Macroeconomic consequences of migration diversion : a CGE simulation for Germany and the UK
Abstract"This paper examines the macroeconomic consequences of the diversion of migration flows away from Germany towards the UK in the course of the EU Eastern Enlargement. The EU has agreed with the new member states from Central and Eastern Europe transitional periods for the free movement of workers. The selective application of migration restrictions during the transitional periods has resulted in a reversal of the pre-enlargement allocation of migration flows from the new member states across the EU: Germany as the main destination before enlargement attracts only modest immigration flows since 2004, while the UK and Ireland which have been only marginally affected by immigration prior to enlargement absorb about 60% of the inflows in the post-enlargement period. The macroeconomic effects of this diversion process is analysed in this paper on the basis of a CGE model which considers wage rigidities. We find that higher migration is associated with larger GDP and employment gains, but also with a smaller wage increase and a smaller decline of the unemployment rate. The diversion of migration flows away from Germany towards the UK yields thus a higher GDP and employment growth in the UK. The joint GDP of Germany and the UK declines by 0.1 per cent as a consequence of the migration restrictions." (Author's abstract, IAB-Doku) ((en))
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Bibliographic InfoPaper provided by Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany] in its series IAB Discussion Paper with number 200803.
Length: 28 pages
Date of creation: 28 Jan 2008
Date of revision:
EU-Osterweiterung - Auswirkungen; internationale Wanderung; Ost-West-Wanderung; Arbeitskräftemobilität; Mobilitätsbarriere; Wirtschaftsentwicklung - internationaler Vergleich; Bruttoinlandsprodukt; Beschäftigungseffekte; Arbeitsmarktentwicklung; Arbeitslosigkeit; Lohnentwicklung; Beschäftigungsentwicklung; Einwanderung; Bundesrepublik Deutschland; Großbritannien; Irland; Europäische Union; Osteuropa;
Find related papers by JEL classification:
- F15 - International Economics - - Trade - - - Economic Integration
- F22 - International Economics - - International Factor Movements and International Business - - - International Migration
- C68 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Computable General Equilibrium Models
- J61 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Geographic Labor Mobility; Immigrant Workers
- J30 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - General
This paper has been announced in the following NEP Reports:
- NEP-ALL-2008-02-02 (All new papers)
- NEP-CMP-2008-02-02 (Computational Economics)
- NEP-EEC-2008-02-02 (European Economics)
- NEP-LAB-2008-02-02 (Labour Economics)
- NEP-MAC-2008-02-02 (Macroeconomics)
- NEP-MIG-2008-02-02 (Economics of Human Migration)
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