Structural Challenges to Employment Policy Effectiveness in Rural Regions: a General Equilibrium Assessment

Rural development policy has a broad remit, in that it seeks to address social, environmental and economic objectives. A key economic objective that is common across rural development approaches is to improve employment outcomes in rural areas. Rural schemes and policies targeting employment directly or indirectly manifest within a wider context of national schemes and policies. Employment policies can roughly be divided into demand-side (such as cluster development) and supply-side (such as education and training) approaches. This paper explores the possibilities and limitations for national demand-side policies to improve employment outcomes in sub-national regions away from metropolitan centres due to systematic differences in economic structure. Particular attention is given to the interactions between regional and gender employment convergence. The approach developed can be used to develop ‘reactionary’ rural development schemes to compensate for differential impacts of national schemes in rural regions