The consistency of EU foreign policies towards new member states
This paper analyses the relation between transfers, migration and income levels. While European countries have been very generous by opening their frontiers to trade, investing in transition countries, and accepting as EU new members some of the latter, their migration policies were less liberal. The policy coherence debate is an old theme in the international economics literature, which is revisited here by looking at the relationships between aid and migration policies towards new member states. Are they substitutes or complements? What happens if eastern European labour markets conditions improve? In theory, potential migrants will stay home, and the concern of being invaded by skilled/unskilled workers searching for better conditions and higher wages in the old member states can be alleviated. But in practice, at low level or revenue in the origin countries, economic progress can result in lowering a budgetary constraint (potential migrants cannot afford the cost of moving), leading to more migration pressures. We therefore compute the critical level of GDP, above which an increase in European transfers and improvement in economic situation of the recipient country will not lead to an increase in migration pressures by decreasing the cost of moving. It amounts to 2837 $US for within European migration. We argue that this critical level is not the same for a skilled and for an unskilled individual. In other words, the critical revenue, under which a skilled individual with better opportunities abroad decides to migrate, will be higher than the critical revenue for an unskilled worker, who may be better off by staying home and looking for a job at home: US$15085 for the former, and US$ 4384 for the latter. This has an important implication, namely that in some cases, increasing financial transfers will result in increasing the gap between skilled and unskilled departures from countries suffering already from a brain drain phenomena.
|Date of creation:||Mar 2009|
|Date of revision:|
|Contact details of provider:|| Postal: Inter-institutional relations and communication Unit, B-1049 Brussels|
Fax: +32 2 298.08.23
Web page: http://ec.europa.eu/economy_finance/index_en.htm
More information through EDIRC
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.:
- Kahanec, Martin & Zimmermann, Klaus F, 2009.
"Migration in an enlarged EU: A challenging solution?,"
CEPR Discussion Papers
7200, C.E.P.R. Discussion Papers.
- Martin Kahanec & Klaus F. Zimmermann, 2008. "Migration in an Enlarged EU: A Challenging Solution?," Discussion Papers of DIW Berlin 849, DIW Berlin, German Institute for Economic Research.
- Kahanec, Martin & Zimmermann, Klaus F., 2008. "Migration in an Enlarged EU: A Challenging Solution?," IZA Discussion Papers 3913, Institute for the Study of Labor (IZA).
- Martin Kahanec & Klaus F. Zimmermann, 2009. "Migration in an enlarged EU: A challenging solution?," European Economy - Economic Papers 2008 - 2015 363, Directorate General Economic and Financial Affairs (DG ECFIN), European Commission.
- George J. Borjas, 1994. "The Economics of Immigration," Journal of Economic Literature, American Economic Association, vol. 32(4), pages 1667-1717, December.
- Timothy Hatton & Jeffery Williamson, 2002.
"What Fundamentals Drive World Migration?,"
CEPR Discussion Papers
458, Centre for Economic Policy Research, Research School of Economics, Australian National University.
- Timothy J. Hatton & Jeffrey G. Williamson, 2002. "What Fundamentals Drive World Migration?," NBER Working Papers 9159, National Bureau of Economic Research, Inc.
- Hatton, Timothy J. & Williamson, Jeffrey G, 2002. "What Fundamentals Drive World Migration?," CEPR Discussion Papers 3559, C.E.P.R. Discussion Papers.
- Hatton, Timothy J. & Williamson, Jeffrey G., 2003. "What Fundamentals Drive World Migration?," Working Paper Series UNU-WIDER Research Paper , World Institute for Development Economic Research (UNU-WIDER).
- David Karemera & Victor Iwuagwu Oguledo & Bobby Davis, 2000. "A gravity model analysis of international migration to North America," Applied Economics, Taylor & Francis Journals, vol. 32(13), pages 1745-1755.
- Hatton, Timothy J. & Williamson, Jeffrey G., 1998. "The Age of Mass Migration: Causes and Economic Impact," OUP Catalogue, Oxford University Press, number 9780195116519, December.
- Hristos Doucouliagos & Martin Paldam, 2005. "Aid Effectiveness on Growth. A Meta Study," Economics Working Papers 2005-13, Department of Economics and Business Economics, Aarhus University.
- Michaël Freudenberg & Françoise Lemoine, 1999. "Central and Eastern European Countries in the International Division of Labour in Europe," Working Papers 1999-05, CEPII research center.
- Parsons, Christopher R. & Skeldon, Ronald & Walmsley, Terrie L. & Winters, L. Alan, 2007. "Quantifying international migration : a database of bilateral migrant stocks," Policy Research Working Paper Series 4165, The World Bank.
- Markusen, James R., 1983. "Factor movements and commodity trade as complements," Journal of International Economics, Elsevier, vol. 14(3-4), pages 341-356, May.
- Richard H. Adams, Jr. & John Page, 2003. "International migration, remittances, and poverty in developing countries," Policy Research Working Paper Series 3179, The World Bank.
- Faini, Riccardo & Venturini, Alessandra, 1993. "Trade, aid and migrations: Some basic policy issues," European Economic Review, Elsevier, vol. 37(2-3), pages 435-442, April.
When requesting a correction, please mention this item's handle: RePEc:euf:ecopap:0365. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (ECFIN INFO)
If references are entirely missing, you can add them using this form.