There was one instrument, the policy rate. Central bank policy for employment creation should therefore focus on enabling aggregate demand expansion, making credit available for investment and maintaining a stable and competitive real exchange rate to support export demand. Possible remedies include tripartite or collective wage bargaining and fixing mechanisms, backed by increased government social spending and directed credit allocation to employment-generating sectors and firms. While the former dampens wage demands and thus helps avoid wage-price inflationary spirals, the latter can protect employment from the effects of a general credit crunch that would be triggered if policy were to rely solely on the rather blunt instrument of interest rate hikes.