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Reaction Patterns of German Regional Labour Markets to Macroeconomic and Policy-induced Shocks¡ª A Comparative Analysis

Author

Listed:
  • J¨¹rgen Roth

    (ESB Business School, Reutlingen University, Germany)

  • Simon G. Fauser

    (Heilbronn University, Germany; Reutlingen University, Germany)

Abstract

This paper analyses labour market reactions of three representative German federal states to economic and policy-induced shocks. The magnitude of the reactions of the states to an equally strong shock on labour demand, labour supply and unemployment are observed. Differences in the structural composition of the states¡¯ economies and flexibility of the states¡¯ labour markets lead to distinct reaction patterns over time. The reaction patterns of all states are dominated by labour demand effects in the short term, whereas labour supply effects are propagated over time and, hence, from the medium term onwards dominate the development of the unemployment rate.

Suggested Citation

  • J¨¹rgen Roth & Simon G. Fauser, 2011. "Reaction Patterns of German Regional Labour Markets to Macroeconomic and Policy-induced Shocks¡ª A Comparative Analysis," Review of Economics & Finance, Better Advances Press, Canada, vol. 1, pages 87-103, February.
    • Handle: RePEc:bap:journl:110108
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    References listed on IDEAS

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    Keywords

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    JEL classification:

    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
    • O18 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Urban, Rural, Regional, and Transportation Analysis; Housing; Infrastructure
    • R23 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Regional Migration; Regional Labor Markets; Population

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