Trade, Migration and Regional Unemployment
Paolo Epifani () and
Gino Gancia
No 199, Working Papers from Barcelona School of Economics
Abstract:
A by now large literature in regional economics has greatly improved our understanding of the determinants of the observed spatial disparities in productivity. However, this literature neglects what seems to be a robust and persistent fact accompanying regional productivity differences: high productivity regions also have lower unemployment than low productivity regions. In this paper, we set out a model in the NEG/job search tradition to explore the theoretical determinants of this fact. We find that the same forces producing regional agglomeration and productivity differences also generate persistent unemployment disparities. Moreover, we highlight a contrast between the short-run and long-run effects of migration on regional unemployment. In particular, migration from the periphery to the core may reduce unemployment disparities in the short-run, but exacerbates them in the long-run.
Keywords: agglomeration; transport costs; search frictions; labor mobility; regional disparities (search for similar items in EconPapers)
JEL-codes: F12 F15 F16 (search for similar items in EconPapers)
Date: 2015-09
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Citations: View citations in EconPapers (6)
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Related works:
Journal Article: Trade, migration and regional unemployment (2005) 
Working Paper: Trade, migration and regional unemployment (2003) 
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Persistent link: https://EconPapers.repec.org/RePEc:bge:wpaper:199
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