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The Free Movement of Inactive Citizens in the EU – A Challenge for the European Welfare State?

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  • Wolfgang Ochel

Abstract

The EU Directive on Free Movement of 2004 extended free movement within the EU to Union citizens who are inactive and gave them access to the welfare benefits of host countries. The paper examines the extent to which these measures provoke migration to those countries with the highest levels of welfare benefits. The paper concludes that migration is limited by the requirement of considerable financial assets in order to bridge a waiting period of five years as well as negative financial incentives. On the other hand, migration is attractive for those working in the informal sector of host countries.

Suggested Citation

  • Wolfgang Ochel, 2007. "The Free Movement of Inactive Citizens in the EU – A Challenge for the European Welfare State?," CESifo Working Paper Series 1930, CESifo.
    • Handle: RePEc:ces:ceswps:_1930
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    File URL: https://www.cesifo.org/DocDL/cesifo1_wp1930.pdf
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    References listed on IDEAS

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    1. Thomas K. Bauer, 2002. "Migration, Sozialstaat und Zuwanderungspolitik," Vierteljahrshefte zur Wirtschaftsforschung / Quarterly Journal of Economic Research, DIW Berlin, German Institute for Economic Research, vol. 71(2), pages 249-271.
    2. Borjas, George J, 1999. "Immigration and Welfare Magnets," Journal of Labor Economics, University of Chicago Press, vol. 17(4), pages 607-637, October.
    3. Jonah B. Gelbach, 2004. "Migration, the Life Cycle, and State Benefits: How Low Is the Bottom?," Journal of Political Economy, University of Chicago Press, vol. 112(5), pages 1091-1130, October.
    4. Borjas, George J., 1999. "The economic analysis of immigration," Handbook of Labor Economics, in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 3, chapter 28, pages 1697-1760, Elsevier.
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    1. repec:ces:ifodic:v:4:y:2006:i:4:p:14567436 is not listed on IDEAS
    2. Wolfgang Ochel, 2006. "The EU Directive on Free Movement - A Challenge for the European Welfare State?," ifo DICE Report, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 4(4), pages 21-29, 02.
    3. Wolfgang Ochel, 2006. "The EU Directive on Free Movement - A Challenge for the European Welfare State?," ifo DICE Report, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 4(04), pages 21-29, February.
    4. Kenneth Nelson, 2009. "Social Assistance and Minimum Income Protection in the EU: Vulnerability, Adequacy, and Convergence," LIS Working papers 511, LIS Cross-National Data Center in Luxembourg.

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