On regional unemployment: an empirical examination of the determinants of geographical differentials in the UK

Korobilis, Dimitris and Gilmartin, Michelle (2010): On regional unemployment: an empirical examination of the determinants of geographical differentials in the UK.

Abstract

This paper considers the determinants of regional disparities in unemployment rates for the UK regions at NUTS-II level. We use a mixture panel data model to describe unemployment differentials between heterogeneous groups of regions. The results indicate the existence of two clusters of regions in the UK economy, characterised by high and low unemployment rates respectively. A major source of heterogeneity seems to be caused by the varying (between the two clusters) effect of the share of employment in the services sector, and we trace its origin to the fact that the "high unemployment" cluster is characterised by a higher degree of urbanization.

• Item Type: MPRA Paper
• Language: English
• Keywords: distribution dynamics; regional labour markets; unemployment differentials
• Subjects: J - Labor and Demographic Economics > J0 - General > J08 - Labor Economics Policies; C - Mathematical and Quantitative Methods > C2 - Single Equation Models ; Single Variables > C23 - Panel Data Models ; Spatio-temporal Models; J - Labor and Demographic Economics > J6 - Mobility, Unemployment, Vacancies, and Immigrant Workers > J64 - Unemployment: Models, Duration, Incidence, and Job Search; R - Urban, Rural, Regional, Real Estate, and Transportation Economics > R1 - General Regional Economics > R12 - Size and Spatial Distributions of Regional Economic Activity; R - Urban, Rural, Regional, Real Estate, and Transportation Economics > R2 - Household Analysis > R23 - Regional Migration ; Regional Labor Markets ; Population ; Neighborhood Characteristics

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