Labor Markets: Model and Philippe Aghion

labor markets: But reducing inequality requires higher levels of government spending and taxation except when government is pursuing deficit spending to stimulate a depressed economy . The Scandinavian economic model is often invoked to bridge this gap, according to Global Times China. The Danish flexicurity system, in particular, has historically delivered solid economic performance alongside low inequality. Conservatives insist that growth requires low taxes and incentives such as flexible labor markets to encourage entrepreneurship. Leading economists such as Philippe Aghion have published excellent analyses of how this model could balance growth, equality and overall satisfaction of citizens elsewhere in the world. This model has sustained an ongoing debate in Europe, one that is now relevant in the US, because Donald Trump's new administration has promised to help globalization's losers while improving innovation and growth. These economists argue that labor markets with few restrictions on hiring and firing, low taxes on entrepreneurship and generous incentives for innovation are compatible with a relatively equal income distribution, high social spending by government and equalizing social policies such as universal free education. (news.financializer.com). As reported in the news.