Question

Would you expect the natural rate of unemployment to remain the same within one country over the long run of several decades?

Short answer

Generally, it will remain the same but have some exceptions.

Step-by-step solution

Step 1. Definition

In an economy the workers may come and go and always look for a better job, the period of joblessness in which the workers are looking for a job is called the natural level of unemployment.

Step 2. Explanation

Normally the rate of natural unemployment remains the same over time but may change in some drastic situations like any reforms in public policy etc.

Step 3. Example

Take an example like in a country where guaranteed unemployment insurance, welfare benefits, food, medical benefits are given to an unemployed person here the person is less likely to work because the opportunity cost of being unemployed is less. So, in this country, the natural rate of unemployment is more as compared to the country which doesn’t provide these benefits to the unemployed.