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The effects of unemployment benefits on migration in lagging regions

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  • Jordi Jofre-Monseny

    (Universitat de Barcelona & IEB)

Abstract

In this paper we analyze the unintended effects on mobility of a national place-based policy (SIPTEA) that provides greater unemployment protection in two lagging regions of southern Spain (namely, Extremadura and Andalucía). Using a border identification strategy and (1981 and 1991) census data at the municipal level, we estimate the effects of SIPTEA on population growth, the probability of staying and in-migration in rural areas that are experiencing high unemployment and significant out-migration flows. The results indicate that the policy mitigated population losses by increasing both the probability of staying and in-migration, although the locational inefficiencies implied are not particularly large. We also explore the effects of greater unemployment protection on labor market outcomes. Here, the results indicate that the policy led to a 10- to 13-percentage point increase in unemployment.

Suggested Citation

  • Jordi Jofre-Monseny, 2013. "The effects of unemployment benefits on migration in lagging regions," Working Papers 2013/10, Institut d'Economia de Barcelona (IEB).
    • Handle: RePEc:ieb:wpaper:doc2013-10
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    References listed on IDEAS

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    More about this item

    Keywords

    Unemployment protection; migration; mobility; place-based policy; lagging regions;
    All these keywords.

    JEL classification:

    • H73 - Public Economics - - State and Local Government; Intergovernmental Relations - - - Interjurisdictional Differentials and Their Effects
    • J6 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers
    • R23 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Regional Migration; Regional Labor Markets; Population

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