DP2255 Unemployment Clusters Across European Regions and Countries
|Author(s):||Henry G Overman, Diego Puga|
|Publication Date:||October 1999|
|Keyword(s):||Distribution Dynamics, European Regions, Unemployment|
|JEL(s):||E24, F15, R12|
|Programme Areas:||International Trade and Regional Economics|
|Link to this Page:||cepr.org/active/publications/discussion_papers/dp.php?dpno=2255|
European regions have experienced a polarisation of their unemployment rates between 1986 and 1996, as regions with intermediate rates have moved towards either extreme. This process has been driven by changes in regional employment, only partly offset by labour force changes. Regions' outcomes have closely followed those of neighbouring regions. This is only weakly explained by regions being part of the same Member State, having a similar skill composition, or broad sectoral specialisation. Even more surprisingly, foreign neighbours matter as much as domestic neighbours. All of this suggests a reorganisation of economic activities with increasing disregard for national borders.