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Labour Flexibility and Migration in the EU Eastward Enlargement Context: The Case of the Baltic States

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  • Tiiu Paas

    ()
    (Institute of Economics, University of Tartu)

  • Raul Eamets

    ()
    (Institute of Economics, University of Tartu)

Abstract

The eastward enlargement of the European Union and the requirements of the European Monetary Union increase pressure for flexibility of labour markets. This paper analyses main changes in the Baltic States’ labour market over the period 1990 - 2001 giving emphasis on the problems of labour market flexibility and migration in the EU eastward enlargement context. Labour market flexibility issues are analysed paying attention to wage flexibility and institutional flexibility (regulations, labour policy, trade unions) while labour migration problems are discussed giving emphasis on pull and push factors of migration and on labour migration experience during the previous stages of EU enlargement. In conclusion labour market flexibility is relatively high in all three Baltic States, being a bit higher in Estonia and lower in Lithuania. In all three states the flexibility has declined in the course of transition. The weakness of the trade unions compared to EU has contributed to the high wage flexibility, while the insufficient funding of labour policies and high share of passive measures might have had negative effect on flexibility. Labour migration from the Baltic States into the EU15 countries will not be significant in the near future. Still the free movement of labour will have pressure on the labour markets of the Baltic States due to possible movement of better-qualified and flexible labour force and due to possible cross-border movement of workers in the Baltic Sea region.

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Bibliographic Info

Paper provided by Free University Berlin, Jean Monnet Centre of Excellence in its series Eastward Enlargement of the Euro-zone Working Papers with number wp11.

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Length: 79 pages
Date of creation: 01 Sep 2002
Date of revision: 01 Sep 2002
Handle: RePEc:ezo:ezppap:wp11

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Postal: Jean Monnet Centre of Excellence, Freie Universität Berlin, Ihnestrasse 22, D-14195 Berlin
Web page: http://www.jmc-berlin.org
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Related research

Keywords: Labour market flexibility; labour migration; Baltic States; eastward enlargement of the European Union;

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References

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  1. Bentolila, Samuel & Saint-Paul, Gilles, 1992. "The macroeconomic impact of flexible labor contracts, with an application to Spain," European Economic Review, Elsevier, vol. 36(5), pages 1013-1047, June.
  2. Blanchard, Olivier Jean & Aghion, Philippe, 1994. "On the Speed of Transition in Central Europe," Scholarly Articles 4481322, Harvard University Department of Economics.
  3. Ana L. Revenga & Samuel Bentolila, 1995. "What Affects the Employment Rate Intensity of Growth?," Banco de Espa�a Working Papers 9517, Banco de Espa�a.
  4. Thomas Straubhaar, 2001. "East-West migration: Will it be a problem?," Intereconomics: Review of European Economic Policy, Springer, vol. 36(4), pages 167-170, July.
  5. Laurence M. Ball, 1997. "Disinflation and the NAIRU," NBER Chapters, in: Reducing Inflation: Motivation and Strategy, pages 167-194 National Bureau of Economic Research, Inc.
  6. Casale, Giuseppe, 1997. "Collective bargaining and the law in central and Eastern Europe : some comparative issues," ILO Working Papers 322996, International Labour Organization.
  7. Bauer, Thomas K. & Zimmermann, Klaus F., 1999. "Report No. 3: Assessment of Possible Migration Pressure and its Labour Market Impact Following EU Enlargement to Central and Eastern Europe," IZA Research Reports 3, Institute for the Study of Labor (IZA).
  8. repec:sae:niesru:v:155:y::i:1:p:81-89 is not listed on IDEAS
  9. Ana L. Revenga & Samuel Bentolila, 1995. "What Affects the Employment Rate Intensity of Growth?," Banco de Espa�a Working Papers 9517, Banco de Espa�a.
  10. Paul Geroski & Paul Gregg & John van Reenen, 1995. "Market Imperfections and Employment," OECD Jobs Study Working Papers 5, OECD Publishing.
  11. Tito Boeri & Giuseppe Nicoletti & Stefano Scarpetta, . "Regulation and Labour Market Performance," Working Papers 158, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University.
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Citations

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Cited by:
  1. Anna Zasova & Aleksejs Melihovs, 2005. "Assessment of Labour Market Elasticity in Latvia," Working Papers 2005/03, Latvijas Banka.
  2. Gunther Schnabl & Christina Ziegler, 2008. "Exchange Rate Regime and Wage Determination in Central and Eastern Europe," CESifo Working Paper Series 2471, CESifo Group Munich.
  3. Andreas Freytag, 2002. "Estonian labour market and EMU membership - challenges and policy options," Bank of Estonia Working Papers 2002-11, Bank of Estonia, revised 10 Dec 2002.

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