On both theoretical and empirical grounds, this paper provides evidence that refutes the natural rate of unemployment (NRU) hypothesis as an explanation of the evolution of regional disparities in the unemployment rate. We first present our analytical framework, which follows the chain reaction...

This paper analyses the theoretical and empirical implications of the Chain Reaction Theory of unemployment movements on regional unemploment persistence and regional disparities. This is the first attempt to apply this theory to a regional context. The Chain Reaction Theory focuses on the...

In this paper we analyse wage flexibility in Spain and its regional differences, departing from the estimation of wage curves. Specifically, and using as the main data source the Wage Structure Survey, we proceed to estimate for each Spanish region a wage equation, which explains observed wage...

The existence and persistence of regional disparities is a common problem of many European economies. However, in Spain this fact exhibits a characteristic feature: a strong positive relationship with the business cycle. The analysis in this paper investigates the relationship between this...