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Three-Step Method for Delineating Functional Labour Market Regions

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  • Per Kropp
  • Barbara Schwengler

Abstract

K ropp P. and S chwengler B. Three-step method for delineating functional labour market regions, Regional Studies . This paper proposes a new three-step method to find delineations that adequately define functional regions with strong interactions within the region and few connections with outside areas based on commuting flows. A graph-theoretical approach is used to create many meaningful delineations for labour market regions in Germany and the modularity concept from network analysis is employed to select the delineation that captures the commuting flows best. As a result, a delineation of 50 German labour market regions that are quite heterogeneous in terms of size is obtained. Using the modularity measure, the current delineation is compared with previous functional delineations.

Suggested Citation

  • Per Kropp & Barbara Schwengler, 2016. "Three-Step Method for Delineating Functional Labour Market Regions," Regional Studies, Taylor & Francis Journals, vol. 50(3), pages 429-445, March.
    • Handle: RePEc:taf:regstd:v:50:y:2016:i:3:p:429-445
    DOI: 10.1080/00343404.2014.923093
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    Cited by:

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    2. Christopher S. Fowler & Nathan Frey & David C. Folch & Nicholas Nagle & Seth Spielman, 2018. "Who are the people in my neighborhood? The ‘contextual fallacy’ of measuring individual context with census geographies," Working Papers 18-11, Center for Economic Studies, U.S. Census Bureau.
    3. Lorenz, Svenja & Zwick, Thomas, 2020. "Money also is sunny in a retiree's world," ZEW Discussion Papers 20-056, ZEW - Leibniz Centre for European Economic Research.
    4. Lorenz, Svenja & Zwick, Thomas, 2021. "Money also is sunny in a retiree’s world: financial incentives and work after retirement," Journal for Labour Market Research, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany], vol. 55, pages 1-21.
    5. Mario Bossler & Thorsten Schank, 2023. "Wage Inequality in Germany after the Minimum Wage Introduction," Journal of Labor Economics, University of Chicago Press, vol. 41(3), pages 813-857.
    6. Lucas Martínez‐Bernabéu & José Manuel Casado‐Díaz, 2021. "Standard modularity is unsuitable for functional regionalization of spatial interaction data," Papers in Regional Science, Wiley Blackwell, vol. 100(5), pages 1323-1330, October.
    7. Marco Caliendo & Steffen Künn & Robert Mahlstedt, 2022. "The Intended and Unintended Effects of Promoting Labor Market Mobility," CEPA Discussion Papers 42, Center for Economic Policy Analysis.
    8. Julio A. Berdegué & Tatiana Hiller & Juan Mauricio Ramírez & Santiago Satizábal & Isidro Soloaga & Juan Soto & Miguel Uribe & Olga Vargas, 2019. "Delineating functional territories from outer space," Latin American Economic Review, Springer;Centro de Investigaciòn y Docencia Económica (CIDE), vol. 28(1), pages 1-24, December.
    9. Christopher S Fowler & Leif Jensen, 2020. "Bridging the gap between geographic concept and the data we have: The case of labor markets in the USA," Environment and Planning A, , vol. 52(7), pages 1395-1414, October.
    10. Mario Bossler & Martin Popp, 2022. "Labor Demand on a Tight Leash," Papers 2203.05593, arXiv.org, revised Feb 2024.
    11. Kosfeld, Reinhold & Dreger, Christian, 2019. "Towards an East German wage curve - NUTS boundaries, labour market regions and unemployment spillovers," Regional Science and Urban Economics, Elsevier, vol. 76(C), pages 115-124.
    12. Mergele, Lukas & Weber, Michael, 2020. "Public employment services under decentralization: Evidence from a natural experiment," Journal of Public Economics, Elsevier, vol. 182(C).
    13. Ben Yahmed, Sarra & Berlingieri, Francesco & Brüll, Eduard, 2022. "Adjustments of local labour markets to the COVID-19 crisis: The role of digitalisation and working-from-home," ZEW Discussion Papers 22-031, ZEW - Leibniz Centre for European Economic Research.
    14. Erik-Benjamin Borschlein & Mario Bossler & Martin Popp, 2024. "Scarce Workers, High Wages?," Papers 2408.04508, arXiv.org, revised Nov 2024.
    15. Popp, Martin, 2024. "Minimum Wages in Concentrated Labor Markets," IZA Discussion Papers 17357, Institute of Labor Economics (IZA).
    16. Christian Hutter & Enzo Weber, 2017. "Mismatch and the Forecasting Performance of Matching Functions," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 79(1), pages 101-123, February.
    17. Klapka, Pavel & Kraft, Stanislav & Halás, Marián, 2020. "Network based definition of functional regions: A graph theory approach for spatial distribution of traffic flows," Journal of Transport Geography, Elsevier, vol. 88(C).
    18. Bossler, Mario & Popp, Martin, 2024. "Labor Demand on a Tight Leash," IZA Discussion Papers 16837, Institute of Labor Economics (IZA).
    19. Jing Chen, 2017. "Geographical Scale, Industrial Diversity and Regional Economic Stability," Working Papers Working Paper 2017-03, Regional Research Institute, West Virginia University.
    20. Mergele, Lukas & Weber, Michael, 2020. "Public employment services under decentralization: Evidence from a natural experiment," Journal of Public Economics, Elsevier, vol. 182(C).
    21. Börschlein, Erik-Benjamin & Bossler, Mario & Popp, Martin, 2024. "Scarce Workers, High Wages?," IZA Discussion Papers 17447, Institute of Labor Economics (IZA).
    22. Breidenbach, Philipp & Budde, Rüdiger & Eilers, Lea & Kaeding, Matthias & Schaffner, Sandra, 2018. "Überprüfung des Zuschnitts von Arbeitsmarktregionen für die Neuabgrenzung des GRW-Fördergebiets ab 2021. Endbericht: Studie im Auftrag des Bundesministeriums für Wirtschaft und Energie (BMWi)," RWI Projektberichte, RWI - Leibniz-Institut für Wirtschaftsforschung, number 181939.

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