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Regional unemployment in Spain: Disparities, business cycle and wage setting Author info | Abstract | Publisher info | Download info | Related research | Statistics Bande, Roberto
Fernández, Melchor
Montuenga, Víctor
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The existence and persistence of regional disparities in the unemployment rate is a common problem of many European economies. However, in Spain, this situation exhibits a characteristic feature: a strong positive relationship with the business cycle. The analysis in this paper investigates the relationship between this distinguishing feature of the Spanish economy and changes in the regional wage-setting mechanism, and how this relationship has influenced the aggregate Spanish labour market performance in the recent past. The empirical finding of an important regional imitation effect in wage bargaining may explain both the persistence of disparities, and the positive relationship between regional unemployment dispersion and the business cycle. This result has a direct implication for employment policies, which must take into account the regional dimension of the unemployment problem.
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Article provided by Elsevier in its journal Labour Economics .
Volume (Year): 15 (2008)
Issue (Month): 5 (October)
Pages: 885-914
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Handle: RePEc:eee:labeco:v:15:y:2008:i:5:p:885-914Contact details of provider: Web page: http://www.elsevier.com/locate/labeco
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Keywords: Regional unemployment Disparities Business cycle Wage setting ; Other versions of this item:
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references Cited by : (explanations , Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile , click on "citations" and make appropriate adjustments.)
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