Exercise 2 (8 points):

Below is the natural unemployment rate in 2017 for U.S., Canada, and the European Union Area:

Natural unemployment rate in U.S. was 4.4 %

Natural unemployment rate in Canada was 9.75 %.

Natural unemployment rate in the European Union Euro Area was 7.9 %.

What might explain the lower natural rate of unemployment in United States than in Canada and Western European countries? Explain with words + graph.