The job-chains model of local labor market change is a demand-driven analytic device for estimating the effects of new job creation. This paper explores the effects of restricting supply, i.e. limiting job access, on the model’s primary outcomes: vacancy chain multipliers, welfare effects and distributional impacts. Major sources of labor supply are the local unemployed, out of the labor force and in-migrants. Three simulations are reported relating to 1) restricting new jobs to current local residents (i.e. no in-migrants), 2) restricting new jobs to current residents in the first round of hiring only and 3) restricting hiring to local unemployed/out of labor force on the first round alone. The results are compared to the basic model that assumes no supply-side restrictions. In terms of chain length, welfare effects, distributional impacts and policy palatability, first round restrictions on in-migrants would seem to be the most plausible option. However, as an economic development strategy,well targeted demand-side initiatives would still seem to be preferable.
Download Info
To download:
If you experience problems downloading a file, check if you have the
proper application to
view it first. Information about this may be contained
in the File-Format links below. In case of further problems read
the IDEAS help
file. Note that these files are not on the IDEAS
site. Please be patient as the files may be large.
Publisher Info
Paper provided by European Regional Science Association in its series ERSA conference papers with number
ersa06p82.