Primum vivere… Industrial Change, Job Destruction and the Geographical Distribution of Unemployment
This paper aims to provide a frame of mind to understand the link between structural change and regional unemployment, and, based on it, to survey the most recent literature. An overly optimistic view on the ability of the adjustment mechanism to generate convergence in local unemployment rates has long neglected the question of how regional imbalances arise in the first place. The availability of new longitudinal data sets allows us looking again at this issue with a fresh look, starting from patterns of reallocation among labour market statuses. The main conclusion of recent research is that high unemployment regions have a higher, not a lower rate of reallocation; this suggests, in turn, that they do not suffer from low job creation, but, rather, from high job destruction, and this is because of the low competitiveness of any economic activity. Our findings sound as a renowned justification of the need for demand side policy, especially aimed at increasing the life expectancy of private businesses in high unemployment regions.
|Date of creation:||Jan 2013|
|Date of revision:|
|Publication status:||published in: IZA Journal of European Labor Studies, 2012, 1:7|
|Contact details of provider:|| Postal: |
Phone: +49 228 3894 223
Fax: +49 228 3894 180
Web page: http://www.iza.org
|Order Information:|| Postal: IZA, Margard Ody, P.O. Box 7240, D-53072 Bonn, Germany|
References listed on IDEAS
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.:
- Lucie Samson, 1985. "A Study of the Impact of Sectoral Shifts on Aggregate Unemployment in Canada," Canadian Journal of Economics, Canadian Economics Association, vol. 18(3), pages 518-30, August.
- Caballero, Ricardo J & Hammour, Mohamad L, 1994.
"The Cleansing Effect of Recessions,"
American Economic Review,
American Economic Association, vol. 84(5), pages 1350-68, December.
- Roberto Basile & Alessandro Girardi & Marianna Mantuano & Francesco Pastore, 2011.
"Sectoral Shifts, Diversification and Regional Unemployment. Evidence From Local Labour Systems in Italy,"
WIFO Working Papers
- Roberto Basile & Alessandro Girardi & Marianna Mantuano & Francesco Pastore, 2012. "Sectoral shifts, diversification and regional unemployment: evidence from local labour systems in Italy," Empirica, Springer, vol. 39(4), pages 525-544, November.
- Basile, Roberto & Girardi, Alessandro & Mantuano, Marianna & Pastore, Francesco, 2011. "Sectoral Shifts, Diversification and Regional Unemployment: Evidence from Local Labour Systems in Italy," IZA Discussion Papers 6197, Institute for the Study of Labor (IZA).
- J. Paul Elhorst, 2003. "The Mystery of Regional Unemployment Differentials: Theoretical and Empirical Explanations," Journal of Economic Surveys, Wiley Blackwell, vol. 17(5), pages 709-748, December.
- Simon, Curtis J & Nardinelli, Clark, 1992. "Does Industrial Diversity Always Reduce Unemployment? Evidence from the Great Depression and After," Economic Inquiry, Western Economic Association International, vol. 30(2), pages 384-97, April.
- Stephen T. Marston, 1985. "Two Views of the Geographic Distribution of Unemployment," The Quarterly Journal of Economics, Oxford University Press, vol. 100(1), pages 57-79.
- Anna Maria Ferragina & Francesco Pastore, 2008.
"Mind The Gap: Unemployment In The New Eu Regions,"
Journal of Economic Surveys,
Wiley Blackwell, vol. 22(1), pages 73-113, 02.
- Neelin, Janet, 1987.
"Sectoral Shifts and Canadian Unemployment,"
The Review of Economics and Statistics,
MIT Press, vol. 69(4), pages 718-23, November.
- Fortin, M. & Abdelkrim, A., 1993.
"Sectoral Shifts, Stock Market Dispersion and Unemployment in Canada,"
Cahiers de recherche
93-05, Departement d'Economique de la Faculte d'administration à l'Universite de Sherbrooke.
- Mario Fortin & Abdelkrim Araar, 1997. "Sectoral shifts, stock market dispersion and unemployment in Canada," Applied Economics, Taylor & Francis Journals, vol. 29(6), pages 829-839.
- Martin Robson, 2009. "Structural change, specialization and regional labour market performance: evidence for the UK," Applied Economics, Taylor & Francis Journals, vol. 41(3), pages 275-293.
- Floro Ernesto Caroleo & Francesco Pastore, 2010. "Structural Change and Labour Reallocation Across Regions: A Review of the Literature," AIEL Series in Labour Economics, in: Floro Ernesto Caroleo & Francesco Pastore (ed.), The Labour Market Impact of the EU Enlargement. A New Regional Geography of Europe?, edition 1, chapter 2, pages 17-47 AIEL - Associazione Italiana Economisti del Lavoro.
- Abraham, Katharine G. & Katz, Lawrence F., 1986.
"Cyclical Unemployment: Sectoral Shifts or Aggregate Disturbances?,"
3442781, Harvard University Department of Economics.
- Abraham, Katharine G & Katz, Lawrence F, 1986. "Cyclical Unemployment: Sectoral Shifts or Aggregate Disturbances?," Journal of Political Economy, University of Chicago Press, vol. 94(3), pages 507-22, June.
- Katharine G. Abraham & Lawrence F. Katz, 1984. "Cyclical Unemployment: Sectoral Shifts or Aggregate Disturbances?," NBER Working Papers 1410, National Bureau of Economic Research, Inc.
- Mussida, Chiara & Pastore, Francesco, 2012. "Is There a Southern-Sclerosis? Worker Reallocation and Regional Unemployment in Italy," IZA Discussion Papers 6954, Institute for the Study of Labor (IZA).
- Garonna, Paolo & Sica, Francesca G. M., 2000. "Intersectoral labour reallocations and unemployment in Italy," Labour Economics, Elsevier, vol. 7(6), pages 711-728, November.
- John Francis, 2009. "Agglomeration, job flows and unemployment," The Annals of Regional Science, Springer, vol. 43(1), pages 181-198, March.
- Lourens Broersma, 1997. "Competition between employed and unemployed job searchers: is there a difference between the UK and The Netherlands?," Applied Economics Letters, Taylor & Francis Journals, vol. 4(3), pages 199-203.
- George R. Neumann & Robert H. Topel, 1991. "Employment Risk, Diversification, and Unemployment," The Quarterly Journal of Economics, Oxford University Press, vol. 106(4), pages 1341-1365.
- Harry J. Holzer, 1989.
"Employment, Unemployment and Demand Shifts in Local Labor Markets,"
NBER Working Papers
2858, National Bureau of Economic Research, Inc.
- Holzer, Harry J, 1991. "Employment, Unemployment and Demand Shifts in Local Labor Markets," The Review of Economics and Statistics, MIT Press, vol. 73(1), pages 25-32, February.
- Andrew Newell & Francesco Pastore, 2000.
"Regional Unemployment and Industrial Restructuring in Poland,"
CELPE Discussion Papers
51, CELPE - Centre of Labour Economics and Economic Policy, University of Salerno, Italy.
- Andrew Newell & Francesco Pastore, 2006. "Regional Unemployment and Industrial Restructuring in Poland," Eastern European Economics, M.E. Sharpe, Inc., vol. 44(3), pages 5-28, May.
- Newell, Andrew T. & Pastore, Francesco, 2000. "Regional Unemployment and Industrial Restructuring in Poland," IZA Discussion Papers 194, Institute for the Study of Labor (IZA).
- Burgess, Simon M, 1993. "A Model of Competition between Unemployed and Employed Job Searchers: An Application to the Unemployment Outflow Rate in Britain," Economic Journal, Royal Economic Society, vol. 103(420), pages 1190-204, September.
- Paolo Epifani & Gino Gancia, 2004.
"Trade, Migration and Regional Unemployment,"
199, Barcelona Graduate School of Economics.
- Decressin, Jörg & Fatás, Antonio, 1994.
"Regional Labour Market Dynamics in Europe,"
CEPR Discussion Papers
1085, C.E.P.R. Discussion Papers.
- Chiarini, Bruno & Piselli, Paolo, 2000. "Unemployment, Wage Pressure and Sectoral Shifts: Permanent and Temporary Consequences of Intersectoral Shocks," Journal of Policy Modeling, Elsevier, vol. 22(7), pages 777-799, December.
- Boeri, Tito, 2000. "Structural Change, Welfare Systems, and Labour Reallocation: Lessons from the Transition of Formerly Planned Economies," OUP Catalogue, Oxford University Press, number 9780198293651, July.
- Curtis J. Simon, 1988. "Frictional Unemployment and the Role of Industrial Diversity," The Quarterly Journal of Economics, Oxford University Press, vol. 103(4), pages 715-728.
- van Ours, Jan C., 1995. "An empirical note on employed and unemployed job search," Economics Letters, Elsevier, vol. 49(4), pages 447-452, October.
- Olivier Jean Blanchard & Lawrence F. Katz, 1992. "Regional Evolutions," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 23(1), pages 1-76.
- Naticchioni Paolo & Rustichelli Emiliano & Scialà Antonio, 2006.
"Employment Protection and Regional Worker Flows in Italy,"
Società editrice il Mulino, issue 3, pages 453-474.
- Naticchioni, Paolo & Rustichelli, Emiliano & Scialà, Antonio, 2006. "Employment protection and regional worker flows in Italy," MPRA Paper 1690, University Library of Munich, Germany.
- Eriksson, Stefan & Lagerström, Jonas, 2004.
"Competition between employed and unemployed job applicants: Swedish evidence,"
Working Paper Series
2004:2, IFAU - Institute for Evaluation of Labour Market and Education Policy.
- Stefan Eriksson & Jonas Lagerström, 2006. "Competition between Employed and Unemployed Job Applicants: Swedish Evidence," Scandinavian Journal of Economics, Wiley Blackwell, vol. 108(3), pages 373-396, October.
- Munich, Daniel & Svejnar, Jan, 2009. "Unemployment and Worker-Firm Matching Theory and Evidence from East and West Europe," Policy Research Working Paper Series 4810, The World Bank.
- Petri Bockerman, 2003. "Unravelling the Mystery of Regional Unemployment in Finland," Regional Studies, Taylor & Francis Journals, vol. 37(4), pages 331-340.
- Berg Andrew, 1994. "Does Macroeconomic Reform Cause Structural Adjustment? Lessons from Poland," Journal of Comparative Economics, Elsevier, vol. 18(3), pages 376-409, June.
- Bernard G. Funck & Lodovico Pizzati, 2003. "European Integration, Regional Policy, and Growth," World Bank Publications, The World Bank, number 15144.
- Pastore, Francesco & Tyrowicz, Joanna, 2012. "Labour Turnover and the Spatial Distribution of Unemployment: A Panel Data Analysis Using Employment Registry Data," IZA Discussion Papers 7074, Institute for the Study of Labor (IZA).
- Bernard Funck & Lodovico Pizzati, 2002. "Labor, Employment, and Social Policies in the EU Enlargement Process : Changing Perspectives and Policy Options," World Bank Publications, The World Bank, number 15235.
- Lilien, David M, 1982. "Sectoral Shifts and Cyclical Unemployment," Journal of Political Economy, University of Chicago Press, vol. 90(4), pages 777-93, August.
- Luca Barbone & Domenico J. Marchetti & Stefano Paternostro, 1999. "The early stages of reform in Polish manufacturing," The Economics of Transition, The European Bank for Reconstruction and Development, vol. 7(1), pages 157-177, March.
- Boeri, Tito & Scarpetta, Stefano, 1996. "Regional mismatch and the transition to a market economy," Labour Economics, Elsevier, vol. 3(3), pages 233-254, October.
- Hartmut Lehmann & Patrick Paul Walsh, 1999. "Gradual restructuring and Structural Unemployment in Poland. A Legacy of Central Planning," LICOS Discussion Papers 7899, LICOS - Centre for Institutions and Economic Performance, KU Leuven.
When requesting a correction, please mention this item's handle: RePEc:iza:izadps:dp7126. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Mark Fallak)
If references are entirely missing, you can add them using this form.