Developing-country attempts to regain macroeconomic stability through fiscal adjustment are often unsuccessful in reducing inflation and balance-of-payments (BoP) disequilibrium. This paper examines why this may be so in the light of India's experience with stabilization in response to the BoP...

The widespread belief in the natural rate of unemployment among economists has been extraordinary. Debate is more over why it fluctuates than whether policy should use it as a target. But these Dutch economists argue that allegiance to the NAIRU could well reduce potential productivity growth...

According to the mainstream theory of equilibrium unemployment, persistent unemployment is caused mainly by 'excessive' labour market regulation, whereas aggregate demand, capital accumulation and technological progress have no lasting effect on unemployment. We show that the mainstream...

Unlike internal ('functional') forms of flexibility of labour, external ('numerical') forms of flexibility (i.e. high shares of people on temporary contract or a high turnover of personnel) yield substantial savings on a firm's wage bill. Savings on wage bills lead to higher job growth, but do...

According to the mainstream theory of equilibrium unemployment, persistent unemployment is caused (mainly) by "excessive" labor market regulation, whereas aggregate demand, capital accumulation, and technological progress have no lasting effect on unemployment. We argue that the mainstream...

Using a multiperiod real--financial CGE model, this paper identifies the impact of budgetary policy on credit supply as a possible factor limiting the effectiveness of structural adjustment programmes. Focusing on credit rather than money, and explicitly analysing the relation between the budget...

Economists and the governments they advise have based their macroeconomic policies on the idea of a natural rate of unemployment. Government policy that pushes the rate below this point—about 6 percent—is apt to trigger an accelerating rate of inflation that is hard to reverse, or so the...

type="main" xml:lang="en" <title type="main">Abstract</title> <p>East Asia's newly industrializing economies are the paragon of successful industrialization. This article investigates what lies behind this success by identifying seven ‘stylized facts’, which concern the contributions to industrialization and growth of...</p>