This manifesto challenges a pernicious orthodoxy that has gripped Europe's policy makers. It is that demand- and supply-side policies must have different aims, that a limited number of supply-side policies are to be devoted to fighting unemployment, and that demand management (and particularly...

The analysis provides a new explanation for two widespread problems concerning European unemployment policy: the disappointingly small effect of many past reform measures on unemployment, and the political difficulties in implementing more extensive reform programs. We argue that the heart of...