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Fear, Unemployment and Migration

  • DavidG. Blanchflower
  • Chris Shadforth

We examine the impact on the UK economy of the flow of workers from ten East European countries after their accession to the European Union. We find evidence that those most susceptible to competition from these workers have seen weaker wage inflation. We document that the presence of these foreign workers has increased the fear of unemployment and helped to contain wage pressure. We argue that this inflow of workers has increased supply by more than it has raised demand and, thus, had the effect of reducing both inflationary pressures and the natural rate of unemployment. Copyright © The Author(s). Journal compilation © Royal Economic Society 2009.

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Article provided by Royal Economic Society in its journal The Economic Journal.

Volume (Year): 119 (2009)
Issue (Month): 535 (02)
Pages: F136-F182

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Handle: RePEc:ecj:econjl:v:119:y:2009:i:535:p:f136-f182
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  17. Griliches, Zvi, 1969. "Capital-Skill Complementarity," The Review of Economics and Statistics, MIT Press, vol. 51(4), pages 465-68, November.
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  29. Welch, F, 1970. "Education in Production," Journal of Political Economy, University of Chicago Press, vol. 78(1), pages 35-59, Jan.-Feb..
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