The system-wide impact on the recipient region of a regional labour subsidy

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This paper analyses the impact of the introduction of a general, automatic labour subsidy in a regional economy, concentrating on employment effects. We adopt a computable general equilibrium (CGE) approach, using a model parameterised on data from a UK region, Scotland. Two particular issues are identified which have usually been neglected in previous work in this area: the impact of the fiscal injection associated with the subsidy and the qualitative and quantitative consequences of allowing the nature of the regional labour market to vary.
Original languageEnglish
Pages (from-to)105-133
Number of pages28
JournalOxford Economic Papers
Issue number1
Publication statusPublished - Jan 1996


  • regional economy
  • computable general equilibrium
  • CGE

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    Enhancing the Scottish Government’s policy evaluation capacity

    Peter McGregor (Participant), John Swales (Participant), Grant Allan (Participant), Patrizio Lecca (Participant) & Karen Turner (Participant)

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