Achieving Full Employment: History, Theory and Policy

The objective of full employment emerged as a response to periodic crises in capitalism and the political instability which became a hallmark of the first half of the Twentieth Century. The Great Depression (1929–1932) represented a major influence on post-Second World War policy, with economists such as John Maynard Keynes and William Beveridge exerting influence on government policies in a number of Western economies. While, in the aftermath of the Great War, there had been a desire to return to normality, the period from 1945 was marked by a desire to break from the disastrous economic policies and doctrine which had typified the inter-war years. In the context of the rise of the USSR and the emergent threat of Communism in China, there was an establishment priority to protect capitalism from such seismic shifts. Unemployment, in particular, was perceived as a social blight which threatened the social order.