Trade

Lionel Jospin recently took power in France with a promise to reduce the workweek from 39 to 35 hours. Why? Because of the latest popular economic fallacy: the theory of global glut, or the belief that there is too much output and not enough work to go around in today’s hyper-efficient economy. But productive capacity in the advanced nations is not growing much faster than it was during the last two decades, and more slowly than in the 1950s and 1960s. People will always find new wants, and the newly industrializing countries are consuming even more than they produce. As Marx could have told you, capitalism can go on accumulating capital — and producing more goods and services — forever.