Employment growth and regional development: industrial change and contextual differences between Denmark and Sweden

ABSTRACT

This paper explores the potential drivers behind uneven regional development in the context of employment growth in Denmark and Sweden. In particular, we are interested in the roles of urbanization, industrial change and the rise of the new economy as manifested in the growth of the two economies in 2002–2007. The aim of this paper is, therefore, to analyse the impact of a number of key industrial sectors on regional employment growth in the two countries. The empirical analysis is based on longitudinal matched employer–employee data retrieved from official registers in each economy from 2002 to 2007, a period of strong national growth following the crisis of early 2000. Our findings indicate that the two economies follow a similar pattern in addressing total employment growth; but looking at changes in employment levels across the national borders of these two relatively similar open economies, we find that, although in general these economies react relatively similarly to changes, embarking on a narrower analysis of the individual sectors reveals marked national differences. This indicates that context matters in the analysis of regional economic dynamics in terms of structure, system and policy.

KEYWORDS:

• Regional development
• employment growth
• industrial change
• urbanization
• Denmark
• Sweden

Disclosure statement

No potential conflict of interest was reported by the authors.

ORCID

Rikard H. Eriksson http://orcid.org/0000-0003-3570-7690

Høgni Kalsø Hansen http://orcid.org/0000-0001-6174-1417

Lars Winther http://orcid.org/0000-0002-6939-0903

Notes

1 In the case of Denmark, we use municipalities dating from after the municipal reform in 2007 where the number of municipalities was reduced from 271 to 99. We use this because of ongoing administrative changes in the municipal structure between 2002 and 2007. For Sweden, only 289 rather than 290 municipalities are included. This is because Knivsta was broken out from Uppsala during the period of analysis (2003). Hence, Knivsta is regarded to belong to Uppsala throughout the entire period.