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Macroeconomic Evaluations of Labour Market Programs

Published online by Cambridge University Press:  01 January 2023

Elizabeth Webster
Elizabeth Webster*
Affiliation:
Melbourne Institute of Applied Economic and Social Research, University of Melbourne
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Abstract

Labour market programs are time honoured microeconomic policies, which offer different solutions to different policy makers. Some advocate them to moderate wage inflation and thus complement macroeconomic demand expansion. For others, they are advanced as a second-best, but politically feasible, substitute for reducing real wages. For many, they are regarded as an equity measure to assist the very long-term unemployed. All these goals are macroeconomic, for the policy maker is interested in the number and type of people displaced from employment as a result of the labour market programs. However, despite this, the macroeconomic field of labour market program evaluations is surprisingly thin. Few direct measures exist in Australia and overseas on the aggregate employment effects of such programs and the inference from related works finds little consistent evidence that they increase aggregate employment. Furthermore, there is a lack of macroeconomic assessments of the equity effects.

Type
Current Issues
Information
The Economic and Labour Relations Review , Volume 10 , Issue 1 , June 1999 , pp. 107 - 125
Copyright
Copyright © The Author(s) 1999

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Footnotes

*

This paper has been written as part of the Full Employment Project. It is a joint project run by the Institute of Public Affairs, the Melbourne Institute and the Faculty of Economics and Commerce, University of Melbourne. Thanks are due to the numerous private charity trusts and individuals who provided the funding for this project. I would also like to thank John Freebaim, Mark Harris, Don Harding, Joanne Loundes, Peter Summers, Meredith Baker, Phil Gatenby and Greg Connolly for comments and many useful suggestions. They are all of course exonerated from any misrepresentations and errors.

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