The Delta-Model Revisited: Recent trends in the structural performance of the Dutch economy

Since the late 1980s, the Dutch economy has outperformed neighbouring countries in terms of employment and GDP growth. We argue that the recent growth performance of the Netherlands has primarily been the result of a correction of the belowaverage performance during the 1970s. This correction was mainly brought about by a significant wage moderation since the early 1980s, probably strengthened by the creation of a more effective wage negotiation structure and measures to reduce the replacement rate. Furthermore, we show that the euphoria about the 'Delta model' is dampened by a slowdown in labour productivity performance, which appears to be particular serious in major parts of the services sector.