lecture14 - Two propositions for model (Garrett 1998) 1. 2....

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Two propositions for model (Garrett 1998) 1. Democratic political competition generate incentives for parties of the left and right to redistribute wealth and social risk in favor of their core political constituencies. However, this is much easier to do where partisan policies do not adversely affect macroeconomic outcomes. 2. Two different types of national labor market institutions are conducive to strong macroeconomic performance: (1) those in which trade unions are too weak to subvert the operation of market forces (2) those in which organized labor movement are sufficiently encompassing to internalize the externalities of wage militancy.
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The closed economy model 1. Exposure to trade is relatively low and there are substantial barriers to cross-border capital flows. 2. Governments can effectively manipulate aggregate demand using both fiscal and monetary policy. -> “Keynesian welfare state” (1) countercyclical fiscal and monetary policies (2) tax-transfer program (3) the public provision of social services (4) industrial policies propping up jobs in declining sectors (5) progressive systems of taxation. 3. The core political constituencies of the left and the right are easily defined in terms of the ____________divide. 4. The interests of workers are relatively _________________.
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Left vs. Right 2. Labor market institutions (1) Encompassing (2) Strong, but uncoordinated -> strong individual trade unions whose behavior is not subject to the centralized authority of a peak confederation -> can veto against market-oriented policies and become more militant. (3) weak
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This note was uploaded on 04/09/2008 for the course POL SCI 139 taught by Professor Ha during the Winter '08 term at UCLA.

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lecture14 - Two propositions for model (Garrett 1998) 1. 2....

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