Public Employment and Regional Risk Sharing
AbstractWe provide an empirical analysis of regional risk sharing in Norway over the period 1977-90. The approach of Asdrubali, Sørensen and Yosha (1996) is extended to take public employment into account as a possible shock absorber. The other channels of risk sharing are capital markets and commuting, taxes and transfers, and credit markets. The estimated degree of regional consumption insurance is very high. We cannot reject the hypothesis that there is full interregional risk sharing in the short term. Public employment absorbs up to 25 percent of private sector output shocks in our analyses. Generally, central government insurance against regional shocks is relatively more important, the more permanent the shocks are, and vice versa for market-based risk-sharing channels. Copyright The editors of the "Scandinavian Journal of Economics", 2004 .
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Bibliographic InfoArticle provided by Wiley Blackwell in its journal The Scandinavian Journal of Economics.
Volume (Year): 106 (2004)
Issue (Month): 2 (06)
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Web page: http://onlinelibrary.wiley.com/journal/10.1111/(ISSN)1467-9442
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- Masayoshi Hayashi, 2013. "On the Decomposition of Regional Stabilization and Redistribution," CIRJE F-Series CIRJE-F-910, CIRJE, Faculty of Economics, University of Tokyo.
- Sebastian G. Kessing & Chiara Strozzi, 2012.
"The Regional Distribution of Public Employment: Theory and Evidence,"
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- Sebastian Kessing & Chiara Strozzi, 2012. "The Regional Distribution of Public Employment: Theory and Evidence," Department of Economics 0682, University of Modena and Reggio E., Faculty of Economics "Marco Biagi".
- Juessen, Falko, 2008. "Risk Sharing and Commuting Among US Federal States," IZA Discussion Papers 3374, Institute for the Study of Labor (IZA).
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