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The Relationship between Regional Economic Variables and Local Employment Growth

Choi, Jihye 1 KIM, ILTAE 1

1전남대학교

Accredited

ABSTRACT

This study examines the long-run equilibrium relationship between regional economic variables and local employment growth using the panel data of 16 regions from 1995 to 2013 in Korea. This study uses the GRDP, wage, and public expenditure for the explanatory variables. This study estimates long-run equilibrium equation in terms of panel cointegration relationships between the variables which have the unit roots using the FMOLS(Fully Modified OLS) estimation. This study shows that GRDP and public expenditure have positive impacts on total industrial employment and service industrial employment. Moreover, if the variables deviate from equilibrium, then error correction term converges to the Long-Run equilibrium. This study also reveals that service industrial sector has higher impact than total industrial sector and that the wage variable has a negative effect on employment.

Citation status

* References for papers published after 2022 are currently being built.