changes in the unemployment compensation system enacted in Germany during the 1980s and 1990s to demonstrate that incentivesʺ …

large data sets from the U.S., Britain, and western Germany to test the Krugman hypothesis for the 1990s, when unemployment … in Germany increased (unlike in the U.S. and Britain, where it fell). British and German evidence is further backed up … with alternative data sets for these countries. I find evidence for the Krugman hypothesis when Germany is compared to the …