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Public Employment and Compensation Reform During Times of Fiscal Consolidation
Author:
Lorenzo Forni
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Natalija Novta
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Series:
IMF Working Papers
Volume/Issue:
Volume 2014: Issue 192
Language:
English
Publication Date:
23 Oct 2014
DOI:
https://doi.org/10.5089/9781498350341.001
ISBN:
9781498350341
ISSN:
1018-5941
Pages:
23
Keywords:
WP; wage; wage bill; bill; employment; Public sector; fiscal consolidation; public reform; bill reduction; indexation rule; bill consolidation; consolidation episode; bill measure; Government wage bill; Wages; Public employment; Wage adjustments; Labor share; Europe; Global
Legal-disclaimer:
IMF Working Papers describe research in progress by the author(s) and are published to elicit comments and to encourage debate. The views expressed in IMF Working Papers are those of the author(s) and do not necessarily represent the views of the IMF, its Executive Board, or IMF management.
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This paper compiles and compares recent and past measures introduced to contain the public wage bill in a number of emerging and advanced economies to assess their effectiveness in bringing down expenditure in a sustained way. In the aftermath of the Great Recession a number of countries have approved measures on the wage bill as part of fiscal consolidation efforts. These recent episodes are compared to past cases implemented in advanced economies over the period 1979–2009. Findings suggest that public wage bill consolidation episodes pre and post 2009 are similar in many respects. Moreover, typically countries that were able to achieve more sustained reductions in the wage bill have implemented to larger extent structural measures, and/or these measures were accompanied with substantial social dialogue and consensus.
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Cover IMF Working Papers
IMF Working Papers
ISSN:
1018-5941
Publisher:
International Monetary Fund