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The sources of metropolitan unemployment fluctuations in the Greater Taipei metropolitan area**I wish to express my thanks to three anonymous referees for valuable suggestions regarding econometric analysis and policy advice. I am also indebted to Shang†hsien Chiang, my father and my family both for adhering to and inspiring my innovative idea. At the same time, I would like thank Mat Huang for excellent data†processing assistance. Finally, the financial support is offered by national science council (NSC 99†2410†H†033†054)

Author

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  • Chiang, Shu†hen

Abstract

While past macroeconomic studies based on the natural rate hypothesis have tended to limit their discussions to cyclical unemployment, this paper applies shift†share analysis to additionally consider both frictional and structural unemployment, which is composed of sectoral shifts and geographic mismatches. The results of the estimation confirm that the recent high unemployment in the Taipei metropolitan area mainly stems from both sectoral shifts and frictional unemployment. Therefore, how to smooth the industrial transformation and more flexible turnovers should be critical in reducing the pressure brought about by such unemployment today.

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Handle: RePEc:eee:paresc:v:91:y:2012:i:4:p:775-794
DOI: 10.1111/j.1435-5957.2011.00407.x
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JEL classification:

  • J64 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment: Models, Duration, Incidence, and Job Search
  • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes

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