chapter  8
THE CONCEPT OF EQUILIBRIUM AND THE REALITY OF UNEMPLOYMENT
ByBruno Jossa
Pages 15

The main reason why the theory of general economic equilibrium for many economists is, at most, a point of departure and certainly not the point of arrival for every theory that wishes to explain the reality of the world in which we live is that it is not able to explain the persistence of unemployment (cf. Hahn 1986: 1). Persistent unemployment, we need to say, is a phenomenon that belongs to the very nature of capitalist economy, as evidenced in the 1930s, 1950s and 1960s in many different countries throughout the world, but it has never appeared so incurable as in the last decade, the 1980s. And, as the more aware economists view it, if unemployment is so persistent, for so long and in such a noticeable way, it cannot reasonably be seen as a phenomenon of disequilibrium without depriving the theory of equilibrium of any interpretative value.