How does the labour market effect capitalism?
In many ways, the labour market is the one that affects capitalism the most. The right-libertarian assumption (like that of mainstream economics) is that markets clear and, therefore, the labour market will also clear. As this assumption has rarely been proven to be true in actuality (i.e. periods of full employment within capitalism are few and far between), this leaves its supporters with a problem — reality contradicts the theory. The theory predicts full employment but reality shows that this is not the case. Since we are dealing with logical deductions from assumptions, obviously the theory cannot be wrong and so we must identify external factors which cause the business cycle (and so unemployment). In this way attention is diverted away from the market and its workings — after all, it is assumed that the capitalist market works — and onto something else. This “something else” has been quite a few different things (most ridiculously, sun spots in the case of one of the founders
