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Incomes Policies and the Norwegian Economy 1973-93

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    Abstract

    During the second half of the 1970s there was massive government interference in wage and price formation in Norway. Incomes policies changed in the first half of the 1980s - the hey days of "dynamic tax policies" in Norway - and during the second half of the 1980s new direct interventions in wage formation were implemented. These episodes of incomes policies are discussed and their empirical importance is assessed in the econometric price and wage equations of a large scale macroeconometric model of the Norwegian economy. Model simulations show that while price regulations generally led to an expansion of output and loss of cost competitiveness, wage regulation produced both output expansion and gain in competitiveness. The dynamic tax policy implemented in Norway was less successful and led to both higher prices and wages as well as lower output.

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    File URL: http://www.ssb.no/publikasjoner/DP/pdf/dp-192.pdf
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    Bibliographic Info

    Paper provided by Research Department of Statistics Norway in its series Discussion Papers with number 192.

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    Date of creation: Apr 1997
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    Handle: RePEc:ssb:dispap:192

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    Keywords: Incomes policies; macroeconomic models.;

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    1. Aaberge, Rolf, et al, 2002. "Income Inequality and Income Mobility in the Scandinavian Countries Compared to the United States," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 48(4), pages 443-69, December.
    2. Elin Berg & Snorre Kverndokk & Knut Einar Rosendahl, 1996. "Market Power, International CO2 Taxation and Petroleum Wealth," Discussion Papers 170, Research Department of Statistics Norway.
    3. Pål Boug & Knut Anton Mork & Trond Tjemsland, 1995. "Financial Deregulation and Consumer Behavior: the Norwegian Experience," Discussion Papers 156, Research Department of Statistics Norway.
    4. Rolf Aaberge & Ugo Colombino & Steinar Strøm, 1996. "Welfare Effects of Proportional Taxation: Empirical Evidence from Italy, Norway and Sweden," Discussion Papers 171, Research Department of Statistics Norway.
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