Even in a very open economy..

Unfortunately, the quote is in Dutch (and one needs a subscription to the Netherlands quality daily, NRC Handelsblad)

• Overigens presenteerde het CPB een indrukwekkend succes van Balkenende IV. Zonder de stimuleringsmaatregelen was de economische groei dit jaar 2 procentpunt lager geweest, rekende het CPB uit, en de werkloosheid zou 150.000 personen hoger zijn uitgekomen – 8,25 procent van de beroepsbevolking.

But we tell you what it says. According to the CPB (the official economic think-tank, which reputation is rather good), the Dutch economy has benefited from the stimulation measures to the tune of saving 150,000 jobs and a full 2% of economic growth. Unemployment would have been 8.25% of the labour force without the stimulus (at present, it stands at 5.6%, the lowest in Europe).

That really is substantial, considering the small, open nature of the Dutch economy where much of the demand created by the stimulus has a tendency to leak abroad. In a more closed economy the effectiveness of the stimulus would certainly have been larger still.

Two lessons:

• The rather large public sector in the Netherlands is no impediment to good economic outcomes
• The stimulus worked, even in as open an economy as the Netherlands (international trade is more than 60% of the national product)