Wage cut as a solution of unemployment in classical theory is suggested by:

Question

Quizplus · Accepted Answer

Classical theory, particularly as articulated by economists like A.C. Pigou, suggests that wage cuts can help reduce unemployment. This is based on the idea that lower wages would make it cheaper for businesses to hire more workers, thus reducing unemployment levels. Keynesian economics, on the other hand, often argues against wage cuts as a solution to unemployment, emphasizing instead the role of aggregate demand.

Wage Cut as a Solution of Unemployment in Classical Theory