Munich Personal RePEc Archive

Does the Dutch Model Really Exist?

van der Hoek, M. Peter (2000): Does the Dutch Model Really Exist? Published in: International Advances in Economic Research , Vol. 6, No. 3 (2000): pp. 387-403.

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The policy that has led from the ‘Dutch disease’ (in the 1980s) to the ‘Dutch miracle’ (in the 1990s) consists of three tracks: 1) wage moderation, 2) retrenching public expenditure and reducing the tax burden, 3) slimming the welfare system. The wage moderation track seems to have been the most important one. The term ‘Dutch model’ refers to the socioeconomic system of the Netherlands. Most observers point in particular to the relatively low unemployment rate to indicate the success of this model. However, the economic inactivity rate in the Netherlands is not lower than in neighboring countries. This suggests that open unemployment in the Netherlands has partly been replaced with hidden unemployment. In particular the disability scheme seems to contain a large component of hidden unemployment. Another feature of the Dutch model is its consensus seeking nature, which is fostered by its institutional structure.

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