Journal article

The relationship between regional and national unemployment

D Shepherd, R Dixon

REGIONAL STUDIES | CARFAX PUBLISHING | Published : 2002

Abstract

An important issue in the analysis of regional unemployment is whether movements in regional unemployment rates reflect the impact of region-specific shocks or shocks affecting the entire economy. Previous studies have examined this problem by considering how the regional rates move in relation to the national unemployment rate. However, it has to be remembered that the national rate is merely a weighted average of the regional rates. In this paper we show that misleading correlation or regression results are likely to be generated by such models and that the problem can best be avoided by utilizing available information about the interactions between the regional unemployment rates directly..

View full abstract

University of Melbourne Researchers