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Has the tradeoff between productivity gains and job growth disappeared?

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  • Paul Cavelaars
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    Abstract

    Policymakers' efforts to boost trend output growth may be hampered by the presence of a tradeoff between productivity gains and job creation. This paper presents empirical evidence that the negative relationship between productivity growth and employment growth that prevailed in the 1960s and 1970s has disappeared since then. This finding is robust to using alternative measures and including other explanatory variables. The improved tradeoff may be good news for policymakers who aim at raising the 'speed limit' of the economy.

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    File URL: http://www.dnb.nl/binaries/ms2003-12_tcm46-147342.pdf
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    Bibliographic Info

    Paper provided by Netherlands Central Bank, Monetary and Economic Policy Department in its series MEB Series (discontinued) with number 2003-12.

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    Date of creation: Oct 2003
    Date of revision:
    Handle: RePEc:dnb:mebser:2003-12

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    Related research

    Keywords: productivity; employment; cross-country analysis;

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    1. Giuseppe Nicoletti & Stefano Scarpetta & Olivier Boylaud, 2000. "Summary Indicators of Product Market Regulation with an Extension to Employment Protection Legislation," OECD Economics Department Working Papers 226, OECD Publishing.
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    Cited by:
    1. Henri de Groot & Richard Nahuis & Paul Tang, 2004. "Is the American model Miss World? Choosing between the Anglo-Saxon model and a European-style alternative," CPB Discussion Paper 40, CPB Netherlands Bureau for Economic Policy Analysis.

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