ABSTRACT
The preceding chapters have laid the basis, and in some measure fore cast, the theory of employment being presented here by outlining an insensitive-price theory of economic adjustment and a monetary theory of aggregate demand. The first theory explains why changes in aggre gate demand could be expected to work themselves out through changes in both prices and employment. The second theory explains the level of aggregate demand in terms of the relation between the demand for money and the stock of money outstanding. In combina tion these theories can explain the level of employment in terms of the demand for and the stock of money outstanding, and thereby provide for what might be called a monetary theory o f employment.
