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I V · · Papers Public Employment and Wage Subsidies in Western Europe-and the U.s.: What We're Doing and What We Know Doing and What We Know
| Content Provider | Semantic Scholar |
|---|---|
| Author | Haveman, Roberth Gregory, Barbra Christainsen Haveman, Robert H. Christainsen, Gregory B. Garfinkel, Irwin Palmer, John |
| Abstract | This paper examines the theory and empirical work relating to programs of direct job creation in Western industrialized countries. After an introductory section which discusses the historical context in which these programs have emerged, the paper looks at the possible forms such measures might take. Public employment is considered in the guises of special public service jobs, public works, and training and sheltered employment. Possible types of wage subsidy schemes include earnings supplements, wage ~ subsidies, and wage bill subsidies. The nature of existing schemes in the U.S. and Western Europe is outlined in section 2. The discussion proceeds according to the types of programs pursued rather than on a country-by-country basis. Following this description of actual direct job creation measures, the economics of such policies are examined. A priori, what effects would one expect such measures to have on inflation, the overall level of employment, the distribution of employment, the balance of payments, and the efficiency of resource allocation? The empirical work on these issues is limited, but in section 4, the existing literature on the macroeconomic and distributional effects of direct job creation programs is surveyed. Empirical work that conveys indirect evidence regarding the probable success of job creation measures is also discussed. Here research on such issues as displacement and wage adjustment over time is considered. In section 5, notes on evaluation research and suggestions for future evaluation studies are presented. In the final section, some overall conclusions are presented. Public Employment and Wage Subsidies in Western Europe and the U.S.: What We're Doing and What We Know During the decade of the 1960s, the successful management of the economy via fiscal and monetary measures seemed assured. With the publication of A.W. Phillips' article in 1958, the monetary sector of the economy was connected to the real sector and the Keynesian system became complete. The rate of change of money wages appeared reliably related to the unemployment rate. From this Phillips curve framework emerged a consensus that policies of aggregate demand management could move an economy to an inflation-unemployment combination that somehow balanced social objectives regarding these variables. By the end of the decade this analysis began to be challenged. Implicitly, the Phillips curve analysis assumed that the demand and supply of labor were functionally related to the nominal wage rate, while neo-classical economic theory has viewed them as related to the real wage rate. If the … |
| File Format | PDF HTM / HTML |
| Alternate Webpage(s) | http://www.irp.wisc.edu/publications/dps/pdfs/dp52278.pdf |
| Alternate Webpage(s) | https://www.irp.wisc.edu/publications/dps/pdfs/dp52278.pdf |
| Language | English |
| Access Restriction | Open |
| Content Type | Text |
| Resource Type | Article |
