Geography, Migrations and Equilibrium Unemployment
AbstractWe study the effects of trade integration on the regional coevolution of income, migrations and unemployment in a dynamic core-periphery model with limited labor mobility and frictions in the job matching process. Our model can help explain a recently documented empirical puzzle, i.e., the divergence of unemployment rates, together with low migrations and modest income convergence experienced by European regions over the last twenty years. By studying explicitly the transitional dynamics of the model, we also highlight a contrast between short run and long run effects of trade and policy shocks on a geographically differentiated economy.
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Bibliographic InfoPaper provided by KITeS, Centre for Knowledge, Internationalization and Technology Studies, Universita' Bocconi, Milano, Italy in its series KITeS Working Papers with number 128.
Length: 26 pages
Date of creation: Mar 2002
Date of revision: Jul 2001
Contact details of provider:
Postal: via Sarfatti, 25 - 20136 Milano - Italy
Web page: http://www.kites.unibocconi.it/
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Other versions of this item:
- Paolo Epifani & Gino A. Gancia, 2001. "Geography, Migrations and Equilibrium Unemployment," Development Working Papers 156, Centro Studi Luca d\'Agliano, University of Milano.
- F12 - International Economics - - Trade - - - Models of Trade with Imperfect Competition and Scale Economies; Fragmentation
- F15 - International Economics - - Trade - - - Economic Integration
- F16 - International Economics - - Trade - - - Trade and Labor Market Interactions
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