Open Labor Market Operations

Forthcoming in 62 Challenge __ (2019)

Cornell Legal Studies Research Paper No. 19-02

18 Pages Posted: 10 Dec 2018 Last revised: 20 Mar 2019

Date Written: December 10, 2018


I offer both a moral and a macroeconomic case for institutionalizing continuous public operations in labor markets analogous to continuous Fed operations in money markets. The macroeconomic case stems from prevailing wage and salary rates’ status as what I call ‘systemically important prices’ on a par with prevailing money rental – i.e., ‘interest’ – rates. The pervasive importance of these rates requires ongoing public action to confine fluctuation within a reasonably narrow band. The moral case sounds in the need to counteract the commodification of citizens in human rental markets, which is what ‘labor markets’ in the absence of collective citizen action amount to. A permanent ‘public option’ in the realm of labor-hiring will effectively constitute a ‘fallback’ collective self-employment option, the ‘self-pay’ and workplace standard conditions of which will become benchmarks economy-wide and render all labor effectively ‘free labor’ in the 19th century ‘labor republican’ sense of the phrase.

Keywords: Commodification, Department of Labor, ELR. Employer of Last Resort, Fed, Federal Reserve, Financial Regulation, JG, Job Guarantee, Open Market Operations, Labor, Labor Standards, Macroprudential Regulation, Monetary Policy, Prices, Salaries, Systemic Risk, Systemically Important Prices, Wages

Suggested Citation

Hockett, Robert C., Open Labor Market Operations (December 10, 2018). Forthcoming in 62 Challenge __ (2019), Cornell Legal Studies Research Paper No. 19-02, Available at SSRN: or

Robert C. Hockett (Contact Author)

Cornell University - Law School ( email )

Myron Taylor Hall
Cornell University
Ithaca, NY 14853-4901
United States

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