Hendrik Folmer

Labor market institutions and the efficiency of interregional migration: A Cross-Nation Comparison

An important question for economists concerns the effectiveness, or efficiency, of interregional migration as a labor market adjustment mechanism. We have considered the many dimensions of this issue in Chapter 1. Hoover and Giarratani (1984) suggest that this question of efficiency can be addressed at three different levels of inquiry by: (1) examining ratios of net to total gross flows of migrants between pairs of regions; (2) determining whether migrants benefit from their actions in terms of enhanced employment and/or income opportunity; and (3) assessing the contribution of interregional migration to aggregate output or, more broadly, to social welfare. Although a perfectly homogeneous labor force is required for (1) to assume economic meaning, and (3) is often considered unopera-tional due to the difficulty of measuring migration externalities, a number of recent studies have addressed the question of migration efficiency (directly and indirectly) along the lines of (2) above.1

Migration and labor market adjustment

This volume presents papers from the International Conference on Migration and Labor Market Adjustment held at the University of Tennessee in Knoxville October 15-17 1987. The papers are organized under chapter headings on migration as a reflection of interregional labor market adjustment; the relationships among unemployment migration and job matching; aspects of regional labor market dynamics migration and economic efficiency; the human investment approach to labor market mobility and personal status; and conceptual and methodological issues. The geographical focus is on the United States and the market-economy countries of Europe.

The consequences of interregional labor migration for the regional labor market : theory, methodology and Dutch experience

An important problem of interregional migration is whether migrants fulfill vacancies which could also have been filled by native unemployed. It is argued that this problem could adequately be analyzed by means of ex post comparison of both categories with regard to age, education, family status and work experience. In a Dutch case study this comparison has been made by means of logistic regression and the results have been cross- validated. The migrants are found to have superior labor market characteristics. The implications of this finding for some migra- tion theories and regional policy are discussed.

Entry of the unemployed into employment : theory, methodology and Dutch experience

Van Dijk J. and Folmer H. (1985) Entry of the unemployed into employment: theory, methodology and Dutch experience, Reg. Studies 19, 243–256. This study examines the entry probabilities of the unemployed into the employed labour force. The personal characteristics (age, work experience, education and family status) and the regional characteristics (regional unemployment and average regional income) are theoretically derived as the determinants of the entry probabilities. The theoretical model is empirically tested with data from the Dutch Labour Force Survey 1979 by means of maximum likelihood logit analysis. The results closely conform to the theoretical expectations. On the basis of the analysis some conclusions for labour market policy are formulated.

The impact of personal and regional unemployment on individual wages in The Netherlands

A considerable body of recent labour economics literature has examined the relative impact of unemployment duration. Attention has primarily focused on the effects on (re-)entry into employment. An important finding is that the prolongation of the spell of unemployment leads to a deterioration of the (re-)entry probability.1 Another strand of research analyses differences in personal and regional labour market characteristics of individuals with different spells of unemployment. It has been found that different spells of unemployment are primarily attributable to differences in personal characteristics and not to regional labour market features.2 A third strand of research focuses on the trade-off between voluntary prolongation of job search and wage offers. Given optimal search activity, an unemployed person will continue searching until he receives a job offer of which the corresponding wage exceeds his reservation wage.3

Spatial inequalities and regional development: A framework

The concepts of spatial inequality and regional development have been widely dealt with in regional science and in related base disciplines like (regional) economics, sociology and political science. In spite of this, spatial inequality is an ill-defined term in the literature, as is shown in an economic context by Richardson in Chapter 7. Often it is used as a synonym for inequity. In this chapter inequality is defined as the difference in spatially-defined variables as, e.g., population density and income per capita. This implies that spatial inequality may both refer to a desired and to an undesired difference. For instance, variety in landscape is generally regarded as desirable, whereas large spatial differences in living conditions are mostly unwanted. Spatial inequality associated with ideological commitment, describing an undesired difference, will be defined as spatial inequity.

Worker Endowments and the Effects of Institutions on Earnings Realization: A Cross-National Comparison

In this study we investigate how differential institutions, and their observance within regional labor markets, impact potential earnings realization. We investigate institutional linkages to labor market outcomes by means of cross-nation comparisons between the United States and the Netherlands. In this regard, better job-matching (information) programs, higher relative unemployment benefits and minimum wages, and a greater prevalence of both trade unionism and collective bargaining likely work to the favor of Dutch workers, and in turnaugment their reservation wages during job search. The predictable outcome of higher earnings realization among Dutch workers is tested econometrically by frontier estimation.

EQUILIBRATING AND ADJUSTMENT TENDENCIES OF INTERREGIONAL MIGRATION: AN INTRODUCTION

In the past traditional economic theory assumed that labor force migration is efficient, from both an individual and societal perspective. However, a considerable body of recent empirical literature has evolved that questions the equilibrating role of the market mechanism in redistributing labor resources across space. Greenwood (1975), perhaps, was the first to survey this work that challenges the efficacy of interregional labor force migration. In this respect, he argues that research in this area is difficult to characterize in that many of the investigations derive, or infer, implications relevant to migration “effectiveness” in an indirect fashion from empirical studies of related topics. Perhaps the best examples of this are the many studies that attribute sizeable and persistent interregional (real) wage differentials to market failures in migration. On the other hand, simultaneous equations models of migration and labor market conditions provide direct evidence of adjustment tendencies of interregional migration.