| Popis: |
In this paper we address the empirical question whether the skill distribution of regions has a permanent effect on regional unemployment rates. We argue that if technology and skill are complements and workers with different skills are poor substitutes, the uneven spatial distribution of human capital plays an important role in shaping regional unemployment rate differentials. When the adaption and application of technology need skilled workers, the inflow of technology raises the skill premium and attract skilled workers, which in turn also ameliorate low-skilled unemployment, if skilled and unskilled workers are not perfect substitutes in the production process, or the higher share of skilled workers in the traded sector increase the demand for unskilled labor in the local non-traded sector. Empirical evidence from the Hungarian post-socialist transition confirms the hypothesis that the uneven distribution of skills inherited from the socialist era had a major and permanent influence on the emergence of regional unemployment disparities, which prevailed even after the end of transition through the inward flow of technology through FDI and the spatial concentration of economic activity. Regression estimates show that the share of college educated individuals has a strong negative effect on regional unemployment. However this is not only the result of the initially lower risk of unemployment among college educated individuals but also the complementarity between different skill levels. Separate estimates on skill-specific unemployment rates show that an increase in the percentage share of college graduates abates the unemployment rate of lower skilled workers. |
