Introduction

For roughly the past 25 years, the advanced economies have experienced a significant decline in their average growth rate relative to that experienced in the first quarter-century after World War II. Output growth in the countries of the OECD (Organization for Economic Cooperation and Development) averaged 4.8 percent from 1959 to 1970, the latter phase of the post-World War II “Golden Age” stretching from 1945 to 1970, while during the more recent “Leaden Age,” running from the early 1970s to the present, output growth in the OECD has averaged 2.8 percent (1994 is the last year for which we have full data). This Leaden Age growth experience in the OECD is closely associated with changes in employment conditions. In Western Europe, high average unemployment rates have emerged concurrently with the growth slowdown, while in the United States, slow growth has been associated with a sharp long-term decline in average real wages for nonsupervisory workers.

Employment conditions have also been worsening in developing countries. As Singh and Zammit write: