Persistence and turnover in regional unemployment disparities

This study investigates persistence and turnover in regional unemployment disparities in Finland by examining time-series data on 10 labour districts and 423 municipalities. The data on the labour districts indicates that regional unemployment disparities are rather persistent and that steady-state unemployment rates differ considerably across the districts. The results on the municipality level data, however, suggest the presence of substantial intra-distribution dynamics and that the degree of persistence is less profound than the labour district data indicates. In all, the results are more in line with the disequilibrium than the equilibrium view of the causes of regional unemployment differences.