This Paper presents a reappraisal of unemployment movements in the European Union. Our analysis is based on the chain … reaction theory of unemployment, which focuses on (a) the interaction among labour market adjustment processes, (b) the … unemployment responses to each shock. Our analysis permits us to distinguish between the short- and long-run effects of the shocks …

, and unemployment arising from the decline of the tradeable sector. …

model, covering a panel of EU countries, and derives the implied long-run inflation-unemployment tradeoff. Our results …