In JPA 1.0's persistence.xml, <exclude-unlisted-classes> defaulted to false (providers always scanned for entities). As of JPA 2.0, <exclude-unlisted-classes> was changed to default to true. However, Hibernate EntityManager does not honor this. See lines 219-221 of PersistenceXmlParser.java:

                else if ( tag.equals( "exclude-unlisted-classes" ) ) {
                    persistenceUnit.setExcludeUnlistedClasses( true );
                }

This has two consequences:

1. If you omit <exclude-unlisted-classes>, Hibernate will scan for entities, which is not compliant. Hibernate should default to the right value based on the JPA version.
2. If you intentionally add <exclude-unlisted-classes>false</exclude-unlisted-classes> to persistence.xml to enable scanning, Hibernate will disable scanning, which is downright incorrect.

This probably makes more sense:

                else if ( tag.equals( "exclude-unlisted-classes" ) ) {
                    persistenceUnit.setExcludeUnlistedClasses( extractBooleanContent(element, !isJpaGte20) );
                }
...
    private static boolean extractBooleanContent(Element element, boolean defaultBool) {
        String content = extractContent( element, null );
        if (content != null && content.length() > 0) {
            return Boolean.valueOf(content);
        }
        return defaultBool;
    }

I don't know where the imaginary isJpaGte20 variable would come from.