ABSTRACT
In the first Guide to Post Keynesian Economics, Eileen Appelbaum (1978: 100) offered a simple and clear summary of the Post Keynesian approach to labor economics. It largely follows Keynes in its approach to the demand for labor, and the segmented labor market theorists in its approach to the supply of labor. A Post Keynesian analysis of this sort leads to a conclusion radically different from the orthodox, neoclassical theory. This is that neither the demand for labor nor the supply of labor depends on the real wage. It follows from this that the labor market is not a true market, for the price associated with it, the wage rate, is incapable of performing any market-clearing function, and thus variations in the wage rate cannot eliminate unemployment.
