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Sectoral Shifts, Diversification and Regional Unemployment. Evidence From Local Labour Systems in Italy

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  • Roberto Basile
  • Alessandro Girardi
  • Marianna Mantuano
  • Francesco Pastore

Abstract

Using local labour systems data, this work aims at assessing the effects of sectoral shifts and industry specialisation patterns on regional unemployment in Italy over the years 2004-2008, when huge worker reallocation caused by changes in the international division of labour occurred. Italy represents an interesting case study because of the high degree of spatial heterogeneity in local labour market performance and the well-known north-south divide. Furthermore, the presence of strongly specialised local labour systems (industrial districts) allows us to test whether industrial districts perform better than highly diversified urban areas thanks to the effect of agglomeration economies, or vice versa. Building on a semiparametric spatial autoregressive framework, our empirical investigation documents that sectoral shifts and the degree of specialisation exert a negative effect on unemployment dynamics. By contrast, highly diversified areas turn out to be characterised by better labour market performances.

Suggested Citation

  • Roberto Basile & Alessandro Girardi & Marianna Mantuano & Francesco Pastore, 2011. "Sectoral Shifts, Diversification and Regional Unemployment. Evidence From Local Labour Systems in Italy," WIFO Working Papers 411, WIFO.
    • Handle: RePEc:wfo:wpaper:y:2011:i:411
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    Cited by:

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    2. F. Pastore, 2015. "The Mezzogiorno and Crisis after Market and State Failures. A Review of Economic Literature," Rivista economica del Mezzogiorno, Società editrice il Mulino, issue 3-4, pages 525-582.
    3. Demidova, Olga & Kolyagina, Alena & Pastore, Francesco, 2018. "Marshallian vs Jacobs Effects: Which One Is Stronger? Evidence for Russia Unemployment Dynamics," IZA Discussion Papers 12042, Institute of Labor Economics (IZA).
    4. Walid Jebili & Lotfi Belkacem, 2015. "Sectoral Shifts, Diversification, Regional Unemployment on the Eve of Revolution in Tunisia: a Sequential Spatial Panel Approach," Working Papers 952, Economic Research Forum, revised Oct 2015.
    5. Demidova, Olga, 2021. "Methods of spatial econometrics and evaluation of government programs effectiveness," Applied Econometrics, Russian Presidential Academy of National Economy and Public Administration (RANEPA), vol. 64, pages 107-134.
    6. Francesco Pastore, 2012. "Primum vivere . . . industrial change, job destruction and the geographical distribution of unemployment," IZA Journal of European Labor Studies, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 1(1), pages 1-15, December.
    7. Nam Foo & Ruhul Salim, 2022. "The evolution of mining employment during the resource boom and bust cycle in Australia," Mineral Economics, Springer;Raw Materials Group (RMG);Luleå University of Technology, vol. 35(2), pages 309-324, June.
    8. Watson, Philip & Deller, Steven, 2017. "Economic diversity, unemployment and the Great Recession," The Quarterly Review of Economics and Finance, Elsevier, vol. 64(C), pages 1-11.
    9. Irene Brunetti & Valerio Intraligi & Andrea Ricci & Valeria Cirillo, 2020. "Low‐skill jobs and routine tasks specialization: New insights from Italian provinces," Papers in Regional Science, Wiley Blackwell, vol. 99(6), pages 1561-1581, December.
    10. Amie M. Jobe & Roberto Ricciuti, 2023. "Sectoral shifts and labour market outcomes in sub-Saharan Africa," WIDER Working Paper Series wp-2023-138, World Institute for Development Economic Research (UNU-WIDER).
    11. Pastore, Francesco, 2013. "Primum vivere… Industrial Change, Job Destruction and the Geographical Distribution of Unemployment," IZA Discussion Papers 7126, Institute of Labor Economics (IZA).
    12. Mussida, Chiara & Pastore, Francesco, 2012. "Is There a Southern-Sclerosis? Worker Reallocation and Regional Unemployment in Italy," IZA Discussion Papers 6954, Institute of Labor Economics (IZA).
    13. Demidova, Olga & Kolyagina, Alena & Pastore, Francesco, 2020. "Marshallian vs Jacobs effects: Which is stronger? Evidence for Russia unemployment dynamics," Structural Change and Economic Dynamics, Elsevier, vol. 55(C), pages 244-258.

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    JEL classification:

    • C14 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Semiparametric and Nonparametric Methods: General
    • C21 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Cross-Sectional Models; Spatial Models; Treatment Effect Models
    • L16 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Industrial Organization and Macroeconomics; Macroeconomic Industrial Structure
    • R23 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Regional Migration; Regional Labor Markets; Population

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