Commentary: The Role of Demand Management Policies in Reducing Unemployment Welfare State Unemployment: A Comment
نویسندگان
چکیده
Charles Bean has written an informative discussion of unemployment that brings to a larger audience some parts of his comprehensive discussion of European unemployment (Bean, 1994). His current paper also discusses the role that policy might take to reduce unemployment. I will put policy issues aside initially to concentrate on the causes of unemployment. I begin by stating and commenting on four main points about the causes of unemployment that I draw from his work, particularly his survey paper. Why European unemployment rose First, most of the increase in unemployment within the European Union is on the supply side. Chart 1 in Bean's conference paper, and his earlier survey paper (1994, Figure 2), show that the steady-state unemployment rate rose from less than 2'/2 percent in the late 1960s to about 10 percent twenty years later. Bean's chart, reproduced as Chart 1, shows that the unemployment rate at any rate of inflation is higher in all countries but, outside the European Community (EC), the increases are modest. The rise in the EC is almost a constant rate of increase over a fifteen-year period. Since the rise in the unemployment
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