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Labour Mobility As An Adjustment Mechanism In The Euro Area

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  • Cristina Puiu

    (Alexandru Ioan Cuza University of Iasi)

Abstract

The aim of this paper is to assess the capacity of labour mobility in the euro area to act as an adjustment mechanism in the event of an asymmetric shock. According to the optimum currency area theory, labour mobility has been emphasized as one of the main adjustment mechanism. Given the present situation, where there are major concerns about the future of the euro area, it is necessary to study if the mechanism for stability works and if it can be improved. Considering the difficulty of quantifying the labour mobility, we have analyzed the net migration and the regulations regarding labour market. The empirical evidence shows that labour mobility does not act as a sufficient adjustment mechanism.

Suggested Citation

  • Cristina Puiu, 2011. "Labour Mobility As An Adjustment Mechanism In The Euro Area," CES Working Papers, Centre for European Studies, Alexandru Ioan Cuza University, vol. 3(4), pages 579-591, December.
    • Handle: RePEc:jes:wpaper:y:2011:v:3:i:4:p:579-591
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    References listed on IDEAS

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    More about this item

    Keywords

    geographical mobility; optimality; asymmetric shock; endogenous effect Romania;
    All these keywords.

    JEL classification:

    • E42 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Monetary Sytsems; Standards; Regimes; Government and the Monetary System
    • F33 - International Economics - - International Finance - - - International Monetary Arrangements and Institutions
    • J61 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Geographic Labor Mobility; Immigrant Workers

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