ABSTRACT
During the period from 1945 to the early 1970s, the OECD countries enjoyed what, in retrospect, appears as a ‘golden age’ in terms of their labour market performance, an era of full employment, job security, rising real incomes and increasing social equality in economic welfare and opportunity. Although there were recurring recessions when employment fell, these were essentially minor interruptions to an otherwise unprecedently buoyant labour market, and for the most part the unemployment that existed was short term and frictional. Many of the advanced countries seemed to have achieved a workable blend of economic efficiency and social equity. Western Europe in particular appeared to be successful in applying the Keynesian-welfarist economic policy model, a form of state intervention in which macroeconomic demand management was used to maintain full employment and a redistributive-tax-and-benefit transfer-based welfare system was used to limit the extremes of wealth and poverty. 1
