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On regional unemployment: an empirical examination of the determinants of geographical differentials in the UK

  • Korobilis, Dimitris
  • Gilmartin, Michelle

This paper considers the determinants of regional disparities in unemployment rates for the UK regions at NUTS-II level. We use a mixture panel data model to describe unemployment differentials between heterogeneous groups of regions. The results indicate the existence of two clusters of regions in the UK economy, characterised by high and low unemployment rates respectively. A major source of heterogeneity seems to be caused by the varying (between the two clusters) effect of the share of employment in the services sector, and we trace its origin to the fact that the "high unemployment" cluster is characterised by a higher degree of urbanization.

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File URL: http://mpra.ub.uni-muenchen.de/28542/1/MPRA_paper_28542.pdf
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Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 28542.

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Date of creation: Dec 2010
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Handle: RePEc:pra:mprapa:28542
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  1. Frühwirth-Schnatter, Sylvia & Kaufmann, Sylvia, 2004. "Model-based Clustering of Multiple Time Series," CEPR Discussion Papers 4650, C.E.P.R. Discussion Papers.
  2. Theodore M. Crone, 2005. "An Alternative Definition of Economic Regions in the United States Based on Similarities in State Business Cycles," The Review of Economics and Statistics, MIT Press, vol. 87(4), pages 617-626, November.
  3. Quah, Danny, 1996. "Regional Convergence Clusters Across Europe," CEPR Discussion Papers 1286, C.E.P.R. Discussion Papers.
  4. Cracolici, M. Francesca & Cuffaro, Miranda & Nijkamp, Peter, 2007. "Geographical distribution of unemployment: an analysis of provincial differences in Italy," Serie Research Memoranda 0001, VU University Amsterdam, Faculty of Economics, Business Administration and Econometrics.
  5. Fabio Canova, 2004. "Testing for Convergence Clubs in Income Per Capita: A Predictive Density Approach," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 45(1), pages 49-77, 02.
  6. Overman, Henry G & Puga, Diego, 1999. "Unemployment Clusters Across European Regions and Countries," CEPR Discussion Papers 2255, C.E.P.R. Discussion Papers.
  7. Elhorst, J. Paul, 2001. "The mystery of regional unemployment differentials : a survey of theoretical and empirical explanations," Research Report 00C06, University of Groningen, Research Institute SOM (Systems, Organisations and Management).
  8. repec:dgr:vuarem:2007-1 is not listed on IDEAS
  9. repec:dgr:uvatin:20070065 is not listed on IDEAS
  10. Paap, Richard & Franses, Philip Hans & van Dijk, Dick, 2005. "Does Africa grow slower than Asia, Latin America and the Middle East? Evidence from a new data-based classification method," Journal of Development Economics, Elsevier, vol. 77(2), pages 553-570, August.
  11. Costas Megir & Danny Quah, 1996. "Regional Convergence Clusters Across Europe," CEP Discussion Papers dp0274, Centre for Economic Performance, LSE.
  12. Mark Partridge & Dan Rickman, 1997. "The Dispersion of US State Unemployment Rates: The Role of Market and Non-market Equilibrium Factors," Regional Studies, Taylor & Francis Journals, vol. 31(6), pages 593-606.
  13. Taylor, Jim & Bradley, Steve, 1997. "Unemployment in Europe: A Comparative Analysis of Regional Disparities in Germany, Italy and the UK," Kyklos, Wiley Blackwell, vol. 50(2), pages 221-45.
  14. repec:dgr:uvatin:20080085 is not listed on IDEAS
  15. Quah, Danny T., 1996. "Regional convergence clusters across Europe," European Economic Review, Elsevier, vol. 40(3-5), pages 951-958, April.
  16. Enrique Lopez-Bazo & Tomas Del Barrio & Manuel Artis, 2005. "Geographical distribution of unemployment in Spain," Regional Studies, Taylor & Francis Journals, vol. 39(3), pages 305-318.
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