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Emigration and Wages: The EU Enlargement Experiment

  • Benjamin Elsner

    ()

    (Department of Economics, Trinity College Dublin)

This paper studies the impact of a large emigration wave on real wages in the source country. Following EU enlargement in 2004, a large share of the workforce of the Central and Eastern Europe emigrated to Western Europe. Using data from Lithuania for the calibration of a factor demand model I show that emigration had a significant short-run impact on real wages in the source country. In particular, emigration led to a change in the wage distribution between young and old workers. The wages of young workers increased by 6%, whereas the wages of old workers decreased by around 1%. On the contrary, I find no effect on the wage distribution between workers of different education levels.

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File URL: http://www.tcd.ie/Economics/TEP/2011/TEP1311.pdf
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Paper provided by Trinity College Dublin, Department of Economics in its series Trinity Economics Papers with number tep1311.

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Length: 49 pages
Date of creation: Jan 2011
Date of revision:
Handle: RePEc:tcd:tcduee:tep1311
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Fax: 6772503
Web page: http://www.tcd.ie/Economics/

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