most when the adverse incentive effects of benefits are largest. Adjustment costs of changing benefits introduce hysteresis … and can help explain why post-oil shock benefits remained high in Europe but not in the US. Desirable features of the … model are that we obtain an asymmetry out of a symmetric environment and that the mechanism yielding hysteresis is both …

This paper uses data for the UK and the Netherlands (1983q4-2011q4) to test if hysteresis occurs in these economics …, and through what mechanisms. The novelty of the paper resides in the use of a VAR-IRF that encompasses previous hysteresis …-shock on long-term unemployment. Our findings suggest that there is hysteresis in both countries, and that it happens through …

. The first part of this paper shows that increases in employment in Europe are likely to be associated with rising real …