Public Policies for Reducing Unemployment

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Table of Contents

Unemployment in the US
Policy details
Applying the rational choice model
Evaluation
Reference List

Unemployment in the US

In the recent times, the issue of unemployment has taken a new dimension in the United States. This follows from the premise that the number of unemployed persons continue to rise. Since the 2007-2008 economic crisis, the state of the US economy has been undesirable.

From that time, the US economy has failed to register meaningful growth or development. Although there were prospects that the economy would improve after the financial meltdown, the state has worsened. As Foroohar (2011) reckons, the Obama regime was on the verge of registering growth before discouraging data began emerging.

Firstly, the increase in GDP was below the expected levels, as future forecasts did not show signs of improvement. Further, the housing industry revealed that prices were declining to levels that have never been experienced. In addition, levels of consumer spending were declining.

When consumer spending falls, the manufacturing sector is negatively affected. Overall, unemployment rates are also likely to rise, as job creation continues to fall below the expected levels.

Policy details

After reflecting on the economic problems facing the United States, it is important to tackle the issue of unemployment in a bid to reign on its likely consequences. This is necessary since unemployment is becoming rampant among the youth in the United States. Towards addressing the concern, a policy option is proposed.

The policy seeks to empower the youth before they graduate from colleges and schools. In this regard, the policy proposes the introduction of the subject of entrepreneurship in all disciplines of study. This should pave way for teaching the youth ways of creating jobs instead of looking for jobs after graduating.

In order to make the policy successful, the State governments are required to set aside funding kitties. Such kitties will be required to advance soft loans to fresh graduates.

The funding kitties are also expected to hire investment consultants who are charged with the responsibility of extending advisory services to the fresh graduates. The graduates will be advised to form small enterprises instead of seeking the mainstream employment opportunities.

Applying the rational choice model

The rational choice model of decision making presents a major framework that aids in the understanding of the decision making process (Dye, 2010). In its simplest form, the rationality model hinges on the notion that a rational being would prefer the option that yields the most preferable returns (Allingham, 2002).

Bicchieri, (2003) observes that since the rational choice model promotes the gathering of all the necessary information, the policymakers are under an obligation to solicit for all relevant ideas. Such pursuit of information holds an important place in policy-making as it guarantees that the policy being made is valuable in addressing the needs of the people.

As illustrated in the paper, the problems facing the United States are diverse. In addition, the possible solutions to the problems are equally diverse.

As such, it is necessary to collect information on the problem, list all possible solutions, weigh the various approaches and make a decision based on the assessment of these attributes. In this regard, policy makers are empowered to take measures that are most effective at the lowest possible price.

Apart from the alarming rate of overall unemployment in the United States, the youth unemployment trends are worrying. It is observed by Foroohar, (2011) that a group of workers faces a danger of permanent relegation from the job market.

The worst aspect lies on the probable consequences of these unemployment statistics on the American community. Youth unemployment rests at twenty-four percent. Worse still, this group is not likely to secure jobs in the near future.

Even if it did, it would earn twenty percent less than the amount the preceding groups earned. Applying the model in this case, policy makers are able to assess the consequences of the issue and take appropriate action.

The model proposed would prove useful in both the decision-making and in the implementation process. In the decision-making process, the policy would be useful in deciding the options to take given a list of alternatives.

Similarly, in the implementation process, the policy implementers would be able to decide which implementation approaches to use given a pool to select from. As such, the policy model is significant both to the decision-making and the implementation processes.

Evaluation

Based on the rational choice model, people engage in activities after comparing competing alternatives. If there are competing alternatives, then the need for perfect information is mandatory. This is important as it allows the decision-makers ample time to make informed decisions.

However, in practice, it is often impossible to access all the necessary information regarding any case. Further, it is almost impossible to have complete understanding of an issue. This view is held in reference to the idea that human knowledge is often limited.

Consequently, the rational choice model is premised on a number of assumptions which are not easy to meet. The theory also holds that the decision makers are able to compare the costs and the benefits associated with the decisions taken.

Reference List

Allingham, M. (2002). Choice Theory: A Very Short Introduction. London: Oxford.

Bicchieri, C. (2003). “Rationality and Game Theory”, in The Handbook of Rationality. London: Oxford University Press.

Dye, T.R. (2010). Understanding public policy (13th ed.). Longman: Pearsonn Prentice Hall.

Foroohar, R. (2011, June 08). What U.S. Economic Recovery? Five Destructive Myths. Time Inc. Web.

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