• Lukas Maslo University of Economics, Prague, Czech Republic
  • Zdenek Chytil University of Economics, Prague, Czech Republic


This paper presents a restatement of Keynes’s underemployment equilibrium as a center-equilibrium system. The authors present their centralequilibrium underemployment model with the income-balancing mechanism. The authors postulate the existence of a causal link between the fundamental uncertainty and the center-equilibrium underemployment. Two channels of fundamental uncertainty are suggested here to capture this causal link, the capital channel and the money channel. Drawing upon Davidson (2009, p. 333; 1991, p. 138), the authors identify the capital channel of fundamental uncertainty with the entrepreneurial risk and the money channel of fundamental uncertainty with the cash-flow-managerial risk of asset-liability mismatch. From this, the author infer a conclusion that the economic policy of flexible liquidity supply cannot be mixed up with an economic policy of governmental spending under a highly ambiguous term “money pumping”.


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How to Cite
Maslo, L., & Chytil, Z. (2015). UNCERTAINTY, MONEY AND UNDEREMPLOYMENT. European Scientific Journal, ESJ, 11(10). Retrieved from https://eujournal.org/index.php/esj/article/view/6150