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Wage Formation, Regional Migration and Local Labour Market Tightness

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  • Fredrik Carlsen
  • K�re Johansen
  • Knut R�ed

Abstract

Empirical studies of regional wage formation and interregional migration routinely include the regional unemployment rate as indicator of local labour market tightness. However, these studies are usually motivated by economic theories that emphasize transition probabilities between unemployment and employment, and the unemployment rate is an imperfect proxy for these probabilities. We use a large micro data set to compute estimates of the rate of outflow from unemployment for 90 Norwegian travel-to-work areas. The outflow rates perform better than traditional measures of regional labour market tightness in panel data analyses of regional wages and interregional migration. Copyright 2006 Blackwell Publishing Ltd.

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Bibliographic Info

Article provided by Department of Economics, University of Oxford in its journal Oxford Bulletin of Economics and Statistics.

Volume (Year): 68 (2006)
Issue (Month): 4 (08)
Pages: 423-444

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Handle: RePEc:bla:obuest:v:68:y:2006:i:4:p:423-444

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Cited by:
  1. Longhi, Simonetta, 2010. "Job Competition and the Wage Curve," IZA Discussion Papers 4777, Institute for the Study of Labor (IZA).
  2. Fredrik Carlsen & Kare Johansen & Lasse Sigbjorn Stambol, 2011. "Effects of Regional Labour Markets on Migration Flows, by Education Level," ERSA conference papers ersa10p693, European Regional Science Association.
  3. Ekhaugen, Tyra, 2007. "Long-term Outcomes of Vocational Rehabilitation Programs: Labor Market Transitions and Job Durations for Immigrants," Memorandum 10/2007, Oslo University, Department of Economics.
  4. repec:ese:iserwp:2007-24 is not listed on IDEAS
  5. Torberg Falch & Kaare Johansen & Bjarne Stroem, 2008. "Teacher shortages and the business cycle," Working Paper Series 9608, Department of Economics, Norwegian University of Science and Technology.

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