Spatial Search, Migration and Regional Unemployment

The dominant explanation of spatial unemployment in the literature assumes that workers must live in an area in order to be able to access job offers. This gives rise to 'compensating variations' in local wages and unemployment. However, for many occupations search is clearly conducted ove...

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Bibliographic Details
Published in:Economica (London) 2001-05, Vol.68 (270), p.269-283
Main Author: Molho, Ian
Format: Article
Language:English
Subjects:
Economic models
Equilibrium
Job hunting
Job search
Labor markets
Labour market
Marginal costs
Market equilibrium
Mathematical models
Migration
Modeling
Regional variation
Spatial analysis
Studies
Unemployment
Unemployment rates
Urban economics
Urban unemployment
Wages
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Summary:The dominant explanation of spatial unemployment in the literature assumes that workers must live in an area in order to be able to access job offers. This gives rise to 'compensating variations' in local wages and unemployment. However, for many occupations search is clearly conducted over longer distances from a home base. In the model presented in this paper, migration and unemployment are analysed both when the optimal search field is local, as in the traditional model, and when search is conducted over longer distances. I compare equilibria in these two regimes, and discuss the implications for regional policy.
ISSN:0013-0427
1468-0335
DOI:10.1111/1468-0335.00245