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Regional Mobility and Geography

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  • Diego Comín

Abstract

Larger countries should have a higher degree of interregional mobility of labor. A model of regional migration is calibrated for the U.S. and Europe in order to asses the importance of this effect. The model is able to replicate the observed patterns. By reversing the sizes, the mobility patters of U.S. and the European countries are also reversed. This observation implies that the increase in effective size associated with the European Union will transform Europe in to an optimum currency area. The methodology used to approximate the recursive problem may be of independent interest.

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Bibliographic Info

Paper provided by Santa Fe Institute in its series Working Papers with number 99-07-050.

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Date of creation: Jul 1999
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Handle: RePEc:wop:safiwp:99-07-050

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Keywords: Optimum currency areas; interregional labor mobility; approximation of dynamic programming problems; social interactions;

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References

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Cited by:
  1. David C Maré & Wai Kin Choy, 2001. "Regional Labour Market Adjustment and the Movements of People: A Review," Treasury Working Paper Series 01/08, New Zealand Treasury.

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