Political Immobilism and Labour Market Performance: The Dutch Road to Mass Unemployment

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Abstract
A political-institutional explanation of the deteriorating labour market performance of the Netherlands during the economic crisis of the 1970s is suggested. By comparing the macroeconomic and labour market strategies of the Netherlands and full employment countries the economic feasibility of Dutch solutions to the unemployment problem is estimated. Dutch strategies turn out to have been of a fragile and contradictory character, while full employment countries could rely on rather coherent and consistent strategies. This difference in strategy-building is very likely a result of differences in the political-institutional structures of countries. The policy-making process in the Netherlands has been subject to political immobilism. Institutional ineffectiveness after the first oilcrisis, a balance-of-power situation, concertation without consensus and internal contradictions within the Christian Democratic party have resulted in the failure to control the labour market.

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