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Europe's migration experience and its effects on economic inequality

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  • Martin Guzi
  • Martin Kahanec
  • Magdalena M. Ulceluse

Abstract

This chapter provides the historical context for the past half-century in Europe focusing specifically on the link between migration and economic development and inequality. The literature review suggests that there are several channels through which migration affects economic inequality between countries in one or the other direction. The net effects are an open empirical question and are likely to depend on the economic, demographic and institutional and policy contexts; sources, types and selectivity of migration, as well as responses of the receiving societies as well as migrants themselves. We undertake an empirical analysis and find that immigration has contributed to reducing inequality within the 25 EU countries over the 2003-2017 period. As the EU attracted relatively highly qualified immigrants throughout this period, our results are consistent with the ameliorating effect of skilled migration on within-country inequality, as predicted by theory.

Suggested Citation

  • Martin Guzi & Martin Kahanec & Magdalena M. Ulceluse, 2021. "Europe's migration experience and its effects on economic inequality," Discussion Papers 60, Central European Labour Studies Institute (CELSI).
  • Handle: RePEc:cel:dpaper:60
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    More about this item

    Keywords

    immigration; inequality; labour mobility; income distribution; EU enlargement;
    All these keywords.

    JEL classification:

    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • D60 - Microeconomics - - Welfare Economics - - - General
    • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration

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