More and more I’m convinced that what we see here isn’t a true indicator of unemployment. Rather, what we’re seeing is a text book example of:
In other countries, particularly in Europe, benefits are more generous and last longer. The drawback to this generosity is that it reduces a worker’s incentive to quickly find a new job. Generous unemployment benefits in some European countries are widely believed to be one of the main causes of “Eurosclerosis,” the persistent high unemployment that affects a number of European countries.
And can you guess who said THAT?
The most Liberal Economist Alive: Paul Krugman; that’s who.
Anyway, Exhibit in the Unemployment Fallacy: