REGIONAL UNEMPLOYMENT ELASTICITIES: FURTHER EVIDENCE
| Author | D. Peter B. Elias |
| Date | 01 February 1978 |
| DOI | http://doi.org/10.1111/j.1467-9485.1978.tb01187.x |
| Published date | 01 February 1978 |
Scottish
Journal
of
Political
Economy,
Vol.
25,
No.
1,
February
1978
Notes
and
Communications
REGIONAL UNEMPLOYMENT ELASTICITIES:
FURTHER
EVIDENCE
D.
PETER
B.
ELIAS*
University
of
Warwick
INTRODUCTION
It is well known that the traditionally high unemployment regions of Great
Britain (North of England, Wales, Scotland) have a lower cyclical response
within their labour markets to changes in demand conditions. Most work
over the past decade has focused upon a key policy variable, the regional
unemployment rate, and has measured the elasticity of the regional un-
employment rate with respect to changes in the national unemployment rate
or regional vacancy rate(s). Of more interest, perhaps, is a regional analysis
of the cyclical responses of the flow of persons onto the unemployment
register and of the mean duration of completed spells of unemployment.
If the differing cyclical responses of regional unemployment rates are primarily
a function of differences in the elasticity of the flow of persons onto a region’s
unemployment register, this would reflect regional variations in the redun-
dancy policies of firms and the propensity to register as unemployed when
searching for
a
new job. If these differences in regional unemployment
elasticities were principally a function of differences in the elasticity of the
mean duration of completed spells of unemployment, one would focus upon
the regional job search behaviour of the registered unemployed and the
hiring policies of firms for an explanation of these variations. The data used
to disaggregate regional unemployment rates into a flow component (the
incidence of registered unemployment per period) and a stock component
(the mean duration of spells of unemployment completed by all persons
registering as unemployed in this period) does not correspond with that
which
is
ideally required. Consequently, this analysis yields only tentative
conclusions. It is presented in the hope that it will provoke further research
into the still unresolved reasons for the large and persistent differences in
regional unemployment rates.
AN ANALYSIS
OF
REGIONAL UNEMPLOYMENT RATES
Registered unemployment statistics are the only continuous series of
information on regional joblessness. For females, particularly married
females, the propensity to register as unemployed when engaged in
a
job
search is rather low and, as Bowers
(1975,
pp.
64-66)
has shown, is probably
*
I
am most grateful for the helpful criticism and suggestions made by Professor
L. C.
Hunter and
D.
I.
MacKay,
J.
K.
Bowers and
A.
P.
Thiriwall
on
earlier drafts of this paper.
Received in final form:
14
September
1977.
89
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