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The labor market effects of worker outflow: Evidence from Hungary

Author

Listed:
  • Attila Lindner

    (University College London; ELTE Centre for Economic and Regional Studies; IFS; IZA)

  • Balázs Reizer

    (ELTE Centre for Economic and Regional Studies; Corvinus University of Budapest)

  • Andrea Weber

    (CEU; CEPR; RFBerlin)

Abstract

We investigate how a large-scale outflow of workers affect the reaming workforce. We use Hungarian administrative social security data on the opening of the Austrian labor market to Hungarian workers as a natural experiment. We find that the opening of the Austrian border increased wages by 1 percent and decreased employment by 5 percent in the close neighborhood of the Hungarian side of the border. We also show that the outflow of workers slightly decreased the quality of the remaining workforce in Hungary. Furthermore, we show that Austrian labor demand shocks have a positive impact on Hungarian wages as the increase of vacancies in Austria increases the wages on the Hungarian side of the border.

Suggested Citation

  • Attila Lindner & Balázs Reizer & Andrea Weber, 2025. "The labor market effects of worker outflow: Evidence from Hungary," KRTK-KTI WORKING PAPERS 2514, Institute of Economics, Centre for Economic and Regional Studies.
    • Handle: RePEc:has:discpr:2514
    as

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    References listed on IDEAS

    as
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    Full references (including those not matched with items on IDEAS)

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    Keywords

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    JEL classification:

    • J23 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Demand
    • F22 - International Economics - - International Factor Movements and International Business - - - International Migration

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