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Did the Thatcher Reforms Change British Labour Performance?

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  • David G. Blanchflower
  • Richard B. Freeman

Abstract

In this paper we evaluate the success of policies that were implemented in the 1980s that were designed to improve the workings of the UK labour market. Our primary conclusion is that the Thatcherite reforms succeeded in their goals of weakening union power; may have marginally increased employment and wage responsiveness to market conditions and may have increased self-employment. They were accompanied by a substantial improvement in the labour market position of women. But the reforms failed to improve the responsiveness of real wages to unemployment; they were associated with a slower transition from nonemployment to employment for men; a devastating loss in full-time jobs for male workers and produced substantial seemingly noncompetitive increases in earnings inequality.

Suggested Citation

  • David G. Blanchflower & Richard B. Freeman, 1993. "Did the Thatcher Reforms Change British Labour Performance?," NBER Working Papers 4384, National Bureau of Economic Research, Inc.
    • Handle: RePEc:nbr:nberwo:4384
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    References listed on IDEAS

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    1. repec:bla:econom:v:58:y:1991:i:230:p:155-72 is not listed on IDEAS
    2. Richard B. Freeman & David A. Wise, 1982. "The Youth Labor Market Problem: Its Nature, Causes, and Consequences," NBER Books, National Bureau of Economic Research, Inc, number free82-1, February.
    3. D Smeaton, 1992. "Self-Employment: Some Preliminary Findings," CEP Discussion Papers dp0096, Centre for Economic Performance, LSE.
    4. Lawrence F. Katz & Gary W. Loveman & David G. Blanchflower, 1995. "A Comparison of Changes in the Structure of Wages in Four OECD Countries," NBER Chapters, in: Differences and Changes in Wage Structures, pages 25-66, National Bureau of Economic Research, Inc.
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    6. Blanchflower, David G & Millward, Neil & Oswald, Andrew J, 1991. "Unionism and Employment Behaviour," Economic Journal, Royal Economic Society, vol. 101(407), pages 815-834, July.
    7. Ingram, Peter N, 1991. "Ten Years of Manufacturing Wage Settlements: 1979-89," Oxford Review of Economic Policy, Oxford University Press and Oxford Review of Economic Policy Limited, vol. 7(1), pages 93-106, Spring.
    8. D. Blanchflower, 1984. "Union Relative Wage Effects: A Cross Section Analysis Using Establishment Data," Working Papers 106, Queen Mary University of London, School of Economics and Finance.
    9. Lawrence F. Katz & Gary W. Loveman & David G. Blanchflower, 1993. "A Comparison of Changes in the Structure of Wages," NBER Working Papers 4297, National Bureau of Economic Research, Inc.
    10. Richard B. Freeman & Lawrence F. Katz, 1995. "Differences and Changes in Wage Structures," NBER Books, National Bureau of Economic Research, Inc, number free95-1, February.
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