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Interview Professors Cheshire and Blien -A globalising Dutch labour market: insights and challenges

On Wednesday the 13th of March 2013 the VU-University in Amsterdam, the Dutch Bureau for Economic Policy Analysis (CPB) and network organisation Platform 31 organised a workshop on the influence of globalization and agglomeration on the Dutch labour market and economy. The completion of a 4-year research project executed by Platform 31 and led by Professor Henri de Groot from the VU-University was one of the reasons for this workshop. More than 60 scientists and policy makers gathered to share knowledge and exchange experiences. This article gives a short overview of a few presentations held that day as well as of an interview with Professors Uwe Blien and Paul Cheshire.

During the workshop the effect is of globalisation on different types of organisations and labour forces was discussed. The availability of microdata makes it possible to, for example, make a distinction between the effects of globalisation on different educational levels. Before the workshop Professor Paul Cheshire (economic geography) and Professor Uwe Blien (labour market specialist) shared their views on the challenges facing the Dutch labour market.

Labour market and cultural diversity 

Cheshire & Blien: ‘focus on the advantages of cultural diversity’. Certain political parties and media channels see globalization and cultural diversity as a negative development, but , for example, Professor Blien’s research shows that cultural diversity could potentially lead to a higher productivity. Professor Cheshire sees the cultural diversity of London as one of the main reasons for its success. 

According to both professors everybody must speak the same language in an open labour market to avoid unnecessary boundaries. It is also important to take account of the cultural background of migrants. In Germany, for example, Asian migrants score much better than German or Turkish scholars. Because of differences between cultures they can not be considered as one group, according to Professor Blien.

Labour market and demographic development 

Professor Blien is familiar with the Dutch discussion on the transition from region to the city. In Germany he sees the same development. At the same time there is the ageing population that causes a decrease in labour force on the longer term. Professor Cheshire warns the Netherlands and Germany not to be overly influenced by demographic developments. For example, in the United Kingdom there was also a predicted declining population in the nineties, but in the end in turned out that certain other developments had not been taken into account (i.e. women started having children later in life and immigrants had more children than initially predicted). 

Policy for certain top sectors: good or bad idea? 

According to Professor Cheshire it is not the task of the government to invest more in on particular economic sector over the other. In his opinion tax payers’ money  should be invested in the overall stimulation of the economy. This overall investment (in all sectors) is important  because factors determining which sectors should be stimulated more than others, are largely unknown. Professor Blien, however, disagrees. He is of the opinion that it could be wise to invest in specific economic sectors. For example, investing in sectors leading to an increase in employment. Generally speaking, both professors agree that the main task of the government should be in facilitating transitions in the economy and not leading these transitions.