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The myth of incomes policy in the Netherlands

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An assessment is made about whether the Dutch government conducted an effective incomes policy in the postwar period. Targeted wage rate development is compared with actual wage outcomes and an empirical model of wage formation is used to estimate whether wage rates were lower when the incomes policy was on. It is concluded that two periods of incomes policy were effective: 1955-1959 and 1980-1981. However, the net effect of the policy in 1955-1959 was very moderate, due to a 'wage explosion' in 1964.
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Document Type: Research Article

Publication date: 1996-07-01

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