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Regional Labour Market Disparities in an Enlarged European Union

  • Peter Huber

    (WIFO)

We characterise regional labour market problems in the EU 27 using disaggregate data on regional employment, unemployment and participation rates, by gender and 10-year age groups at the NUTS-2 level. We ask whether accession changed disparities in regional labour market conditions and to what degree the structure of employment, unemployment and participation rates in the 12 new member countries differs from the EU 15. We find that aggregate labour market disparities are comparable between the two country groups but that there are important structural differences. Performing a basic components analysis we find that five principal components (four of which are associated with the structure of employment and participations rates) explain around 90 percent of the variance in the data. Cluster analysis suggests that new member country regions are most similar in structural labour market characteristics to many German and French NUTS-2 regions. Regression analysis suggests that the correlates of aggregate regional employment and unemployment rates between the two groups do not differ dramatically but that there may be some differences with respect to employment rates of individual demographic groups.

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Paper provided by WIFO in its series WIFO Working Papers with number 309.

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Length: 41 pages
Date of creation: 20 Feb 2008
Date of revision:
Handle: RePEc:wfo:wpaper:y:2008:i:309
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  1. 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.
  2. Christine M. Aumayr, 2007. "European Region Types in EU-25," European Journal of Comparative Economics, Cattaneo University (LIUC), vol. 4(2), pages 109-147, September.
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  4. Cristiano Perugini & Marcello Signorelli, 2007. "Labour Market Performance Differentials and Dynamics in EU-15 Countries and Regions," European Journal of Comparative Economics, Cattaneo University (LIUC), vol. 4(2), pages 209-262, September.
  5. Vera Gács & Peter Huber, 2005. "Quantity Adjustments in the Regional Labour Markets of EU Candidate Countries," WIFO Working Papers 254, WIFO.
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  8. 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, March.
  9. Károly Fazekas, 1996. "Types of Microregions, Dispersion of Unemployment, and Local Employment Development in Hungary," Eastern European Economics, M.E. Sharpe, Inc., vol. 34(3), pages 3-48, June.
  10. Lucio R. Pench & Paolo Sestito & Elisabetta Frontini, 1999. "Some unpleasant arithmetics of regional unemployment in the EU. Are there any lessons for EMU?," European Economy - Economic Papers 134, Directorate General Economic and Financial Affairs (DG ECFIN), European Commission.
  11. 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.
  12. Peter Huber, 2007. "Regional Labour Market Developments in Transition: A Survey of the Empirical Literature," European Journal of Comparative Economics, Cattaneo University (LIUC), vol. 4(2), pages 263-298, September.
  13. Adalgiso Amendola & Floro Ernesto Caroleo & Gianluigi Coppola, 2006. "Regional Disparities in Europe," AIEL Series in Labour Economics, in: Floro Ernesto Caroleo & Sergio Destefanis (ed.), The European Labour Market. Regional Dimensions, edition 1, chapter 2, pages 9-31 AIEL - Associazione Italiana Economisti del Lavoro.
  14. Burda, Michael C, 1998. "The Consequences of EU Enlargement for Central and Eastern European Labour Markets," CEPR Discussion Papers 1881, C.E.P.R. Discussion Papers.
  15. Fabian Bornhorst & Simon Commander, 2006. "Regional unemployment and its persistence in transition countries," The Economics of Transition, The European Bank for Reconstruction and Development, vol. 14(2), pages 269-288, 04.
  16. Caroleo, Floro Ernesto & Pastore, Francesco, 2007. "A New Regional Geography of Europe? The Labour Market Impact of the EU Enlargements," IZA Discussion Papers 2620, Institute for the Study of Labor (IZA).
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