Geoscience Reference
In-Depth Information
Fig. 16.1
The regional net
immigration rate
G
ยข
(Diseq)
IMR
(MAX)
Y
t
IMR
(MIN)
1
G
IMR
t
IMR
(TREND)
observed bounds (
IMR
(
MIN
)
and
IMR
(
MAX
)
respectively). Second, by establishing a
positive relationship between
IMR
t
and
Y
t
(
Diseq
)
, the function reflects the insight of
Whalley and Trella (
1986
) that, because individuals differ in their preferences for
residing within given regions, greater movements in relative regional wage rates are
required to bring forth higher levels of interregional migration. Third, it allows us to
model the autonomous component of net interregional immigration by establishing
a trend value for
IMR
t
(
IMR
(
TREND
)
) consistent with a value for
Y
t
(
Diseq
)
of 1.
To translate movements in
IMR
t
to movements in net interregional immigrant
numbers, we multiply
IMR
t
by the year
t
regional working age population. The
resulting population flow affects the start-of-year working age population in year
t
+1.
16.3.5 Economic Closure for the LA-DYN Model Under a Chlorine
Attack Scenario
We outline here the main elements of the model's closure as they relate to factor
markets and the expenditure side components of regional GDP.
10
Within any given year of the simulation, we assume that the regional working
age population is given. However, the regional working age population adjusts
through time to changes in the migration income measure, in accordance with the
migration theory described in Sect.
16.3.1
.
Regional employment is the product of the working age population and the
regional employment rate. In the short-run, the employment rate is endogenous, and
10
This follows closely the closure described in Giesecke and Madden (
2013
, pp. 443-445),
establishing an environment in which short-run capital stocks, population and the real wage are
sticky (and rates of return, regional income relativities, and the employment rate are flexible),
transitioning to a long-run environment in which rates of return, regional income relativities and
employment rates are sticky.
