6533b82ffe1ef96bd1295d2a

RESEARCH PRODUCT

Regional labor markets in Finland: Adjustment to total versus region-specific shocks

Sari PekkalaAki Kangasharju

subject

Labour economicsSecondary labor marketmedia_common.quotation_subjectGeography Planning and DevelopmentLabor demandEnvironmental Science (miscellaneous)Excess supplyShock (economics)Region specificjel:J6UnemploymentEconomicsLabor market employment unemployment migration shock adjustmentjel:R23media_common

description

This article analyses regional labor market adjustment in the Finnish provinces during 1976-2000. We investigate the inter-relations of employment, unemployment, labor force participation, and migration to see how a change in region-specific and total labor demand is adjusted. The analysis reveals that region-specific labor demand shocks adjust mainly via participation, whereas total shocks are adjusted by unemployment. The region-specific component of labor demand shock has shorter-lived effects on unemployment and participation, but its effect on employment is permanent. Conversely, total shocks leave no permanent effect. Migration is more important in the region-specific case where, after a few years, it acquires a large role in the adjustment process.

yearjournalcountryeditionlanguage
2005-01-14Papers in Regional Science
https://doi.org/10.1111/j.1435-5597.2002.tb01237.x