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On the Interaction between Unemployment and Inter-regional Mobility

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Author Info
Raquel Fonseca () (CSEF, University of Salerno)

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Abstract

This paper aims at examining the interaction between unemployment and inter-regional mobility in the presence of asymmetric productivity shocks. We present an intertemporal two-regions equilibrium model where unemployed workers can migrate from one region to another. The hiring process is represented by a matching function à la Pissarides. We also analyse the wage setting procedure by introducing Nash bargaining between firms and employees. We compare two extremely different scenarios. The case where there is no mobility with unemployment persistence versus the same economy where perfect mobility is assumed. This paper also studied different types of asymmetries such as changes in "unemployment benefits" and/or the cost of posting vacancies. We show the importance of these changes to explain regional unemployment disparities.Finally, we calibrate the model for Spain and we analyse the relevance of the model in explaining regional disparities and inter-regional labour force mobility

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Publisher Info
Paper provided by Centre for Studies in Economics and Finance (CSEF), University of Naples, Italy in its series CSEF Working Papers with number 105.

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Date of creation: 01 Sep 2003
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Handle: RePEc:sef:csefwp:105

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Related research
Keywords: Migration; Unemployment; Nash bargaining;

Other versions of this item:

Find related papers by JEL classification:
J51 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - Trade Unions: Objectives, Structure, and Effects
J61 - Labor and Demographic Economics - - Mobility, Unemployment, and Vacancies - - - Geographic Labor Mobility; Immigrant Workers
R23 - Urban, Rural, and Regional Economics - - Household Analysis - - - Regional Migration; Regional Labor Markets; Population

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References listed on IDEAS
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  2. Mincer, Jacob, 1978. "Family Migration Decisions," Journal of Political Economy, University of Chicago Press, vol. 86(5), pages 749-73, October. [Downloadable!] (restricted)
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    Other versions:
  6. Olympia Bover & Pilar Velilla, 1999. "Migration in Spain: Historical Background and Current Trends," IZA Discussion Papers 88, Institute for the Study of Labor (IZA). [Downloadable!]
    Other versions:
  7. Juan J. Dolado & Juan F. Jimeno & Rosa Duce, . "The effects of migration on the relative demand of skilled versus unskilled labour: Evidence from Spain," Working Papers 96-20, FEDEA.
    Other versions:
  8. Burda, Michael C. & Profit, Stefan, 1996. "Matching across space: Evidence on mobility in the Czech Republic," Labour Economics, Elsevier, vol. 3(3), pages 255-278, October. [Downloadable!] (restricted)
    Other versions:
  9. Jimeno, Juan F. & Bentolila, Samuel, 1998. "Regional unemployment persistence (Spain, 1976-1994)," Labour Economics, Elsevier, vol. 5(1), pages 25-51, March. [Downloadable!] (restricted)
    Other versions:
  10. Pissarides, Christopher A & McMaster, Ian, 1990. "Regional Migration, Wages and Unemployment: Empirical Evidence and Implications for Policy," Oxford Economic Papers, Oxford University Press, vol. 42(4), pages 812-31, October. [Downloadable!] (restricted)
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    Other versions:
  12. Saint-Paul, Gilles, 1992. "Are the Unemployed Unemployable?," CEPR Discussion Papers 689, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)
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  13. Decressin, Jorg & Fatas, Antonio, 1995. "Regional labor market dynamics in Europe," European Economic Review, Elsevier, vol. 39(9), pages 1627-1655, December. [Downloadable!] (restricted)
    Other versions:
  14. Olivier Jean Blanchard & Lawrence F. Katz, 1992. "Regional Evolutions," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 23(1992-1), pages 1-76. [Downloadable!]
  15. Jackman, R & Layard, Richard & Pissarides, C, 1989. "On Vacancies," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 51(4), pages 377-94, November.
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  19. Cahuc, Pierre & Wasmer, Etienne, 2001. "Does Intrafirm Bargaining Matter In The Large Firm'S Matching Model?," Macroeconomic Dynamics, Cambridge University Press, vol. 5(05), pages 742-747, November. [Downloadable!]
  20. Antolin, Pablo & Bover, Olympia, 1997. "Regional Migration in Spain: The Effect of Personal Characteristics and of Unemployment, Wage and House Price Differentials Using Pooled Cross-Sections," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 59(2), pages 215-35, May.
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    Other versions:
  23. Greenwood, Michael J, 1975. "Research on Internal Migration in the United States: A Survey," Journal of Economic Literature, American Economic Association, vol. 13(2), pages 397-433, June. [Downloadable!] (restricted)
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  30. Ortega, Javier, 2000. "Pareto-Improving Immigration in an Economy with Equilibrium Unemployment," Economic Journal, Royal Economic Society, vol. 110(460), pages 92-112, January. [Downloadable!] (restricted)
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