Full employment

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Full employment is an economic situation in which there is no unemployment or no cyclical or deficient-demand unemployment. The definition of full employment differs between economists. Full employment can entail the disappearance of all unemployment and a 100% employment-to-population ratio. For other economists full employment can occur even when structural and frictional unemployment remain. For instance, workers who are "between jobs" for short periods of time as they search for better employment are not counted against full employment, as such unemployment is frictional rather than cyclical. An economy with full employment might also have unemployment or underemployment where part-time workers cannot find jobs appropriate to their skill level, as such unemployment is considered structural rather than cyclical. Full employment marks the point past which expansionary fiscal and/or monetary policy cannot reduce unemployment any further without causing inflation. Other economists view...

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