Regional unemployment disparities in Australia

Abstract

In this paper we examine the nature of disparities in regional (state) unemployment rates in Australia over the period 1978-99 and their relationship to the national unemployment rate. Using co-integration analysis, we find that there is a negative relationship between the two implying that, as the national unemployment rate falls, micro and/or differentiated labour market policies need to bite harder (and affect proportionately more people) if equity in unemployment across regions is to be maintained. We also find that the trade-of between dispersion and unemployment has become steeper in the period following significant deregulation of the Australian economy in the early 1980s. It would ap..