Trade and Migration: a U-Shaped Transition in Eastern Europe
AbstractThis paper proposes a 2-country 3-region economic geography model that can account for the most salient stylized facts experienced by Eastern European transition economies during the 1990s. In contrast to the existing literature, which has favored technological explanations, trade liberalization and factor mobility are the only driving forces. The model correctly predicts that in the first half of the decade trade liberalization led to divergence in GDP per capita, both between the West and the East and within the East. Consistent with the data, in the second half of the decade, internal labor mobility in the East reversed this process, and convergence became the dominant force. The model furthermore shows that the same U-shaped pattern applies to relative industrialization of West and East, although within the East the hinterland continued to lose industry throughout the decade.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by International School of Economics at TSU, Tbilisi, Republic of Georgia in its series Working Papers with number 010-08.
Length: 32 pages
Date of creation: Aug 2008
Date of revision:
Other versions of this item:
- Cristobal, Adolfo, 2007. "Trade and migration: a U-shaped transition in Eastern Europe," MPRA Paper 3446, University Library of Munich, Germany.
- J30 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - General
- F22 - International Economics - - International Factor Movements and International Business - - - International Migration
- F12 - International Economics - - Trade - - - Models of Trade with Imperfect Competition and Scale Economies
- F16 - International Economics - - Trade - - - Trade and Labor Market Interactions
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Krugman, Paul & Venables, Anthony J., 1995.
"Globalization and the Inequality of Nations,"
Working Paper Series
430, Research Institute of Industrial Economics.
- Krugman, Paul & Venables, Anthony J., 1994. "Globalization and the Inequality of Nations," CEPR Discussion Papers 1015, C.E.P.R. Discussion Papers.
- Paul Krugman & Anthony J. Venables, 1995. "Globalization and the Inequality of Nations," NBER Working Papers 5098, National Bureau of Economic Research, Inc.
- Hans-Werner Sinn & Frank Westermann, 2001.
NBER Working Papers
8125, National Bureau of Economic Research, Inc.
- Paul Krugman, 1990.
"Increasing Returns and Economic Geography,"
NBER Working Papers
3275, National Bureau of Economic Research, Inc.
- Ross, Matthias, 2001. "Transfers, agglomeration and German unification," HWWA Discussion Papers 144, Hamburg Institute of International Economics (HWWA).
- Luca De Benedictis & Roberta De Santis & Claudio Vicarelli, 2005.
"Hub-and-Spoke or else? Free trade agreements in the 'enlarged' European Union,"
European Journal of Comparative Economics,
Cattaneo University (LIUC), vol. 2(2), pages 245-260, December.
- Luca De Benedictis & Roberta De Santis & Claudio Vicarelli, 2005. "Hub-and-Spoke or else? Free trade agreements in the “enlarged” European Union," ISAE Working Papers 52, ISTAT - Italian National Institute of Statistics - (Rome, ITALY).
- Puga, Diego, 1999.
"The rise and fall of regional inequalities,"
European Economic Review,
Elsevier, vol. 43(2), pages 303-334, February.
- Raul Livas Elizondo & Paul Krugman, 1992.
"Trade Policy and the Third World Metropolis,"
NBER Working Papers
4238, National Bureau of Economic Research, Inc.
- Blanchard, Olivier, 1996. "Theoretical Aspects of Transition," American Economic Review, American Economic Association, vol. 86(2), pages 117-22, May.
- Ethier, Wilfred J, 1982. "National and International Returns to Scale in the Modern Theory of International Trade," American Economic Review, American Economic Association, vol. 72(3), pages 389-405, June.
- Puga, Diego & Venables, Anthony J., 1997.
"Trading arrangements and industrial development,"
Policy Research Working Paper Series
1787, The World Bank.
- Brakman, Steven & Garretsen, Harry, 1993. "The Relevance of Initial Conditions for the German Unification," Kyklos, Wiley Blackwell, vol. 46(2), pages 163-81.
- Forslid, Rikard, 2003. "Regional Policy, Integration and the Location of Industry," Research Papers in Economics 2003:7, Stockholm University, Department of Economics.
- repec:fth:iniesr:430 is not listed on IDEAS
- Dimitris Kallioras & George Petrakos & Georgios Fotopoulos, 2005. "Economic integration, regional structural change and cohesion in the EU new member-states," ERSA conference papers ersa05p383, European Regional Science Association.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Zaier Aouani).
If references are entirely missing, you can add them using this form.