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Employment strategies for Europe: lessons from Denmark and the Netherlands

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  • Barrell, Ray
  • Genre, Veronique

Abstract

Labour market reform has become a central policy issue for many European countries, and there are lessons to learn for the further development of the New Deal in the UK. We discuss reforms in Denmark and the Netherlands, and look at their implication for employment and earnings. The Dutch started a sequence of reforms in the early 1980s based around wage moderation. Real wages per person hour rose less rapidly than elsewhere in Europe, and employment rose more strongly. Other reforms made the labour market more flexible, and many part-time jobs were created. The Dutch can claim to have succeeded in improving their labour market preformance. The Danes started serious reforms in the 1990s, and individuals on social benefits have a right and a duty to be activated. Registered unemployment has fallen sharply as a result of these New Deal style policies, but only some of these individuals have moved into employment. Increased flexibility, moderate real wage growth and active support for job-seekers all seem to help reduce unemployment and raise employment. Evidence from Denmark and the Netherlands suggests that making work relatively more rewarding helps to reduce inactivity and unemployment.

Suggested Citation

  • Barrell, Ray & Genre, Veronique, 1999. "Employment strategies for Europe: lessons from Denmark and the Netherlands," National Institute Economic Review, National Institute of Economic and Social Research, vol. 168, pages 82-98, April.
    • Handle: RePEc:cup:nierev:v:168:y:1999:i::p:82-98_9
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    Cited by:

    1. Andrea Brandolini & Anthony B. Atkinson, 2001. "Promise and Pitfalls in the Use of "Secondary" Data-Sets: Income Inequality in OECD Countries As a Case Study," Journal of Economic Literature, American Economic Association, vol. 39(3), pages 771-799, September.
    2. Torben Heinze, 2011. "Mechanism-Based Thinking on Policy Diffusion. A Review of Current Approaches in Political Science," KFG Working Papers p0034, Free University Berlin.
    3. Gern, Klaus-Jürgen & Meier, Carsten-Patrick & Scheide, Joachim, 2003. "Higher economic growth through macroeconomic policy coordination? The combination of wage policy and monetary policy," Kiel Discussion Papers 399, Kiel Institute for the World Economy (IfW Kiel).
    4. Andrew Martin, 2000. "Social Pacts, Unemployment, and EMU Macroeconomic Policy," EUI-RSCAS Working Papers 32, European University Institute (EUI), Robert Schuman Centre of Advanced Studies (RSCAS).
    5. International Monetary Fund, 2008. "Republic of Poland: Selected Issues," IMF Staff Country Reports 2008/131, International Monetary Fund.
    6. Blanchflower, David G., 2001. "Unemployment, Well-Being, and Wage Curves in Eastern and Central Europe," Journal of the Japanese and International Economies, Elsevier, vol. 15(4), pages 364-402, December.
    7. Veronique Genre & Ramon Gomez Salvador & Ana Lamo, 2010. "European women: why do(n't) they work?," Applied Economics, Taylor & Francis Journals, vol. 42(12), pages 1499-1514.

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