ABSTRACT
John Maynard Keynes's first argument shows that unemployment can be involuntary in the sense that it arises from the money wage being too high in view of the prices of the products, and that for institutional reasons or reasons of rivalry there will be no willingness on the part of workers to allow money wages to be reduced. His second argument shows, however, that even if workers accepted a reduction of money wages, this would not necessarily, or probably, lead to a reduction in their real wages. Technology may, on the contrary, dictate one lorry, one loom or one type-setting machine per worker, and if so, unemployment of machines will keep step with that of workers. Then the marginal product of the employed workers need not reflect a changed relation of existing equipment to employed workers, but only the unchanged relation of employed equipment to employed workers.
