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Article
April 17, 1948

The Guarantee of Annual Wages

JAMA. 1948;136(16):1072. doi:10.1001/jama.1948.02890330062037

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Abstract

The Brookings Institution offers here a consideration of a proposal to improve the lot of persons who work for wages: emotional erosion may be the result of workers fear of losing their jobs. However, a measure which meets the needs of one group may injure the interests of other groups. The author explains that guaranteed annual wages are suitable for certain industries—chiefly those with predictable seasonal variation in productivity. But to force all industries into the mold would require something akin to guaranteed production plans for each industry if member firms are to stay afloat. The minimum result would be the creation of new rigidities in a price system which works best when kept flexible and new monopolistic elements in an economy that works best without dominant agencies. The maximum result would be an approach to a fully planned industrial production. With either result. consumers would be offered only the

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