To the layperson, the upward trend in European unemployment is related to the slowdown in economic growth. We argue that the layperson’s view is correct. The increase in European unemployment and the slowdown in economic growth are related because they stem from a common cause: an excessively...

We develop a general equilibrium analysis of the impact of active labour market policy on unemployment, wages and the welfare of the employed. This framework is used to assess the political support in favour of such policies and to relate it to the working of such policies and other parameters...

In Portugal real wage flexibility, at the macroeconomic level, is noticeably higher, while unemployment duration is lower, when compared to Spain. This suggests that the hardship of being unemployed is higher in Portugal. Unemployment benefits and family insurance, which are the main buffer...

The paper examines the implications of an important aspect of the ongoing reorganization of work – the move from occupational specialization towards multi-tasking – for centralized wage bargaining. The analysis shows how, on account of this reorganization, centralized bargaining becomes...

Before the early 1970s generous welfare states seemed to be consistent with high employment. Since then, there has been growing concern over disincentive effects of social insurance. This paper suggests that the problem may have arisen in part because European nations were in effect trying to...

This paper describes an equilibrium labour market in which an unemployment benefit system cannot raise the average value of being unemployed in the long run. It proposes an alternative benefit system which pays generous benefit rates when unemployment is high, but pays much lower rates in booms....