The Netherlands: Is the Polder Model Sinking Harvard Case Solution & Analysis

Netherlands suffered an economic crisis in the late 1970s and early 1980s, despite (or perhaps because of) its access to the North Sea gas. In response to mounting inflation and unemployment, a tripartite agreement between employers, unions and the government was reached in 1982. This agreement laid the foundation for macroeconomic stabilization in 1980. At the same time, various structural reforms were introduced - to focus on increasing the flexibility of the labor market by increasing part-time. The results were dramatic: by the mid-1990s, the Netherlands enjoyed high rates of economic growth and the unemployment rate is below 3%, which is much lower than the major continental European neighbors. However, many observers doubt the sustainability of the so-called "polder model". Low unemployment has been achieved in part by reducing the interest. Some doubted that reducing the working population can support the Dutch standard of living. At the same time, the Netherlands has not been a leader in technological development, and others were concerned about whether it can effectively compete in the new global information economy. "Hide
by Hugh Pill, Marie-Laure Goepfer, Ingrid Vogel, Mathijs Robbens Source: Harvard Business School 24 pages. Publication Date: June 23, 2002. Prod. #: 702051-PDF-ENG

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The Netherlands: Is the Polder Model Sinking

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