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Has the tradeoff between productivity gains and job growth disappeared?

  • Paul Cavelaars
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    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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    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
    Contact details of provider: Postal: Postbus 98, 1000 AB Amsterdam
    Web page: http://www.dnb.nl/en/

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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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