Persistence of relative unemployment rates across Italian regions

In this paper we present some preliminary evidence about regional unemployment rates in Italy. In particular we ask whether the finding that relative unemployment rates are short run persistent holds also for Italy. Pairwaise cointegration tests and tests for common trends on relative unemployment rates allow us to reject this hypothesis. This leads us to question the view that the source of long run persistence of regional unemployment is uniquely aggregate in nature and due fluctuations in the aggregate natural rate of unemployment. Preliminary evidence is reported according to fluctuations in macroareas may be considered as a source of persistence at least as important as tbc aggregate source. "Very Preliminary and Incomplete. Comments are welcome. W e are grateful to Dr. Guanini (Prometeia) for providing the data. This paper has been written as a part of the Progetto Strategico CNR: La disoccupazione e il basso livello di attività economica in Italia. Sottoprogetto: Squilibri regionali e occupazione.