Jobs for agricultural workers in the process of building new rural areas in Hanoi Capital

capital, as we assumed before. The quantity of labour demanded falls relative to the magnitude of total capital, and falls in an ever-increasing progression with the increase of that magnitude. In fact, with the increase of total capital, its variable part, or the labour-power incorporated in it, also increases, but in a constantly decreasing proportion [4, pp. 886-887].

Studying the surplus population in the capitalist mode of production, he made a judgment about the population of the capitalist mode of production. He argued that, while the working class creates the accumulation of capital, and to the extent that it succeeds in doing so, the working class itself also creates the means of dismissing itself or turning itself into a relative surplus population, that is, the unemployed. He wrote, “together with the accumulation of capital which it itself has engendered, the working population also produces on an ever-increasing scale the means of making itself a relative surplus population.” This surplus population is of great importance for the development of capitalist production, ensuring the necessary permanent labor for society and also an important lever for promoting exploitation, coexistence and inevitability of capitalist production. He wrote:

But if surplus population of workers is the necessary product of accumulation, or of the development of wealth on a capitalist basis, then this surplus population, on the contrary, becomes a lever of capitalist accumulation and even a condition for the existence of the capitalist mode of production. This surplus population forms a ready-made industrial reserve army, which also belongs absolutely to capital, as if capital had paid for its maintenance. This industrial reserve army supplies the changing needs of the increase in the value of capital with a vast source of human power.

Maybe you are interested!

are also now readily exploitable, and are not subject to the limits of actual population growth. [4, p. 891]

In relation to the form of relative surplus population, he argued that relative population (unemployment) always has three forms: mobile, latent and stagnant. The first form includes workers who are sometimes pushed out of work, sometimes drawn in relatively large numbers into work even when the number of jobs increases. The second form includes surplus population in agriculture, where workers are like those who are working but not fully employed, when the opportunity arises they move to urban areas, or look for other jobs. The third form includes people who work irregularly, that is, are often unemployed for a long time. This form of stagnant unemployment creates a class of vagrants, vagrants, criminals, thereby causing social instability.

* The theory of job creation and unemployment of some modern economists

- Keynes's general theory of employment, interest and money :

JM Keynes is the founder of the theory of employment and state-regulated capitalist economics. He is considered the most outstanding economist of the 20th century.

His work "The General Theory of Employment, Interest and Money" published in 1936 [32] deals with the issue of employment and determines which factors determine the level of employment. J.M.Keynes's employment theory is synthesized from critical analysis and comparison with the neoclassical employment theory of supply and demand equilibrium. He argues that effective demand combined with full employment is a special case that can only be realized if consumption and investment desire are constantly increased at a certain rate.

When studying the relationship between income, savings, investment consumption and

employment, he argued, the scale of savings and investment were not compatible with each other,

cannot create equilibrium, because they have significant fluctuations in the overall production volume and employment. He disagrees with the view of reducing wages to increase employment, according to him, reducing wages will lead to a decrease in income, a decrease in purchasing power and a narrowing of the consumer market, thereby not promoting production development and employment will not increase, he stated that the cause of crisis and unemployment is due to the lack of efficiency of the demand set, he affirmed that it is necessary to increase the overall size of the demand set. The lack of efficiency of the demand set will lead to a decrease in production, the emergence of crisis and unemployment.

He also pointed out that macroeconomic regulation to solve employment and increase income requires the use of economic policy tools to encourage investment and reduce savings. Only then can the crisis and unemployment be resolved. By expanding demand, the state will contribute to reducing unemployment. This is the first time in economic science that he has demonstrated and identified the basic directions of the market economy, in which the meaning of state intervention in its operation is being applied by many countries.

In his study of the impact of interest rates, J.M. Keynes asserted that interest rates are closely related to investment and employment. He explained that the more money is put into circulation, the lower the interest rate will be. Therefore, to stimulate investment, it is necessary to find measures to reduce interest rates. Reducing interest rates will stimulate investment and thus expand employment, limiting unemployment. He asserted that high interest rates are one of the most important causes of unemployment.

In his research on unemployment, he mentioned three forms. In addition to the two forms of structural unemployment and voluntary unemployment (i.e. unemployment due to moving from one enterprise to another and due to refusing unreasonable wages) proposed by classical theory, he argued that there was a third form, which was forced unemployment. This form of forced unemployment was due to the aggregation of labor supply.

of workers willing to accept the current wage but due to

narrowing production so can not get jobs.

JMKeynes paid special attention to establishing the relationship between the volume of investment, consumption and national income. He used the concept of investment multiplier to prove and determine that increasing or decreasing investment can bring about many times increase or decrease in GDP. The investment multiplier shows the relationship between increasing investment and increasing income. It tells us that when there is an additional amount of aggregate investment, income will increase by an amount equal to K times the increase in investment.

Changes in investment value will create a chain reaction, increasing employment in the invested sectors, and at the same time affecting the increase in investment and employment in other sectors. According to Keynes, every increase in investment leads to an increase in the demand for additional workers, the demand for means of production, thus increasing consumer demand, increasing prices, and increasing employment for workers. All of that increases income. In turn, increased income is the premise for increased new investment. Thus, the investment multiplier has a chain reaction, it amplifies national income. That process is the process of increasing investment increasing income; increasing income increasing new investment; increasing new investment increasing new income. The multiplier process magnifies income.

To facilitate increased investment and employment, JMKeynes proposed the following measures:

- First, reduce interest rates. Reducing interest rates will allow increased credit for production, increasing absolute investment.

- Second, socialize investment, invest in the right places and provide credit to enterprises from the national fund, and the state will buy back goods and services from it.

- Third, stimulate consumption. Find ways to continuously increase consumption.

consumption must exceed investment.

From the above studies, it can be seen that, according to J.M. Keynes, to create jobs and reduce unemployment, it is necessary to increase consumer demand and investment. Increasing consumer demand and investment will stimulate the amount of money stored in circulation, thereby helping to expand the scale of the economy and increase income. And in turn, increased income will increase investment, increase employment and increase consumption.

However, the JMKeynes model has the following concerns:

- It is only likely to be true for countries with developed economies and reasonable economic structures. As for underdeveloped countries, the fundamental difficulty in increasing output and creating jobs is not that aggregate demand is not high enough, but rather that it is due to structural and institutional limitations in the supply of investment capital. Furthermore, due to the small scale of the economy in developing countries, stimulating consumption will be very difficult. The national budget is poor, the economic potential is small, and implementing loans for development is very difficult, while if the state increases printing money for consumption, it will cause prices and inflation to increase continuously.

- In stimulating demand, if too much attention is paid to stimulating urban areas, it will increase the flow of population from rural areas to urban areas to earn a living, which will increase the pressure to find jobs in urban areas. Thus, stimulating demand to increase employment and reduce unemployment in urban areas will not achieve the set goals.

- Philip's Philip curve theory :

In the 1970s, high inflation appeared in the world economy, and it became a common factor in the economies of developing countries. Studying the dependence between inflation and unemployment, Professor Philip (British) discovered an inverse correlation between the rate of inflation and the level of unemployment. He introduced this dependence in the form of a so-called "simple arc" and it was later adjusted and named "Philip curve".

The Philip curve theory holds that the higher the inflation rate, the lower the unemployment rate and vice versa, full employment cannot exist without unemployment. However, the reality of economic development during the Great Depression was

The ongoing crisis from 2008 to present shows that inflation will lead to increased production costs, increased costs will lead to increased prices, reduced real GDP volume and increased unemployment.

When studying the correlation between unemployment and inflation according to the Philip curve theory in the Russian economy during the transition period after 1991, Russian economists discovered that it was not so. In Russia, unemployment increased along with the increase in inflation, and curbing inflation helped the Russian economy curb unemployment. A matter of concern is that, in the Philip curve theory, he did not evaluate which is more worrisome, inflation or unemployment? Many scientists believe that unemployment is the more worrisome problem. Accepting inflation while reducing unemployment would be better for the economy. And many scientists also believe that the inverse relationship between inflation and unemployment can only be true in the short term, and rarely happens in the long term.

- W.Arthur Lewis's dualistic theory :

W. Arthur Lewis, an economist who won the Nobel Prize in 1979, proposed the dual economic model. Later, economists John Fei and Gustar Ranis applied it to analyze the growth process in developing countries. The basic idea of this model is to transfer surplus labor from traditional industries to modern industries invested by foreign capitalists in backward countries. This process will create conditions for backward countries to develop their economies. Because in the traditional economy, land is limited, labor is surplus, and this surplus labor has no jobs. In other words, they have no wages and income. Therefore, when there is a higher wage in this area, investors will immediately have an unlimited source of labor from agriculture. Because wages are only paid according to marginal productivity, the rest will belong to investors, from which investors will quickly recover their capital, make profits and continue to expand reproduction.

According to them, the transfer of labor from agriculture to industry has two effects:

+ First, transfer some labor out of agriculture, leaving only enough labor to create a fixed output. Thereby increasing output per capita while creating jobs for the surplus labor in agriculture.

+ Second, this move will create conditions to increase profits in the industrial sector, boosting economic growth in general.

Thus, according to this theory, developing countries can achieve growth by focusing on developing the modern economic sector, the industrial economy without paying attention to the traditional economic sector. And the growth rate of the modern sector also determines the growth rate of the economy in general.

Lewis's dualism theory has been continued to be studied and analyzed by many other famous economists (such as G.Ranis, J.Fei, Harris). Their argument comes from the ability to develop and absorb labor in the modern industrial sector. This sector has many possibilities to choose production technology, including labor-intensive technology, so in principle, it can absorb all the surplus labor of the agricultural sector. However, the migration of labor is assumed to be determined by the income gap between workers in the two economic sectors (the authors assume that the income of industrial workers is at least 30% higher than that of workers in the agricultural sector). Thus, the industrial sector can only attract agricultural labor when there is a surplus of agricultural labor and the wage gap between the two sectors is large enough. But when the surplus agricultural labor source is increasingly depleted, the ability to maintain this wage gap will become increasingly difficult. By then, the continued migration of agricultural labor to industry will reduce agricultural output and cause agricultural prices to rise, and with it a corresponding increase in wages in the industrial sector.

This industrial sector places a limit on the additional demand for labor in this sector. Thus, technically, although the industrial sector can absorb an unlimited amount of surplus labor from the agricultural sector, in terms of income and elasticity of supply and demand, the industrial sector's ability to absorb labor from the agricultural sector is limited.

- Todaro's theory of labor mobility :

Another line of analysis based on the dualism theory of W. Arthur Lewis is to analyze the possibility of labor mobility from rural areas (agricultural sector) to urban areas (industrial sector), of which Todaro is a typical example. The process of labor mobility only takes place smoothly when the total supply of labor from agriculture matches the total demand in the industrial sector. This labor mobility depends not only on the income gap but also on the probability of finding employment for agricultural workers.

Todaro's theory studies labor migration on the basis of income and wage regulation between different economic sectors. According to him, workers in rural areas have low average income. They choose to move labor from low-income areas to urban areas with higher income. Thus, the process of labor migration is spontaneous, depending on the choices and decisions of individuals. This makes the supply and demand of labor in each region unstable, making it difficult for the government to manage labor and population.

This model shows that in agricultural countries that want to promote growth, they need to focus on development, first of all, the agricultural sector and the rural economy, to create a market for industrial and service development. This is even more meaningful in the current period when the global economic crisis is slowing down the economic growth rate, many economic sectors are barely developing. Therefore, one of the measures to get out of the crisis is to focus on developing the agricultural sector and the rural economy.

Jobs for agricultural workers in the process of building new rural areas in Hanoi Capital - 6

Comment