In the 1980s Professor Phelps worked with European universities and institutions, such as Banca d'Italia (most of his 1985-86 holidays were spent in Italy) and Observatoire Français des Conjonctures Économiques (OFCE). He became interested in the continuing high unemployment in Europe and published some work about it with Jean-Paul Fitoussi (the director of OFCE). During the next years, Professor Phelps worked to calculate the natural rate of unemployment. He published some of his research in a 1994 book. Phelps also worked with Luigi Paganetto at the University of Rome Tor Vergata and, between 1988-98, they held the Villa Mondragone International Seminar.