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An Assessment of the Macroeconomic Implications of Foreign and Domestic Labour Supply Shocks in Malta

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  • Germano Ruisi

    (Central Bank of Malta)

Abstract

Over the recent years Malta has experienced a remarkable increase in its labour force due to a large influx of immigrants and an unprecedented increase in the domestic participation. Driven by the observation of such a phenomenon, this paper aims at assessing the impact of foreign and domestic labour supply shocks on the Maltese economy by estimating a number of structural vector autoregressions (VARs) identified through sign restrictions. The VARs are estimated by using data over the 2004Q1- 2019Q2 period and the results point toward a relevant impact of the identified shocks on domestic production, wages and unemployment as well as on a number of other key variables, e.g., government revenue and expenditure, rents and measures of productivity.

Suggested Citation

  • Germano Ruisi, 2020. "An Assessment of the Macroeconomic Implications of Foreign and Domestic Labour Supply Shocks in Malta," CBM Working Papers WP/06/2020, Central Bank of Malta.
  • Handle: RePEc:mlt:wpaper:0620
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    File URL: https://www.centralbankmalta.org/site/excel/working-papers/WP-06-2020.pdf
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    More about this item

    JEL classification:

    • C11 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Bayesian Analysis: General
    • C32 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes; State Space Models
    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles

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