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Geography, Migrations and Equilibrium Unemployment

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Author Info
Paolo Epifani () (Universita' di Parma, Parma, Italy, CESPRI, Universita' Bocconi, Milano, Italy)
Gino Gancia () (IIES-Stockholm University, Stockholm, Sweden)

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Abstract

We 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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File URL: ftp://ftp.unibocconi.it/pub/RePEc/cri/papers/wp128.pdf
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Publisher Info
Paper provided by CESPRI, Centre for Research on Innovation and Internationalisation, Universita' Bocconi, Milano, Italy in its series CESPRI Working Papers with number 128.

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Length: 26 pages
Date of creation: Mar 2002
Date of revision: Jul 2001
Handle: RePEc:cri:cespri:wp128

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Related research
Keywords: Patents; Integration; Agglomeration; Regional unemployment; Europe;

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Find related papers by JEL classification:
F12 - International Economics - - Trade - - - Models of Trade with Imperfect Competition and Scale Economies
F15 - International Economics - - Trade - - - Economic Integration
F16 - International Economics - - Trade - - - Trade and Labor Market Interactions

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References listed on IDEAS
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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    Other versions:
  2. Pissarides, Christopher A., 1998. "The impact of employment tax cuts on unemployment and wages; The role of unemployment benefits and tax structure," European Economic Review, Elsevier, vol. 42(1), pages 155-183, January. [Downloadable!] (restricted)
    Other versions:
  3. Quah, Danny, 1996. "Regional Convergence Clusters Across Europe," CEPR Discussion Papers 1286, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)
  4. Quah, Danny T., 1996. "Regional convergence clusters across Europe," European Economic Review, Elsevier, vol. 40(3-5), pages 951-958, April. [Downloadable!] (restricted)
  5. JANSEN, Marion & TURRINI, Alessandro, 1998. "Job creation, job destruction, and the international division of labour," CORE Discussion Papers 1998064, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE). [Downloadable!]
    Other versions:
  6. Bentolila, Samuel, 1997. "Sticky labor in Spanish regions," European Economic Review, Elsevier, vol. 41(3-5), pages 591-598, April. [Downloadable!] (restricted)
    Other versions:
  7. Pissarides, Christopher A, 1985. "Short-run Equilibrium Dynamics of Unemployment Vacancies, and Real Wages," American Economic Review, American Economic Association, vol. 75(4), pages 676-90, September. [Downloadable!] (restricted)
  8. Davidson, Carl & Martin, Lawrence & Matusz, Steven, 1999. "Trade and search generated unemployment," Journal of International Economics, Elsevier, vol. 48(2), pages 271-299, August. [Downloadable!] (restricted)
  9. Maurice Obstfeld & Giovanni Peri, 1998. "Regional non-adjustment and fiscal policy," Economic Policy, CEPR, CES, MSH, vol. 13(26), pages 205-259, 04. [Downloadable!] (restricted)
  10. Masahisa Fujita & Paul Krugman & Anthony J. Venables, 2001. "The Spatial Economy: Cities, Regions, and International Trade," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262561476.
  11. Krugman, Paul, 1991. "Increasing Returns and Economic Geography," Journal of Political Economy, University of Chicago Press, vol. 99(3), pages 483-99, June. [Downloadable!] (restricted)
    Other versions:
  12. Lars Ljungqvist & Thomas J. Sargent, 1998. "The European Unemployment Dilemma," Journal of Political Economy, University of Chicago Press, vol. 106(3), pages 514-550, June. [Downloadable!] (restricted)
    Other versions:
  13. Costas Megir & Danny Quah, 1996. "Regional Convergence Clusters Across Europe," CEP Discussion Papers dp0274, Centre for Economic Performance, LSE. [Downloadable!]
  14. Faini, Riccardo & Galli, Giampaolo & Gennari, Pietro & Rossi, Fulvio, 1997. "An empirical puzzle: Falling migration and growing unemployment differentials among Italian regions," European Economic Review, Elsevier, vol. 41(3-5), pages 571-579, April. [Downloadable!] (restricted)
  15. Puga, Diego, 1999. "The rise and fall of regional inequalities," European Economic Review, Elsevier, vol. 43(2), pages 303-334, February. [Downloadable!] (restricted)
    Other versions:
  16. Ottaviano, G.I.P., 1999. "Ad Usum Delphini: a Primer in 'New Economic Geography'," Economics Working Papers eco99/28, European University Institute.
    Other versions:
  17. Henry Overman & Diego Puga, 1999. "Unemployment Clusters Across European Regions and Countries," CEP Discussion Papers dp0434, Centre for Economic Performance, LSE. [Downloadable!]
    Other versions:
  18. Ottaviano, Gianmarco Ireo Paolo & Puga, Diego, 1997. "Agglomeration in the Global Economy: A Survey of the 'New Economic Geography'," CEPR Discussion Papers 1699, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)
    Other versions:
  19. Faini, Riccardo, 1996. "Increasing returns, migrations and convergence," Journal of Development Economics, Elsevier, vol. 49(1), pages 121-136, April. [Downloadable!] (restricted)
  20. Borjas, George J., 1999. "The economic analysis of immigration," Handbook of Labor Economics, in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 3, chapter 28, pages 1697-1760 Elsevier. [Downloadable!] (restricted)
Full 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.)

  1. Annekatrin Niebuhr & Silvia Stiller, 2004. "Integration and Labour Markets in European Border regions," ERSA conference papers ersa04p29, European Regional Science Association. [Downloadable!]
  2. Basile, Roberto & Padoa Schioppa, Fiorella Kostoris, 2002. "Unemployment Dynamics of the 'Mezzogiornos of Europe': Lessons for the Mezzogiorno of Italy," CEPR Discussion Papers 3594, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)
  3. Stephen Drinkwater & Paul Levine & Emanuela Lotti & Joseph Pearlman, 2003. "The Economic Impact of Migration: A Survey," Department of Economics Discussion Papers 0103, Department of Economics, University of Surrey. [Downloadable!]
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