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Spatial effects of open borders on the Czech labour market

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  • Moritz, Michael

Abstract

Hardly noticed in Western Europe the fall of the Iron Curtain had also ef-fects on the regional structures of the labour markets in the Central and Eastern Euro-pean Countries (CEEC). I analyse whether during the undoubtedly increasing integration of markets the Czech border region close to the Western European high-wage countries benefited from its geographical position. Even without transnational free labour mobility, free trade and outsourcing of production activities can lead to shifts in the labour demand and wage structure with respect to different skill groups. These integration effects should be stronger in border regions. Using data from the Czech Microcensus and quarterly dis-trict level data, I investigate the impact of the fall of the Iron Curtain on the regional differ-ences in unemployment, the skill structure of employment and wages in the Czech Re-public. According to my results there are no indications of disproportionate shifts in the economic structure as well as in the skill structure in the Czech districts neighbouring Bavaria and Austria compared to non-border districts. However, regarding wage differ-entials between workers employed in the border region and workers in the rest of the country, I find evidence that between 1996 and 2002 the border region workers of the lowest skill category exhibit a positive wage differential of around 12% compared to their counterparts in non-border districts. For all other skill groups in the border region the spatial wage gap is negative and, in absolute value, increases with the skill level. -- Der Beitrag untersucht, ob die tschechische Grenzregion in unmittelbarer Nähe zu den westeuropäischen Hochlohnländern während der zunehmen-den Integration der Märkte von ihrer geographischen Lage profitierte. Auf der Basis von Daten des tschechischen Mikrozensus und vierteljährlicher aggregierter Daten auf Kreis-ebene werden die Auswirkungen des Falls des Eisernen Vorhangs auf regionale Unter-schiede bezüglich Arbeitslosigkeit sowie Qualifikations- und Lohnstruktur in der Tsche-chischen Republik analysiert. Die Ergebnisse zeigen, dass es keine Hinweise auf über-proportionale Veränderungen in der Wirtschafts- und Qualifikationsstruktur in den an Bayern und Österreich angrenzenden tschechischen Kreisen im Vergleich zu den nicht im Grenzgebiet liegenden Bezirken gab. Wenn man die Lohnunterschiede zwischen Ar-beitnehmern in der Grenzregion und Arbeitnehmern im Rest des Landes betrachtet, zeigt sich, dass zwischen 1996 und 2002 die Beschäftigten in der Grenzregion mit der niedrigsten Qualifikationsstufe einen positiven Lohnunterschied von rund 12 Prozent im Vergleich zu entsprechenden Beschäftigten im Binnenland aufweisen. Für alle anderen Qualifikationsgruppen in der Grenzregion ist die räumliche Lohnkluft negativ und nimmt in absoluten Zahlen mit ansteigender Qualifikation zu.

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Bibliographic Info

Paper provided by Friedrich-Alexander-University Erlangen-Nuremberg, Chair of Labour and Regional Economics in its series Discussion Papers with number 59.

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Date of creation: 2008
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Handle: RePEc:zbw:faulre:59

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Web page: http://www.arbeitsmarkt.wiso.uni-erlangen.de/english-version/
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Keywords: regional labour markets; border regions; international trade; employment; wage inequality;

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References

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  1. Jim Airola & Chinhui Juhn, 2008. "Wage Inequality in Post-Reform Mexico," Journal of Income Distribution, Journal of Income Distribution, vol. 17(1), pages 110-134, March.
  2. František Turnovec, 2001. "Regional reform in the czech republic and regional disparities in the extending european union," Prague Economic Papers, University of Economics, Prague, vol. 2001(1).
  3. Fazia Pusterla & Laura Resmini, 2005. "Where do foreign firms locate in transition Countries? An empirical investigation," ISLA Working Papers 20, ISLA, Centre for research on Latin American Studies and Transition Economies, Universita' Bocconi, Milano, Italy, revised Sep 2005.
  4. repec:hal:cesptp:halshs-00096285 is not listed on IDEAS
  5. Chiquiar, Daniel, 2008. "Globalization, regional wage differentials and the Stolper-Samuelson Theorem: Evidence from Mexico," Journal of International Economics, Elsevier, vol. 74(1), pages 70-93, January.
  6. Marius Brülhart & Matthieu Crozet & Pamina Koenig, 2004. "Enlargement and the EU Periphery: The Impact of Changing Market Potential," The World Economy, Wiley Blackwell, vol. 27(6), pages 853-875, 06.
  7. Daniel Munich & Jan Svejnar & Daniel Munich, 1999. "Returns to Human Capital under the Communist Wage Grid and During the Transition to a Market Economy," William Davidson Institute Working Papers Series 272, William Davidson Institute at the University of Michigan.
  8. Annekatrin Niebuhr, 2008. "The impact of EU enlargement on European border regions," International Journal of Public Policy, Inderscience Enterprises Ltd, vol. 3(3/4), pages 163-186.
  9. Barjak, Franz & Heimpold, Gerhard, 1999. "Development Problems and Policies at the German Border with Poland," ERSA conference papers ersa99pa136, European Regional Science Association.
  10. Robert C. Feenstra & Gordon H. Hanson, 1995. "Foreign Investment, Outsourcing and Relative Wages," NBER Working Papers 5121, National Bureau of Economic Research, Inc.
  11. Peter Huber & Michael Pfaffermayr & Yvonne Wolfmayr, 2011. "Are There Border Effects in the EU Wage Function?," DANUBE: Law and Economics Review, European Association Comenius - EACO, issue 2, pages 23-41, June.
  12. Hartmut Egger & Peter Egger, 2002. "How international outsourcing drives up Eastern European wages," Review of World Economics (Weltwirtschaftliches Archiv), Springer, vol. 138(1), pages 83-96, March.
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Cited by:
  1. Kirchner, Stefan & Oppen, Maria & Bellmann, Lutz, 2008. "Zur gesellschaftlichen Einbettung von Organisationswandel : Einführungsdynamik dezentraler Organisationsstrukturen," IAB Discussion Paper 200837, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
  2. Matthes, Britta & Burkert, Carola & Biersack, Wolfgang, 2008. "Berufssegmente: Eine empirisch fundierte Neuabgrenzung vergleichbarer beruflicher Einheiten," IAB Discussion Paper 200835, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
  3. Bruckmeier, Kerstin & Graf, Tobias & Rudolph, Helmut, 2008. "Working poor: Arm oder bedürftig? : eine Analyse zur Erwerbstätigkeit in der SGB-II-Grundsicherung mit Verwaltungsdaten," IAB Discussion Paper 200834, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
  4. Hirsch, Boris & Mueller, Steffen, 2010. "Temporary agency work and the user firm's productivity: First evidence from German Panel Data," Discussion Papers 68, Friedrich-Alexander-University Erlangen-Nuremberg, Chair of Labour and Regional Economics.

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