Abstract
In the face of massive long-term unemployment, the early 1980s witnessed the resurgence of an old orthodoxy, based on two premises. First, mass unemployment results from the excess of wages with respect to productivity. Secondly, this should be removed, via reforms of industrial relations: enhancing market mechanisms would be the best method to promote the required adjustment towards fuller employment. Academic researches and an impressive array of official reports have promoted (OCDE, 1986) or discussed this general view (BIT, 1987; Boyer, 1988). The related strategies have tentatively been applied in most OECD countries, with varying degrees of intensity and with contrasting results. For example, the outstanding job creation in the USA has been related to the significant flexibility and highly competitive nature of the American labour market, whereas the poor performance of much of Europe is frequently attributed to labour market rigidities, partly linked to the role of unions and state regulations.
This paper has benefited from the comments of the participants of the conference. Special thanks go to Professors Ignazio Musu, Renato Brunetta and Carlo Dell’Aringa for their comments and suggestions and to Dr P. M. Hillebrandt and Barnet Wagman for their help in preparing the final draft.
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Bowles, S., Boyer, R. (1990). Labour Market Flexibility and Decentralisation as Barriers to High Employment? Notes on Employer Collusion, Centralised Wage Bargaining and Aggregate Employment. In: Brunetta, R., Dell’Aringa, C. (eds) Labour Relations and Economic Performance. International Economic Association Series. Palgrave Macmillan, London. https://doi.org/10.1007/978-1-349-11562-4_13
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