Full Employment: A Survey of Theory, Empirics and Policies

ABSTRACT The concept of full employment is associated with diverse economic, political and social aspects. We provide a survey of theory, empirics and policy issues related to full employment. In doing so, we tie together aspects of full employment regarding definitions, theoretical perspectives, empirical measurements, policy debates and real‐world policy programmes. We distinguish concepts of full employment that provide systematic links to price stability, minimum unemployment and maximum employment approaches and the unfilled vacancies perspective. Furthermore, we provide and discuss different empirical measures of full employment for selected economies, and we propose a new full employment typology to better understand and categorise contributions in the literature. Based on our findings, we argue that conceptualising and measuring full employment is not merely a technical task but inevitably involves normative judgements. Finally, we discuss avenues for future research.