New Deal’s interventionist labor program was on balance necessary and beneficial. He also highlights the neglected macroeconomic dimension of industrial relations theory and policy