Taxation, Wage Bargaining, and Unemployment

Nonfiction, Social & Cultural Studies, Political Science, International, Foreign Legal Systems, Business & Finance
Cover of the book Taxation, Wage Bargaining, and Unemployment by Isabela Mares, Cambridge University Press
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Author: Isabela Mares ISBN: 9781139810456
Publisher: Cambridge University Press Publication: February 13, 2006
Imprint: Cambridge University Press Language: English
Author: Isabela Mares
ISBN: 9781139810456
Publisher: Cambridge University Press
Publication: February 13, 2006
Imprint: Cambridge University Press
Language: English

Why were European economies able to pursue the simultaneous commitment to full employment and welfare state expansion during the first decades of the postwar period and why did this virtuous relationship break down during recent decades? This book provides an answer to this question, by highlighting the critical importance of a political exchange between unions and governments, premised on wage moderation in exchange for the expansion of social services and transfers. The strategies pursued by these actors in these political exchanges are influenced by existing wage bargaining institutions, the character of monetary policy and by the level and composition of social policy transfers. The book demonstrates that the gradual growth in the fiscal burden has undermined the effectiveness of this political exchange, lowering the ability of unions' wage policies to affect employment outcomes.

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Why were European economies able to pursue the simultaneous commitment to full employment and welfare state expansion during the first decades of the postwar period and why did this virtuous relationship break down during recent decades? This book provides an answer to this question, by highlighting the critical importance of a political exchange between unions and governments, premised on wage moderation in exchange for the expansion of social services and transfers. The strategies pursued by these actors in these political exchanges are influenced by existing wage bargaining institutions, the character of monetary policy and by the level and composition of social policy transfers. The book demonstrates that the gradual growth in the fiscal burden has undermined the effectiveness of this political exchange, lowering the ability of unions' wage policies to affect employment outcomes.

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