© 2017

The Job Guarantee and Modern Money Theory

Realizing Keynes’s Labor Standard

  • Michael J. Murray
  • Mathew Forstater

Part of the Binzagr Institute for Sustainable Prosperity book series (BISP)

Table of contents

About this book


The contributors to this edited collection argue that a flexible Job Guarantee program able to react to an economy’s fluctuating need for work would stabilize the labor standard, the value of employment in relation to money. During economic downturns, the program would expand to provide more public sector jobs in response to private sector layoffs. It would then contract when economic growth offered private sector employment opportunities. This flexible full employment program would create a balanced, perpetually active labor force, providing the macroeconomic stability necessary to define a functioning labor standard.

Just as the gold standard measured the worth of money against gold reserves, John Milton Keynes argued, so a labor standard ought to measure the value of money in terms of its labor equivalent. However, he failed to account for the fact that, unlike a gold standard, a labor standard does not have any kind of surety that money will continue to match its value in paid work over time. Together, the contributors argue that full employment would provide this missing security and allow authorities to define the value equivalencies of money and labor, the way that money once represented its exact equivalent in gold.


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Editors and affiliations

  • Michael J. Murray
    • 1
  • Mathew Forstater
    • 2
  1. 1.Bemidji State UniversityBemidjiUSA
  2. 2.University of MissouriKansas CityUSA

About the editors

Michael J. Murray is Associate Professor of Economics at Bemidji State University, USA, and a Research Scholar at the Binzagr Institute for Sustainable Prosperity. He co-edits the American Review of Political Economy and is co-editor of four volumes on the job guarantee. Murray's research focuses on public policies targeting the dual problems of unemployment and poverty. He also studies production theory, structural and technological change, and its impacts on employment.

Mathew Forstater is Professor of Economics at the University of Missouri-Kansas City, USA; Research Director at the Binzagr Institute for Sustainable Prosperity; and Research Associate at the Levy Economics Institute of Bard College, USA. He is engaged in projects on employment and federal budget policy, using a historical, interdisciplinary approach to examine the potential role of full employment policies in the face of deficit reduction and continuous technological change.


Lorenzo Esposito, Bank of Italy, Milan, Italy
Scott Fullwiler, University of Missouri-Kansas City, USA
Rohan Grey, Columbia Law School, USA
James Juniper, University of Newcastle, Australia
Fadhel Kaboub, Denison University, USA
Giuseppe Mastromatteo, Catholic University of the Sacred Heart, Italy
Scott L.B. McConnell, Eastern Oregon University, USA
William Mitchell, University of Newcastle, Australia
Edward J. Nell, The New School, USA
Timothy P. Sharpe, Nottingham Trent University, UK
Martin J. Watts, University of Newcastle, Australia

Bibliographic information