The Dutch productivity slowdown: The culprit at last?

C.W.M. Naastepad, A.H. Kleinknecht

    Research output: Contribution to journalArticleAcademicpeer-review

    22 Citations (Scopus)

    Abstract

    Two aspects of the recent performance of the Dutch economy (1982–2001) have attracted wide international attention: (1) rapid employment growth and (2) a significant slowdown in labour productivity growth. This paper argues that the shift from a high-productivity, low-employment towards a low-productivity, high-employment growth path constitutes a structural change set off by the policy of low wage growth launched in 1982. Various theoretical perspectives—including neo-classical substitution, induced technological change, vintage and the Verdoorn Law—point to channels through which wage growth restraint may hold back labour productivity growth. Our growth accounting analysis—based on these perspectives—suggests that a substantial part of the Dutch labour productivity growth slowdown can be attributed to the wage growth slowdown.
    Original languageEnglish
    Pages (from-to)137-163
    JournalStructural Change and Economic Dynamics
    Volume15
    Issue number2
    DOIs
    Publication statusPublished - 2004

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