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Regional Unemployment in Spain - Disparities, Business Cycle and Wage Setting

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Author Info
Roberto Bande ()
Melchor Fernandez ()
Víctor Manuel Montuenga ()

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Abstract

The existence and persistence of regional disparities is a common problem of many European economies. However, in Spain this fact exhibits a characteristic feature: a strong positive relationship with the business cycle. The analysis in this paper investigates the relationship between this distinguishing feature of the Spanish economy with the wage bargain system, and how changes in this system may have influenced the aggregate Spanish labour market performance in the recent past. The empirical findings of an important imitation effect in wage bargainings may explain both the persistence of disparities and their positive relationship with the cycle. This result has a direct implication to employment policies, which must take into account the regional dimension of the unemployment problem.

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Paper provided by European Regional Science Association in its series ERSA conference papers with number ersa05p489.

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Date of creation: Aug 2005
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Handle: RePEc:wiw:wiwrsa:ersa05p489

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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. Roberto Bande & Melchor Fernandez & Victor Montuenga, . "Disparidades Regionales En La Tasa De Paro: El Papel Del Mecanismo De Determinacion Salarial," Documentos de trabajo - Análise Económica 0018, IDEGA - Instituto Universitario de Estudios e Desenvolvemento de Galicia. [Downloadable!]
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  4. 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)
  5. Akerlof, George A & Yellen, Janet L, 1990. "The Fair Wage-Effort Hypothesis and Unemployment," The Quarterly Journal of Economics, MIT Press, vol. 105(2), pages 255-83, May. [Downloadable!] (restricted)
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  7. 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!]
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  15. Evans, Philip & McCormick, Barry, 1994. "The New Pattern of Regional Unemployment: Causes and Policy Significance," Economic Journal, Royal Economic Society, vol. 104(424), pages 633-47, May. [Downloadable!] (restricted)
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  19. Henry G. Overman & Diego Puga, 2002. "Unemployment clusters across Europe's regions and countries," Economic Policy, CEPR, CES, MSH, vol. 17(34), pages 115-148, 04. [Downloadable!] (restricted)
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  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.
  21. Nickell, Stephen & Kong, Paul, 1992. "An investigation into the power of insiders in wage determination," European Economic Review, Elsevier, vol. 36(8), pages 1573-1599, December. [Downloadable!] (restricted)
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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. Roberto Bande & Marika Karanassou, 2006. "Labour Market Flexibility and Regional Unemployment Rate Dynamics: Spain (1980-1995)," ERSA conference papers ersa06p53, European Regional Science Association. [Downloadable!]
    Other versions:
  2. Antonio Golpe & Andre van Stel, 2007. "Self-Employment and Unemployment in Spanish Regions in the Period 1979-2001," Jena Economic Research Papers in Economics 2007-021, Friedrich-Schiller-University Jena, Max-Planck-Institute of Economics, Thueringer Universitaets- und Landesbibliothek. [Downloadable!]
  3. GAMARRA, José R., 2006. "¿Cómo se comportan las tasas de desempleo en siete ciudades colombianas?," REVISTA DE ECONOMÍA DEL ROSARIO, UNIVERSIDAD DEL ROSARIO - FACULTAD DE ECONOMÍA. [Downloadable!]
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