Regional labor market dynamics in Europe

Decressin, Jörg; Fatás, Antonio

doi:10.1016/0014-2921(94)00102-2

Cited by 518 publications

(414 citation statements)

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“…Conversely, the congestion effect, alone, is unable to sustain the symmetric equilibrium for high trade costs, because, even if some workers are always left in the periphery, their income share would shrink as τ grows and so would the market potential of the peripheral region. 5 Discrete time allows us to use numerical methods to solve for transitional dynamics of the model.…”

Section: Householdsmentioning

confidence: 99%

Trade, migration and regional unemployment

Epifani

Gancia

2005

Regional Science and Urban Economics

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We formulate a dynamic core-periphery model with frictions in the job matching process to study the interplay between trade costs, migration and regional unemployment in the short-and long-run. We Þnd that the spatial distribution of unemployment mirrors (inversely) the distribution of economic activities. Further, we highlight a contrast between the short-run and the long-run effects of trade-induced migration on regional unemployment. In particular, an inßow of immigrants from the periphery into the core reduces the unemployment gap in the short-run, but exacerbates unemployment disparities in the long-run. JEL classiÞcation: F12, F15, F16.Keywords: Integration, Agglomeration, Search frictions, Labor mobility, Regional disparities. * We thank Daron Acemoglu, Giovanni Bruno, Francesco Daveri, Henrik Horn, Gianmarco Ottaviano, Torsten Persson, Diego Puga, Jaume Ventura, Fabrizio Zilibotti and seminar participants at IIES, Stockholm University, University of Cagliari and MIT. We are especially indebted to Robert Shimer and two anonymous referees for very generous and helpful comments. We thank Annika Andreasson for editorial assistance. The usual caveat applies.

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Section: Householdsmentioning

confidence: 99%

Trade, migration and regional unemployment

Epifani

Gancia

2005

Regional Science and Urban Economics

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“…Moreover, many studies point to the higher wage flexibility is the US as a re-equilibrating mechanism in the labour market, even though this explanation is rejected by authors as Freeman (1995) or Baddeley et al (2000). For a discussion of the European case, see Decresin and Fatás (1995). 3 For a detailed analysis of migratory movements in Spain see Ródenas (1994), Bentolila (1997Bentolila ( , 2001), Antolín and Bover (1997), Bóver and Velilla (1999) and de la Fuente (1999). between the regional unemployment rates.…”

Section: -Introductionmentioning

confidence: 99%

Regional unemployment in Spain: Disparities, business cycle and wage setting

2008

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“…While unemployment reflects a mismatch in labour supply and demand, employment growth reflects labour demand. Changes in participation rates have been shown to be the main adjustment mechanism to demand shocks in European regional labour markets (Decressin & Fatás, 1995;Gács & Huber, 2005). Furthermore, job growth can encourage more people to enter the labour market (Elhorst, 2003;Partridge, 2001).…”

Section: Extension Of the Modelmentioning

confidence: 99%

Regional labour force participation across the European Union: a time–space recursive modelling approach with endogenous regressors

Vega

Elhorst

2016

Spatial Economic Analysis

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Regional labour force participation across the European Union: a time-space recursive modelling approach with endogenous regressors. Spatial Economic Analysis. Although there is an abundant regional labour market literature taking a spatial perspective, only a few studies have explored extending the analysis of labour force participation with spatial effects. This paper revisits this important issue, proposing a timespace recursive modelling approach that builds on and appraises Fogli and Veldkamp's methodology from 2011 and finding for the United States that participation rates vary with past values in nearby regions. Major shortcomings in their study are corrected for, including stationarity and the control for endogenous regressors other than the time and space-time-lagged dependent variable using system generalized method of moments (GMM). The paper also highlights interaction effects among explanatory variables for the first time in this context. Using a panel of 108 regions across the European Union over 1986-2010, the results for total, male and female participation rates throw a new light on the socio-economic relevance of different determinants. Importantly, characteristics in neighbouring regions play a significant role, and neglecting endogeneity is found to have serious consequences, underlining increased attention on the specification and estimation of spatial econometric models with endogenous regressors. MOTS CLÉS participation de la population active régions de l'Union européenne, panneaux spatiaux dynamiques, régresseurs endogènes RESUMEN Participación regional de la población activa en la Unión Europea: un enfoque de modelo recursivo tiempoespacio con regresores endógenos. Spatial Economic Analysis. Aunque existen abundantes publicaciones sobre el mercado laboral regional con una perspectiva espacial, solo en unos pocos estudios se ha intentado ampliar con efectos espaciales el análisis de la participación de la población activa. En este artículo revisamos esta cuestión importante proponiendo un enfoque de modelo recursivo tiempo-espacio que valora y se basa en la metodología de Fogli y Veldkamp de 2011, donde se observó que en los Estados Unidos los niveles de participación varían con valores previos en regiones cercanas. Corregimos importantes deficiencias en su estudio, entre ellas la estacionalidad y el control de regresores endógenos que no sean la variable que depende del tiempo y el espacio-tiempo retrasado mediante el método generalizado de momentos (GMM). También se destacan los efectos de interacción entre las variables explicativas por primera vez en este contexto. A partir de un panel de 108 regiones de toda la Unión Europea para el periodo entre 1986 y 2010, los resultados para el nivel de participación total, de mujeres y de hombres, aportan un enfoque nuevo sobre la relevancia socioeconómica de los diferentes determinantes. Pero lo más importante es que las características en las regiones vecinas desempeñan un importante papel y observamos que ignorar la endogeneidad tie...

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Regional labor market dynamics in Europe

Cited by 518 publications

References 3 publications

Trade, migration and regional unemployment

Trade, migration and regional unemployment

Regional unemployment in Spain: Disparities, business cycle and wage setting

Regional labour force participation across the European Union: a time–space recursive modelling approach with endogenous regressors

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