Employment Promotion and the Social Safety-Net

Abstract

In Chapter 1 it was argued that there are three strategic tasks that must be completed successfully in order to effect the transition from a centrally planned to a market-guided economy. First, the level of aggregate demand must be reduced to reflect the productive capacity of the economy. Second, the composition of expenditure must shift in favour of human and physical investment in order to accelerate the growth of output and average incomes. Third, relative prices must be restructured in order to provide incentives to employ labour, use capital efficiently and exploit opportunities for profitable international trade.