Suppose the National Assembly passes legislation making it more difficult for firms to fire workers. (An example is a law requiring severance pay for fired workers.). If this legislation reduces the rate of job separation without affecting the rate of job finding, how would the natural rate of unemployment change? Do you think that it is plausible that legislation would not affect the rate of job finding? Why or why not

Economics:
10th Edition
ISBN:9781285859460
Author:BOYES, William
Publisher:BOYES, William
Chapter7: Unemployment And Inflation
Section: Chapter Questions
Problem 16E
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Suppose the National Assembly passes legislation making it more difficult for firms to fire workers. (An example is a law requiring severance pay for fired workers.). If this legislation reduces the rate of job separation without affecting the rate of job finding, how would the natural rate of unemployment change? Do you think that it is plausible that legislation would not affect the rate of job finding? Why or why not?
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