The Rise of European Unemployment: A Synopsis

Abstract

Unemployment in the European Union has risen from a modest 2% in 1970 to 8.3% in 2002, a level not seen since the Great Depression. In this draft introduction for his new book, The Rise of European Unemployment: A Keynesian Approach, economist Engelbert Stockhammer argues that changes in the relationship between the financial sector and the real sector of the economy, a phenomenon he labels “financialization,” is at the root of the slowdown.