This article analyses the Spanish experience with voluntary wage moderation, focusing on the differences between the current model of wage moderation that began in 1997 and the traditional model of wages policies and social pacts implemented between 1977 and 1986. The article stresses the importance of changes in the economic and political environment and in the attitudes of unions towards the effectiveness and suitability of wage moderation as a tool to solve micro- and macroeconomic problems, to explain the abandonment of wages policies and then their renaissance in the late 1990s.
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