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Labour hoarding in a disequilibrium model of the Dutch labour market

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Summary

This paper presents a method to integrate labour hoarding into a disequilibrium model of the labour market. Disequilibrium indicators for the labour market that include labour hoarding are constructed. These indicators, being important determinants of policy multipliers with respect to employment, are found to be less volatile than the corresponding disequilibrium indicators for the goods market which are available from business surveys. The lower volatility reflects the role of labour hoarding as a buffer between actual and efficient employment levels. Our results indicate that labour hoarding in Dutch enterprises ranges from a minimum of 0.5 per cent of employment in early 1985 to a maximum of 7.0 per cent in 1975. Furthermore, the paper pays special attention to the modelling of mismatch unemployment and to the simulation results of an empirical disequilibrium macromodel of the Dutch economy.

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Authors and Affiliations

  1. Econometric Research and Special Studies Department, De Nederlandsche Bank NV, Amsterdam

    Peter J. A. Van Els & Linda M. Keijzer

Authors
  1. Peter J. A. Van Els
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  2. Linda M. Keijzer
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The authors thank M.M.G. Fase and two anonymous referees for their useful comments.

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Van Els, P.J.A., Keijzer, L.M. Labour hoarding in a disequilibrium model of the Dutch labour market. De Economist 141, 256–278 (1993). https://doi.org/10.1007/BF01717383

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