Question

Explain the meaning of the Involuntary unemployment.

Answer 1

Hey buddy here is ur answer !!

》Involuntary unemployment occurs when a person is willing to work at the prevailing wage yet is unemployed. Involuntary unemployment is distinguished from voluntary unemployment, where workers choose not to work because their reservation wage is higher than the prevailing wage.

》》BE BRAINLY 《《

Answer 2

An involuntary unemployment means a situation in which all able persons who are willing to work at the prevailing wage rate do not get work.

Such people are (i) physically and mentally fit to work and are also (ii) willing to work at the going rate but are out of Job.

Thus, their unemployment is involuntary (i.e., not voluntary) because they are rendered unemployed against their wishes.

This type of unemployment is due to deficiency of aggregate demand sufficient to ensure full employment. It indicates excess supply of labour which the rigid wage-rate has failed to eliminate. In short, if involuntary unemployment exists, the economy cannot be said to be at the level of full employment equilibrium. It will indicate under-employment equilibrium in the economy.