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Employment Policy of the Middle Reagan Years: What Didn't Happen and Why It Didn't Happen

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  • Martin Feldstein

Abstract

This paper examines the record of employment and unemployment between 1982 and 1986 and discusses a variety of cyclical and structural employment policies that were considered but not implemented during the years 1982-84 when I served as chairman of the Council of Economic Advisers. Employment rose by 11 million jobs during the cyclical recovery of those four years, lowering the unemployment rate from 10.8 percent to 6.6 percent. Even before the recovery was visible, the Reagan administration supported the tight Federal Reserve policy to reverse the high inflation at the end of the 1970s. The policies to reduce structural unemployment that were considered but not enacted at the time have become law in later years: a gradual decline in the real minimum wage, the full taxation of unemployment insurance, and a work requirement for those on welfare.

Suggested Citation

  • Martin Feldstein, 1997. "Employment Policy of the Middle Reagan Years: What Didn't Happen and Why It Didn't Happen," NBER Working Papers 5917, National Bureau of Economic Research, Inc.
    • Handle: RePEc:nbr:nberwo:5917
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    References listed on IDEAS

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    1. Martin S. Feldstein, 1975. "The Importance of Temporary Layoffs: An Empirical Analysis," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 6(3), pages 725-745.
    2. Feldstein, Martin S, 1978. "The Effect of Unemployment Insurance on Temporary Layoff Unemployment," American Economic Review, American Economic Association, vol. 68(5), pages 834-846, December.
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    JEL classification:

    • J6 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers

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