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Unemployment from "failed policies of the 90's"

Published tisdag 1 mars 2011 kl 09.00
"Interest rates were too high for too long"
(4:35 min)
Göran Zettergren, head economist at the Swedish Confederation for Professional Employees.

Equilibrium unemployment, also called the natural rate of unemployment, was advocated by the controversial American economist Milton Friedman. There’s apparently a broad consensus supporting it among Swedish economists today.

The resulting conclusion, that the way to create jobs is to reduce unemployment benefits, reduce the power of the unions, and lower taxes, has largely been pursued by the center-right Swedish government that took over four and a half years ago.

But in a report to the think tank Global Challenge, economist Göran Zettergren disputes that model. He says those measures don’t really make much of a difference, and blames Sweden’s relatively high level of unemployment today on failed policies of the Swedish central bank, the Riksbanken, to deal with the crisis of the 90’s.

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