Welfare benefits and the rate of unemployment: some evidence from the European Union in the last thirty years

Our objective in this paper is to re-examine the hypothesis that welfare benefits may be responsi- ble for the observed differences in cross-country unemployment rates and test its validity by using panel data from 19 countries over the 1970-2000 period. For this purpose, we set up a general equi- librium model encompassing the private and public sectors of the econ..