A regional panel data analysis of the Spanish Beveridge curve
Unemployment is one of the most important problems of the Spanish and European economies. A possible analysis, vastly extended in recent literature, focuses on mismatch problems between labour demand and supply. In this sense, the empirical relationship between the vacancy rate and the unemployment rate, the so-called Beveridge curve, offers a potential instrument to characterise the unemployment of the considered economy. Different studies, such as Jackman et al. (1983), Pissarides (1985) and Abraham (1987) among others, point out that outward shifts of the Beveridge curve can be interpreted as increases in structural unemployment. The identification of these shifts provide useful information that can be used for policy planning. The main objective of this paper is to identify and to quantify the magnitude of outward shifts of the Beveridge curve for the Spanish economy in the period 1978-1996 using annual data from the Encuesta de Poblacion Activa, INE and the Estadistica de Empleo, INEM. As both sources provide regional disaggregated data, the econometric technique to be used will be Dynamic Panel Data (Arellano and Bond, 1988). This kind of analysis will permit to test the significance of time effects and the existence of different regional behaviours in the process of matching jobs with workers.
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- Richard Jackman & Christopher A. Pissarides & S Savouri, 1990. "Labour Market Policies and Unemployment in the OECD," CEP Discussion Papers dp0011, Centre for Economic Performance, LSE.
- Manuel Arellano & Stephen Bond, 1991.
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- Tom Doan, "undated". "RATS program to replicate Arellano-Bond 1991 dynamic panel," Statistical Software Components RTZ00169, Boston College Department of Economics.
- Esteban Sanroma Melendez & Raul Ramos Lobo, 1999. "El mercado de trabajo espanol en la union monetaria. Flexibilidad de salarios y politica laboral," Working Papers in Economics 45, Universitat de Barcelona. Espai de Recerca en Economia.
- Borsch-Supan, Axel H, 1991. "Panel Data Analysis of the Beveridge Curve: Is There a Macroeconomic Relation between the Rate of Unemployment and the Vacancy Rate?," Economica, London School of Economics and Political Science, vol. 58(231), pages 279-297, August.
- Jackman, R & Layard, Richard & Pissarides, C, 1989. "On Vacancies," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 51(4), pages 377-394, November.
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