What drives unemployment disparities in European regions? A dynamic spatial panel approach
Regional Studies, 2017, vol. 51, issue 11, 1599-1611
What drives unemployment disparities in European regions? A dynamic spatial panel approach. Regional Studies. This study analyzes unemployment differentials in European regions during the period 2000–11. To that end, a theoretical model with substantive spatial interactions among regions is developed. The solution implies a dynamic-spatial Durbin model specification including regional and institutional-level factors as explanatory variables. In conjunction with dynamic-spatial panel estimates, relative importance metrics are used to quantify the effect of regional disequilibrium, equilibrium and national-level factors. Relative importance analysis suggests that during the pre-crisis period, unemployment disparities were mainly driven by regional-level equilibrium factors. Nevertheless, labour market institutions are of major importance to explain increasing disparities during 2009–11.
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Persistent link: https://EconPapers.repec.org/RePEc:taf:regstd:v:51:y:2017:i:11:p:1599-1611
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