Scandinavian Working Papers in Business Administration
Discussion Papers,
Norwegian School of Economics, Department of Business and Management Science
No 2008/17: An agent-based computational approach to explaining persistent spatial unemployment disparities
David McArthur (), Inge Thorsen () and Jan Ubøe ()
Additional contact information
David McArthur: Stord/Haugesund University College, Postal: Stord/Haugesund University College, Postboks 5000, N-5409 Stord, Norway
Inge Thorsen: Stord/Haugesund University College, Postal: Stord/Haugesund University College, Postboks 5000, N-5409 Stord, Norway
Jan Ubøe: Dept. of Finance and Management Science, Norwegian School of Economics and Business Administration, Postal: NHH , Department of Finance and Management Science, Helleveien 30, N-5045 Bergen, Norway
Abstract: This paper explores possible reasons for persistent spatial unemployment disparities using agent-based computational methods. The method relies on observing the actions of thousands of individuals within an artificial society. The paper models the effect of unemployment insurance, wage disparities, region specific amenities and innate residential preferences on regional labour market interactions, accounting for both migration and commuting. An empirical example of Rogaland county in south-west Norway is given, where unemployment disparities have proved remarkably persistent for decades. The model provides non-trivial insight into the nature of spatial unemployment disparities as well as making a valuable contribution to the policy debate.
Keywords: Unemployment insurance; wage disparities; region specific amenities; innate residential preferences; regional labour market interactions
30 pages, September 22, 2008
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