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European Integration -- A Downward Bias in Employment Policies?

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Author Info
Torben Andersen ()
Abstract

Even when labour mobility is low, international integration affects labour markets by making jobs more mobile. This runs via product market integration, which is an essential element of European integration. Increasing job mobility aects the possibilities single countries perceive in pursuing employment policies. In a setting where trade is driven by comparative advantages, and thus wage competitiveness plays an important role for employment, it is shown that there is a tendency that a bias arises in employment policies. Policies expanding private employment tend to be used too little, while policies harming private employment tend to be used too much. These effects are stronger the more integrated product markets are.

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Publisher Info
Paper provided by CESifo Group Munich in its series CESifo Working Paper Series with number CESifo Working Paper No. 574.

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Date of creation: 2001
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Handle: RePEc:ces:ceswps:_574

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Related research
Keywords: spill-overs; coordination; employment.;

Find related papers by JEL classification:
F01 - International Economics - - General - - - Global Outlook
F42 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - International Policy Coordination and Transmission
J23 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Demand
J30 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - General

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  1. David E. Wildasin, 2000. "Factor Mobility and Fiscal Policy in the EU: Policy Issues and Analytical Approaches," CESifo Working Paper Series CESifo Working Paper No. , CESifo Group Munich. [Downloadable!]
    Other versions:
  2. Torben M. Andersen & Niels Haldrup & Jan Rose Sørensen, 2000. "Labour market implications of EU product market integration," Economic Policy, CEPR, CES, MSH, vol. 15(30), pages 105-134, 04. [Downloadable!] (restricted)
  3. Hans-Werner Sinn, 2001. "Social Dumping in the Transformation Process?," NBER Working Papers 8364, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
    Other versions:
  4. R. Dornbusch & S. Fischer & P. A. Samuelson, 1976. "Comparative Advantage, Trade and Payments in a Ricardian Model With a Continuum of Goods," Working papers 178, Massachusetts Institute of Technology (MIT), Department of Economics.
    Other versions:
  5. Devereux, Michael B, 1991. "The Terms of Trade and the International Coordination of Fiscal Policy," Economic Inquiry, Oxford University Press, vol. 29(4), pages 720-36, October.
  6. Midelfart-Knarvik, K.H. & Overman, H.G. & Redding, S.J. & Venables, A.J., 2000. "The Location of European Industry," European Economy - Economic Papers 142, Commission of the EC, Directorate-General for Economic and Financial Affairs (DG ECFIN).
  7. Jonathan Coppel & Martine Durand, 1999. "Trends in Market Openness," OECD Economics Department Working Papers 221, OECD, Economics Department. [Downloadable!]
  8. Cooper, Richard N., 1985. "Economic interdependence and coordination of economic policies," Handbook of International Economics, in: R. W. Jones & P. B. Kenen (ed.), Handbook of International Economics, edition 1, volume 2, chapter 23, pages 1195-1234 Elsevier. [Downloadable!] (restricted)
  9. Cooper, Russell & John, Andrew, 1988. "Coordinating Coordination Failures in Keynesian Models," The Quarterly Journal of Economics, MIT Press, vol. 103(3), pages 441-63, August. [Downloadable!] (restricted)
  10. Chari, V V & Kehoe, Patrick J, 1990. "International Coordination of Fiscal Policy in Limiting Economies," Journal of Political Economy, University of Chicago Press, vol. 98(3), pages 617-36, June. [Downloadable!] (restricted)
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  11. van der Ploeg, Frederick, 1988. "International policy coordination in interdependent monetary economies," Journal of International Economics, Elsevier, vol. 25(1-2), pages 1-23, August. [Downloadable!] (restricted)
    Other versions:
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This page was last updated on 2009-12-14.

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