Forces of Change : A Dynamic Shift-Share and Spatial Analysis of Employment Change in New Zealand Labour Markets Areas

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Over the last two decades New Zealand has undergone fundamental economic restructuring, and phases of slow and rapid growth, which have resulted in some dramatic changes in the regional economies. This paper provides a detailed multi-period shift-share analysis over three intercensal periods between 1986 and 2001 on changes in regional employment outcomes at the level of 58 Labour Market Areas (LMAs) that have economically meaningful (commuting determined) boundaries. The contributions to employment outcomes of national trends, sectoral composition within regions, structural change, and local conditions (often referred to as the regional shift, competitive or differential effect), are calculated. An exploratory spatial data analysis of the industry-mix and regional shift effect is conducted and finds evidence of significantly positive spatial autocorrelation in the latter, but not in the former. Local indicators of spatial association help to identify regions that stand out in terms of being surrounded by similar regions, or by regions that are just the opposite, in terms of the regional shift effect. Some implications and avenues for further research are suggested.JEL Classification: J21, R11, R23
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