Regional Unemployment Disparities: Can Fiscal Policy Help?
AbstractRegional unemployment disparities are widely observed, appear to persist through time and are often a reason for concern on the part of both regional and national governments. This paper constructs a small two-region general-equilibrium model and uses it to assess the effectiveness of traditional fiscal policy in combating regional unemployment disparities. The model is based on optimising behaviour of households and firms and incorporates inter-regional migration. It is calibrated using data for the Australian states and then simulated to evaluate the effects of expenditure changes by both regional and federal governments. In particular, we consider (i) a rise in federal government spending in one region, (ii) a rise in regional government spending, (iii) a policy of ‘unlocking the forests’ in which a regional government increases the availability of regional natural resources, and (iv) a general increase in federal government spending. The results are often surprising – only the fourth policy reduces unemployment in the high-unemployment region and all policies exacerbate the disparity.
Download InfoTo our knowledge, this item is not available for download. To find whether it is available, there are three options:
1. Check below under "Related research" whether another version of this item is available online.
2. Check on the provider's web page whether it is in fact available.
3. Perform a search for a similarly titled item that would be available.
Bibliographic InfoArticle provided by Bankwest Curtin Economics Centre (BCEC), Curtin Business School in its journal Australian Journal of Labour Economics.
Volume (Year): 7 (2004)
Issue (Month): 1 (March)
Contact details of provider:
Postal: GPO Box U1987, Perth WA 6845
Web page: http://business.curtin.edu.au/research/publications/journals/ajle/
More information through EDIRC
Mobility; Unemployment; and Vacancies: General Mobility; Unemployment; and Vacancies: Public Policy (Employment Services) General Equilibrium and Welfare Economic Analysis of Regional Economies;
Find related papers by JEL classification:
- J60 - Labor and Demographic Economics - - Mobility, Unemployment, and Vacancies - - - General
- J68 - Labor and Demographic Economics - - Mobility, Unemployment, and Vacancies - - - Public Policy
- R13 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - General Equilibrium and Welfare Economic Analysis of Regional Economies
You can help add them by filling out this form.
reading list or among the top items on IDEAS.Access and download statisticsgeneral information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Alan Duncan).
If references are entirely missing, you can add them using this form.