Labour Market Adjustment: Evidence on Interstate Labour Mobility.

In this paper, we investigate the behaviour of the Australian slate labour markets, focusing on the rote of geographic labour mobility. We find that interstate migration does play an important role in reducing differences in labour market conditions between states, although permanent (or very persistent) differences between state unemployment rates remain. We also find that out-migration from a state resulting front a relative downturn in its labour market occurs slowly and steadily. Most of the migration takes place, on average, within four years, and the process of adjustment is complete tier seven years. [ABSTRACT FROM AUTHOR]