Regional Unemployment Research Articles

Epidemiological spreading of mortgage default

PurposeThis paper aims to introduce mathematical models to capture the spreading of epidemics to explain the expansion of mortgage default events in the USA.Design/methodology/approachThe authors use the state of infectiousness and death to represent the subsequent steps of payment elinquency and default, respectively. As the local economic structure influences regional unemployment, which is a strong driver of mortgage default, the authors model interdependencies of regional mortgage default rates through employment conditions and vicinity.FindingsBased on a large sample between 2000 and 2014 of loan-level data, the estimation of key parameters of the model is proposed. The model’s forecast accuracy shows an above-average performance compared to well-known approaches such as linear regression or logit models.Originality/valueThe key findings may be useful in understanding the dynamics of mortgage defaults and its spatial spreading.

Crises and mortality: Does the level of unemployment matter?

The relationship between mortality and economic fluctuations has been a topic of long interest, which intensified following the 2008 global financial crisis. We study whether mortality responds non-linearly and asymmetrically to unemployment in the context of national economic crises. Although these assumptions have been challenged in other domains, they have been neglected in the mortality literature. Greece offers an ideal setting as unemployment was decreasing until mid-2008, but then it was sharply increased as a result of a severe economic crisis. We use quarterly data on regional unemployment and mortality from 1999 to 2013, giving a balanced panel of 780 observations. We find evidence of a countercyclical total mortality, especially for the older groups, and a further deteriorating crisis effect. We provide evidence that the relationship is non-linear and asymmetric, suggesting that the effect on death rates changes for very high values of unemployment and depends on its direction. Both non-linearity and asymmetry are mainly driven by those above 65 years old. The results suggest that the mechanisms explaining these effects are likely to vary across age groups. Our findings have important methodological implications and suggest that empirical investigations on fluctuations, recessions and mortality should not ignore possible non-linear and asymmetric behaviours, especially during turbulent times.

The Effect of Unemployment on Life Satisfaction: A Cross-National Comparison Between Canada, Germany, the United Kingdom and the United States

This paper investigates the effect of unemployment on life satisfaction from a comparative perspective. It also tests whether the link between unemployment and life satisfaction is moderated or reinforced by contextual unemployment across regions within a country—either through a negative spillover or a positive social-norm effect, or both. The results suggest that noticeable non-pecuniary costs are associated with unemployment in the four countries studied. Cross-national differences also emerged in the impact of the moderating factors. Regional unemployment is a strong moderating factor of own unemployment in Canada and to a lesser extent in the United States; the effect is ambiguous in the United Kingdom and exacerbating in Germany. The results also support a negative spillover effect of regional unemployment on the employed in the United States and Germany, no spillover effect in the United Kingdom and, surprisingly, a positive overall spillover effect in Canada. Sensitivity testing further revealed that this Canadian anomaly was a phenomenon mainly in Atlantic Canada, not across the whole country.

Restructuring Regional Economy Based on ICT Networks

Information and Communication Technology (ICT) gave us great influence on our society/industries as a kind of paradigm shift in many aspects. For many rural regions in advanced countries, globalization accelerated by ICT advancement caused some negative influences in industries. Manufacturing industry and agriculture in those regions were damaged and stagnated by competing with low cost products/labor-force in merging countries. The stagnation of regional economy also promoted degradation of regional commerce and unemployment that caused depopulation and aging issues in regional community. However, on the other hand, ICT advancement also brought us new potential of regional industries through virtual clustering by networking. Many small enterprises can be virtually integrated through ICT networks and can be enhanced their power by virtual integration such as real industrial clustering. By joining in such clustering, many regional enterprises regained their power. And by restructuring regional industries with those enterprises, regional economy has been recovered in some cases. This study introduces some cases of virtual clustering in industries and some regions recovering their economy by restructuring regional industries. Their manners to restructure regional economy are very suggestive for regional societies to escape from undesirable negative circulation of de-industrialization/unemployment and to realize sustainable development.

Unemployment in the Carpatho-Podilsky Region of the Ukraine

Unemployment in the Carpatho-Podilsky Region of the Ukraine

Unemployment Clubs in Russian Regions

ABSTRACTIn this article, we empirically investigate regional unemployment in Russia. We first detect the existence of two unemployment clubs, that is, regions with high (low) unemployment surrounded by regions with high (low) unemployment, and a group that comprises the remaining regions. We then apply a specially designed class of spatial-econometric models to regional data 2005–2012, using difference GMM, and we obtain partial confirmation of our two main hypotheses: (i) spatial effects for the high-high and low-low clubs regions differ significantly; and (ii) the determinants of unemployment of the two clubs significantly differ with respect to those of the remaining regions. Our results have key implications for the national- and regional-level policies.

The victims of neoliberal globalisation and the rise of the populist vote: a comparative analysis of three recent electoral decisions

Recent presidential elections in the US and Austria as well as the referendum on Brexit in the UK delivered victories or near-victories for populist right-wing candidates or agendas. In all three cases, globalisation and European integration were blamed for higher immigration and pressure on public services, deindustrialisation and job losses, and the attack on traditional values by cosmopolitan elites supported by traditional centre parties that have been unable or unwilling to control those processes. While election analysts seek to explain voting behaviour with socio-demographic characteristics of individuals, individual voting preferences also depend on the geographical context in which decisions are made. This article thus examines how long-term, regional structural economic changes, the varying impact of the Great Recession on the rise of and recovery from regional unemployment and current regional economic conditions, such as unemployment and welfare benefit losses, affect regional vote shares. In addition to those economic conditions, we examine the impact of immigration and urban size on populist vote shares. We show that regions with low, but rising immigrant shares, old industrial regions, smaller regions, those whose labour markets were exposed more and recovered less from the Great Recession, and those with high unemployment rates and benefit losses exhibited higher populist vote shares. These results are largely consistent across the three case study countries.

Построение кривой Филлипса на региональных данных

This article is devoted to estimating the Phillips curve on the regional panel data for Russia, that allows to understand the degree of regional heterogeneity of the main macroeconomic indicators.Using the generalized method of moments, the hybrid Phillips curve and its partial cases (adaptive expectations-augmented and neokeynesian) are estimated in this paper. The results show that among three model’s modifications the hybrid model with the output gap and forward-and back-looking expectations is the most fitting to real data. Thus, we can assume that inflation expectations in Russia include both adaptive and rational components.At the same time, the Phillips curve with the unemployment rate incorrectly describes the regional panel data. We associate this result with the specifics of regional labor markets and divide the regional sample into clusters by the indicators of income and unemployment, which gives the formation of three clusters: 1) with high income per capita, high level of the economically active population and low unemployment, 2) with low income per capita, low level of the active population and high unemployment, 3) with middle values of each indicator.The results of the model estimation show that the Phillips curve does not describe the data on the sample of «rich» regions, which is explained by the natural and climatic conditions in these regions and/or by specific state premiums. At the same time, inflation and unemployment in regions with low and/or moderate incomes are adequately described by the Phillips curve. The obtained results allow to understand more deeply the mechanisms of pricing in the Russian regions, the specific features of labor markets and the formation of macro variables at the regional level.

Regional Unemployment: False Impressions of Rural-Urban Differences

Regional Unemployment: False Impressions of Rural-Urban Differences

Understanding U.S. Wage Dynamics

In this paper, we undertake empirical analysis to understand U.S. wage behavior since thebeginning of the new millennium. At the macroeconomic level, we find that aproductivity-augmented Phillips curve model explains the data fairly well. The modelreveals that the upward pressure on wage growth from recent tightening in the labormarket has been dampened by a persistent decline in trend labor productivity growth andthe share of income that accrues to labor. These themes are reinforced and complementedat the micro-economic level. Lower regional unemployment puts an upward pressure onwages of individuals, although this effect has become weaker since 2008. But there isdownward pressure on wages for individuals with occupations that are exposed toautomation and offshoring, and in industries with a higher concentration of large firms.All these factors appear to play a role illustrating why it is difficult to single out any oneculprit for the observed wage growth moderation.

Understanding U.S. Wage Dynamics

In this paper, we undertake empirical analysis to understand U.S. wage behavior since the beginning of the new millennium. At the macroeconomic level, we find that a productivity-augmented Phillips curve model explains the data fairly well. The model reveals that the upward pressure on wage growth from recent tightening in the labor market has been dampened by a persistent decline in trend labor productivity growth and the share of income that accrues to labor. These themes are reinforced and complemented at the micro-economic level. Lower regional unemployment puts an upward pressure on wages of individuals, although this effect has become weaker since 2008. But there is downward pressure on wages for individuals with occupations that are exposed to automation and offshoring, and in industries with a higher concentration of large firms. All these factors appear to play a role illustrating why it is difficult to single out any one culprit for the observed wage growth moderation.

Youth Unemployment, Violent Extremism and Job Creation For Peace and Prosperity- Silatech as a Case Study

The first section of this Paper portrays the youth unemployment situation in the Arab region. The scale of youth unemployment in the Arab region, being more than double the average world rate, justifies why Silatech, the case study of the Paper, has decided to start focusing on the region despite being launched by its initiator as an international youth-oriented initiative, a role that still Silatech endeavours to move onto. The second section exposes violent extremism as a threat to global peace and security. It also shown that youth represent a primary recruitment target of violent extremists. While youth unemployment may be a push factor leading to violent extremism, it has been argued that there are other push and pull factors that need to be understood and considered when developing strategies and interventions to prevent and combat violent extremism. The third section affirms employment creation as a priority for peace, security and for attaining global sustainable development goals. It discusses and draws lessons from donor youth programming. The fourth section present the activities and the organisation of operations of Silatech, as an organisation that works in the economic empowerment of youth. Two points make the conclusion: the employment promotion role of Silatech as peacebuilding; helping in preventing and dealing with the consequences of violent extremism, and how can Silatech avoids two of the negative international experiences in youth development programmes

Measuring Regional Differences in Labour Market Sensitivity in Hungary

The core of this study is the development of a statistical tool for measuring the regional labour market sensitivity. The goal is to present and apply a general index, which can be used in other disciplines as well. An additional objective is the evaluation of the social and economic processes affecting the labour market, and the identification of highly vulnerable areas exposed to crises. In this study, sensitivity means the relative volume of responsiveness to the labour market changes in the examined areas. Former spatial statistical methods have tried to identify the regional differentiating factors of unemployment; however, they did not reveal the extent to which the villages and towns were exposed to economic and employment changes. A new index provides this opportunity. It evaluates the processes of regional unemployment, the degree of exposure to the crisis and the employment mechanisms with particular regard to public employment programmes. The research explores and evaluates the specific labour market vulnerability and macro-regional structure of the settlements of Hungary with the help of the developed index. Thus at least three new elements of the national spatial structure will be revealed which enables us to prepare for socio-economic changes similar to the latest crisis.

Regional unemployment and employee loyalty: evidence from 12 UK regions

ABSTRACTThis study investigates the relationship between unemployment and employee loyalty across UK regions. It is argued that higher regional unemployment depresses wages and increases the cost of a potential job loss, thus providing an incentive for employees to be loyal to their employer. Using data from the Work and Employment Relations Survey (WERS), the results confirm the positive association between regional unemployment and employee loyalty. A disaggregated analysis by type of business reveals that this association is stronger in the private sector. The study adds a spatial dimension to an emergent literature that examines how unemployment affects the employed.

Do high levels of home-ownership create unemployment? Introducing the missing link between housing tenure and unemployment

A large number of studies have demonstrated that the proportion of home-owners in a region tend to be positively associated with the unemployment levels in that region. In this paper, we introduce a missing piece of explaining this commonly found pattern. By analysing individual-level population register data on Sweden, we jointly examine the effects of micro- and macro-level home-ownership on individuals’ unemployment. The findings indicate that even though home-owners have a lower probability of being unemployed, there is a penalty for both renters and home-owners on unemployment in regions with high home-ownership rates. Differences in mobility patterns cannot explain this pattern. However, when labour market size is considered, the higher probability of unemployment in high home-owning regions is drastically reduced. This suggests that high home-ownership regions tend to coincide with small labour markets, affecting the job matching process negatively.

Regional Unemployment and Employee Loyalty: Evidence from Twelve UK Regions

This study investigates the relationship between unemployment and employee loyalty across UK regions. It is argued that higher regional unemployment depresses wages and increases the cost of a potential job loss, thus providing an incentive for employees to be loyal to their employer. Using data from the Work and Employment Relations Survey (WERS), the results confirm the positive association between regional unemployment and employee loyalty. A disaggregated analysis by type of business reveals that this association is stronger in the private sector. The study adds a spatial dimension to an emergent literature that examines how unemployment affects the employed.

Explaining regional unemployment in Croatia: GVAR approach

The paper models the effects of various macroeconomic and business indicators as well as environmental impacts for the period from January 2002 to December 2013 in order to explain the differences in the Croatian regional unemployment. The paper proposes use of relatively novel methodology for modelling regional unemployment. The applied methodology enables joint modelling of all Croatian counties in a single (global) model and employing a rich set of variables, as well as accounting for interactions among regional labor markets, economic activities and firms. The study indicates an absence of conventional market economies adjustment mechanisms on the regional labor markets. Low flexibility of the regional labor markets combined with strong dependence on national dynamics makes regions highly exposed to the occurrence of economic downturn.

Does Regional Unemployment Influence Individual Early-stage Entrepreneurial Activity £¿

This paper examines the relation between regional unemployment and the likelihood of individual early-stage entrepreneurial activities from a social and human capital perspective. Using Chinese Global Entrepreneurship Monitor (GEM) survey data and China statistics yearbook during 2009-2013, this paper finds out the negative effect of regional unemployment on the probability of an individual to start a new business. The findings also indicate that the social capital strengthen the relationship between regional unemployment and individual opportunity or necessity entrepreneurial activity, and the human capital weaken the relationship between regional unemployment and individual opportunity- based entrepreneurial activity. Finally, this paper makes theoretical contributions about entrepreneurship and practice contributions about government policies.

Robots and potential technological unemployment in the Russian regions: Review and preliminary results

The use of unmanned technologies can cause a decrease in the level of employment. The article discusses the compensation mechanisms and conflicting results of empirical studies. On the basis of internationally comparable methods, it was estimated that about 44% of the workers in Russia can be replaced, which is lower than in most developed countries. In the regions, specializing in the manufacturing industry, this value is higher, the least values are in the least developed regions. Some people will not be ready for life-long learning, competition with robots, and accordingly there is a possibility of their social exclusion in the future.

SEASONALITY OF UNEMPLOYMENT IN THE COASTAL AND MOUNTAINOUS TOURIST REGIONS OF POLAND

Purpose. Comparison of the size, distribution and trends of seasonal fluctuations in unemployment in seaside and mountain tourist areas. Efforts were made to determine the differences between groups of regions as a whole, internal differentiation within individual regions and between selected regions. Method. The decomposition of the time series relies on extracting the seasonal component from the input range . To extract the seasonal component, we used the Census X12 ARIMA procedure. The analysis used data on the number of registered unemployed individuals in particular months from 2004 to 2014. Findings. Tourist labour markets in Poland were characterized by relatively high seasonal unemployment. Seasonality level of unemployment was significantly lower in the mountain regions than in the seaside regions. In both regions, seasonality of unemployment increased during the considered period. Seasonal fluctuations in unemployment on seaside and mountain labour markets showed a similar distribution. Research and conclusion limitations. The analysis used data on the number of registered unemployed individuals. The number of registered unemployed individuals does not fully describe the actual number of those unemployed and occurring in the short term changes in the labour market. Practical implications. The findings may be useful from the point of view of shaping instruments affecting the labour market in the tourist regions. They also allow an assessment of the changes that have occurred among labour markets in tourist regions. Originality. The originality of the research is based on comparison of seasonality in tourist regions with different locations and specifics. It allows to assess whether short-term fluctuations in unemployment in seaside and mountain tourist regions have any specificity. Type of paper. Research article.