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Education, Unemployment and Migration

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  • Wolfgang Eggert
  • Tim Krieger
  • Volker Meier

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Abstract

This paper studies a two-region model in which unemployment, education decisions and interregional migration are endogenous. The poorer region exhibits both lower wages and higher unemployment rates, and migrants to the richer region are disproportionally skilled. The brain drain from the poor to the rich region is accompanied by stronger incentives to acquire skills even for immobile workers. Regional shocks tend to affect both regions in a symmetric fashion, and skilled-biased technological change reduces wages of the unskilled. Both education and migration decisions are distorted by a uniform unemployment compensation, which justifies a corrective subsidization.

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File URL: http://www.cesifo-group.de/portal/page/portal/DocBase_Content/WP/WP-CESifo_Working_Papers/wp-cesifo-2007/wp-cesifo-2007-10/cesifo1_wp2119.pdf
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Bibliographic Info

Paper provided by CESifo Group Munich in its series CESifo Working Paper Series with number 2119.

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Date of creation: 2007
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Handle: RePEc:ces:ceswps:_2119

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Keywords: education; unemployment; interregional migration; externalities; brain drain;

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References

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Citations

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Cited by:
  1. Dreher, Axel & Krieger, Tim & Meierrieks, Daniel, 2011. "Hit and (they will) run: The impact of terrorism on migration," Economics Letters, Elsevier, vol. 113(1), pages 42-46, October.
  2. Camilo Alberto Cárdenas Hurtado & María Alejandra Hernández Montes & Jhon Edwar Torres Gorron, 2014. "An Exploratory Analysis of Heterogeneity on Regional Labour Markets and Unemployment Rates in Colombia: An MFACT approach," Borradores de Economia 802, Banco de la Republica de Colombia.
  3. Alexander Haupt & Tim Krieger & Thomas Lange, 2010. "A Note on Brain Gain and Brain Drain: Permanent Migration and Education Policy," Working Papers CIE 27, University of Paderborn, CIE Center for International Economics.
  4. Dulam, T. & Franses, Ph.H.B.F., 2011. "Emigration, wage differentials and brain drain: The case of Suriname," Econometric Institute Research Papers EI 2011-33, Erasmus University Rotterdam, Erasmus School of Economics (ESE), Econometric Institute.
  5. Alexander Kemnitz, 2009. "Native welfare losses from high skilled immigration," International Tax and Public Finance, Springer, vol. 16(4), pages 560-570, August.
  6. Volker Meier, 2010. "Programmauswahl in der aktiven Arbeitsmarktpolitik durch Selbstbeteiligung?," Ifo Schnelldienst, Ifo Institute for Economic Research at the University of Munich, vol. 63(17), pages 27-29, 09.

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