Modeling how macroeconomic shocks affect regional employment: analyzing the brazilian formal labor market using the global VAR approach
DOI:
https://doi.org/10.1590/1980-53575615bepKeywords:
GVAR, Cointegration, Regional dynamics, Labor marketAbstract
Using a Global Vector Autoregressive (GVAR) framework that addresses the curse of dimensionality, we assess linkages between regions and examine how macroeconomic shocks spread across them. This study examines the Brazilian labor market by identifying and quantifying the regional and temporal propagation of shocks in aggregate economic activity. A key innovation is our use of data from the Brazilian Institute of Geography and Statistics to measure regional linkages by analyzing the infrastructure connections of Brazilian municipalities. We capture regional interdependence by incorporating both economic and infrastructure connections. Our findings indicate that macroeconomic shocks have a particularly strong effect in Brazil’s South, Southeast, and Midwest regions.
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Atualizado em 14/08/2025