Introduction

Two recent alternative perspectives on the role of unemployment are the social structure of accumulation (SSA) approach in the United States and the regulation approach in France. Both approaches view unemployment not merely as a proxy for the excess labor supply, but as a reflection of the social and institutional conditions supporting the labor market. The argument that unemployment (the reserve army of labor) has a dual role can be traced back to Marx (1976 [1867]). Unemployment, he asserted, “compels those who are employed to furnish more labor” (p.793) and “puts a curb on their pretensions” to higher wages (p. 792). Kalecki (1943) went a step further: persistent full employment creates “political tension” over wage increases and improvements in working conditions. This leads to a growth of the political power of the working class and an eclipse in the social position of the employing class. Hence, from the employers' viewpoint, the pressure of the unemployed is indispensable as “an integral part of the ‘normal’ capitalist system” (Kalecki, 1943, p. 326). Recent years have seen the diffusion of this classical insight and its application to empirical studies on wages and productivity (Boddy and Crotty, 1975; Kahn, 1980; Oster, 1980; Green and Weisskopf, 1990).

This chapter examines the reserve army effect from a perspective that integrates propositions from the SSA and regulation approaches.