The Natural Rate of Unemployment Reflections on 25 Years of the Hypothesis [Paperback]

A challenge to the conventional theory of the natural rate of unemployment hypothesis.The natural rate of unemployment hypothesis proposed in the 1960s has dominated thought about the causes of, and possible solutions, to unemployment. In the 1980s, however, European unemployment rates rose sharply, despite supply-side innovations to economic policy inspired by the hypothesis.The natural rate of unemployment hypothesis proposed in the 1960s has dominated thought about the causes of, and possible solutions, to unemployment. In the 1980s, however, European unemployment rates rose sharply, despite supply-side innovations to economic policy inspired by the hypothesis.The natural rate of unemployment hypothesis proposed in the 1960s has dominated thought about the causes of, and possible solutions to, unemployment. It asserts that only supply-side measures can achieve sustainable reductions in unemployment. In the 1980s, however, European unemployment rates rose sharply, despite supply-side innovations to economic policy inspired by the hypothesis. These essays reflect retrospectively on the state of the hypothesis and look forward to the emergence of a new wisdom regarding unemployment.1. Introduction Rod Cross; Part I. The Theoretical Framework: 2. The origins and further development of the natural rate of unemployment Edmund Phelps; 3. The natural rate as new classical macroeconomics James Tobin; 4. Theoretical reflections on the 'natural rate of unemployment' Frank Hahn; 5. Of coconuts, decomposition and a jackass: the genealogy of the natural rate Huw Dixon; Part II. Adjustment, Ranges of Equilibria and Hysteresis: 6. The economics of adjustment Andrew Caplin and John Leahy; 7. Hysteresis and memory in the labour market G. C. Archibald; 8. Models of the range of equilibria Ian McDonald; 9. Hysteresis revisited: a methodological approach Bruno Amable, J?rome Henry, Fr?d?ric Lordon and Richard Topol; 10. Is the natural rate hypothesis consistent with hysteresis? Rod lC!