Economists who are skeptical of hysteresis in Europe during the 1980s and 1990s cite all of the following as reasons for persistently high unemployment in Europe EXCEPT
A) generous unemployment benefits.
B) restrictions on firms' ability to hire and fire workers.
C) the existence of an ongoing recession.
D) high tax rates.

Question

Quizplus · Accepted Answer

Economists skeptical of hysteresis in Europe argue that persistently high unemployment was not due to the existence of an ongoing recession because the recession had ended by the mid-1990s. They attribute high unemployment to generous unemployment benefits, restrictions on firms' ability to hire and fire workers, and high tax rates.

Economists Who Are Skeptical of Hysteresis in Europe During the 1980s