Labor Market Integration Policies and The Convergence of Regions: The Role of Skills and Technology Diffusion

Herbert Dawid (), Simon Gemkow, Philipp Harting and Michael Neugart
Additional contact information
Herbert Dawid: Bielefeld University
Simon Gemkow: Bielefeld University
Philipp Harting: Bielefeld University

A chapter in The Two Sides of Innovation, 2013, pp 167-186 from Springer

Abstract: Abstract We study the role of different labor market integration policies on economic performance and convergence of two distinct regions in an agent-based model. Production is characterized by a complementarity between the quality of the capital stock and the specific skills of workers using the capital stock. Hence, productivity changes in a region are influenced both by the investment of local firms in high quality capital goods and by the evolution of the specific skill distribution of workers employed in the region. We show that various labor market integration policies yield, via differing regional worker flows, to distinct regional distributions of specific skills. Through this mechanism, relative regional prices are affected, determining the shares that the regions can capture from overall consumption good demand. There occurs a trade-off between aggregate output and convergence of regions with closed labor markets resulting in relatively high convergence but low output, and more integrated labor markets yielding higher output but lower convergence. Furthermore, results differ substantially in several respects as distinct labor market opening policies are applied.

Keywords: Labor Market; European Union; Capital Stock; Specific Skill; Policy Scenario (search for similar items in EconPapers)
Date: 2013
References: Add references at CitEc
Citations: View citations in EconPapers (5)

There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it.

Related works:
Working Paper: Labor market integration policies and the convergence of regions: the role of skills and technology diffusion (2013)
Journal Article: Labor market integration policies and the convergence of regions: the role of skills and technology diffusion (2012)
Working Paper: Labor market integration policies and the convergence of regions: the role of skills and technology diffusion (2012)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:spr:eccchp:978-3-319-01496-8_9

Ordering information: This item can be ordered from
http://www.springer.com/9783319014968

DOI: 10.1007/978-3-319-01496-8_9

Access Statistics for this chapter

More chapters in Economic Complexity and Evolution from Springer
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().