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Fighting UnemploymentThe Limits of Free Market Orthodoxy$
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David Howell

Print publication date: 2005

Print ISBN-13: 9780195165845

Published to Oxford Scholarship Online: July 2005

DOI: 10.1093/0195165845.001.0001

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PRINTED FROM OXFORD SCHOLARSHIP ONLINE (oxford.universitypressscholarship.com). (c) Copyright Oxford University Press, 2021. All Rights Reserved. An individual user may print out a PDF of a single chapter of a monograph in OSO for personal use. date: 25 July 2021

 Labor Market Success and Labor Market Reform: Lessons from Ireland and New Zealand

 Labor Market Success and Labor Market Reform: Lessons from Ireland and New Zealand

(p.197) 6. Labor Market Success and Labor Market Reform: Lessons from Ireland and New Zealand
Fighting Unemployment

Andrew Glyn

Oxford University Press

Ireland and New Zealand are often acclaimed as 1990s labor market success stories. Andrew Glyn shows that Ireland achieved this extraordinary improvement in labor market performance without adopting the OECD’s neo-liberal labor market policy prescription. Irish employment took off and unemployment collapsed without an increase in wage inequality at the bottom, without significant changes in employment protection regulations, and without major changes in the unemployment benefit system. He attributes Ireland’s success not to deregulation, but to cooperative and regulated wage bargaining. In contrast, New Zealand’s policy makers were early and enthusiastic converts to the OECD’s labor market deregulation prescription, and the effects, particularly on labor unions, were substantial. But New Zealand’s unemployment performance was quite mediocre in the 1990s, fluctuating between 7.8 and 10.3% between 1990 and 1994, and from 6.3 and 7.5% between 1995 and 1999. The lesson Glyn draws from this Ireland-New Zealand comparison is that “extensive labor market deregulation is neither a necessary nor a sufficient condition for a radical improvement in employment.”

Keywords:   flexibility, welfare state, labor market, regulation, deregulation, unemployment, employment, labor market institutions, unemployment benefits, wages, wage inequality, collective bargaining, Ireland, New Zealand

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