The Costs and Benefits of a Job Guarantee: Estimates from a Multi-Country Econometric Model

19 Pages Posted: 31 Dec 2012

See all articles by Scott T. Fullwiler

Scott T. Fullwiler

Wartburg College; Bard College - The Levy Economics Institute

Date Written: May 15, 2012


The Job Guarantee (Mosler 1997-8, Mitchell and Muysken 2008, Wray 1998; hereafter, JG) is a policy proposal designed as an alternative to the neoclassical natural rate of unemployment or non-accelerating inflation rate of unemployment (NAIRU). Whereas that approach presumes that some positive percentage of the total labor force must be sustained as involuntarily unemployed in order to avoid accelerating inflation, the JG literature argues instead that a buffer stock of the employed can enable true full employment without compromising price stability, with the additional benefit of mitigating the economic and social costs of involuntary unemployment. The purpose of this paper is to provide such estimates derived for the first time from a model that places the U. S. economy in a global context with dozens of other countries. To do this, the JG is simulated within the multi-country version of the Fairmodel (Fair 2004).

Keywords: job guarantee, employer of last resort, automatic stabilizers, fiscal policy, unemployment, simulation

JEL Classification: E6, E62, E32, E37

Suggested Citation

Fullwiler, Scott T., The Costs and Benefits of a Job Guarantee: Estimates from a Multi-Country Econometric Model (May 15, 2012). Available at SSRN: or

Scott T. Fullwiler (Contact Author)

Wartburg College ( email )

222 Ninth St. NW
Waverly, IA 50677
United States

Bard College - The Levy Economics Institute ( email )

Annandale-on-Hudson, NY 12504-5000
United States

Register to save articles to
your library


Paper statistics

Abstract Views
PlumX Metrics

Under construction: SSRN citations while be offline until July when we will launch a brand new and improved citations service, check here for more details.

For more information