Real-Wage Determination and Labour Market Policies: The Swedish Experience
It is a common view that labor market programs reduce unemployment and restrain wages by increasing the competition for jobs. The Swedish case is often advanced as a blueprint to follow. This article questions the conventional wisdom on the Swedish labor-market policies. It finds empirical evidence in favor of the hypothesis that job creation and training programs weaken the incentives for wage restraint. As a consequence, it appears likely that labor-market programs have strong crowding-out effects on regular employment. Copyright 1991 by Royal Economic Society.
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Volume (Year): 101 (1991)
Issue (Month): 408 (September)
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